More than a dozen winners of the second Ontario cannabis retail lottery will not be opening pot stores.
The Alcohol and Gaming Commission of Ontario (AGCO), which oversaw the draw on Aug. 20, announced Friday that only 29 of the 42 winners submitted applications before the deadline of Aug. 28. As a result, 13 applicants from regional waiting lists have been brought forward, the AGCO said.
Among the original winners now disqualified: the three consecutive addresses in Innisfil near Barrie; and both winners in the GTA region who each listed 20 Simcoe St S in Oshawa as the address of their prospective pot shop.
Notable among those to advance to the review stage: 104 Harbord St, the location of CAFE, a well-known illegal dispensary. Cory Floyd Cacciavillani, son of Aphria Inc. co-founder Cole Cacciavillani and Najla Guthrie, CEO of Auxly Cannabis subsidiary KGK Science Inc. also submitted complete applications before the Wednesday deadline. Mr. Cacciavillani is proposing to open a cannabis store in Burlington while Ms. Guthrie’s proposed site, in Toronto’s Upper Beaches neighbourhood on Kingston Road, is already facing criticism over its proximity to a local Montessori school.
The lottery winner associated with the CAFE address is a numbered company, registered earlier this year, that lists Canadian film producer Robert Heydon as its sole director in the federal corporate registry. Mr. Heydon has not responded to requests for comment.
When The Globe and Mail visited 104 Harbord St. in late July, shortly after Toronto Police barricaded the entrance with concrete blocks, people were sitting in lawn chairs directly outside, openly selling cannabis while urging customers to sign petitions.
Six winners in total were disqualified for violating lottery rule 14a, which requires all application materials to be submitted within five business days of the lottery result. Another six violated rule 8c, which requires pre-qualification documents such as two bank letters confirming access to $250,000 in cash and an additional $50,000 in credit.
In addition to those 12, one of the original 42 winners subsequently withdrew their bid: Michelle Romanow, venture capitalist and Dragon’s Den star. She won using an Alberta-registered numbered company with 619 King Street West - in the heart of downtown Toronto’s entertainment district - as her proposed store address.
All told, the second lottery had 4,864 submissions from roughly 1,800 businesses or sole proprietors. The process was intended to be an improvement upon the first lottery in January, which saw more than 17,000 individuals compete for the right to apply for Ontario’s first 25 permits.
Applicants in the first draw were only required to submit proof of Ontario residency and a $60 application fee, while the second lottery required access to $300,000 and access to a suitable retail space. However, the rules did not require a signed lease or deed, leading multiple applicants to make submissions using the same address.
For example, 169 individual applicants listed 20 Simcoe St. S. in Oshawa as the proposed address of their cannabis store. Despite both winning entries listing that address being disqualified as of Friday, four of the five entries now on the waiting list for the Greater Toronto Area (GTA) region list 20 Simcoe St. S in Oshawa as their proposed location.