Wired News reported June 5 that rifts over money and conflict of interest “threatens to hinder the California Institute for Regenerative Medicine even before it awards its first grant.”
Voters approved the $3 billion initiative ($6 billion after paying off loans) last November, but almost immediately it ran into trouble. Lawsuits were filed, and grants were halted. Forbes reported in February…

One lawsuit filed by the People’s Advocate and the National Tax Limitation Foundation alleges that the California Institute for Regenerative Medicine violates California law because it’s not governed exclusively by the state government and the committee that controls the money isn’t publicly elected.
The second lawsuit was filed by a newly created nonprofit called Californians for Public Accountability and Ethical Science, which is supported by at least one person who originally opposed Proposition 71.
The lawsuit alleges that provisions in Proposition 71 exempting members of the institute from some conflict-of-interest laws are illegal. The suit also alleges that the ballot language violated a California election law that requires each proposition to address a single subject.

Newsweek reported March 7:

Stem-cell supporters in the Golden State now face two new lawsuits from conservative groups dead-set on keeping that $3 billion out of scientists’ hands; questions from government watchdogs about the money’s dispersal, and an upcoming hearing in the state Senate on a moratorium against some types of stem-cell science.

As a result of the lawsuits, the distribution of grants has been stopped until at least autumn 2005, as reported by LifeNews.com in April, because bonds to fund the grants cannot be sold in the midst of the legal mess.