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Farmers in Utah have begun growing hemp following the legalization of the crop late last year, including strains of the plant with names featuring a decidedly political twist. One varietal, Obama, is named for former President Barak Obama, who was in office when the 2014 Farm Bill that authorized hemp research pilot programs was signed into law.

Another strain, Trump, is also named for a president that figures prominently in hemp history. President Donald Trump signed the 2018 Farm Bill in December, which legalized the crop as an agricultural commodity in the United States.

Farmer Kenny McFarland grew hemp for the first time this year, planting clones on eight acres of his farm in Weber County. He shared some of the knowledge he gained from the experience at the annual convention of the Utah Farm Bureau that was held last week in Layton.

“Trump was super aggressive,” McFarland said, drawing laughs from the crowd of farmers at the event.

Since the 2018 Farm Bill was signed into law, the Utah Department of Agriculture and Food has issued 290 cultivation licenses to grow hemp, including 190 licenses that were active for this year’s growing season. Farmers were required to pay a fee of $500 to obtain the license.

Difficult First Growing Season for Hemp in Utah

Drew Rigby, the Utah agriculture agency’s director of medical cannabis and industrial hemp, said that the first year of hemp cultivation in the state was a difficult learning experience. Besides Obama and Trump, farmers also gave other strains of hemp a try, including ones named Cherry Blossom, Tokyo, and Merlot.

“We did not have a lot of successful grows and the quality of the product was nothing to write home about,” Rigby said. “It is not unusual to struggle the first year.”

Mont McPherson of Millard County planted 60 acres of hemp at his farm. He used four different varieties of what was supposed to be feminized seed but achieved a germination rate of only 30 percent, including 10,000 to 15,000 male plants that had to be removed from the field to prevent the female plants from being pollinated and producing flowers with seed.

“We spent hours driving the fields looking for males,” McPherson said.

“It was pretty much a train wreck,” he added.

Rigby agreed that male plants posed a challenge for growers, noting that just one male plant in a field can pollinate the females, producing seed and reducing the value of the crop.

“Culling males is a very difficult thing,” he said. “Males have zero value in this game.”

Rigby said that “the window to make a quick buck from growing hemp is closing” and that farmers shouldn’t consider the crop unless they are in it for the “long haul.”

“Don’t waste your time,” he said.

David Politis, a consultant for the Utah Farm Bureau who was also at last week’s convention, said that while the state’s climate is ideal for growing hemp, farmers should be cautious about growing the new crop.

“This market is like the wild, wild West,” he said. “There are a lot of crooks or people who don’t know what they are doing. For better or worse, there are producers who hear about this and they see the opportunity to make a quick buck and strike it rich quickly.”

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California regulators announced on Thursday that taxes paid by the state’s licensed cannabis business will increase on New Year’s Day, despite calls to ease the burden on an industry struggling to compete with a thriving illicit market.

In a special notice from the California Department of Tax and Fee Administration, the state announced that cannabis cultivation taxes would be raised by more than 4%, reflecting an adjustment for inflation as required by state law. The tax on an ounce of dried cannabis flower will rise from $9.25 to $9.65, a jump of 4.3%

The tax levied on dry cannabis leaves will go up from $2.75 to $2.87, which is also a 4.3% increase. The tax on an ounce of fresh cannabis plant material will rise to $1.35 from $1.29, a jump of 4.6%.

The notice also revealed an increase in the state’s cannabis markup rate from 60% to 80%. The mark-up rate — the average difference between the wholesale cost and the retail selling price of cannabis and cannabis products — is used to determine the state excise tax on cannabis products. Regulators are required to recalculate the cannabis mark-up through an analysis of statewide market data every six months.

The increase in taxes comes despite the burden already borne by licensed businesses struggling to compete with a continuing unregulated market, which is estimated by BDS Analytics to be worth $8.7 billion per year in California, more than twice as much as the regulated market.

Industry Already Facing High Taxes

Phil Blurton, the owner of All About Wellness, a cannabis dispensary in Sacramento, said earlier this week that it’s difficult to compete with unlicensed operators.

“Our city license now is $20,000 a year,” Blurton said. “The state license is $96,000. Then we pay 8.75% sales tax to the state.”

Blurton said he also pays an additional 4% cannabis tax to the city, plus the 15% tax to the state, “which is making the cost of our product so expensive the black market is booming now.”

“I would like to see our taxes lowered,” Blurton said. “I would like to see the price of our licenses lowered.

Jay Handal, the co-owner of the Erba Markets dispensary in Los Angeles, said that the current regulatory environment in California is encouraging illicit businesses.

“The reason the black market continues to exist is because taxes are too high,” said Handal, upon learning of the tax increase. “People are looking for the best value and the government, both state and city, are woefully poor at shutting down black market stores. Raising taxes will only exacerbate the situation by continuing to keep black market store prices ridiculously lower than legal dispensaries that carry tested products.”

Back to the Ballot Box?

Cannabis industry consultant Jacqueline McGowan blasted the decision to raise taxes at a time when licensed firms and ancillary businesses are announcing layoffs to deal with fiscal woes.

“California’s taxing authority’s decision to raise taxes during a time when the legal market is contracting is comparable to the Federal Reserve raising interest rates during a recession,” she said in an email to High Times. “It is the opposite of responsible fiscal policy.”

McGowan added that if current legislative attempts to lower the taxes on cannabis businesses fail, the industry may have to resort to a new initiative to correct the drawbacks of Prop 64, the 2016 ballot initiative that legalized the adult use of cannabis in California.

“If legislation is not enacted urgently then the industry may be facing a situation where a new voter initiative is the only path left to pursue in order to enact sufficient tax relief so that the legal cannabis industry has a chance at surviving and competing with a thriving $9 billion dollar unregulated industry,” she said.

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After a year of legal cannabis, Massachusetts is taking stock. Numbers released by the state’s Department of Revenue and its Cannabis Control Commission summed up the first phase of the regulated cannabis industry, announcing that the state’s 33 dispensaries had raked in a total of nearly $400 million in sales, and employed 6,700 individuals.

Massachusetts has largely dodged issues with illegal dispensaries such as those in California, even as a large share of in-state cannabis sales take place under illegal circumstances. It also faced its fair share of other challenges, among them ensuring social equity for people of color in the cannabis industry. The state has previously stated that a paltry 3.5 percent of the business entities that had filed with the state are owned by people of color.

Sales figures started out of the gate strong. The sole two dispensaries that were initially licensed in Northampton and Leicester rang up $2 million in customer purchases in the first five days they were open, and saw lines so long to get into the retail locations that the neighbors sometimes complained about the influx of car traffic.

The state is now home to 33 dispensaries, which have sold $393.7 million worth of cannabis products, generating $19 million in sales tax, $32.8 million in excise tax, and $9.1 in local option tax.

No Smooth Sailing in the Commonwealth

The cannabis industry was roiled by allegations that Fall River Mayor Jasiel Correia II had been accepting bribes from marijuana entrepreneurs in exchange for allowing them to open up their businesses in his city. Legally admissible types of bribery have also been a concern, with many communities asking marijuana companies for payments via “host community agreements.”

The Department of Revenue and the Cannabis Control Commission also identified several other ongoing issues that they hope to address in year two of cannabis sales.

One was the need to open more, geographically well-distributed cannabis stores. “I have no expectation there will be a retail store on every corner, but we have a lot more geographic expansion to do,” said the chairperson of the Cannabis Control Commission Steven Hoffman, explaining that the roll-out prioritized long-term quality over speed. “I was much more concerned about what this industry would look like in 2021 or 2022 than in 2018,” he said.

Hoffman also spoke about the necessity of getting more doctors and nurses to take on medical cannabis patients. “I think we’re missing an opportunity to substantially improve the lives of patients around the state,” the chairperson said. “We need to figure out how to engage the medical community in this.”

“I feel proud of what we’ve accomplished and I’m pleased with how the rollout has gone to date but we are in the early stages and have a ton more work to do,” said Hoffman.

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This week, the United States House of Representatives could be voting on the federal legalization of cannabis. Representative Jerry Nadler announced on Monday that the house judiciary committee had posted a markup for HR 3884 a.k.a. the Marijuana Opportunity, Reinvestment, and Expungement (MORE) Act — which means a vote could go down as early as Wednesday.

“I look forward to moving this legislation out of the House Judiciary Committee, making it one step closer to becoming law,” said Nadler in a press release.

From the get-go, the MORE Act looked like it had a better-than-average chance at making it through the legislative gauntlet than its many predecessors. The bill was created and introduced by Nadler of New York, who is the judiciary committee chair.

Pressure has increased on Congress to pass federal legalization ever since it approved the SAFE Act. That bill guaranteed banking protections for cannabis companies and financial institutions, raising many questions about why similar relief has not been given to cannabis users and the United States’ sizable population of individuals incarcerated on drug-related charges.

Primary on the MORE Act’s priorities is the re-classification of marijuana to remove it from the Controlled Substances Act and Schedule I category that defines it as a material with no medicinal value. It would empower states to craft their own regulations when it comes to cannabis.

New Law Would Also Tackle Dire Social Justice Issues

The MORE Act would encourage states to provide expungement for some past cannabis-related criminal offenses, and provide protection for marijuana users living in federally subsidized housing. It would remove restrictions currently on the Small Business Administration that block it from assisting cannabis entrepreneurs.

The MORE Act also looks to help vets. Currently, doctors with the VA are not allowed to speak with patients about medicinal cannabis usage, and residents in federally-assisted nursing facilities are not allowed to consume marijuana at their place of residence. The proposed legislation would lift those restrictions in states that choose to regulate cannabis.

The legislation is sponsored in the Senate as SB 2227 by 2020 Democratic presidential nomination candidate Kamala Harris, who has reversed her previous position on cannabis legalization to become one of the cause’s champions on the campaign trail. All the Democratic White House front-runners have endorsed federal cannabis legalization except for former vice president Joe Biden, who supports marijuana decriminalization.

On Tuesday, Nadler was joined by Representatives Barbara Lee, Earl Blumenauer, Nydia Velázquez, Steve Cohen, and Pramila Jayapal at a press conference to discuss the bill’s upcoming chance at a floor vote.

Key to the changing chances of marijuana legalization have been the issue’s increasingly bi-partisan support. Recent poll numbers tell us that 55 percent of Republican voters support legalizing recreational marijuana. Only 12 percent of Republican voters said that cannabis should not be legal for either recreational or medicinal use. The party has already taken note in some surprising parts of the country — Texas Republicans recently voted to add marijuana decriminalization to their state-wide platform.

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Listen to the podcast or read the transcript

Legal Landscape Of Cannabis Industry With Patricia Heer (Podcast Transcript)

Nov. 14, 2019 7:00 AM ET 

Patricia Heer is Editor and co-founder of Cannabis Law Digest, an online platform of legal resources for the cannabis industry.

With her extensive litigation and commercial experience, Patricia helps break down the convoluted legal landscape in the cannabis industry.

We also discuss why advocates have a problem with the SAFE Banking Act, the impediments to wide-spread legalization and the best ways for companies to navigate regulations.

Editors’ Note: This is the transcript version of the podcast we published yesterday with Patricia Heer. We hope you enjoy it.

Listen on the go! Subscribe to The Cannabis Investing Podcast on Apple Podcasts, Google Podcasts, Spotify, and Stitcher.

LISTEN TO THE PODCAST

Rena Sherbill: Today, I am happy to be joined by Patricia Heer, Editor and co-founder of Cannabis Law Digest, an online platform of legal resources for the cannabis industry. I interviewed Patricia at the CWCBExpo last month in LA. As we’ve mentioned before on this podcast, the cannabis laws are especially difficult to parse and in California the regulatory structure would be comical if it weren’t so frustrating and disheartening to stay in compliance. Patricia, with her extensive litigation and commercial experience helps break down the convoluted legal landscape for us.

Prior to serving as editor for the Digest, Patricia was special counsel at Duane Morris, LLP. and her clients have ranged from national advocacy groups and investors to direct and ancillary operators cannabis industry. Patricia is also a member of the State Regulations Committee of the National Cannabis Industry Association, a member of the Emerging Issues Committee of the National Cannabis Bar Association, a regular supporter of the New York chapter of Women Grow and CannaGather, and a member of the New York City Affairs Committee of the New York City Bar Association.

For reference purposes, this interview was recorded September 27, 2019.

Patricia, welcome to the Cannabis Investing Podcast. It’s great to have you.

Patricia Heer: Thank you. Thank you. Excited to be here.

RS: Okay Good. Tell us about what you do and who you work for.

PH: Sure. For the past 12 years I was at a National Law firm and then the last five years of those I did Cannabis Law and I found myself spending a lot of time searching between state agency websites and statutes and regulations and court decisions and I just found myself wasting a lot of time and I thought: how is that that we don’t have all of this information in one spot, all of these resources and hence the birth of Cannabis Law Digest, which is what I’ve been focusing on for the past year now since I left the firm, and basically we gather all of the state statutes and the regulations on the medical or at all use program in a particular state, any proposed changes because we obviously know that’s an issue in the industry.

We have those proposed changes to regulations also covered and court decisions that really interpret right, what a regulation says or let’s say, there is a dispute right, a legal dispute and litigation between operators or an ancillary business, we will cover those decisions. So, any cannabis decision that we think really affects an operator that an operator should know about or that an investor looking into a company should know about we will cover those cases.

So, federal cases, state cases, or even cases at the administrative tribunal level right we’ll have those because those also will affect how operators handle issues on a particular state with regard to let’s say, they tripped a regulation and so now they are facing a violation from the state regulatory authority, right. So, what’s going to be the penalty and other operators in that jurisdiction need to know that.

RS: So, can you talk about a few instances that have come up lately that you’ve looked at and been like this is a great case study and this is what it would be good for?

PH: I mean there is, you know, it’s interesting when we started this right, we saw cases trickling in, but more recently, I mean there is at least two on average, two three decisions coming out a week from federal and state courts. So, it’s kind of tough for me to pick an issue that’s really hot lately. I mean what we are seeing, you know, I will tell you this. What we are seeing is a lot of litigation heating up right.

So, litigation between former owners, you know that years ago just jumped into the industry because they saw the money and let’s face it, it’s a cash industry, right. We know all of the 280 issues, right, and how the industry has to operate, based on cash a lot [of the time] and so when you have two friends that go into business together and all of a sudden they are making money, right and all of this cash is pouring in, there is not necessarily standard operating procedures that are set-up.

There isn’t an operating agreement that they thought, you know what, we should really have an agreement; talk about the structure of how we’re going to operate and how we are going to make decisions, right. And then the money is pouring in, you know maybe someone takes the money because they need to pay the mortgage or something else and now all of a sudden right, you have a little bit of a fight between friends and who owns the company; who has been doing most of the operations, right. Who’s been spending more time on the business and now you have litigation. And so that’s what we’re seeing a lot.

We’re also seeing a lot of FLSA violation. So, labor and employment issues, right. How do companies need to treat their employees, what are the accommodations that they need to provide to an employee who is also let’s say a patient under the medical program in that state, right. Does the employer need to provide certain accommodations? Can the employer fire an employee, right, for testing positive in the drug test? You know, are there protections in that state that protect the employee. Do those protections allow the employee to then file a lawsuit against the employer for firing the employee on the basis of marijuana use? So, a lot of employee issues.

You know, and then in every state it’s funny because people say, Oh! Colorado and California, they are mature markets, they don’t have issues they are settled markets, but that’s not true. As a program matures, it sees that, you know what are these new issues that the industry is facing, how do we deal with it?

You know what, we don’t really have any regulations written for that. You know California started out with two pages of regulations. There are 200 now, you know because as the industry matures, you know the regulators are understanding, you know we need to provide guidance to the industry right and so we’ll see a lot of either guidance coming out of agencies, which we also report on or we’ll see administrative tribunal decisions that will also talk about those regulations.

RS: Given that you are coming from a background as a lawyer and somewhat of an expert in the law space, are you surprised by the kind of what’s the word, inconsistencies, in legislation?

PH: Oh! Inconsistencies. I mean, do you want to talk about, you know inconsistencies between federal and state or between state and state or state and local. Look, you know it’s interesting right, so historically my background was financial restructuring, right, bankruptcy and the way you know, really to get anything done right in bankruptcy, the premise and the goal of bankruptcy is to make a deal, right. Everyone is going to not come out as happy as they want in a bankruptcy, while all of the creditors will be harmed in some way, right from their point of view, but maybe someone will – maybe everyone will get something, right. And so, the point is to find a work around, right. And that’s what this industry is: finding workarounds, right.

As new issues come up, as new regulations change, right, you are thinking of ways to deal with it, but ya, you know it is, I mean, take 280E for instance, right, take the tax issue that the industry deals with, right. Operators that touch the plant, they can’t deduct expenses, right that they incur in running their business that a regular business can do, right. Because of the IRS code section 280E. Now, for a while because of this one case, the Champs case from California years ago, what the industry would do, is separate out their entity.

So, they would have the operator be a separate entity, let’s say from the management company, right. And for a long time, we thought okay you know then the management company can deduct expenses that it incurs as long as we keep them separate. Well, about a year ago there is a decision from the tax court that says no, no, if the management company, if the sole purpose for the management company is to support and provide services to the cannabis operator, guess what, you are one in the same entity and you can’t deduct expenses either oh and by the way, there is a double penalty now for not paying those taxes.

So, that’s tough in the IP world. You know what happened recently was you know a lot of the way the operators would protect their IP, their intellectual property is by registering with the state for a state trademark and also apply for a federal trademark, but because of the inability to get a federal trademark for cannabis you would get a trademark for let’s say your logo that appears on a hat, right. So, it would be in a different category. And with the hope that ultimately you can use this theory of the zone of insolvency to expand it to your other products, right.

Well we had a recent decision, the Woodstock case, where the court said, you know what that’s not a good argument at one point when you applied for a federal trademark, you had to say that your registration is for a product that is not involved with cannabis and so any hope of you using the trademark protection for a cannabis product in the future is now being used against you.

So, many changes in the industry at one point we think you know this is going to be a workaround that will work and the next minute we find out it’s not, but look, we know that getting into the industry, right. It is the gray industry, we know it, right. We know that it is tough and we have to find ways, you know to operate, even if it is illegal at the state level.

RS: It‘s interesting. I mean, I’ve heard people be so surprised at the laws that do pass and then the law that don’t get passed like everybody thought New Jersey was going to pass, it didn’t. I’ve heard very few people thought Illinois was going to pass, it did. The SAFE Banking Act that passed yesterday, what are your thoughts on all of that?

PH: Let’s take a look at what happened at the state level in Jersey because, you know, it really fits into what happened, almost happened with the SAFE Banking Act, right. So, in Jersey, you had a lot of advocacy groups, right, and you had a lot of interest, right. Some of those interests collided, some of those interests coincided, right. Ultimately, they were not able to make them work, right. Coincide and pass the legislation, right. There was an issue over expungement. Okay, of past records.

And at the federal level, right with regard to the SAFE Banking Act, what happened was it passed the full House, right? So, we will see what happens at the Senate level, but coming up to the days before the vote, there was letters sent, right from advocacy groups saying, hey House legislators, please don’t take a vote on this. And the reason they did that was because they were concerned about the effect on the industry as a whole and that if the House considered this bill it would only consider this bill and not legislation that addressed other issues in the industry, right that the industry struggles with.

So, the concern was look, you passed the SAFE Banking Act, if you are only going to look at one piece of marijuana legislation this year and this is the only one, the only thing you are doing is really helping the folks that are already in the industry, but you are not addressing other issues that we are concerned about, for instance how communities have been hurt by the war on drugs and fixing and fixing those issues, right.

So, there is the legislation out there, it’s the more legislation that addresses these issues and so these advocacy groups were pushing for that legislation to be considered instead. Right now, that did not happen, ultimately the House did have a vote, but and did pass it, but I find it interesting that these issues between possibly divergent interests, they’ve up until this point have played out at the state level.

To see that being played out at the federal level, you know on a standalone marijuana bill, you know it is the first standalone marijuana bill. I mean, that in itself is interesting. But to see those issues play out at the federal level on a marijuana issue, I think, it‘s indicative of possibly, look, it’s periodic change, right, maybe we are going to get there. We know that there’s tons of bills introduced, right? But maybe we’re getting to the point, where it’s more than just the introduction of bills. It’s consideration, and then a back and forth on them.

RS: What do you think about that? What‘s your idea for a timeline? I know, everybody hates answering this question. It doesn’t need to be the answer.

PH: Yes. You know what, it‘s interesting. I mean, look, the more I’m in the industry, actually, I think, you know, you start understanding all of the interests that that play out, right? So, I’ll use the SAFE Banking Act. Is it going to pass in the Senate? Well, who knows right? Because there, you do have interests there, right, that are opposed to the bill passing, for instance, right?

We have supporters of the hemp industry that are afraid that, that if we push that marijuana industry too much into legalization, that‘s going to overshadow hemp, right? And so, do I think for full-scale legislation, that’s coming soon? Absolutely not, because of those issues, right, there are legislators – congressional legislators from the Midwest states that just have no interest in legalizing marijuana, right?

I mean, we‘re now at more states that have a program than that don’t have a program. I think, we only have like three states that don’t have some sort of a program. There’s 17 states that have a CBD program, 11 that have a medical program, 30, 33 or something that have a medical program, sorry, 11 with an adult use program. And so, the initiatives are being pushed at the state level, but there’s still states that don’t have an interest, right, in pushing full marijuana legalization, right? Maybe hemp, maybe CBD, but I think it’s going to be years before that happens. And you’re not going to have that happen unless the citizens in that state are really pushing, right, their legislators to take up such legislation and to take any action on such legislation, right?

And so, if they‘re not pushing, the legislators are certainly not going to do anything on their own.

RS: It‘s interesting, most people when they talk about the holdups to legalization, they talk about people aren’t ready or there’s not enough data or all of these things. But it’s interesting to talk about how the hemp bill and CBD, that they’re worried about that overshadowing them and taking some of the shine off of what they could do easily – more easily. So, that’s interesting to think about like how many impediments there are to full-scale federal legalization.

PH: Yes, it really is. I mean, I – you‘ve got the hemp. You have advocacy groups. I think it’s funny, because a lot of our colleagues in Canada say, “How can you even really separate marijuana and CBD from the cannabis plant? It’s all in the one that – it’s all in the same plant, right. And we’re seeing that difficulty with having put in that separate infrastructure now, right, with states not being able to enforce their marijuana laws, right, because hemp smells and looks the same way, right? So yes, we’re definitely running into some issues with that.

RS: And it seems like the CBD Hemp market wants to position itself more as a health and wellness thing, not as a psychoactive substance?

PH: Yes. I mean, good luck with that from the FDA perspective. I mean, we have so far, the FDA right has made a statement that, it‘s neither a dietary supplement or a drug, because for drug you need to go through drug experiments right, and the required steps for approval for a drug to be able to make claims. And then, same thing from a dietary supplement, doesn’t fit into the definition. So, just hold off and just wait until we come out with regulations. We’re looking into it, we’re gathering information. But ya, the CBD and hemp market are pushing for that, but we see clearly the FDA cracking down and writing warning letters to the industry.

RS: Right. And Health Canada, for that matter.

PH: Oh, no, no, I mean, we‘ve seen in Canada, previously, right, where you were able to take your company and list it on the exchange up there, right, on the TSE, as long as you had a business plan, right, and you had a good team. Now, they’re really looking into your company. I mean, obviously, with CannTrust (OTC:CTST) what’s happening, right? The regulators are taking another look.

RS: So, do you see any kind of lessening of those stringent measures, because people think it‘s going to die down once the FDA kind of makes itself felt and people, the companies change their packaging, if that’s the issue or the wording on the packaging, if that’s the issue? But do you think they’re just going to keep pushing kind of the goalpost further and further?

PH: Ya. Look, I think as an industry matures, I don‘t think you’re getting less regulations, you’re getting more regulations right, because the regulations are tried, the regulators are trying to keep up with the industry, what’s happening, what kind of guidance do we need to put out there, right, either from a safety perspective or from an operation perspective?

You know, like I said, in California, right, we started out with two pages, we‘ve got 200 pages. At the federal level, it’s going to be the same thing. Everybody’s gunning for descheduling, take it off the Controlled Substances Act. Well, that really, okay. So, that’s fine. We’ll make it legal, but that doesn’t mean that it’s not regulated by some other entity, right, like the Food and Drug, Cosmetic Act, like the FDA or for hemp, right, like the U.S. Agricultural Department, right? So, it’s not less regulations that you’re going to see.

RS: So, I don‘t know how much you pay attention to the various companies that play in this space, but if you do, who do you see as being the companies that are best able to navigate this? Or do you see kind of a pattern of people that think that they can handle it, and then they can’t handle all the regulatory hurdles?

PH: Ya. It‘s tough, right? I do see, for instance, a lot of operators who, at one point had operations in a couple jurisdictions, and then just realized you know what, the compliance, the resources it takes for compliance, right, to be compliant, is just too much to focus on every single jurisdiction that we’re in. So, let’s just focus on being really good in one jurisdiction. And once we get that down, then we’ll expand, right. But you got to remember that once you expand, again, it’s a whole new separate ballgame, right, because every state is different. And so, I’ve seen a lot of that. And I think those are the companies that are going to be a lot more successful from a compliance, regulatory standpoint, not facing either warning letters or violations, or frankly, cease and desist letters from other operators, or from – or a – from litigation standpoint.

So, ya, I think, it‘s the entity that really focuses on being really good in the market that they’re in before they really just start buying up entities and other – in other jurisdictions and then focusing on trying to operate all at once. Unless you have the resources to do it, right, unless you have the infrastructure and resources to do it. But a lot of entities in this space are startups, right? So, it really depends on what market you’re in, at what stage your businesses in, and what your – obviously, what your goals are. I think, most of the time companies are looking to be compliant, because obviously, if you’re thinking of the exit strategy, right, that that’s obviously going to increase your value.

RS: So, given that, would you say that like multi-state operators have kind of a leg up in that regard, because they‘re navigating different states?

PH: Look, they have a leg up from the perspective of, we tend to think that they have more resources to spend on compliance. So, I – in-house counsel, they have money for databases, right, checking outside counsel. But does that mean that they are any more successful in navigating the state laws than a small operator who‘s, let’s say, maybe in two states, right, and just really focusing on one product and really focusing on building their brand, I’m not sure about that.

RS: And let me ask you, what‘s your feeling on – there’s a lot of talk about the social justice aspect of cannabis and how unfair and racist the laws have been up until this point? What do you see the future of it? You say, it’s years away, probably federal legalization. How do you see it playing out? Let’s say, I mean, the fact that there’s people sitting in jail right now for selling marijuana. And yet here we are at a conference, the SAFE Banking Act just passed. We know how much money’s pouring into it. What do you think about that? How do you think it’s going to play out?

PH: It’s interesting. So, you‘ve got social equity programs, right, in a number of states that are part of the programs. For instance, in Massachusetts, right, there’s a social equity portion, part of that program. And in California as well, right, the applications were due just recently.

The difficulty there that you‘re seeing is, you could have a state attempt, right, to remedy the situation, right, the disparate impact that occurred. But at the same time, if your regulations for the program as a whole don’t match your social equity program regulations and initiatives, then that’s going to be tough for you to implement.

So, let me give you an example. In Massachusetts, for instance, what we have is these host community agreements, right, that you‘re required to get from your local municipality before you can receive a license from the state, right? These host community agreements, they basically set out the structure of how you’re going to operate in that community and the fee that you’re going to pay to the community, to whether the county government or city, to offset the impact that your business will have on the locality. There’s a cap on that fee.

But what‘s been happening is that fee has been categorized into a different term, let’s say. And so there’s been workarounds on that cap. And so basically, what applicants are saying is, look, this is extortion. We’re paying way more than what’s permitted under the legislation. This was never the intent of these hosts community agreements. But basically, because we want to get a license and because we’re required to get a host community agreement, we have no choice, but to pay this amount. But guess what? We can’t even pay this amount, because it’s now so exorbitant, and we can’t compete with the larger operator who can pay that exorbitant fee. That now me who’s, let’s say, a startup, right, with not that much funding behind me that wants to start a company. Now my chances of getting a host community agreement in that particular locality, right, are decreased, because my competitor who’s got huge funding, let’s say, backing behind them can afford the fee, and they’re the ones that are going to get that host community agreement. And therefore, they’re the ones that are going to get the license, especially in the community, let’s say, that limits the number of applicants that can go into that jurisdiction, right?

So, it‘s almost, when you think about, okay, well, Massachusetts wants to increase the number of their diverse businesses, right that are going to be operators, you know that’s difficult, right? And small business operators, that’s difficult to do when you have this other regulation that requires an agreement that will charge the small business a fee that they can’t afford.

RS: Man.

PH: Yes, it‘s a lot.

RS: You have a lot at your fingertips. It‘s – I can’t even imagine how many laws you studied on this. But it seems like for, however, many laws you study, we kind of know – none of us have any idea of what, how it’s really going to play out?

PH: No, and it‘s always changing, like I said. Someone asked me yesterday or this morning, maybe, do you put out something in print? And I said, no, that would be a complete disservice on my part, things are continuously changing, right? I mean, we constantly have proposed regulations, that then there’s a hearing on, right, that then gets implemented or emergency rule. If I put something out in print, I’d have to change it, do a reprint in an hour, yes.

RS: Right. Well, I think you‘ve given us a lot of things to think about, a lot of things to be concerned about maybe. But I think it’s really great to get that kind of realistic perspective, not from an executive, not – even from an industry expert, but from a law expert to just break it down to the black and white of it. So, I really appreciate you coming on and sharing with us your expertise and your knowledge.

PH: Thank you. My pleasure.

Source: https://seekingalpha.com/article/4306494-legal-landscape-cannabis-industry-patricia-heer-podcast-transcript

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TRENTON, N.J. (AP) — Candy, cocoa and chocolate, as well as any other flavor of e-cigarette, are among the flavors New Jersey lawmakers sought to prohibit on Thursday, along with a separate ban on menthol-flavored traditional cigarettes.

New Jersey’s Democrat-led Assembly and Senate health committees advanced the legislation after several hours of testimony that drew crowds of supporters and opponents to the statehouse annex.

Supporters of the flavor ban say it hooks kids on nicotine. Opponents worry the ban would lead to a black market and could also hurt some businesses in the state.

Democratic Gov. Phil Murphy supports banning e-cigarette flavors since a commission he established to come up with the state’s response to nationwide vaping-related outbreak recommended the prohibition last month.

His office declined to comment on the menthol cigarette ban.

That measure sparked some heated rhetoric from one lawmaker in particular.

Democratic state Sen. Ronald Rice, of Newark, chairs the Legislative Black Caucus and opposed the legislation. Rice pointed to the timing of the prohibitions coming as the state is also considering legalizing recreational marijuana, which he also opposes and says would likely harm the black community because he says businesses would likely be controlled by large, white-run companies.

“I’m an African-American. I’m a black legislator, and we continue to have folk in the Legislature and the governor tell us what’s doing harm to the black community,” Rice said. “We know what harms us as a people and a community.”

Lawmakers say they’re seeking to ban menthol cigarettes in particular because they’ve been marketed to black consumers for decades.

Senate health committee chairman Democratic Sen. Joe Vitale says he agrees with Rice that it’s important for lawmakers to understand the communities that legislation will affect.

“I’m a middle-class white legislator. I can’t pretend to understand what life is like in some of those underserved communities,” he said in a phone interview.

The e-cigarette flavor ban goes back to 2016 but took on new urgency earlier this year when more than 2,000 Americans, many of them young people, have gotten sick this year from vaping. At least 40 people have died.

The cause of the outbreak was still a mystery when Murphy’s panel recommended the flavor ban, but since then federal health officials recently announced a breakthrough in identifying the culprit.

Health officials reported that vitamin E acetate was found in vaping devices used by those who got sick. Most of them also used black market products containing THC, the ingredient that produces a high in marijuana.

By Mike Catalini

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At 12:01 p.m. on November 12, Massachusetts’ emergency ban on medical cannabis vaping products expired. But in its place, the state’s Cannabis Control Commission immediately instituted a quarantine of all medical marijuana vaping devices and products, with the exception of devices that vape flower. Officials with the Cannabis Control Commission say the quarantine isn’t as far-reaching as the Department of Public Health ban that a state judge ruled exceeded the agency’s authority. However, the state’s ban on nicotine vape products and recreational cannabis vape products remains in place.

As Ban Expires, Massachusetts’ Cannabis Control Commission Blocks Sale of Medical Cannabis Vapes

Last Tuesday, Massachusetts Superior Court judge Douglas Wilkins blocked Gov. Charlie Baker’s administration from enforcing its emergency ban on medical marijuana vaping products. The authority to regulate medical marijuana, Wilkins ruled, belongs entirely to the state’s Cannabis Control Commission.

Medical marijuana vaping products, along with nicotine-based vaping products like e-cigarettes and recreational cannabis vape products like THC cartridges, were all banned under emergency regulations Gov. Baker and the Department of Public Health filed in late September.

The blanket ban on vaping devices came as a response to the nationwide rash of vape-linked illnesses and deaths that hospitalized thousands with unknown lung diseases. As health experts rushed to determine a specific cause connecting vaping to the outbreak of lung illnesses, politicians in several states acted quickly to institute temporary bans on all vaping products.

But after a series of legal challenges, Judge Wilkins ruled in late October that Gov. Baker’s administration did not follow the legally required procedures to institute such a ban. Wilkins’ ruling kept the ban in place, but ordered Baker’s Department of Health to adhere to all of the steps of the process, which include holding public hearings on the emergency ban and assessing its economic impact on small businesses.

Under Quarantine, Massachusetts Medical Cannabis Patients Can Only Vape Flower

Then, on November 5, Judge Wilkins ruled that the governor’s ban on medical cannabis vaping products specifically was unconstitutional. Wilkins cited the “exclusive powers” over medical marijuana regulations granted to the Cannabis Control Commission. In banning medical cannabis vaping products, the Department of Public Health had “very likely exceeded its authority,” Wilkins wrote in his decision.

The ruling kept the ban on medical marijuana vapes in place for a week in order to give the commission time to make a decision regarding the ban. If the commission took no action, then the ban would expire at noon on November 12.

But just as the ban was coming to an end today, the Commission issued a quarantine on all medical marijuana vaping products except devices that operate exclusively with dried flower.

Under the quarantine, medical cannabis patients cannot access vape pens designed to work with oils or concentrates, vape cartridges, aerosol products or inhalers.

The Cannabis Control Commission said its decision stems from a recent CDC report linking the common vape cartridge additive vitamin E acetate to the spate of lung illnesses and related deaths. Under the commission’s current regulations, testing protocols do not require screening for vitamin E acetate. As such, legal cannabis products sold at licensed dispensaries could contain the suspect additive, the commission said.

Massachusetts Regulators Work to Improve Testing for Suspect Vape Additives

Retail operators that sell quarantined products are now required to place administrative holds on those products in the state’s tracking system. The commission is currently working with third-party testing labs to improve their capacity to screen for vitamin E acetate and other suspect ingredients.

The commission’s decision has already drawn criticism from cannabis industry groups and patient advocates. They say the ban effectively pushes patients back into the illicit market. Many experts believe counterfeit vape cartridges widely available on the illicit market are the primary source of vape-linked lung illnesses. Cannabis Control Commissioner Shaleen Title said the quarantine was a response to the credible evidence provided by the CDC report.

Meanwhile, the state’s ban on nicotine vape products and recreational cannabis vape products will remain in effect. In line with Judge Wilkins’ ruling, the Baker administration will hold a public hearing on the vape ban later this month. The state Supreme Judicial court will begin hearing lawsuits against the ban from business owners and cannabis industry representatives in December.

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Actress and artist Bella Thorne has launched a new cannabis brand in California, teaming up with vertically integrated producer Glass House Group. The new brand, Forbidden Flowers, will offer sun-grown cannabis products from the company’s cultivation division, Glass House Farms.

Thorne said in a press release that cannabis has long been part of her personal wellness regimen.

“I have struggled with anxiety for many years, and weed was the one source I found for me to do the most healing,” she said. “Because of the properties in weed, I have been able to cope with my anxiety in a natural way.“ 

Bella Thorne elaborated in an interview with High Times.

“I’ve always had stomach problems, and I saw a ton of gastroenterologists as a kid. They always prescribed pills… I don’t believe in that. I won’t even take an Advil or Tylenol. My brother was the first to suggest weed, and it really helped. Then with my anxiety I started to really see the health benefits it could provide.”

Bella Thorne, 21, is an actor, artist, singer, and director who got her start in the entertainment business at the age of only six months. She gained notoriety for her work in the Disney Channel series “Shake It Up” in the role of CeCe Jones, and right after releasing a book this summer titled ‘The Life of a Wannabe Mogul’, won a Pornhub Vision Award for “Her & Him,” which was her debut as an adult film director. There’s little Thorne touches that doesn’t turn to gold, it seems.

Courtesy of Power Plant Strategies

New Brand Features Sun-Grown Cannabis Flower

The Forbidden Flowers line will offer indica, sativa, and hybrid flower packaged in glass jars and pre-rolls available individually and in packs of five. Glass House Group president Graham Farrar said that the collection was produced at its operation in Santa Barbara especially for Thorne. 

“Bella’s entire product line has been cultivated at our sun-powered, state-of-the-art facility in California using the same high-quality control and earth-friendly approach we are known and respected for,” Farrar said. “We brought some genetics that we grew specifically for Bella for this launch, and we’re confident that both our long-time customers and new consumers are going to love these new product lines.” 

“I’ve been invited to a lot of grows, so I know what I like. I like outdoor flower. There’s something about indoor, maybe the recycled air, that hurts my throat.” Thorne noted to High Times, “As soon as I got to Glass House, I saw the farm and said ‘Oh shit—this is my place!”

The new brand aims to capture an empowered, rebellious feeling that can be inspired by cannabis use. Glass House Group chief marketing officer Groovy Singh said the company’s team spent time with Thorne so that they could understand her as an individual as they created the brand with her.

“Her creative direction on Forbidden Flowers has been absolutely artistic and impressive,” Sing said. “We’re proud to join forces with Bella in rolling out this sexy, enticing, high-quality brand that embodies her captivating spirit.” 

“The authenticity of what we are bringing to market together with Forbidden Flowers is what Bella handpicked at our grow, consumed and loved,” added Singh. “At a time when more people are exploring the power of cannabis, we look forward to introducing a whole new community to the benefits of cannabis and to Bella sharing with her fans and consumers the ways she incorporates cannabis and CBD into her daily lifestyle.”

“I mean, I fucking love these strains, I’m not going to lie. When I left the farm after I first smoked it, I felt euphoric…” Bella told High Times. “I was in the car, and I had my head all the way out the window – I like to do that – and I just felt so happy… I don’t know, I don’t feel that way all the time. Happiness comes and it goes, you know? But this weed—it literally makes you feel lighter on your feet, calmer in your decision making.”

Recognizing that more new consumers are eager to become better educated about cannabis and CBD, Thorne plans to share the various ways she incorporates cannabis and CBD into her lifestyle, health, and wellness regimes with her nearly 29 million social media followers on Instagram, Twitter, and YouTube.

“I want to put CBD in my makeup line, I want to put CBD in my skincare—I’m a really big believer in the marijuana plant.” Bella said. “This younger generation needs another [one of their peers] explaining the benefits. If you’re going to do it, do it right.”

“We set out to engage a whole growing community of consumers embracing the cannabis and CBD market,” said Glass House Group CEO Kyle Kazan, who hinted that the company may have more celebrity cannabis collaborations on the way. 

“We also look forward to rolling out more strategic brands and announcing partnerships in the future,” he said.

Bella Thorne’s Forbidden Flowers brand is now available at select cannabis dispensaries in California. Each Thursday evening through November 21, the Forbidden Flowers Instagram page will reveal a new dispensary location that will be carrying the brand beginning the next day.

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Nearly 500 inmates were set to be released from prison in Oklahoma on Monday. The move by state officials comes in response to a push to reduce mass incarceration in Oklahoma that was put into motion by voters in 2016.

On Friday, the Oklahoma Pardon and Parole Board voted to recommend that the sentences for 527 state inmates be commuted by Republican Gov. Kevin Stitt. Of those, 426 were scheduled to be released from custody on Monday after being processed and receiving Stitt’s signature.

“They’ve got a lot of paperwork to do,” Stitt said of the secretary of state’s office. “I’ve got to sign 450 of these this afternoon.”

Steven Bickley, the executive director of the Pardon and Parole Board, noted the significance of the move in a press release on Friday.

“This is a historical day for criminal justice reform in Oklahoma, as we send the largest single day commutation of sentences in our nation’s history to the governor’s desk,” said Bickley. “With this vote, we are fulfilling the will of Oklahomans. However, from day one, the goal of this project has been more than just the release of low level, non-violent offenders, but the successful reentry of these individuals back into society.”

Reducing Mass Incarceration

The commutations come amid an effort to reduce the incarceration rate in Oklahoma that was put into place by the state’s voters in 2016. With the passage of State Question 780 and 781, certain simple drug possession charges and nonviolent property crimes less than $1,000 were reclassified from felonies to misdemeanors. The ballot propositions also mandated that savings realized from reducing incarceration be used to fund drug treatment and rehabilitation services.

“It has been a moving experience to see our state and community partners help connect our inmates with the resources they need for a successful reentry and I thank Governor Stitt, DOC Director Scott Crow, and the many local nonprofits, churches, and job creators that stepped up to ensure these inmates have every opportunity for success,” Bickley added.

With a bipartisan vote in January, lawmakers made the criminal justice reforms approved by voters apply retroactively and authorized the prison board to schedule dockets for the mass commutation of sentences. On Friday, the first day the law went into effect, 814 prisoners applied to have their sentences considered for commutation.

Stitt, who campaigned for office promising to reduce the state’s prison population, applauded the work of the Pardon and Parole Board.

“This event is another mark on our historic timeline as we move the needle in criminal justice reform, and my administration remains committed to working with Oklahomans to pursue bold change that will offer our fellow citizens a second chance while also keeping our communities and streets safe,” he said.

Ryan Kiesel, the executive director of the American Civil Liberties Union of Oklahoma, said that the reforms signal a change in the state that was sparked at the ballot box.

“From the 30,000-foot view, the criminal justice landscape is light-years ahead of where it was three or four years ago,” Kiesel said. “It would have been impossible before State Question 780 passed in Oklahoma; that signaled to lawmakers there was an appetite for reform.”

Oklahoma has an incarceration rate that is 10 times higher than Canada’s. At any given time, more than one out of 100 adults in the state are behind bars.

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Iowa’s Medical Cannabidiol Board will consider changes to the state’s limited medicinal cannabis program on Friday, including petitions to add new medical conditions that qualify patients to participate in it. The board will also consider a proposal to replace a 3% limit on THC in medical marijuana products with a purchase limit on the high-inducing cannabinoid.

During its last meeting of the year on Friday, the board is expected to vote on adding post-traumatic stress disorder (PTSD), opioid use disorder, Alzheimer’s disease, and intellectual disability with aggression and/or self-injury as qualifying conditions for the state’s medical CBD program. Currently, the program is only open to patients with chronic pain, seizures, Crohn’s disease, multiple sclerosis, HIV/AIDS, amyotrophic lateral sclerosis (ALS), Parkinson’s disease, cancer with specified symptoms, and terminal diseases with a projected life expectancy of less than one year.

The petitions to add PTSD, Alzheimer’s disease, and opioid abuse disorder were submitted by one of the state’s two authorized medical cannabis producers, MedPharm Iowa. Lucas Nelson, the general manager of MedPharm Iowa, said that the petition to add PTSD cited more than 60 sources that demonstrate the efficacy of medical marijuana for treating people with the condition, making it one of the company’s most comprehensive proposals submitted to date.

“It’s not going to work for every single patient, but in this compassionate care program, there’s no reason it would not be one of the approved conditions,” Nelson said.

Doug Bosswick, the acting general manager of Iowa Relief, a Cedar Rapids medical cannabis manufacturer, said in a statement that the state’s program should be open to more patients.

“We believe cannabinoid medicine can be effective for a variety of ailments and plan to closely follow the state’s decision on the addition of qualifying conditions proposed by legislators,” Bosswick said. “If approved by the board, we would be happy to serve patients who suffer from any approved qualifying conditions.”

If the Medical Cannabidiol Board votes to approve one or more of the petitions to add qualifying conditions to the state’s medical cannabis program, they will continue to the Iowa Medical Board for another vote there. Petitions receiving the approval of the medical board will have an effective date set for patients to have their condition certified for the use of medical marijuana.

THC Limit Change Also Proposed

Also during Friday’s meeting, the Medical Cannabidiol Board is expected to consider several recommendations from its 2019 annual report that will be sent to lawmakers prior to the 2020 session of the state legislature. One of those proposals would replace a 3% limit on the amount of THC permissible in medical marijuana products with a purchase limit.

Under the proposal, patients would be able to purchase products containing a total of up to 4.5 grams of THC in a 90 day period. The purchase limit would not apply to the terminally ill and could be increased by the certifying physician without board approval.

Earlier this year, a bill that would have removed the 3% THC limit and make other changes to the state’s medical marijuana program was passed by the state legislature but Republican Gov. Kim Reynolds vetoed the bill in May.

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The artist and activist Domenic Esposito has created “The Opioid Spoon Project,” featuring four 800-pound sculptures depicting spoons used for opioids, which he has displayed outside drug companies. One of the sculptures, called FDA Spoon for the initials of the Food and Drug Administration that are engraved on the end, was displayed outside the federal agency’s headquarters in Washington, D.C. That piece was on display on the campus of Boston University for three weeks last month. Beginning November 6, it will be on display at the Mountainside Recovery Center in the Manhattan neighborhood of Chelsea.

“Our goal is to generate awareness about the intersection of art, activism and recovery; and the reality of the opioid crisis in the U.S.,” Esposito said in a statement.

Each of the four sculptures depicts a partially burnt spoon with a pool of liquid formed in the bowls, the byproduct of heating up heroin or crushed pills. Esposito’s first sculpture was placed outside the headquarters of OxyContin maker Purdue Pharma in Connecticut last year.

“I had kind of an epiphany about a year before,” Esposito said in an interview with BU Today, a publication covering news at Boston University. “I spoke at an event at my local parish about what my family was going through and the recovery services the archdiocese offers. You know, it’s a Sunday morning, everyone’s sort of half asleep, then at the end, you do the coffee and donuts. And I got approached by all these families, people saying my son or my daughter or my granddaughter is in a similar situation—I’m glad you opened up. So many people had the same story. There’s this sense of hopelessness. I was already doing a lot of art, so I thought, why don’t I make a huge statement with this spoon. Guerrilla art, sort of.”

Esposito told the publication that he opted to depict spoons rather than needles for a variety of reasons.

“First, it’s the symbolism behind a tool that is supposed to feed us and nourish us,” Esposito said. “Second, it is a clear sign that something is wrong when a drawer is missing spoons. I have heard this said by so many parents. Third, the spoon can be used for all opioids, including oxys and so many other drugs. The fact is that 80 percent of heroin users start on a synthetic opioid.”

According to the National Institute on Drug Abuse, more than 130 people die each day in the United States from overdosing on opioids.

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The fall edition of Topics and Trends,* published by the Washington State Liquor and Cannabis Board, is available for viewing.

Inside this edition:

Need to Make License Changes?

Who should I contact for general questions about my marijuana license?

You and Your Enforcement Officer

Extraction Requirements – Fire Marshal, WSLCB Approval, and Ethanol Permits

Washington’s Outdoor Cannabis Harvest – A Refresher on Traceability Workarounds

Hemp: Information Available on WSLCB Website

Emergency Rules Adopted Regarding Flavored Vapor Products

Licensing Division – Diversity, Equity and Inclusion Update

* To view as intended, please be sure to use Google Chrome or ensure your browser is current.

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Regulators in Michigan will begin accepting applications for licenses to operate businesses in the state’s coming adult-use cannabis market on Friday. The Michigan Marijuana Regulatory Agency will accept applications for several different license types on its website beginning at 12:01 a.m. on Friday, November 1.

The agency expects to begin issuing adult-use licenses to companies that are already licensed to grow, process, test, and retail medical marijuana as soon as late November, according to media reports. But once those licenses are issued, it will still take months for recreational cannabis to reach consumers, according to Joe Neller, the co-founder of medical marijuana producer and retailer Green Peak Innovations, which has permits allowing the cultivation of 18,000 plants and operates four dispensaries in Michigan.

“If the state takes all of the 90 days afforded to them by law to review our application and grant us a license, then we could start producing that adult-use product,” Neller said. “It does appear the state is going to make us begin those plants basically from seed or clone, so that would take another six months to grow the product, harvest it, pas[s] testing, package it up and get it into market, so anywhere from six to nine month[s] from Nov. 1 is how we’re modeling it.”

Application fees for adult-use cannabis licenses run $6,000, whether or not a permit is eventually issued. Once a license is issued, annual renewals, starting at $1,000 for cannabis event organizers and ranging up to $40,000 for large cultivation and processing operations, are also required. Applicants are also required to carry $100,000 worth of bodily injury and liability insurance.

Medical Cannabis Businesses Given Head Start

Until 2021, only organizations that are currently licensed to operate medical marijuana businesses will be permitted to apply for licenses required for the largest adult-use cultivation and processing facilities. Robin Schneider, the executive director for the Michigan Cannabis Industry Association, said those provisions were written into the ballot proposal that legalized recreational cannabis so that medical marijuana businesses would be able to get a head start in the adult-use market.

“We knew that we needed to have the support of the medical licensees as we were moving into election day, and so that was done on purpose to ensure that their investments were protected,” she said.

Applications for businesses in the retail cannabis supply chain including cultivators, processors, testing labs, and transporters will be accepted. Other license types available include cannabis event organizers, temporary events, and onsite consumption establishments.

Regulators are unsure how much demand there will be for the state’s adult-use cannabis business licenses. When licensing for medical marijuana operations began in 2017, far fewer applications were received than authorities anticipated.

“We were anticipating a big turnout when medical started and it was more a trickle, but we’re preparing for all possibilities,” said Michigan Regulatory Agency spokesman David Harns.

The agency plans to release preliminary data on the applications it receives beginning Friday evening.

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SALT LAKE CITY (AP) — As Utah prepares to launch its medical marijuana program next year, residents who want to use the drug in the meantime are encountering skeptical doctors and the quandary of where to get the plant.

A law passed by the Utah Legislature in December 2018 allows residents to use medical marijuana before patient cards are officially doled out, which is expected to happen in March 2020 at the earliest, but they must obtain a signed letter of recommendation from a doctor, physician’s assistant or other medical provider.

Finding a doctor willing to do that has been difficult because of stigmas and fear surrounding medical marijuana, said Christine Stenquist, the director and founder of advocacy group Together for Responsible Use and Cannabis Education, or TRUCE.

And, the doctor’s letter doesn’t specify how patients can legally obtain medical marijuana. Although growers are beginning to cultivate the plant throughout the state, residents still can’t legally purchase medical marijuana in Utah, forcing them to drive several hours to states where the drug is legal or turn to the black market.

Mitch Hill, 48, began using medical marijuana two months ago to treat the severe back pain he’s dealt with for 10 years. It took Hill six months and three doctors to obtain a signed recommendation letter.

“Our family doctor didn’t even want to talk about it, they wanted nothing to do with it,” said Hill, a construction superintendent from the Salt Lake City suburb of West Jordan.

Hill drives five hours to the nearest dispensary in Colorado a few times a month to purchase medical marijuana.

Juggling work, children and his throbbing back, the trip is “a massive pain in the butt,” he said.

He turned to marijuana because he said opioids and other painkillers turned him into a “walking zombie,” feeling groggy, fatigued and nauseous. Medical marijuana helps his pain dissipate and relax, Hill said. He’s able to be more productive in his job and take care of his children.

“The letter has been a great thing for our family,” Hill said.

State health officials aren’t tracking how many people have doctor’s letters allowing them to use medical marijuana, but it appears there are thousands at least based on information from major medical providers and advocates.

The letters are a “stop-gap measure” before the state’s official medical marijuana program is launched, Evan Vickers, the Senate Republican Majority Leader, said.

“We wanted to try and give patients access to the medication as soon as possible,” he added.

He said the formal program will make it much easier for people to get and use medical marijuana, eliminating trips to neighboring states and long searches for willing doctors.

Patients must meet a list of qualifying conditions_cancer, chronic pain and epilepsy are among the most common— and have the product in the correct dosage. Under the current law, this would likely be an oil or capsule. Next year, patients must still follow the dosage requirements but can appeal to a board of medical providers if they don’t meet one of the qualifying conditions.

Utah is one of at least nine states that allowed recommendation letters to protect unregistered patients, according to data from the Marijuana Policy Project, a Washington-based group that advocates for legalization.

Chris Lindsey, senior legislative counsel with the Marijuana Policy Project, said the states dealt with similar legal challenges and called the letters a “double-edged sword.”

“It helps sick people get relief, but it can create a false sense of security,” he said. “Moving a controlled substance across state lines is still against federal law, and then it’s up to the patients to defend themselves in court.”

Marijuana is banned at the federal level, though a congressional amendment blocks the Justice Department from interfering with states’ medical marijuana programs.

Patients are putting themselves at potential risk of being arrested for drug-related crimes, advocates said, but it is unclear if law enforcement agencies are citing patients who have letters.

Salt Lake County District Attorney Sim Gill, the prosecutor in Utah’s most populated county, said he sees the letter as a critical legal tool in deciding whether to press charges in drug-related crimes.

“I have zero desire to prosecute a patient in need for possessing medical cannabis, and I’ve advised prosecutors the same,” Gill said.

Among Utah’s doctors, the letters have received strong, mixed reactions.

Intermountain Healthcare, the state’s largest health provider, began allowing its doctors to write letters in February. While some doctors applauded the move, others said they aren’t comfortable writing the letters, citing lack of research into medical cannabis and its federally illegal status, said Mark Briesacher, the hospital’s chief physician executive.

A growing national outbreak of lung damage linked to unregulated vaping products containing marijuana’s high-inducing ingredient THC have further compounded concerns, he said. In Utah, one person died from a vaping-related injury.

Stenquist expressed frustration with the challenges Utah’s medical cannabis program has faced but said she’s hopeful for a smooth rollout next year.

“Patients don’t want to break the law, they’re just trying to get access to medication,′ she said.

By Morgan Smith

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SALT LAKE CITY (AP) — Several Utah vape shops sued the state’s Department of Health over its emergency rule restricting the sale of flavored e-cigarettes amid a national outbreak of lung damage linked to vaping.

In the lawsuit filed Monday, retailers claimed there is no evidence to suggest flavored e-cigarettes are causing lung damage and that the new rule could hurt business.

Recent cases of lung damage, they argued, are instead caused by “these persons’ use of black-market THC cartridges,” according to the lawsuit.

The rule, which took effect Monday, bans general tobacco retailers including grocery stores, pharmacies and gas stations from selling flavored e-cigarette products. All tobacco sellers are required to post notices about the danger of vaping unregulated THC, the high-producing ingredient in marijuana that’s been linked to most lung-damage cases in Utah.

All vape shops involved in the lawsuit are general tobacco retailers that can no longer sell flavored vape products under the rule.

The retailers said the health department enacted the rule without public comment and that the ban would cause “irreparable harm to their business reputation” to the point that they would be “forced to close their businesses.”

Utah has been hit especially hard in the national outbreak. State health officials have identified 98 cases and one person has died. Many patients are in their 20s and 30s.

“We know many young people who vape THC initially vape nicotine, especially flavored nicotine,” Joseph Miner, executive director of the state health department, said in a recent statement. “Moving these products to age-restricted specialty shops will restrict young people’s access to them and can reduce the number of users who eventually move on to vaping THC.”

Tom Hudachko, a department of health spokesman, declined to respond to the lawsuit’s claims but said stopping the outbreak is the top priority. He said reducing young people’s access to nicotine vaping and THC products is key.

The U.S. has seen an explosion in youth vaping in recent years, with critics saying the industry is marketing flavors that appeal to teens.

President Donald Trump’s administration has proposed a sweeping ban on e-cigarette flavors. Several states have already done so.

Nearly 1,500 people across the country have become sick from vaping, and 33 people have died, the Centers for Disease Control and Prevention has reported.

Symptoms include coughing, shortness of breath, chest pain, fatigue, nausea and vomiting.

Health officials throughout the country are advising people not to use any vaping product until the cause of the illnesses is better understood.

By Morgan Smith

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October 7, 2019 Advocacy, Commerce, Federal Commerce- USA, general, Industry Professionals, Kight On Cannabis, News, Publicity, Rod Kight, States Commerce Rod Kight

The International Cannabis Bar Association (INCBA), held a Cannabis Law Institute in New York City on October 3-5, 2019. It offered continuing legal education (CLE) classes on a wide array of cannabis law topics by some of the most active cannabis law attorneys in the country, including Kight Law attorneys Rod Kight and Kamran Aryah. Rod moderated two panels, “Ancillary Federal Agencies” and “State Level Issues”. Kamran spoke on the “Heavy Hitting Agencies” panel. Rod was also a “track coordinator” for the event and coordinated speakers and materials for three panels.

INCBA “strives to improve the level of legal service available to the cannabis industry and to make the everyday practice of law for the attorneys serving this industry more efficient, more secure, and more accessible through educational events, an International network of the most experienced legal counsel in cannabis, and advocacy for the legal profession and those engaged therein.”

Here are some pictures from the event:

CANNABIS LAWYER ROD KIGHT AT THE INTERNATIONAL CANNABIS BAR ASSOCIATION 2019 CONFERENCE AT NEW YORK LAW SCHOOL.

ROD KIGHT MODERATED TWO PANELS AT THE INCBA CONFERENCE. ON THIS PANEL, HE DISCUSSED STATE-LEVEL HEMP AND CBD ISSUES WITH CO-PANELISTS MICHELLE BODIAN, LAUREN RUDICK, AND SUSAN HAYS (L-R).

KIGHT LAW ASSOCIATE ATTORNEY KAMRAN ARYAH (3RD FROM LEFT) DISCUSSED THE FEDERAL “HEAVY HITTING AGENCIES” ON HIS PANEL WITH COURTNEY MORAN, THOM NORBY, AND AMANDA CONLEY (L-R).

CANNABIS ATTORNEYS KAMRAN ARYAH AND ROD KIGHT AT THE 2019 INTERNATIONAL CANNABIS BAR ASSOCIATION CONFERENCE IN NEW YORK.

October 7, 2019

The cannabis lawyers at Kight Law Office routinely speak at cannabis conferences across the country, where they discusses legal issues affecting the cannabis industry, including hemp and CBD. You can schedule a consultation by clicking here.  

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One Oklahoma State Department of Health employee appears to have been going through it during the process of drafting the state’s medical marijuana regulation earlier this year. Emails that lawyer Julia Ezell alleged contained dangerous threats from marijuana advocates have been proven to have been sent from her own cell phone. Ezell pled guilty on Wednesday to two misdemeanors for falsifying the threats.

“We will stop YOU and you’re [sic] greed,” went one of the emails. “Any way it takes to end your evil and protect what is ours.”

Ezell was employed by the Department of Health and was fleshing out emergency cannabis regulations this summer in accordance with House Bill 2612, which created Oklahoma’s medical marijuana program. CBS reports that the agency went against Ezell’s legal recommendations, thus voting to approve the prohibition of the sale of smokable marijuana and requiring a pharmacist at every dispensary.

When the agency’s rules were made public, medical cannabis advocates weren’t happy with the harsh restriction and requirement. Two lawsuits were filed against the board.

Emails Appeared Threatening

Ezell reported to department officials that she had received almost a dozen emails that made threats against her life. One read: “We would hate to hurt a pretty lady. You will hear us. We are just beginning.”

Others suggested that she was under surveillance. “You appear distinguished in glasses,” went one of the emails. “Wear them for the camera.” Another email sent the day read in a similar vein: “Julia is home. All alone?” An email from “MaryJameprotonmail.com” described Ezell’s vehicle and included her home address.

The Department of Health got in touch with the Oklahoma State Bureau of Investigation, which appears to have made the case a top priority. “The OSBI takes threats to public officials very seriously,” said one of the agency’s special agents Jordan Solorzano. “In this case, nine OSBI agents, three Edmond police officers, and two officers with the [University of Oklahoma Health Sciences Center] were assigned to the case, just to assure Miss Ezell’s safety.”

But it appears there was no external threat to her safety. Investigators quickly found that one of the emails in question was sent from Ezell’s very phone to her Department of Health email address, and that the account used was created on the same day. Within a week, an agent approached Ezell with the evidence that had been found, and the lawyer allegedly confessed and resigned from the Department of Health.

The two charges to which Ezell pled guilty this week are associated with falsely reporting a crime and using a computer to do something illegal.

Ezell’s lawyer released a statement upon learning of the charges saying, “Julie Ezell has worked as a loyal and dedicated public servant her entire career as a lawyer. These charges do not reflect who she is as a person, nor do they reflect the type of advocate she has been for the people of the State of Oklahoma.”

A local news site reported that her resignation letter read: “Effectively immediately I resign my position as General Counsel of the Oklahoma State Department of Health. I am so sorry.”

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