Cannabis Law Prof Blog

Editor: Franklin G. Snyder
Texas A&M University
School of Law

Wednesday, October 31, 2018

Marijuana legalization likely to create market for low-THC products aimed at new users

20140508__MarijuanaBanking1Most people view marijuana legalization as a floodgates moment where long-time black-market marijuana users can finally go to the corner
store to buy ultra-potent strains of the drug in large quantities, and spend their free time testing the hypothesis that it is impossible to overdose on marijuana.

This may be true, but according to a recent report by Deloitte, widespread marijuana legalization may also create a large market of first-time users trying legal marijuana products out of curiosity. According to the report, these consumers are expected to seek out a less potent, more socially acceptable method of ingesting the substance. Forbes.com has the story:

It seems the American CBD craze has invaded Canada. Now, more of those customers, presumably the ones with less experience with hard-hitting pot like GG#4, or these things called dabs are requesting products heavy in the non-intoxicating compound of the cannabis plant. These people are the focus of the latest market report that suggests new, legal users (typically older folks) are more intrigued these days by the stress relieving powers of the plant than they are in getting wrecked.

 

"CBD is becoming kind of an 'it' word in cannabis. We see a real trend there," Andrew Pollock, vice-president of marketing for The Green Organic Dutchman, told CBC News.

 

Due to the forecasted demand for low-THC pot products, dispensaries may want to consider advising customers on the advantages of micro-dosing. Some are already making this part of the plan. After all, this low-key method for consuming cannabis, which is geared toward the person wanting to maintain a functional high without drooling all over themselves and dreaming of tacos all day, is already catching on in parts of the United States.

 

"(They say) two milligrams or three milligrams just has a mild relaxing effect and doesn't interfere with you going about your day," said Tom Adams, managing director of BDS Analytics in Colorado.

 

It's not totally surprising that this new consumer segment seems to be emerging. After all, the purpose of legalization is to make marijuana safer through regulation, and more accessible to the public. The Deloitte report describes current black-market marijuana users as young "risk takers" indicating that their use of marijuana is driven by a desire to "live life to the fullest", and that its illegal status does not curb that desire–if anything it amplifies it.

However, the report goes on to project that the marijuana consumer of the future will be more interested in a less frequent, more relaxing or therapeutic marijuana experience. In other words, once the drug is legalized it will no longer be a ritualistic and taboo exercise in hedonism, but instead will become more akin to the occasional glass of wine or scotch. Further, the report projects that marijuana users in the future will be willing to pay a premium for their products, and will place a high value on knowledgeable staff and diverse product selection. These insights further the parallel between marijuana and alcohol, as recent years have seen a growing demand for high-quality craft beers and locally distilled liquors sold by knowledgeable bartenders and similar connoisseurs.

Government regulators are sure to be happy to hear this information, as there have historically been some concerns that marijuana legalization would result in increased habitual drug use, leading to a host of other societal problems. At least for now, it sounds like cannabis consumers of the future will approach the drug with caution and treat it as an occasional indulgence, rather than instantly succumbing to the "Reefer Madness" that many used to fear.

 –John Robinson

October 31, 2018 in Business, Drug Policy, Edibles, Federal Regulation, International Regulation, Medical Marijuana, News, Recreational Marijuana, State Regulation, Voter Initiatives | Permalink | Comments (0)

Tuesday, October 30, 2018

Adult Use Marijuana Legalization Leads to Increased Auto Accidents?

DrivinghighMarijuana is so much safer than alcohol . . . ... or is it?

Despite the common argument presented by advocates of marijuana, the U.S. News & World Report recently published an article describing a study that outlined statistics of auto accidents in legal marijuana states versus their neighboring prohibition states. Researchers found an increase in auto accidents in states that have legalized recreational marijuana use:

An analysis of insurance crash claims show that accidents are up by as much as 6 percent in in Colorado, Nevada, Oregon and Washington, compared to neighboring states where recreational marijuana is not legal. Another analysis of police accident reports in Colorado, Oregon and Washington saw a 5.2 percent spike in accidents in those states, again compared with neighboring states.

As the 2018 midterm elections approach, and hot on the tail of Canada's marijuana market kickoff, author Claire Hansen warns that states considering marijuana legalization should consider the correlation between auto accidents and marijuana legalization. While Hansen acknowledges that there is no direct link between marijuana use and auto accidents, she seems to agree that the correlation is concerning, to say the least. 

An analysis of insurance crash claims show that accidents are up by as much as 6 percent in Colorado, Nevada, Oregon and Washington, compared to neighboring states where recreational marijuana is not legal. Another analysis of police accident reports in Colorado, Oregon and Washington saw a 5.2 percent spike in accidents in those states, again compared with neighboring states.

The studies were conducted by the Highway Safety and Highway Loss Data Institute and the National Highway Traffic Safety Administration. President of theHighway Safety and Highway Loss Data Institute, David Harkey, urges that allocation of tax revenues should account for the potential increase in auto accidents post marijuana legalization.

"If you're considering this in your state, if you're a legislator, you need to pay attention to what may be on the horizon in terms of road safety," Harkey says.

The studies highlight the challenge of measuring and enforcing marijuana impairment, Harkey says. Researchers controlled for differences in driver population, weather, unemployment and the mix of urban and rural roads. But while alcohol impairment is easily measured through a driver's blood alcohol concentration and limits are codified into law, there's no equivalent for marijuana use. And though alcohol impairment is generally prevalent at night, roadside survey work found drivers impaired by marijuana at all times of day. 

All of the results point to a need for proactive intervention and awareness from both legislators and the public, Harkey says, adding that something else to consider is how the tax revenue from marijuana sales will be used. Given the studies' results, it's smart to allocate some of the funds to enforcement and intervention efforts, he says.

As Republicans plan to push for medical marijuana reform after the midterm elections, an eye toward motor vehicle safety will likely benefit states that could soon be subjected to an influx of drivers under the influence of marijuana. 

 --Ashley Goldman

October 30, 2018 in Commercial Law, Law Enforcement, News, Research | Permalink | Comments (0)

Israeli Study Shows Cannabis Oil Improves Crohn's Disease Symptoms

AaaA recent study out of Israel provides evidence that cannnabis oil significantly improves symptoms of Crohn's disease. Crohn's disease is a chronic inflammatory bowel disease that causes inflammation of the digestive tract. Common symptoms associated with Crohn's disease include: diarrhea, fever, fatigue, abdominal pain and cramping, blood in the stool, mouth sores, and reduced appetite and weight loss.

Researchers from Israel recruited 46 people with moderately severe Crohn's disease, and randomized the participants to receive 8 weeks of treatment with either a cannabis oil containing 15% cannabidiol and 4% tetrahydrocannabinol or a placebo. Severity of symptoms and quality of life were measured before, during, and after treatment.

The results show that the group receiving the cannabis oil had significant reduction in their Crohn's disease symptoms compared with the placebo group, with 65% of the cannabis oil group meeting criteria for clinical remission. The cannabis oil group also had significant improvements in their quality of life when compared to the placebo group. 

Interestingly, the study's authors say it seems to disprove the idea that the improvement of Crohn's disease symptoms is a result of reduction of inflammation in the digestive tract: 

Speaking at UEG Week 2018 in Vienna, lead researcher, Dr. Timna Naftali explained, "Cannabis has been used for centuries to treat a wide range of medical conditions, and studies have shown that many people with Crohn's disease use cannabis regularly to relieve their symptoms. It has always been thought that this improvement was related to a reduction in inflammation in the gut and the aim of this study was to investigate this."

"We have previously demonstrated that cannabis can produce measurable improvements in Crohn's disease symptoms but, to our surprise, we saw no statistically significant improvements in endoscopic scores or in the inflammatory markers we measured in the cannabis oil group compared with the placebo group," said Dr. Naftali. "We know that cannabinoids can have profound anti-inflammatory effects but this study indicates that the improvement in symptoms may not be related to these anti-inflammatory properties."

Going forward, the research group plans to further study the potential anti-inflammatory properties of cannabis in the treatment of Crohn's disease and other inflammatory bowel diseases:

"There are very good grounds to believe that the endocannabinoid system is a potential therapeutic target in Crohn's disease and other gastrointestinal diseases," said Dr. Naftali. "For now, however, we can only consider medicinal cannabis as an alternative or additional intervention that provides temporary symptom relief for some people with Crohn's disease."

--Taylor Allen

 

October 30, 2018 in Medical Marijuana, News, Research | Permalink | Comments (0)

Saturday, October 20, 2018

Canopy Growth CEO predicts legal banking for cannabis companies by Christmas

Weed-bank

Weed businesses may soon be able to bank legally in the United States, according to the prediction of the CEO of Canopy Growth, Bruce Linton.

This would mean cannabis business owners would no longer have to rely on cash-only business models or cryptocurrencies like Bitcoin, and would be able to get loans far more conveniently. 

The prediction apparently came from a conference for cannabis businesses, according to the Forbes article by contributor Sara Brittany Somerset.

Somerset explained in the article that Linton's prediction was due to a sequence of events indicating that established structures may support legal cannabis banking. 

Linton expressed confidence that since his cannabis company infiltrated the New York Stock Exchange –although they were not allowed to ring or even touch the opening bell– that banking will naturally follow suit.

Linton elucidates that being listed on the exchange validates the company's adherence to anti-money laundering rules, which in turn meant that about a month ago, Bank of America could lend Constellation Brands Inc. -the company behind Corona beer -about CAD five million to give to him. Canopy Growth's game-changing deal with the producers of Corona has more than doubled the pot producer's stock price. Linton, however, attributes Canopy's sky-high valuation to the global medical marijuana market. 

Either way, Linton is confident that this sequence of events provides enough "momentum and weight to cause the banking conundrum to be resolved soon."

The CEO also used the conference to talk about a "port-a-potty theory" involving the impacts of locally sourced resources, according to Somerset's article. 

Linton admits he is "nuts about" his port-a-potty theory, and views it as the cornerstone of local economic stimulation. He insists it creates a snowball effect. "We have almost two thousand employees and they all know what the rules are about renting port-a-potties locally," he insists.

His theory is if he wants to hire Ph.D.s in a local town, he has to purchase port-a-potties for his construction sites locally, so that the port-a-potty vendor will take his new-found extra income and go out for dinner more often, which will, in turn, create better restaurants, then the local car dealerships will improve. Next, the houses will transition, so that when his Ph.D. hires begin to work there, they won't say, “God, what an awful town."

The article's writer seemed unimpressed with other aspects of Linton's speech, such as a "white-washed, non-diversified video commercial for Canopy Growth" and the reaction to his "gentrification ideals" being "stunned, stony silence from the audience and incredulous side-eye from the few Jamaicans in attendance." 

As for Linton's prediction of legal banking by Christmas, only time will tell whether it proves accurate. 

-- Alex Bennett

October 20, 2018 in Banking, Business, Finance, News, Stocks | Permalink | Comments (1)

Weed Is Legal in Canada, But Is There Enough of It?

The move to legalize cannabis in Canada comes into effect on October 17th, but it is estimated that suppliers will not have enough weed to meet demand.

While a recent survey conducted by Statistics Canada shows that the number of Canadian cannabis users is not expected to rise significantly, Statistics Canada's National Cannabis Survey, 3rd quarter 2018, reveals that some 4.6 million Canadians or 15% of the population has used cannabis just in the past 3 months. 

Montana-marijuana-CannabisNow-620x400

According to MetroUK: Researchers from the University of Waterloo and the C.D. Howe Institute say suppliers will only be able to fulfill between 30-60% of demand. According to them, the legal cannabis supply is expected to be around 210 tonnes while total demand in the country will be about 610 tonnes.

One of the main reasons for the lack of cannabis is that the Canadian government seems to be dragging its feet in granting licenses to suppliers. This could cause quite a loss, as MetroUK reports: "[This] means the government will be losing out on an estimated $774,000,000 (£454,000,000) in tax revenues."

 

--Taylor Allan

 

 

 

October 20, 2018 in Business, Finance, International Regulation, News, Taxation | Permalink | Comments (0)

The Canadian Marijuana Experiment

On October 17 Canada became the second country to legalize marijuana allowing Canadians to grow, possess, and consume marijuana recreationally. Canada expects the legalization of recreational marijuana to boost their economy, but the laws surrounding marijuana are left up to each province's experimentation. Inquirer.net reports: Canada experiment

... legalization is expected to boost the Canadian economy, generating $816 million to $1.1 billion in the fourth quarter without taking into account the black market, which is expected to account for a quarter of all joints smoked in Canada, according to Statistics Canada.

A $400 million tax revenue windfall is forecast as a result, with the provinces, municipalities and federal government all getting a slice.

In total, Statistics Canada says 5.4 million Canadians will buy cannabis in legal dispensaries in 2018, about 15 percent of the population. 4.9 million already smoke.

Inquirer.net states that by legalizing marijuana, the Canadian federal government overturns the marijuana ban that had been in place since 1923. The federal government left the task of creating laws to regulate legal marijuana up to the individual provinces. Hence, the world gets to sit back and watch to see which province's experimental regulations work the best. The article further reports:

Several [provinces] have already said they will not fully implement the law.

For example, even though federal law will permit each household to grow up to four cannabis plants, central Manitoba and Quebec in the east say they will ban it and go all the way to the Supreme Court over the matter.

Like with alcohol and tobacco, the question of legal age also falls to the provinces. Nineteen seems to be the standard, but it is 18 in Alberta, while Quebec, whose new government will enter office the day after legalization, wants to raise the age to 21.

With regards to sales, some provinces such as Quebec will implement a public monopoly while others, including Ontario and Nova Scotia, have decided to trust the market to the private sector.

As for law enforcement, federal police will be ordered to abstain for 28 days before working, as will police in Toronto.

Officers in Montreal, however, are simply asked to not show up to work high.

Another issue for the provinces to mull over is open consumption, with Montreal deciding to impose the same rules as those for tobacco, while people in other provinces will have to light up at home.

Legalizing marijuana clearly leads to many new problems, but with each province able to conduct their own experiment concerning the laws surrounding legalization, perhaps these experiments will lead to a structure the rest of the world can implement when moving towards a greener future.

--Wyatt Hinson

October 20, 2018 in Commercial Law, Decriminalization, Federal Regulation, Finance, Law Enforcement, Legislation, Local Regulation, News, Recreational Marijuana | Permalink | Comments (0)

Thursday, October 18, 2018

MAIER - U.K. approves medical cannabis use starting November 1

AcannabisDoctors in Britain can start writing cannabis prescriptions in less than a month. The motivation for the government to quickly legalize medical use came from two cases of sick children whose suffering was eased by cannabis. Both kids have life-threatening epileptic seizures and are successfully managing their diseases with cannabis.  The New York Times reports

The change was announced on Thursday by Home Secretary Sajid Javid, after he called for an urgent review of cannabis-based medicinal products over the summer, and his office said in July it had decided that “senior clinicians will be able to prescribe the medicines to patients with an exceptional clinical need.”

Mr. Javid said on Thursday, “Having been moved by heartbreaking cases involving sick children, it was important to me that we took swift action to help those who can benefit from medicinal cannabis.”

The home secretary commissioned the review after the cannabis-based medicine of Billy Caldwell, 12, who has life-threatening epileptic seizures, was confiscated at Heathrow Airport on June 11. The case was publicized in the British news media and prompted a national discussion on the legalization of medicinal cannabis products.

Ms. Caldwell, the young boy's mother, spoke praise of the Home Secretary for the "swift movements" on behalf of her son and others. The whole process, from Mr. Caldwell's case to approval of medicinal cannabis took about four months. The Home Secretary clarified that general practitioners will not be authorized to write cannabis scripts, but specialized doctors will have discretion to give patients who have exhausted other options access to medical cannabis. This change adds the U.K. to a growing list of states and countries that have legalized medical cannabis use. 

--Manda Mosley Maier

October 18, 2018 in Drug Policy, International Regulation, Legislation, Medical Marijuana, News | Permalink | Comments (1)

Sunday, October 14, 2018

Florida Department of Health Just Approved the State's First Online Medical Cannabis Shopping Portal

I Aaan an era where nearly everything can be purchased online,  Liberty Health Sciences Inc. and Alternate Heath Corp. paired up to created FlorPass--Florida's first approved e-commerce for medical cannabis. According to a recent article by Yahoo! Finance, FlorPass is transforming how patients shop for their cannabis products. 

"As the only medical cannabis e-commerce system approved by the Florida Department of Health, we have established an innovative model with the ability to capture the statewide market for digital cannabis transactions," says Dr. Michael Murphy, Chairman and CEO of Alternate Health. 

Currently, the FlorPass online portal is available to certified patients in St. Petersburg and Tampa. But there are plans to expand to additional locations before the end of this month.

"This is not only a functional way to do transactions, FlorPass will help us grow our business by building better relationships with our patients and enhance overall patient satisfaction. We will continue to invest in state-of-the-art technology to support the development of our products and remain committed to providing guidance and continued care throughout the entire patient experience," said George Scorsis , CEO of Liberty Health Sciences.

In 2017, the FlorPass Electronic Medical Records platform launched in clinics and doctor's offices throughout Florida. FlorPass received strong support from the American Medical Marijuana Physicians Association (AMMPA) which allowed Alternate Health to rapidly onboard new physicians, clinics and patients. FlorPass currently has over 7,500 patients registered in their system.

The strong support from large players in the medical cannabis industry coupled with the convenience factor of having products available to patients online could mean a shift in the way we see other companies approach sales. 

--Gabrielle Rennie

October 14, 2018 in Business, Finance, Local Regulation, News | Permalink | Comments (0)

Despite legalization, marijuana arrest rates continue to rise

AaaWith almost half of all U.S. states having decriminalized possession of small amounts of marijuana, one would think that marijuana-related arrest rates in the U.S. would be decreasing. Not so, according to new data released by the FBI last week. Forbes.com has the story:

There is now an average of one marijuana bust roughly every 48 seconds, according to a new FBI report released on Monday. The increase in marijuana arrests—659,700 in 2017, compared to 653,249 in 2016—is driven by enforcement against people merely possessing the drug as opposed to selling or growing it, the data shows.

 

Last year, there were 599,282 marijuana possession arrests in the country, up from 587,516 in 2016. Meanwhile, busts for cannabis sales and manufacturing dropped, from 65,734 in 2016 to 60,418 in 2017.

 

"At a time when more than 100 deaths per day are caused by opioid overdoses, it is foolish to focus our limited law enforcement resources on a drug that has caused literally zero," Don Murphy, federal policies director for the Marijuana Policy Project said in an interview.

 

"Actions by law enforcement run counter to both public support and basic morality," added NORML Political Director Justin Strekal. "In a day and age where twenty percent of the population lives in states which have legalized and nearly every state has some legal protections for medical cannabis or its extract, the time for lawmakers to end this senseless and cruel prohibition that ruins lives."

 

Overall, marijuana arrests made up 40.4% of the nation's 1,632,921 drug arrests in 2017.

Marijuana-related arrests rates have historically been a major topic of debate in U.S. marijuana policy. Advocates of legalization argue that the drug is harmless, citing the lack of reported overdoses normally associated with drug use, and that legalization would actually decrease the amount of illegal drug trade that can result in violence. They state that it is unfair to group persons in possession of marijuana together with violent offenders, and that it fills our prisons with non-violent offenders, effectively ruining lives over possession of a substance that has not been found to cause physical harm of any kind.

Meanwhile, supporters of the status quo cite the unknown–and possibly unknowable–health risks associated with marijuana, including possible damage to the hippocampus, which is responsible for short and long term memory. Additionally, supporters of marijuana's current criminal status argue that it is difficult to police marijuana intoxication and that more widespread use will result in more traffic fatalities. Finally, some argue that marijuana is a gateway drug, and legalizing it will not only create new weed smokers, but will also create a morality vacuum in which young people may believe that other drugs are not as harmful as they have been made out to be and begin venturing into the world of casual drug use.

For the time being, these statistics suggest that marijuana use and possession are increasing, even in states where the drug has not yet been legalized. This inherently means that the illegal drug trade is still alive and well, possibly vindicating the position of those that are in favor of federal legalization or decriminalization. However, some data has shown that even in states where marijuana has been legalized, foreign cartels are still able to sell the drug to customers, indicating that even full legalization may not be a cure to illegal marijuana trafficking. Regardless, there is a sharp outcry against the current harsh penalties for marijuana possession, and these new FBI statistics indicate that the problem is only getting worse.

 -John Robinson

October 14, 2018 in Decriminalization, Drug Policy, Federal Regulation, Law Enforcement, News | Permalink | Comments (1)

Saturday, October 13, 2018

Cannabis Up Your Nose?: Exclusive Licensing Deal Signed to Advance Medical Cannabis Delivery

AaaAustralian medical technology company Rhinomed has signed a 12-year cannabis licensing agreement with Columbia Care, the largest provider of cannabis-based products in the United States. Rhinomed specializes in anti-snoring nasal delivery technology, but according to the agreement, its nasal platform will now be used by Columbia Care to manufacture a range of products that delivers medical cannabis and other cannabinoid compounds for patients suffering from sleep apnea and PTSD.  

 

Speaking about the future of Rhinomed products in light of the company’s newly-founded relationship with Columbia Care, Rhinomed CEO Michael Johnson said:

“We believe that there is clear medical research support for, and a very real and significant commercial opportunity for nasal stents with medical cannabis formulations. Nasal delivery of cannabinoids opens up a new and exciting market opportunity and has the potential to set a new standard by providing a better and more reliable and repeatable dosing experience.

“This exciting new range of products will sit alongside and complement our existing portfolio – it is an important step in ensuring that Rhinomed technologies deliver on our mission of radically improving the way people breathe, sleep, take medication and maintain their health and wellness.”

By licensing its technology, Rhinomed has removed a key barrier to entry into the still-restricted U.S. medical cannabis market—that is, it’s not actually dealing in pot. In fact, its deal with Columbia Care actually makes Rhinomed the first listed Australian pot stock to open a direct, revenue generating pathway into the U.S. medical cannabis market.

 --Taylor Allan

October 13, 2018 in Business, Medical Marijuana, News | Permalink | Comments (0)

Friday, October 12, 2018

Budding Industries: How Cryptocurrency Might Solve The Cash-Only Cannabis Problem

Marijuana-Blockchain-1-890x480Where traditional efforts to comply with financial and logistical regulations have failed, blockchain industrialists believe that cryptocurrency could solve the "cash-only" cannabis problem by reducing the amount of capital moving through the system in the form of cash and increasing the efficiency, security, and predictability of payments.

Although some form of cannabis is legal in thirty of the fifty states, it remains classified as a Schedule I narcotic under the Controlled Substances Act (CSA) and is illegal on a federal level; therefore, it is impossible for cannabis businesses to get bank accounts from federally chartered banks. As a result, policy, as it currently stands, forces cannabis companies to operate on an all-cash basis. Despite $10 billion worth of sales transactions occurring within the cannabis industry last year, anyone involved in the business operation is susceptible to federal prosecution and left with limited financial service options.

For context, in mid-June, the Senate Appropriations Committee moved to block an amendment that would have allowed cannabis businesses to store their profits in financial institutions. Forbes reporter, Tom Angell provided insight of the Senate bill:

In a 21 - 10 vote, the Senate Appropriations Committee tabled an amendment on Thursday that would have shielded financial institutions that open accounts for cannabis businesses that are complying with state laws from being punished by federal regulatory authorities.

Moreover, just a week earlier the House Appropriations Committee voted to reject a similar proposal, also reported by Angell:

A powerful congressional committee voted on Wednesday to reject a measure to protect banks that open accounts for marijuana businesses from being punished by federal financial regulators. Supporters then scrambled to craft a more limited measure focused on medical cannabis businesses, but it was ultimately withdrawn before a vote could take place.

 

The broader measure would have prevented the U.S. Department of Treasury from taking any action to "penalize a financial institution solely because the institution provides financial services to an entity that is a manufacturer, producer, or a person that participates in any business or organized activity that involves handling marijuana or marijuana products" in accordance with state or local law.

The restrictive regulatory system leaves cannabis businesses open to organized crime like money laundering, theft, and cheating on payroll and taxes; however, there is speculation that cryptocurrency can ease these pains. Nick Meyers of The Phoenix New Times describes the premise of cryptocurrency in his article, Weed Money: Cryptocurrency May Be Key to Unlocking Bank Vaults for Cannabis Industry:

The basic idea of cryptocurrency is that it’s decentralized money, acting as both a currency and a transaction system.

. . .

Unlike official currencies such as the dollar, euro, or yen, no government authority tracks how much cryptocurrency is in circulation or who’s using it. Instead, these all-digital currencies use a process called blockchain.

 

The easiest way to think of a blockchain is as an electronic ledger that gets updated with each transaction. 

 

Every time someone makes a cryptocurrency transaction, that data, along with all previous transactions in the chain, gets stored in a new block.

 

The kicker is that blockchains are secure by design. Because transaction information gets stored in every new block, it’s difficult to tamper with or alter that data without compromising its authenticity.

In addition to solving the "cash-only" problem, the emerging blockchain industry can provide support regarding helping cannabis companies "meet regulatory requirements by offering immutable records showing the source of each plant in a harvest, where it is processed, how it is shipped and where it is distributed," as reported by John McMahon of News BTC

Moe Asnani, owner of Downtown Dispensary and D2 in Tucson, also stated that "anti-money-laundering laws are some of the biggest hurdles to legitimate cannabusiness banking, and having the verifiable ledger stored in high-security blockchains would demonstrate the market's legitimacy."

Asnani and McMahon's sentiment is shared amongst other cannabis and blockchain experts who say that blockchain platforms create transparency in the cannabis supply chain, and various cryptocurrencies, like HempCoin and ParagonCoin, are taking proactive approaches to solve the cash dilemma. 

Both cannabis and cryptocurrency are budding industries, and their similar challenges create the opportunity for joint growth; as cryptocurrency provides transparency to the cannabis business and marijuana operators can supply a stable customer base for the use of cryptocurrencies, perhaps this partnership will be the future of finance in the cannabis industry.

(For those unfamiliar with blockchain, Forbes and BlockGeeks are accessible resources.)

-- Gianna Redeemer

October 12, 2018 in Banking, Business, Commercial Law, Federal Regulation, Finance, News | Permalink | Comments (0)

British Colombia's marijuana: Not ready for legalization?

BC FlagWith the fast approaching legalization of marijuana in Canada, a British Colombia public health advisor is suggesting that the provincial government's policies will need improvement.

As have various US states, BC is now faced with the dilemma of how to handle legalization of an industry that is still in its infancy. CBC has the story:

The B.C. government's expert on keeping people safe in the consumption of recreational cannabis says getting ready for legalization on Oct. 17 is still very much a work in progress.

"What we have been saying for the past eight months is that we are building the plane as we are flying it," said Gerald Thomas, the director of alcohol, tobacco, cannabis and gambling prevention and policy for the Ministry of Health.

Thomas is an academic consultant on public health as it relates to consumption of those substances.

On Friday, he participated in a panel discussion at a cannabis conference at the University of British Columbia on issues concerning upcoming legalization.

. . .

Thomas did not take questions from media afterwards, but told around 150 people in attendance that the government doesn't "have it right," when it comes to its recreational cannabis policy.

Since the majority of marijuana legalization policy has not had to stand the test of time, there is not a tried and true basis for British Colombia to model their policies on. CBC goes on to report:

Despite the work done to date, there are still unknowns such as how people seeking to use marijuana for therapeutic uses will get reliable advice in the legal recreational system.

It's also unclear what will happen to producers of products, like edibles, which aren't currently part of the recreational plan, and how police forces will deal with impaired driving and marijuana.

"Having just spent the last eight months of my life consumed by the cannabis monster, I call it, I would suggest with most of folks here that we don't have it right," said Thomas.

"We have been pushed to the wall to try and make this happen in such a short time frame."

Still he told the audience though that people in the government who are working to be ready for legalization are doing their best to get it right.

The article lastly notes that Thomas hopes the government can get marijuana policies right before parties conform to the existing structure and make the policies difficult to modify.

--Wyatt Hinson

October 12, 2018 in Commercial Law, Decriminalization, Drug Policy, Law Enforcement, Legislation, Local Regulation, News | Permalink | Comments (0)

Thursday, October 11, 2018

OPINION: Marijuana Found in Murder Victim's Apartment is Irrelevant

Screen Shot 2018-09-30 at 9.17.34 AMThe tragic murder of Botham Jean in Dallas, Texas attracted media attention from all over the nation. However, according to theroot.com, Texas’s own Fox4 news station focused its coverage of the murder on the marijuana that was found in the victim’s apartment after the fact. The article reports that Fox4 tweeted the "clickbait" above when the station shared its article on Twitter:

Fox4’s coverage reflects a misguided and inappropriate selection of newsworthy material.  It reflects a common technique used by the media to portray black victims of tragic incidents as being flawed, or as somehow deserving the tragedy that occurred. Here, marijuana is used as an attempt to smear the image of the victim.

As an opinion piece in the Observer points out, this is not uncommon: “In the aftermath of many shootings involving black men, reactions have fallen along partisan lines. When Trayvon Martin and Philando Castile were killed, conservative media painted them as criminal and ‘thugs.’” In the light of the tragic events that occurred, it is disappointing that the station found that a small amount of marijuana in a murder victim’s apartment want “breaking news.”

What we know about what  happened on the tragic evening of September 6th can be summarized from a report from Vox:

Botham Shem Jean, a black man, was in his own apartment in Dallas [on September 6] when Amber Guyger, his downstairs neighbor and an off-duty police officer, shot him inside his own apartment.

. . .

Jean was not accused or suspected of any crime. Guyger, a four-year veteran of the Dallas Police Department, says the shooting was an accident — the tragic culmination of a series of missed warning signs that revolve around a mistaken belief that she was in her own apartment.

According to Guyger's account, when she arrived home to the South Side Flats apartments on September 6, she didn’t realize she had gotten out on the wrong floor of her building and that the apartment she was in was not, in fact, hers. Seeing a “large silhouette” in the dark apartment, she said she thought she was being burglarized. So she shot, hitting Jean in the chest. When she turned on the lights in the apartment, she realized her mistake.

However, there are varying accounts of the stories, as “Witness accounts, however, contradict that narrative: Neighbors say they heard Guyger knocking on Jean’s door and demanding to be let in before the shooting.” 

Amid the swirl of questions, I find it extremely problematic that Fox4 news chose to focus its attention on the small amount of marijuana in Jean’s apartment. Instead of using its investigatory resources on the flurry of issues in this case, the news station chose to post an article that focused primarily on the discovery of illicit drugs. As if that is relevant at all to the tragedy that occurred in the apartment, as if marijuana makes Jean a “criminal,” and as if his “criminality” lends credence to Guyger’s account of events. It doesn’t.

As The Observer noted, many outraged Tweeters voiced their disappointment, so much so that the station changed its headline “to reflect that Jean’s family attorneys were outraged the marijuana search warrant became public. The offending tweet is still up, however.” 

To be fair, it could be said that the news station was just sharing publicly available information regarding a development in an ongoing murder investigation. That’s the job of a news station, right? While news stations have the duty to share information with the public, Fox4’s clickbait line goes too far. This was not simply sharing information with the public, it was sharing the information in a way that attempted to change the public perception of the victim. Taglines such as the one used by Fox4 distract us from the uncomfortable, but sad truth: an unarmed, black man was murdered in his own apartment by a police officer who perceived him as a threat. Did subsequently finding marijuana make him suddenly more threatening?

--Ashleigh Morgan Williams 

October 11, 2018 in Law Enforcement, Legal Ethics, News, Politics, Recreational Marijuana | Permalink | Comments (0)

Sunday, September 30, 2018

New Jersey's Latest Marijuana Act Could Mean Weed Delivery and Public Consumption

State lawmakers in New Jersey have just sent the latest bill that would legalize marijuana and lay the foundation for a commercial weed industry in New Jersey to the state's Governor Phil Murphy.

A recent article by NJ.com covers some of the highlights from the latest bill.

Businesses with a marijuana retail license would be able to apply to have a consumption space on the same premises as, but separated from, their dispensary. Retailers would have to get local approval for the consumption space in addition to getting permission from the state, the bill says. Maxresdefault

If passed, this aspect of the bill would set New Jersey apart from most states which have legalized marijuana but have yet to legalize public consumption. 

The article also discuss the bill's allowance for weed delivery services by licensed retailers.

Businesses with a marijuana retail license would be able to get permission from the state to deliver cannabis products to customers. Not all states allow marijuana to be delivered, but California, Nevada and Oregon do.

The bill could pass as early as October and licensing approval would begin shortly after--with cultivation to follow closely behind. Accordingly, New Jersey may have a marijuana market in place by next September. 

--Gabrielle Rennie

September 30, 2018 in Business, News, State Regulation | Permalink | Comments (0)

Saturday, September 29, 2018

SEC Charges a Texas-based Investment Fund with Fraud, Warning About Marijuana-Related Investments

ShipchandlerRetail investors have officially been warned about marijuana-related securities offerings according to a press release recently issued by the Securities and Exchange Commission (the "SEC"). A Texas-based investment fund and its founder allegedly exploited investor interest in the marijuana industry by lying about high returns, and has been charged with "defrauding investors with false promises of massive returns in cannabis-related businesses."

Even though the investment fund was based in Texas, the fraudulent activity was widespread. In the complaint, the SEC alleges that, from August 2017 through at least March 2018, the investment fund and its founder "orchestrated an unregistered securities offering fraud that victimized more than 60 investors across 26 states." The founder promised massive returns, but actually misappropriated more than $3.3 million of investor funds for designer clothes, luxury cars, and payments to earlier investors to prolong the fraud scheme.

The press release quoted Shamoil T. Shipchandler, Director of the SEC's Fort Worth Regional Office, stating that "Investors must remain vigilant and not let the fear of missing out dupe them into making bad investment decisions." In an effort to warn potential scam victims, the SEC's Office of Investor Education and Advocacy (OIEA) and Retail Strategy Task Force (RSTF) issued an alert for investors earlier this month which stated that "[S]cam artists often exploit 'hot' industries to trick investors, including by making false promises of high returns with low risks. The OIEA and RSTF are warning investors about these kinds of investment schemes involving marijuana-related companies." The SEC's alert further provides:

"OIEA regularly receives complaints about marijuana-related investments, and the SEC continues to bring enforcement actions in this area. If you are thinking about investing in a marijuana-related company, you should beware of the risks of investment fraud and market manipulation. Fraudsters may try to use media coverage about the legalization of marijuana to promote an investment scam."

Although the victims may have believed in promises of high returns on their investments, in reality, the fund "had no track record and its sole investment of $400,000 was in a cannabis company that had yet to harvest a crop," according to the SEC press release. The complaint alleged that the investment fund and founder misrepresented that the fund "had a management team with a ten-year track record of profitably investing more than $100 million in cannabis-related businesses; (2) provided outsized returns to more than 200 investors; and (3) investors could expect a 24% annual return." 

Those who are interested in investing in a cannabis-related business should heed the SEC's advice to "ask questions and understand the risks involved. Carefully research the investment and read any recent reports that the company has filed with the SEC." Company reports can be found by searching the SEC's Electronic Data Gathering, Analysis, and Retrieval System (also known as EDGAR).

--Kindal Wetuski

September 29, 2018 in Business, Federal Regulation, Finance, Law Enforcement, News | Permalink | Comments (0)

Nevada cannabis industry shatters revenue projections; state expects more growth to come

Nevada is the latest state to feel the economic boom of legalized cannabis, and so far it is smooth sailing for state regulators. The state fully legalized the drug beginning in January 2017 and total industry sales soared over $500 million, $425 million of which came from recreational sales alone. These numbers drastically outperformed both state projections, and first year sales of other states. The Las Vegas Review-Journal has the story

Vegas-weedIncluding recreational and medical marijuana as well as marijuana-related goods and accessories, Nevada stores
eclipsed a half-billion dollars in sales, just under $530 million, according to figures released Tuesday by the Nevada Department of Taxation.

 

Bill Anderson, executive director of the Tax Department, said that the industry “has not only exceeded revenue expectations, but proven to be a largely successful one from a regulatory standpoint.”

 

“We have not experienced any major hiccups or compliance issues,” he added. “As we move into fiscal year 2019, we expect to see continued growth in the industry by way of additional businesses opening up, and we expect revenues to continue to be strong.”

This stunning performance translated into $70 million in tax revenue for the state. To give some context to these metrics, state regulators projected $265 million in sales and $50 million in tax revenue, according to the Review-Journal. Furthermore, the states of Colorado, Washington, and Oregon–largely considered to be trailblazing states in the cannabis industry, and all with larger populations than Nevada by at least 1 million citizens–recorded first-year cannabis sales of $303 million, $259 million, and $241 million, respectively, putting them far behind Nevada's first year numbers. Perhaps most surprisingly, despite being home to Las Vegas, Nevada only collected $49 million in intoxicating beverage taxes from 2016-2017, signaling that marijuana may be a greater source of revenue for the state than alcohol moving forward.

Nevada's "sinful" tourist economy can likely be thanked for such astounding numbers, although the state's casinos have come out against marijuana use in their facilities, out of fear of losing their gaming licenses. Additionally, the state's marijuana law prohibits consumption anywhere but in private residences. State Senator Tick Segerblom told the Las Vegas Sun: “The numbers are kind of leveling off, and we need to reach the tourist market a little more. We need a venue where people can come and enjoy marijuana properly."

These results suggest a few things: first, that tourism economies can drive marijuana sales even in states with lower populations and where marijuana use is not widely supported by dominant businesses. Second, that as more states legalize cannabis they may take cues from states that have previously approved legalization in order to more efficiently bring the drug to market. Finally, that there is still much progress to be made with respect to laws surrounding marijuana consumption in states where it has been made legal. Perhaps as more states begin venturing into legalization, they will use Nevada as a model of how best to regulate, tax, and sell cannabis.

--John Robinson

September 29, 2018 in Business, Commercial Law, Decriminalization, Drug Policy, Legislation, Medical Marijuana, News, Politics, Recreational Marijuana, State Regulation, Taxation, Travel | Permalink | Comments (0)

Friday, September 28, 2018

Cannabis cafe coming soon to Oklahoma

With Oklahoma's changing view towards cannabis, Cannafe, a cafe in Norman, Oklahoma, plans to open soon with a line of food and beverages containing CBD. OU Daily has the story: Cannabis cafe

A new cafe will open on Campus Corner selling coffee, tea, brownies, cheesecake and other snacks  — all containing cannabis compounds.

Co-founders of Cannafe, Jim Castor and Joel Jacobs, envision the cafe as a place for students to study and relax. This will be aided by cannabidiol, known as CBD, and other molecules from the cannabis plant that can help reduce anxiety and improve focus, said Jacobs.

CBD is a cannabinoid, or a compound found in cannabis plants. However, unlike the mind-altering compound THC, also found in cannabis, CBD does not get people high and is non-psychoactive, according to Medical News Today.

...

“It doesn’t alter how you can function,” said Castor. “You can still do your job and go to work and go to school and study and relax, and it just kind of takes the edge off.”

...

The owners also want to provide a non-alcoholic space where students too young to go to bars can hang out during the daytime or between parties.

You may now be curious as to if the sale of products containing CBD is even legal in Oklahoma. Oklahoma established the Oklahoma Medical Marijuana Authority (OMMA) to regulate medical marijuana (MMJ) in response to its legalization in June. However, the OMMA only regulates MMJ and does not speak to CBD products. Thus, without specific regulation against CBD products, Oklahoma tolerates the sale of these products, according to MarijuanaBreak.

--Wyatt Hinson

September 28, 2018 in Business, Edibles, Law Enforcement, Legal Education, News, State Regulation | Permalink | Comments (0)

Thursday, September 27, 2018

Amsterdam to begin experimenting with legal marijuana production

The legalization of marijuana production in Canada and a few U.S. states may soon be taking root across the Atlantic. The Dutch government will soon begin experimenting with legal marijuana production, according to CNBC.

PotAmsterdam has long been viewed as a model for the legalization of marijuana. In the 1970’s the Dutch government adopted a toleration policy for marijuana consumption. When visiting Amsterdam, it is common to see recreational use of marijuana in the many famous Dutch coffee shops that line the streets. Although tightly regulated, the Dutch government allows coffee shop customers to purchase up to 5 grams of marijuana for consumption.  

Though consumption of marijuana is allowed, producing and acquiring marijuana is not. It's illegal for coffee shops to purchase their supply of marijuana. Cannabis production is also forbidden. “This has led to an illicit market for cannabis in the Netherlands,” Stijn Hoorens, associate director at RAND Europe, told CNBC.

The prohibition on production is largely overlooked by authorities, however, it poses many difficulties for the coffee shops who must procure marijuana illegally. "The most difficult thing about having a coffee shop in the Netherlands is that it's allowed to sell it, but it's not allowed to buy it," Joachim Helms, co-owner of Green House Coffeeshops in Amsterdam and chairman of the Dutch Cannabis Retailers Association, told CNBC.

Now, as Canada and several U.S. states have legalized various schemes of marijuana production and distribution, the Dutch government has taken notice. According to CNBC, the Dutch government is planning an experiment with legal marijuana production in a handful of municipalities. But it's a small step in an increasingly growing legal weed market.

With the Dutch government actively experimenting with the legalization of production, many coffee shop owners are optimistic that the legal quagmire they continually face could soon be a thing of the past. Like Canada, they hope that Dutch companies will be allowed to produce marijuana. "To walk around in those companies and facilities for us is really a dream come true because it's growing weed in a 100 percent legal way," Helms told CNBC.

 

--Colin Heinrich

September 27, 2018 in Business, Drug Policy, Law Enforcement, News | Permalink | Comments (0)

A Federal Court Win for Connecticut Employees Who Use Medical Marijuana

Connecticut MarijuanaMedical marijuana users in Connecticut now receive extended employment-related protections under the state’s medical marijuana law as a federal court rejects an argument that the state laws conflict with federal laws and are therefore preempted. Dale L. Deitchler and Elizabeth R. McKenna, employment lawyers with national firm Littler Mendelson, report:

A Connecticut federal court has issued another decision in the case of Noffsinger v. SSC Niantic Operating Company LLC, further expanding protections to individuals who are qualified under Connecticut's Palliative Use of Marijuana Act (PUMA) to use marijuana. . . . [T]he parties filed cross-motions for summary judgment. These motions presented the court with another opportunity to address the extent to which PUMA protects qualified medicinal marijuana users—even though marijuana remains illegal as a matter of federal law. On September 5, 2018, the court granted partial summary judgment in the plaintiff's favor and concluded that she had successfully asserted a PUMA discrimination claim, and discussed the damages available. Significantly, the court considered and rejected additional arguments that federal/state law conflicts preempted enforcement of the Connecticut law, concluding that state law can co-exist with federal laws criminalizing marijuana use.

In an earlier decision, known as Noffsinger I, the Connecticut federal court held, “that various federal laws prohibiting use and sale of marijuana do not prohibit employers from hiring individuals who use marijuana in compliance with state law.” According to Deitchler and McKenna,

The case involves claims brought by an applicant who accepted a job offer contingent on passing a drug test. Before taking the test, the plaintiff informed her potential employer she was qualified under PUMA to use marijuana to treat post-traumatic stress disorder (PTSD). The plaintiff reportedly used marijuana "in the evenings" and provided current dosage information.

The employer rescinded the job offer after the plaintiff tested positive for cannabis. The plaintiff sued, alleging that the employer violated PUMA's anti-discrimination provision, claiming her rejection was discriminatory because she was qualified to use marijuana under PUMA.

The Noffsinger II court concluded the employer violated PUMA by rescinding the plaintiff's job offer on the basis of a positive pre-employment drug test when it knew she was using marijuana as permitted under Connecticut law.

The employer bases its position on, among other authority, the federal Drug Free Workplace Act and the federal False Claims Act.

Reading the DFWA narrowly to prohibit only the possession and use of illegal drugs at work, the court concluded that the DFWA did not require the defendant to rescind the plaintiff's job offer because she reportedly used marijuana for medicinal use after work during off-hours.

The court reached the same conclusion in response to the employer's argument that the federal False Claims Act barred it from hiring the plaintiff. . . .[T]he court concluded that "there is no federal law that bars defendant from hiring plaintiff on account of her medicinal use of marijuana outside work hours.

The court also found the employer’s argument that the employment decision was based on the positive drug test result, not on the employee’s status of a PUMA-qualified medical marijuana user unpersuasive. The authors explain:

The court disagreed, in effect finding action based on a positive workplace drug test for marijuana constitutes status-based discrimination when an employer knows the result was caused by marijuana use lawful under Connecticut law. The court explained, "[there] would be no reason for a patient to seek PUMA status if not to use medical marijuana as permitted under PUMA.

According to Deitchler and McKenna, “[t]he takeaway is that the DFWA is not a "free pass" to justify or defend the application of a "zero tolerance" policy in jurisdictions that have adopted protections for medical marijuana users.”

As 30 states in the US have legalized medical marijuana use, it is likely worthwhile to follow the development of this case as it could have a lasting effect on the relationship between state and federal laws in the labor and employment arena.

--Ashley Goldman

September 27, 2018 in Business, Drug Policy, Federal Regulation, Medical Marijuana, News, State Regulation, Workplace | Permalink | Comments (0)

Sunday, September 23, 2018

California's Senior Citizens Ride the Canna-Bus

AaaMarijuana is not just popular for the "young people" anymore.  In Orange County, California, the Bud & Bloom dispensary in Santa Ana has partnered with a bus company to allow senior citizens easier access to dispensaries, according to an article by Stephanie O'Neill for NPR's Morning Edition. The bus drives the patrons thirty minutes from the Laguna Woods Village retirement community to the nearest Bud and Bloom location.  

Though the idea of reliving Woodstock in retirement communities may be an entertaining one, the article notes that many senior citizens are visiting the dispensary to learn about the pain relieving properties of marijuana and "fear of getting high is the biggest concern expressed by senior consumers . . . What they don't realize is there's so many different ways to medicate now that you don't have to actually get high to relieve all your aches and pains."

Bud and Bloom tries to bridge the education gap by providing food and drinks to the elderly customers as the dispensaries' community outreach advisor gives a presentation on the "potential benefits of cannabis as a reliever of anxiety, insomnia and chronic pain and the various ways people can consume it. . . Then, the seniors are invited into the dispensary where they're able to buy."

The "Canna-bus" may be a response to a growing problem Caitlin Morgan Insurance recognized June of last year regarding nursing home and retirement community liability for marijuana. The article notes, 

Marijuana . . .  is banned by federal law even while legally approved for medical use in 29 states . . . This presents senior living facilities with the need to address what some call the elephant in the room: safety and accessibility. Even in states where medical marijuana is legal, older people who stand to benefit often cannot get it. Most nursing homes and assisted living facilities do not openly sanction its use, and many physicians are reluctant to endorse pot use, saying not enough is known about the risks in the oldest age groups.

Though research on how marijuana effects specific age groups is still scarce, "Some assisted living facilities have developed formal medical marijuana policies in response to demands from their residents. The Washington Health Care Association, an industry group, has posted a sample medical marijuana policy on its website, for example."

The article notes that "This is an issue that all facilities should weigh carefully, including any liability they may have as a result of marijuana use by their patients or residents." 

--Kylee Debler

 

 

September 23, 2018 in Business, Medical Marijuana, News | Permalink | Comments (3)