Kentucky’s first licensed medical cannabis cultivator is open for business, despite continued pushback over how the state conducted its licensing lotteries last fall.
“This administration made a commitment to Kentuckians suffering from cancer, PTSD, multiple sclerosis and other eligible conditions, and I am proud we are making progress to deliver safe, affordable access to medical cannabis,” said Gov. Andy Beshear in a July 15 statement. “Through work with the General Assembly to move up business licensing by six full months and providing licensees with the tools they need to get up and running, we are closer than ever to providing Kentuckians with life-changing relief.”
The first operational cultivator is Armory Kentucky. Its principal owner, John Harold Powers, lives in Port Charlotte, Fla., according to its application. Other co-owners and principal officers live in Maryland, West Virginia and Florida. None of the applicants lives in Kentucky. Audacious Edge, a cannabis consultancy based in Durham, N.C., helped complete the application.
The facility is located in Mayfield and is a Tier II grow site, which is allowed to grow up to 10,000 square feet of canopy. The state has 15 more cultivation sites that still need final state inspections before they are allowed to become active.
Lawsuit alleges lottery wasn’t public
As the program continues its roll out, aspiring operators who were left out of the license lottery winners’ circle sued the state, challenging the legitimacy of the lotteries and how the state is attempting to limit the number of available licenses.
Kentucky Dispensary Partners, Shepherdsville Dispensary Partners and Metro Processing Partners, three would-be operators from the region that includes Louisville, sued the state’s Office for Medical Cannabis in Jefferson Circuit Court on June 27.
The first two plaintiffs applied for dispensary licenses while the third applied for a processing license. None of the three were selected in the lotteries that they say should never have been allowed to take place.
The state received almost 5,000 applications for just 74 available licenses late last year. Four out of five applications were for retail licenses. The state selected 36 retailers on Nov. 25 through lotteries, and 12 more retail licenses on Dec. 16. In October, lotteries were used to select 10 processors and 16 cultivators.
The plaintiffs claim the law that legalized medical cannabis in the state two years ago specifically grants the legislature the power to determine how many licenses are issued and whether that number will be restricted in separate regions. They argue that those authorities were illegally delegated to the Office of Medical Cannabis in the executive branch of state government.
The plaintiffs further argue that the lottery, which involved a computer system randomly generating numbers corresponding to winning applications, was not properly conducted.
“This type of arrangement does not constitute a ‘lottery’ in the traditional manner of that term’s common understanding in that it failed to use a mechanical draw machine that utilizes an air mixing device (like a fan) and a valve to randomly blow evenly weighted balls into a tube to determine the winning numbers,” said the 20-page complaint.
The lawsuit also notes that state law requires lotteries to be observable by the general public.
“The manner in which the Cabinet conducted the lottery drawings for determining the medical marijuana processing and retail dispensary tier licenses, however, simply allowed the public to see a computer screen which populated with numbers but failed to allow the public the ability to visually see the manner in which the winning application numbers were drawn,” said the complaint.
The plaintiffs are demanding that the results of the lottery be voided and that they be granted licenses.
A state audit looms
Meanwhile, state Auditor Allison Ball announced she was opening an investigation on April 17 after receiving multiple complaints about how the Office of Medical Cannabis conducted the license lottery. She said she planned to inspect license applications and look into the award process.
“Kentuckians should have confidence that state offices operate with transparency and integrity, and my office is committed to ensuring those standards,” said Ball.
Almost two weeks later on April 28, Ball released a follow-up statement, in which she accused the state’s Democratic Party of attempting to intimidate her office with open records requests.
“The day after we announced, on Good Friday, the Kentucky Democratic Party (KDP) sent five Open Records Act requests to my office in what can only be described as an attempt to intimidate me from continuing the investigation,” said Ball. “It is a shame that parties would seek to weaponize the Open Records Act, an important transparency tool, as a political weapon.”
The auditor’s office did not respond to a request for comment or an update on the status of the investigation.
This story was updated at 11:40 a.m., July 17, 2025, to include more information about Armory Kentucky’s ownership.
