Louis Del Favero Orchids, Inc. v. Scott Rivkees

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[DO NOT PUBLISH]

In the

United States Court of Appeals

For the Eleventh Circuit

____________________

No. 19-14930

____________________

LOUIS DEL FAVERO ORCHIDS, INC.,

Plaintiff-Appellant,

versus

SCOTT RIVKEES,

Individually and in his official capacity as

Surgeon General and Secretary of the

Florida Department of Health,

CHRISTIAN BAX,

Individually,

COURTNEY COPPOLA,

Individually,

LOUISE ST. LAURENT,

Individually,

CELESTE PHILLIP,

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2 Opinion of the Court 19-14930

Individually, et al.,

Defendants-Appellees.

____________________

Appeal from the United States District Court

for the Northern District of Florida

D.C. Docket No. 4:19-cv-00284-RH-MJF

____________________

Before WILSON, ROSENBAUM, and ED CARNES, Circuit Judges.

ROSENBAUM, Circuit Judge:

Despite initial appearances, this isn’t a case about medical

marijuana. Nor is this a case about the allegedly wrongful denial

of a license to dispense medical marijuana. This also isn’t a case

about a state agency that has allegedly ignored a state constitu-

tional directive to license medical marijuana dispensaries, either.

Instead, this is a case about whether there’s a federal constitutional

“property right” to process. There isn’t. To be sure, a federal con-

stitutional right to process to protect constitutional rights to life,

liberty, and property exists. But process itself is not a property

right—that would be circular.

Plaintiff-Appellant Louis Del Favero Orchids, Inc. (“Del

Favero”), applied for a license to dispense medical marijuana from

the Florida Department of Health (“the Department”). But the

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19-14930 Opinion of the Court 3

Department didn’t approve or deny Del Favero’s application. In-

stead, it told Del Favero that it wasn’t accepting applications (yet)

and that it would publish a notice in the Florida Administrative

Register when the application period opened. Del Favero didn’t

accept this answer and sued the Department, claiming that the De-

partment had deprived Del Favero—not of the right to a license—

but of the right to have its application for a license reviewed. The

district court dismissed Del Favero’s complaint.

After a thorough review of the record and with the benefit

of oral argument, we affirm the district court’s judgment because

the federal procedural-due-process clause doesn’t guarantee pro-

cess as an end in itself; it guarantees process only as process regards

a substantive right.

I. FACTUAL BACKGROUND

This dispute arises from interlocking Florida constitutional

and statutory provisions governing the licensing of Medical Mari-

juana Treatment Centers (“Centers”). So before we get to the mat-

ter at hand, we must first review (1) the Florida Compassionate

Medical Cannabis Act of 2014 (the “Act”); (2) Article X, Section 29

of the Florida Constitution; (3) a 2017 amendment to the Act; and

(4) some regulations promulgated under the Act.

A. Florida’s Medical Marijuana Regulatory Scheme

This case finds its origins in 2014, when Florida passed the

Act. The Act legalized cultivating, processing, and dispensing (to

qualified patients) medical marijuana. FLA. STAT. § 381.986(1)

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(2014). It also directed the Florida Department of Health to

“[a]uthorize the establishment of five dispensing organizations”

and ordered that the Department “shall develop an application

form” for potential dispensing organizations. Id. § 381.986(5)(b)

(2014). To accomplish these things, the Act empowered the De-

partment “[a]dopt [necessary] rules.” Id. § 381.986(5)(d) (2014).

Two years later, Florida voters approved a ballot initiative

amending the Florida Constitution to add deadlines for the Depart-

ment to fulfill its duties. The Amendment—codified as Article X,

Section 29 of the Florida Constitution—directed that the Depart-

ment “shall issue reasonable regulations necessary for the imple-

mentation of this section. . . . It is the duty of the Department to

promulgate regulations in a timely fashion.” FLA. CONST. art. X,

§ 29(d). More concretely, the new section of the Constitution re-

quired the Department to “promulgate[] no later than six (6)

months after the effective date of this section”—or by June 3,

2017—regulations establishing “[p]rocedures for the registration of

[Centers] that include procedures for the issuance, renewal, sus-

pension and revocation of registration[.]” Id. § 29(d)(1)c. Section

29 also provided that “[i]f the Department does not issue regula-

tions, or if the Department does not begin issuing identification

cards and registering [Centers] within the time limits set in this sec-

tion, any Florida citizen shall have standing to seek judicial relief to

compel compliance with the Department’s constitutional duties.”

Id. § 29(d)(3).

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Following the amendment, the Florida legislature modified

the Act to track the new constitutional language. The amended

Act required the Department to license Centers that fell into par-

ticular categories. FLA. STAT. § 381.986(8)(a)(1).

First, under the new version of the law, the Department of

Health had to—“[a]s soon as practicable, but no later than July 3,

2017”—relicense any Center that had a license before the amend-

ment and which continued to meet the statutory requirements. Id.

Second, the amended Act required the Department of

Health to distribute ten licenses to (1) applicants who, among other

requirements, had applied for a license under the predecessor law

and been denied and (2) applicants who were “a recognized class

member of Pigford v. Glickman, 185 F.R.D. 82 (D.D.C. 1999), or In

Re Black Farmers Litig., 856 F. Supp. 2d 1 (D.D.C. 2011).” Id.

§ 381.986(8)(a)2a–b. Of these ten licenses, the Department had to

issue at least one to a member of the second category. Id. §

381.986(8)(a)2b. More specifically, under the amended law, the De-

partment had to, “[a]s soon as practicable, but no later than Octo-

ber 3, 2017 . . . license applicants that meet the requirements of this

section in sufficient numbers to result in 10 total licenses issued un-

der this subparagraph, while accounting for the number of licenses

issued under sub-subparagraphs a. and b.” Id. § 381.986(8)(a)2c.

And “[f]or up to two of the licenses issued under subparagraph 2.,

the amended Act required the “[D]epartment [to] give preference”

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to applicants planning to convert a citrus-fruit or citrus-molasses

facility to process marijuana. Id. § 381.986(8)(a)3. 1

To recap then, under the amended Act, the Department had

to relicense active Centers by August 1, 2017. The amended Act

also required the Department, by October 2017, to distribute up to

ten licenses to (1) formerly unsuccessful applicants and (2) mem-

bers of two specified litigation classes, and to give preference to ap-

plicants using converted citrus facilities.

As to the licensing process, the amended Act specified that

licensing applicants had to “apply to the department on a form pre-

scribed by the [D]epartment and adopted in rule.” Id. §

381.986(8)(b). And the amended Act required the Department to

“adopt rules pursuant to [sections] 1200.536(1) and 120.54 establish-

ing a procedure for the issuance and biennial renewal of licenses[.]”

Id. Subject to the initial limits of ten licenses and the designated

groups of recipients, the amended Act also provided that “the

[D]epartment shall issue a license to an applicant if the applicant

meets the requirements of this section and pays the initial applica-

tion fee.” Id.

1 The ten licenses were just the beginning. The new law also required the

Department to license four Centers within six months after the registration of

100,000 active qualified patients (and then four more Centers within six

months of the registration of every additional 100,000 patients). Id.

§ 381.986(8)(a)4.

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A couple of months after the law went into effect, the De-

partment promulgated an emergency administrative rule. FLA.

ADM. CODE R. 64ER17-2(1), (1)(e), (4). The emergency rule stated

that the Department “shall publish in the Florida Administrative

Register and on its website the date upon which the [D]epartment

will begin accepting applications and the deadline to receive all ap-

plications.” Id. Besides this directive, the emergency rule linked to

an application form and explained how applications would be

scored. Id. 2

B. State Court Litigation and Del Favero’s Efforts to Obtain a

Center License

In December 2017, a company other than Del Favero—Flo-

rigrown, LLC—challenged the constitutionality of the 2017 law

and the Department’s regulations. See Fla. Dep’t of Health v. Flo-

rigrown, LLC, 317 So. 3d 1101 (Fla. 2021). Del Favero intervened

in support of Florigrown.

In the course of those proceedings, on October 5, 2018, a

state trial court enjoined Florida’s Department of Health from is-

suing Center licenses “pursuant to the unconstitutional legislative

scheme set forth in” section 381.986; (2) required the Department

2In both July and November 2017, the Department published “Constitutional

Regulations” explaining that the Department would begin—but had not yet

begun—accepting applications and would publish a notice in the Florida Ad-

ministrative Register. See MedPure, LLC v. Dep’t of Health, 295 So. 3d 318,

321 n.3 (Fla. Dist. Ct. App. 2020).

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to start “registering [Centers] in accordance with the plain lan-

guage of the Medical Marijuana Amendment”; and (3) required the

Department to give Florigrown a license. Fla. Dep’t of Health v.

Florigrown, LLC, 320 So. 3d 195 (Fla. Dist. Ct. App. 2019), reversed

in part by Fla. Dep’t of Health v. Florigrown, LLC, 317 So. 3d 1101

(Fla. 2021). Soon after, though, a state intermediate court stayed

the injunction.

While the state-court litigation was proceeding, Del Favero

bought a citrus-processing facility for three-quarters of a million

dollars—to capitalize on the preference afforded such applicants—

and applied for a Center license on October 8, 2018. Del Favero

didn’t receive a response. So it resubmitted its application—with

the full application fee of $60,830—on October 17, 2018.

Del Favero still didn’t get a response. So in January 2019,

Del Favero sent the Department a letter claiming a “default li-

cense” under Florida Statutes section 120.60(1). That section pro-

vides that, if the Department doesn’t approve or deny a license ap-

plication within ninety days of submission, and the applicant pro-

vides notice to the agency, then the applicant can claim use of a

“default license.” FLA. STAT. § 120.60(1).

The Department returned Del Favero’s application fee and

responded that Del Favero’s application was premature because

the Department had not yet published notice that it was accepting

applications. Del Favero, the Department warned, did not have a

default license.

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II. PROCEDURAL HISTORY

Del Favero sued the Florida Department of Health and sev-

eral Department officials for allegedly violating its Fourteenth

Amendment procedural-due-process rights under 42 U.S.C. § 1983.

In its complaint, Del Favero said that it “enjoy[ed] a state-created

property interest in having its application to be a [Center] reviewed

by the [Department].” The Department, it contended, “deprived

[Del Favero] of this property interest by refusing to review [Del

Favero’s] application in violation of these provisions.”

The Department and Department officials moved to dismiss

for five reasons. First, they said, the district court should abstain

from hearing the case because of the Pullman, Burford, and Colo-

rado River abstention doctrines. 3 Second, they argued that sover-

eign immunity and qualified immunity barred Del Favero’s official-

capacity claim against the Department and its individual-capacity

claims against the Department officials, respectively. Third, the

defendants asserted that Del Favero wasn’t an applicant for a li-

cense because the published regulations plainly stated that the ap-

plication period hadn’t yet opened. Fourth, the defendants con-

tended that Del Favero hadn’t stated a claim for the denial of pro-

cedural due process because—even assuming Del Favero was an

applicant—only license holders, not license applicants, possessed a

3See, e.g., R.R. Comm’n v. Pullman Co., 312 U.S. 496 (1941); Burford v. Sun

Oil Co., 319 U.S. 315 (1943); Colo. River Water Conservation Dist. v. United

States, 424 U.S. 800 (1976).

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10 Opinion of the Court 19-14930

property right protected by the Fourteenth Amendment. And fifth,

the Department concluded that, even if Del Favero had a property

interest in obtaining a license, its due-process rights weren’t vio-

lated because it could sue (and had, in fact, sued) in the Florida state

courts.

Upon review of the defendants’ motion, the district court

ordered Del Favero to address in its response whether “a person

has a constitutional right to due process in connection with an ap-

plication for a state license that, if issued, purportedly would au-

thorize the person to commit a federal crime.”

Del Favero responded that the Controlled Substances Act

didn’t prohibit possession of a license under state law. Rather, it

said, we determine property interests protected by the due-process

clause by reference to state law, so what federal law prohibited

didn’t affect the procedure a state needed to provide before depriv-

ing a citizen of a state-created property right. Then, in addressing

the defendants’ arguments, Del Favero contended that the district

court didn’t need to abstain because the pending state-court actions

wouldn’t resolve its federal-law challenges. As to the defendants’

immunity arguments, Del Favero argued both that (1) reviewing

its application wasn’t a discretionary function and that (2) the law

was clearly established that state officials couldn’t refuse to do their

jobs to review and approve or deny pending applications. On the

merits, Del Favero said that the Department had deprived it of a

property right—“a [s]tate-[c]reated [p]roperty [i]nterest in [h]aving

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its [Center] [a]pplication [r]eviewed.” Finally, Del Favero asserted

that state-court procedures didn’t provide an adequate remedy be-

cause Del Favero could obtain only injunctive relief—not damages

for the time and money it had lost in the meantime.

The district court dismissed Del Favero’s claims because fed-

eral law prohibited possessing, distributing, or manufacturing ma-

rijuana. So in the district court’s view, an interest in a license to

possess, distribute, or manufacture marijuana wasn’t a property in-

terest protected by the federal Constitution. Del Favero now ap-

peals.

III. STANDARD OF REVIEW

“We review de novo the district court’s grant of a motion to

dismiss under Rule 12(b)(6) for failure to state a claim, accepting

the allegations in the complaint as true and construing them in the

light most favorable to the plaintiff.” Am. Dental Ass’n v. Cigna

Corp., 605 F.3d 1283, 1289 (11th Cir. 2010) (quotations omitted).

IV. DISCUSSION

As we explain below, Del Favero’s complaint fails to state a

claim because it alleges a “property” interest—not in property—

but in procedure. That is, Del Favero’s claimed property interest

is not in a license, but in having its license application reviewed.

And the Supreme Court has repeatedly explained that the due-pro-

cess clause requires process only to protect certain rights (like prop-

erty) and doesn’t require process to protect process. For this rea-

son—and because we may affirm on any ground supported by the

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record, see Long v. Comm’r, 772 F.3d 670, 675 (11th Cir. 2014)—

we affirm the district court’s dismissal of the case.

The Fourteenth Amendment provides that states shall not

“deprive any person of life, liberty, or property, without due pro-

cess of law.” U.S. CONST. amend. XIV, § 1. The Supreme Court

construed this clause as protecting two concepts: (1) substantive

due process and (2) procedural due process. See Cleveland Bd. of

Educ. v. Loudermill, 470 U.S. 532, 541 (1985) (“The categories of

substance and procedure are distinct.”). As Del Favero alleges a

violation of procedural-due-process rights, we must “determine

whether [it] was deprived of a protected property interest, and if

so, what process was due.” Barnes v. Zaccari, 669 F.3d 1295, 1303

(11th Cir. 2012).

Del Favero’s claim fails because it hasn’t alleged the depriva-

tion of a property interest. “[P]roperty interests subject to proce-

dural due process protection are not limited by a few rigid, tech-

nical forms. Rather, property denotes a broad range of interests

that are secured by existing rules or understandings.” Id. (citation

omitted). Property interests don’t come from the Constitution; in-

stead, they are created (or recognized) by “independent source[s]

such as state law.” Town of Castle Rock v. Gonzales, 545 U.S. 748,

756 (2005) (quotation marks and citations omitted). The Supreme

Court has been clear that procedural due process requires adequate

procedures to protect “certain substantive rights.” Loudermill, 470

U.S. at 541. But procedural due process doesn’t create a standalone

right to process itself.

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Three cases illustrate this distinction. First, consider Olim v.

Wakinekona, 461 U.S. 238 (1983). There, the plaintiff sued a Ha-

waii state prison for transferring him to an out-of-state prison. Id.

at 249. The Supreme Court held that the plaintiff’s procedural-due-

process rights weren’t violated because the administrator enjoyed

“completely unfettered” discretion to transfer the plaintiff, so the

plaintiff didn’t have a substantive right at stake. Id. The Supreme

Court explained that the circuit court had erred by focusing on the

fact that the prison regulations “require[d] a particular kind of hear-

ing before the administrator can exercise his unfettered discretion.”

Id. at 250. But “[p]rocess is not an end in itself,” the Supreme Court

declared. Id. Rather, the Court continued, “[i]ts constitutional pur-

pose is to protect a substantive interest to which the individual has

a legitimate claim of entitlement.” Id. The Court concluded that

“[t]he State may choose to require procedures . . ., of course, but in

making that choice the State does not create an independent sub-

stantive right.” Id. at 250–51.

Second, we look at Loudermill. The plaintiff there was a

public employee who was fired, he asserted, without a meaningful

opportunity to contest the reason for his termination. Loudermill,

470 U.S. at 536. Before the Supreme Court, the city-defendant ar-

gued that, while public employment was a property interest, the

termination procedures laid out by statute defined (or limited) that

property interest. Id. at 539–40. The Supreme Court rejected that

view, explaining that “‘[p]roperty’ cannot be defined by the proce-

dures provided for its deprivation any more than can life or liberty”

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because otherwise the “[c]lause would be reduced to a mere tau-

tology.” Id. at 541.

And third, in Town of Castle Rock, the plaintiff argued that

the police had violated her procedural-due-process rights by failing

to enforce a protective order. 545 U.S. at 763. The Supreme Court

rejected this argument because the enforcement of the arrest war-

rant didn’t constitute property. Id. at 768. The Supreme Court said

that “the seeking of an arrest warrant would be an entitlement to

nothing but procedure—which we have held inadequate even to

support standing; much less can it be the basis for a property inter-

est.” Id. at 764 (cleaned up). As Justice Souter explained in his con-

currence, “the federal process protects the property created by

state law. But [plaintiff] claims a property interest in a state-man-

dated process in and of itself . . . . This argument is at odds with the

rule that ‘[p]rocess is not an end in itself.’” Id. at 771 (Souter, J.,

concurring) (citing Olim, 461 U.S. at 250). A different rule, Justice

Souter said, would “would federalize every mandatory state-law

direction to executive officers” and “work a sea change in the scope

of federal due process.” Id.

Here, Del Favero may or may not have a property right in a

Center license, but it doesn’t have a property right in the process

of licensure. That is, we assume without deciding that Del Favero

could have had a property interest in a Center license. 4 So when

4Because we affirm the district court’s dismissal of this case since Del Favero

has no due-process right in process itself, we do not opine on either the district

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the Department reviews Del Favero’s application, as a license ap-

plicant, Del Favero might be entitled to certain process before the

Department grants or denies its application—for example, to have

its Center application evaluated by a neutral decisionmaker accord-

ing to publicly available objective criteria and with the opportunity

to respond. Cf. Henry Friendly, “Some Kind of Hearing”, 123 U.

PA. L. REV. 1267 (1975). But that isn’t the property right Del Favero

complains it lost. Rather, Del Favero insisted, over and over, that

it was deprived of its “property right” in having its application re-

viewed. But as we have explained, that isn’t a property right.

Loudermill, 470 U.S at 541 (“‘Property’ cannot be defined by the

procedures provided for its deprivation any more than can life or

liberty.”). Instead, procedural due process protects only substan-

tive rights, and “[p]rocess is not an end in itself. Its constitutional

purpose is to protect a substantive interest to which the individual

has a legitimate claim of entitlement.” Olim, 461 U.S. at 250.

There is a difference between a right to a license and the right to

have an application reviewed.

Against this, Del Favero points out that the Florida Consti-

tution provides “any Florida citizen . . . standing to seek judicial

relief to compel compliance with the Department’s constitutional

duties.” FLA. CONST. art. X, § 29(d)(3). And it’s true that the Florida

Constitution can recognize an interest as sufficient to support

court’s basis for dismissing this case or on the defendants’ alternative bases for

arguing that Del Favero’s claim fails.

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standing in Florida state courts. But when making a claim in fed-

eral court for violation of the federal Due Process clause, “federal

constitutional law determines whether that interest rises to the

level of a ‘legitimate claim of entitlement.’”” Memphis Light, Gas

and Water Div. v. Craft, 436 U.S. 1, 9 (1978) (quoting Bd. of Re-

gents v. Roth, 408 U.S. 564, 577 (1972)). And federal constitutional

law doesn’t recognize the right that Del Favero seeks here—a prop-

erty right to state process. In other words, Del Favero might have

a cause of action, but its cause of action would be under state law,

not under federal constitutional law. So it must therefore seek re-

lief in state court. 5

V. CONCLUSION

Because Del Favero doesn’t have a property interest in the

MMTC application process being opened, the district court cor-

rectly concluded that Del Favero’s procedural due process rights

were not violated.

AFFIRMED.

5 Del Favero said in passing that it had a property interest in the default license.

But it didn’t develop this argument before the district court, instead falling

back to its process-as-property arguments. In any event, a state court has since

ruled that the default licensure provisions do not apply to Center licenses. See

Louis Del Favero Orchids, Inc. v. Fla. Dep’t of Health, 2019-CA-1047 (Fla.

Leon Cnty. Ct. July 30, 2021).