The state Board of Morticians, part of the Department of Health and Mental Hygiene, regulates the funeral home industry.

Currently, a funeral home owner must be licensed by the state as a funeral director. Obtaining a license takes two years of study and includes learning how to embalm corpses.

However, there are exceptions. Fifty-eight corporations are authorized to own funeral homes, as are the surviving spouses of deceased funeral directors, even though the widow may have no license or professional experience, according to the institute.

These restrictions are unfair in that they prevent ‘‘ordinary entrepreneurs” from owning funeral homes, the group says. Besides these exempt owners, no one may own a funeral home even if he hires a licensed director to oversee operations.

Clark Neilly, a senior attorney with the group, said the case is moving along as quickly as can be expected, and ‘‘I wouldn’t be surprised if we see something by the end of the summer ... or early fall.”

These ownership restrictions limit opportunities for entrepreneurs, which stifles competition and leads to higher prices for consumers, according to the institute.

But funeral directors who support the law say it protects consumers.

The rules prevent concentrations of ownership that in other states have led to monopolies, abuses and higher prices, said James J. Doyle, a lobbyist for the Maryland State Funeral Directors Association, which supports the current regulations.

The lawsuit is ‘‘one of desperation,” Doyle said, referring to frequent legislative attempts to change the mandate.

‘‘Almost every year there has been one or more bills in to change the law,” Doyle said. And the arguments ‘‘have always been unsuccessful.”

The funeral home industry is not just a moneymaking business, as there are vulnerable customers involved, he said. Owners who are licensed directors have a personal stake in how the business is run, he said.

Karen Black, a spokeswoman with the Department of Health and Mental Hygiene, declined to comment on ongoing litigation.

The nationwide ratio is one funeral home for about every 17,600 people, according to the institute. But in Maryland, the ratio is one for every 24,500 people. The average U.S. funeral home has revenues of $681,000, while the Maryland average is about $887,000, according to the institute.

Drugstores, airlinesand licenses

Plaintiff Charles S. Brown, owner of Rest Haven Cemetery in Hagerstown, compares the law with regulations in other industries, where owners can hire licensed staff to run the business.

For example, a drugstore owner can hire a licensed pharmacist to dispense medication and airline owners hire licensed pilots to fly planes, he said.

‘‘That’s the way every business is conducted,” Brown said.

Brown, who is not a licensed funeral director, invested $1 million to rebuild a funeral home on the cemetery he has owned for about 20 years. The funeral home would provide revenue to help pay for gravesites in the cemetery — which has existed since 1927 — once it is full.

For Brown, it’s a matter of being able to pass on the family business to unlicensed descendants.

As he has been fighting to change the law for almost a decade, his son, Eric L. Brown, became licensed and now owns the funeral home. But under current law, the Brown family will lose the right to ownership when Eric Brown and his wife die.

Buying one of the few corporate licenses that allow unlicensed owners is virtually out of the question, Brown said.

A current holder must be willing to sell his, he said, as the state hasn’t issued one for almost 60 years, according to Laurie Sheffield-James, executive director of the State Board of Morticians. Companies that received one had to be incorporated before 1945, she said.

The licenses can cost nearly $250,000, Brown said. ‘‘They’re so valuable now nobody will sell one.”

‘‘I would expect the court to resolve the case on the basis of the summary judgment motions that have been submitted,” Neilly said. ‘‘I do not think this case needs to go to trial and I would be surprised if it does.”

http://www.gazette.net/stories/071907/busiplo150746_32357.shtml