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A medical marijuana patient, right, pays for cannabis at Reef Dispensaries at 3400 Western Ave. on Wednesday, Feb. 15, 2017. (Jeff Scheid/The Nevada Independent)

The identities of medical marijuana business owners can remain a mystery after the Nevada Supreme Court issued a ruling Thursday protecting that information as confidential.

The 13-page opinion by the state’s highest court rejects the Reno Gazette-Journal’s bid to acquire that information. The newspaper’s quest dates back to 2015 when it filed a lawsuit against the City of Sparks, which produced business licenses for medical marijuana establishments but redacted the owners’ names.

A District Court judge in Northern Nevada had ruled in favor of the newspaper, concluding that the city must disclose the owners’ identities under the Nevada Public Records Act. The city appealed the decision.

The Nevada Supreme Court’s opinion reverses the District Court decision, allowing the city to withhold that information from the public.

State Sen. Tick Segerblom, who has championed the legalization of both medical and recreational marijuana, said he was shocked by the Supreme Court’s decision.

“Our intention was to allow the owners to restrict their financial information like gaming licensees,” he said. “Obviously, (it’s) really critical to know who’s behind these businesses.”

Segerblom said it’s important to know the ownership information to ensure the licenses are being awarded fairly and prevent any conflicts of interest. The state lawmaker said, to his knowledge, Sparks is the only jurisdiction not releasing the identifying information.

Even so, he wants to see a legislative fix to the situation.

“At the end of the day, it’s the Legislature’s job to reverse this,” Segerblom said. “They need to grab the bull by the horn.”

Assembly Republican Leader Paul Anderson commended the Nevada Supreme Court for “staying in their lane” and allowing the Legislature do its job. In general, Anderson said he supports more transparency in this situation, although the lawmaker noted that he needs time to brush up on the statute and regulation.

“Whatever is readily available for normal businesses is probably appropriate for those businesses as well,” he said, referring to medical marijuana establishments.

Democratic Assembly Speaker Jason Frierson expressed general support for transparency in the marijuana realm.

"I agree that it's important to promote transparency in government and we need to carefully look at our statute to accomplish that goal," he said in a statement to The Nevada Independent. "Voters have indicated their support for this policy, so we need to be the gold standard as far as accountability and transparency are concerned."

The state’s seven Supreme Court justices agreed with the city’s argument that Nevada law governing medical marijuana businesses includes a provision granting the owners confidentiality.

Nevada Administrative Code states that, “Except as otherwise provided in NRS 239.0115, the name and any other identifying information of any person who facilitates or delivers services pursuant to this chapter or chapter 453A of NRS are confidential, not subject to subpoena or discovery and not subject to inspection by the general public.”

Barry Smith, executive director of the Nevada Press Association, said in an email that he was disappointed by the ruling but placed most of the blame on the statute and regulation, which he described as “flawed to begin with and need to be clarified.”

“Language that was initially intended to protect the names of people who were prescribed medical marijuana — a legitimate reason for privacy — got extended to cover businesspeople who are operating marijuana enterprises,” he wrote. “There’s a big difference as far as the public’s right to know.”

The Nevada Dispensary Association said its members have never actively pursued confidentiality or asked for special treatment.

“In fact, most have been very open about their involvement and are proud vocal members of the burgeoning industry,” the organization said in a statement. “NDA members are not focused on this issue at this time, but would caution that financial and other sensitive information should continue to be kept confidential, especially as this remains a cash business.”

This is a developing story and will be updated with new information throughout the day.

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