N.M. Admin. Code § 7.34.4.31

Current through Register Vol. 35, No. 21, November 5, 2024

Section 7.34.4.31 - DISCIPLINARY ACTIONS AND APPEAL PROCESS

A.Notice of disciplinary action: The department may issue notice of an immediate disciplinary action, as specified in this rule, or notice of contemplated disciplinary action. Notice shall be served upon a licensee's contact person of record. Notice shall be served via certified U.S. postal mail. A notice shall be deemed to have been served on the date borne by the return receipt showing delivery or the last attempted delivery of the notice or decision to the addressee or refusal of the addressee to accept delivery of the notice or decision.

B.Grounds for disciplinary action: Disciplinary action may be taken against a producer-applicant, a licensed producer, a manufacturer-applicant or approved manufacturer, a laboratory applicant or approved laboratory, or an approved courier or courier-applicant. Disciplinary action may include revocation, suspension, or denial of an application, license, or department approval, monetary penalties, immediate suspensions and revocations in accordance with this rule, and other action. Disciplinary actions may be imposed in any combination, and the actions described in this paragraph, including suspension and monetary fines, are not exclusive of one another. Disciplinary action may be imposed for:

(1) A major violation implicating public safety, including:

(a) failure to comply with or satisfy any provision of this rule that implicates public safety;

(b) diversion, inversion, or attempted diversion or inversion, of cannabis or a cannabis-derived product, as determined by the department;

(c) threatening or harming a patient, a medical practitioner, or an employee of the department;

(d) intentionally destroying, damaging, altering, removing or concealing evidence of a violation under this rule, attempting to do so, or asking or encouraging another person to do so;

(e) deliberately purchasing usable cannabis, cannabis-derived products or cannabis plants from out of state or outside the legal medical cannabis system; or

(f) other conduct that shows willful or reckless disregard for health or safety;

(2) A major violation not implicating public safety, including:

(a) failure to pay a required monetary penalty;

(b) failure to comply with the department's requested access to premises or materials;

(c) failure to allow or impedance of a visit by authorized representatives or designees of the department;

(d) falsification or misrepresentation of any material or information submitted to the department;

(e) failure to adhere to any acknowledgement, verification, or other representation made to the department;

(f) failure to submit or disclose information required by this rule or otherwise requested by the department;

(g) failure to correct any violation of this rule cited as a result of a review or audit of financial records or other materials, or cited as a result of a monitoring visit or site inspection;

(h) a pattern of non-major license violations;

(i) non-compliance with tax obligations as determined by a taxation regulatory authority;

(j) exceeding the plant limit of the license; and

(3) Any other violation, including:

(a) failure to comply with or satisfy any provision of this rule that does not implicate public safety;

(b) failure to take a video recording of the wastage of usable cannabis, in accordance with this rule; and

(c) selling or transferring to a qualified patient or primary caregiver a quantity of usable cannabis greater than the maximum amount permitted by department rule.

C.Fines: Disciplinary actions against a licensed non-profit producer, approved manufacturer, approved laboratory, or approved courier may include the imposition of monetary penalties, which may be assessed by the department in the amount of:

(1) up to $50,000 for each major violation implicating public safety;

(2) up to $20,000 for each major violation not implicating public safety;

(3) up to $5,000 for each other violation.

D. Persons and entities who may request a hearing: The following persons or entities may request a hearing to contest an action or proposed action of the department, in accordance with this rule:

(1) a licensed producer whose license has been summarily suspended or who has received a notice of contemplated action to suspend, revoke, or take other disciplinary action;

(2) a personal production licensure applicant whose application is denied for any reason other than failure to submit a completed application or failure to meet a submittal requirement of this rule;

(3) an approved manufacturer whose approval status has been summarily suspended or who has received a notice of contemplated action to suspend, revoke, or take other disciplinary action;

(4) a manufacturer-applicant whose application is denied for any reason other than failure to submit a completed application or failure to meet a submittal requirement of this rule;

(5) an approved laboratory whose approval status has been summarily suspended or who has received a notice of contemplated action to suspend, revoke, or take other disciplinary action;

(6) a laboratory-applicant whose application is denied for any reason other than failure to submit a completed application or failure to meet a submittal requirement of this rule;

(7) an approved courier whose approval status has been summarily suspended or who has received a notice of contemplated action to suspend, revoke, or take other disciplinary action;

(8) a courier-applicant whose application is denied for any reason other than failure to submit a completed application or failure to meet a submittal requirement of this rule; and

(9) a person whose participation with a licensed producer or approved entity is prohibited based on a criminal background check.

E.Closure of applications period: A hearing may not be requested by a person or entity whose application for licensure is denied solely on the basis that the applicable applications period is closed.

F.Timing and content of request for hearing: The appellant shall mail the request for hearing within 30 calendar days of the date that the notice of contemplated action is received, or in the case of an immediate action, within 30 days of the action. The request shall:

(1) be properly addressed to the medical cannabis program;

(2) be mailed to the medical cannabis program via certified U.S. postal mail;

(3) state the requestor's name, address, and telephone number(s); and

(4) include a statement of the issue(s) that the appellant considers relevant to the review of the action.

G. Hearing process:

(1) All hearings held pursuant to this section shall be conducted by a hearing officer appointed by the secretary.

(2) Hearings shall be conducted in Santa Fe, NM or, with the consent of the parties, in another location.

(3) Due to federal and state confidentiality laws, hearings held pursuant to this section that concern qualified patients, patient-applicants, licensed producers or producer-applicants, shall be closed to the public. Portions of hearings may further be closed to prevent the disclosure of confidential information.

(4) The hearing shall be recorded on audiotape or other means of sound reproduction.

(5) Any hearing provided for in this rule may be held telephonically, with the consent of the parties.

H.Scheduling: The department shall schedule and hold the hearing as soon as practicable, however; in any event no later than 60 calendar days from the date the department receives the appellant's request for hearing. The hearing examiner shall extend the 60 day time period upon motion for good cause shown or the parties may extend the 60 day time period by mutual agreement. The department shall issue notice of hearing, which shall include:

(1) a statement of the location, date, and time of the hearing;

(2) a short and plain statement of the legal authority under which the hearing is to be held; and

(3) a short and plain statement of the subject of the hearing.

I.Presentation of evidence: All parties shall be given the opportunity to respond and present evidence and argument on all relevant issues.

J.Record of proceeding: The record of the proceeding shall include the following:

(1) all pleadings, motions, and intermediate rulings;

(2) evidence and briefs received or considered;

(3) a statement of matters officially noticed;

(4) offers of proof, objections, and rulings thereon;

(5) proposed findings and conclusions; and

(6) any action recommended by the hearing examiner.

K.Audio recording: A party may request a copy of the audio recording of the proceedings.

L.Procedures and evidence:

(1) A party may be represented by a person licensed to practice law in New Mexico or a non-lawyer representative, or may represent himself or herself.

(2) The rules of evidence as applied in the courts do not apply in these proceedings. Any relevant evidence shall be admitted. Irrelevant, immaterial, or unduly repetitious evidence may be excluded.

(3) The experience, technical competence, and specialized knowledge of the hearing examiner, the department or the department's staff may be used in the evaluation of evidence.

(4) An appellant's failure to appear at the hearing at the date and time noticed for the hearing shall constitute a default.

M.Conduct of proceeding: Unless the hearing examiner determines that a different procedure is appropriate, the hearing shall be conducted in accordance with the procedures set forth in this rule. The following procedures shall apply:

(1) the appellant shall present an opening statement and the department may present an opening statement or reserve the statement until presentation of the department's case;

(2) after the opening statements, if made, the appellant shall present its case;

(3) upon the conclusion of the appellant's case, the department shall present its case;

(4) upon conclusion of the appellee's case, the appellant may present rebuttal evidence; and

(5) after presentation of the evidence by the parties, the parties may present closing argument.

N.Burden of proof: The appellant shall bear the burden of establishing by a preponderance of the evidence that the decision made or proposed by the department should be reversed or modified.

O. Continuances: The hearing examiner may grant a continuance for good cause shown. A motion to continue a hearing shall be made at least 10 calendar days before the hearing date.

P.Telephonic hearings:

(1) Any party requesting a telephonic hearing shall do so no less than 10 business days prior to the date of the hearing. Notice of the telephonic hearing shall be given to all parties and shall include all necessary telephone numbers.

(2) The appellant is responsible for ensuring the telephone number to the appellant's location for the telephonic hearing is accurate and the appellant is available at said telephone number at the time the hearing is to commence. Failure to provide the correct telephone number or failure to be available at the commencement of the hearing shall be treated as a failure to appear and shall subject the appellant to a default judgment.

(3) The in-person presence of some parties or witnesses at the hearing shall not prevent the participation of other parties or witnesses by telephone with prior approval of the hearing examiner.

Q.Recommended action and final decision:

(1) The parties may submit briefs including findings of fact and conclusions of law for consideration by the hearing examiner.

(2) No later than 30 calendar days after the last submission by a party, the hearing examiner shall prepare and submit to the secretary a written recommendation of action to be taken by the secretary. The recommendation shall propose sustaining, modifying, or reversing the action or proposed action of the department.

(3) The secretary shall issue a final written decision accepting or rejecting the hearing examiner's recommendation in whole or in part no later than 30 calendar days after receipt of the hearing examiner's recommendation. The final decision shall identify the final action taken. Service of the secretary's final decision shall be made upon the appellant by registered or certified mail.

(4) The final decision or order shall be included in a producer's file with the medical cannabis program.

N.M. Admin. Code § 7.34.4.31

Adopted by New Mexico Register, Volume XXXI, Issue 12, June 23, 2020, eff. 6/23/2020