(Bloomberg) -- Florida Governor Ron DeSantis and billionaire Ken Griffin won a decisive election-day victory in their crusade against legalizing recreational marijuana, sending cannabis industry shares plummeting.
A ballot measure to legalize marijuana, known as Amendment 3, failed to get the 60% support from voters needed to pass under Florida law. (It got 55.9% support — or almost 6 million votes.)
DeSantis made blocking legalization the centerpiece of an election-year political strategy. Griffin largely funded the governor’s crusade, adding the fight to various political causes he’s taken on since moving his Citadel financial empire to Miami from Chicago in 2022.
“Floridians of all backgrounds chose cleaner streets, safer neighborhoods and healthier communities,” Griffin said in an emailed statement. “We united together to protect our quality of life.”
The defeat sent Big Weed stocks into a spiral. The MJ PurePlay 100 Index, which tracks the sector, slumped 17% — the most since February 2021. And Canadian shares of Trulieve Cannabis Corp., which put $145 million into the campaign for the Florida amendment, fell as much as 47% Wednesday — a record drop.
At least two analysts tracked by Bloomberg downgraded their ratings on Trulieve following the verdict.
Legalizing recreational marijuana for Florida’s 23 million residents — plus millions of tourists annually — would have been a huge win for the cannabis industry. Quincy, Florida-based Trulieve had forecast that as many as 2.7 million people would have moved into the legal weed market had Amendment 3 passed.
With Florida on board, about 60% of the US population would have had access to recreational weed, which advocates said would have made national legalization more likely. The cannabis industry invested hundreds of millions of dollars on expanding weed farms, processing plants and dispensary networks in Florida ahead of the vote, betting on soaring demand and profit from legalization.
The massive influx of cash wasn’t enough to offset efforts by DeSantis to defeat the measure. The Republican governor went on a crusade against it, diverting millions in state funds to the effort. He and his wife, Casey, held news conferences with law enforcement officials where they decried the smell of marijuana and what they said was the drug’s potential to increase crime.
The governor’s campaign went beyond weed, said Nick Iarossi, a Tallahassee lobbyist and longtime DeSantis fundraiser and supporter. Fighting legal weed was the centerpiece of DeSantis’ push to bolster his political mandate in Florida after Donald Trump crushed his run for president early this year.
“A lot of people were saying he was in the sunset of his career, but this shows that’s not the case,” Iarossi said in an interview.
The governor found an ally in Griffin, who donated $12 million to the anti-pot cause and was the only large individual donor. All told, DeSantis and anti-weed advocates drummed up $26 million to fight the measure.
The fight over recreational marijuana created some odd bedfellows. Donald Trump, a Florida resident, said he would be voting yes and his ally Roger Stone advocated for the measure. John Morgan, a celebrity personal injury lawyer and longtime Democratic donor, created an alter-ego to promote marijuana in Florida, branding himself as “Pot Daddy.”
--With assistance from Katrina Compoli.
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