The nascent Office of Cannabis Management illegally denied two women entry into the Social Security Lottery to run cannabis businesses in Minnesota, a new trial claims.

Plaintiffs Cristina Aranguiz and Jodi Connolly claim in a lawsuit filed Thursday that the state, in an “arbitrary and capricious decision,” denied their applications to participate in the welfare lottery without explanation and gave other applicants “secret reconsideration” and the opportunity . to fix their applications. They are asking the court to stop social equity lottery proceedings, which are expected to take place on Tuesday, and to overturn the OCM’s decision denying Aranguiz and Connolly a chance to participate in the lottery.

Social equity licenses are intended to prioritize business applications from people who have been harmed by marijuana bans in the past, as well as veterans and people living in high-poverty areas.

OCM announced earlier this week that it sent rejection notices to 1,169 of the 1,817 social justice applicants, according to Star Tribune. Of the 648 remaining, 182 advance approvals will be handed out on Tuesday. A lottery for additional pre-approvals will be held in the future, but OCM has not set a date yet.

OCM said in a statement Reformer that it cannot comment on pending litigation, but as of Friday afternoon has not changed its plans to hold the lottery on Tuesday.

People who win pre-approval in the lottery will be able to line up investors to start their businesses earlier than those who get traditional cannabis licenses.

In their lawsuit, Aranguiz and Connolly state that they both met all of OCM’s social equity application requirements, but were denied earlier this week. OCM did not tell the two why they were denied, according to the lawsuit, and Connolly was not notified that she was denied at all — she had to access the application submission portal.

State law does not allow applicants to appeal OCM’s denial of access to the pre-approval lottery, but Aranguiz and Connolly claim in their lawsuit that OCM has “offered a right of appeal to certain applicants.”

The plaintiffs say they know of at least one person who reached out directly to OCM Interim Director Charlene Briner. Briner forwarded that applicant to OCM Chief Regulatory Officer Max Zappia, who then called the applicant and told them their denial would be overturned, the lawsuit alleges.

“Therefore, contrary to the email sent to all applicants, an appeals process exists for erroneous rejections – the process exists only for applicants who are willing to ignore OCM’s statement in the emails, find the contact information for the Interim Director, and pursue their request” , the lawsuit states.

The OCM told MinnPost earlier this week that it denied about two-thirds of applications because some applicants made multiple applications, i.e. “flooded the zone”, in an attempt to increase their chances in the lottery, or masked their true investors.

Aranguiz’s application for social equity was denied due to failure to “disclose ownership and control,” the lawsuit states. Aranguiz, who has seven cannabis stores in three states, says in the lawsuit that she and Connolly have a “purchase option agreement” that she initially did not disclose to OCM, but that is because it was contingent on state approval, a disclosure that is not required under state cannabis law, she claims.

Other cannabis advocates told Star Tribune that they are also considering filing lawsuits on behalf of clients whose applications OCM rejected.