Arizona Republic: “Residents living near Saguaro High School fought off a proposed medical-marijuana dispensary this week but opposition to 11 other dispensaries and five cultivation facilities proposed for Scottsdale was rather muted over the past two months. The Scottsdale Planning Commission, besieged by a packed hearing room, voted unanimously Wednesday to recommend denial of a city-use permit for Taxonomy Healing Practices in an office building southwest of McDonald Drive and Granite Reef Road.”
Arizona Republic: “If Ganja Gourmet’s plans to expand its edible-marijuana business to Phoenix come through, medical-pot users can expect it to be more of a cafe than a pharmacy. Its Denver location is stocked with tamales, pot pot pies and mousse cakes, designed to cater to those who would rather eat than smoke their medicine. ‘It’s safer than smoking and more socially acceptable,” said owner Steve Horwitz, who also believes there are health advantages to eating medical marijuana vs. smoking it’.”
Arizona Republic: “State health Director Will Humble was putting the finishing touches Tuesday on the letter he will give to prospective medical marijuana dispensary owners when he declines their applications. Though Humble and his staff have spent months preparing for Wednesday’s start of the dispensary application process, the federal lawsuit filed Friday by Gov. Jan Brewer has put the kibosh on it. ‘We’ll explain to them that we’re unable to accept applications right now, and thank them for their efforts,’ he said. ‘At least they’ll have something when they leave to document that they tried‘.”
Three Men from Dryden, MI, Medical Marijuana Dispensary Charged with Delivering & Manufacturing Marijuana
mlive.com: “Three men were charged today with delivery and manufacturing marijuana for their association with the Dryden medical marijuana dispensary, according to the Lapeer County Sheriff’s Department. Randy Crowel, the 54-year-old owner of the facility, Mark Carter, 49, of Romeo and Patrick Salas, 53, of Romeo, face up to four years in prison if convicted. ‘The investigation supports that the Compassion Care Center of Michigan was non-compliant to the Michigan Medical Marijuana Law,’ said Lapeer County Sheriff Ron Kalanquin.”
Arizona Republic: “Arizona’s health director put medical-marijuana dispensaries on hold just days before he was to begin accepting applications, citing the lawsuit filed by the state in federal court Friday to determine whether the new law conflicts with federal drug statutes. State Department of Health Services Director Will Humble is a plaintiff in the lawsuit, along with Gov. Jan Brewer and state Department of Public Safety Director Robert Halliday. The suit seeks a declaratory judgment as to whether compliance with Arizona’s voter-approved medical pot law shields state employees, patients, dispensary owners and others from federal prosecution.”
Here is what Director of the Arizona Department of Health Servcies Will Humble said on his blog yesterday:
“In light of recent communication from the U.S. Attorney for Arizona, the Governor asked the Attorney General to file a suit this week asking for a declaratory judgment from a federal court regarding the legality of the Arizona Medical Marijuana Act and our Rules. We had been planning to begin accepting dispensary applications beginning next Wednesday, June 1 (continuing through June 30). However, as a result of this legal action, legal advice we’ve received from the AZ Attorney General’s Office and the overall uncertainty about the legality of the Act itself (especially the dispensary parts) we won’t be accepting dispensary applications in June after all. Whether we accept and process dispensary applications at a later date will depend on the outcome of legal action. However, we will continue to accept and process on-line applications for Qualifying Patient and Designated Caregiver ID cards on our website.”
Read more stories about the lawsuit:
“Medical marijuana supporters: Suit tailored to kill law,” which says:
“Richard Keyt, an attorney who helps companies set up dispensaries, said the lawsuit is worded in a way that the judge can reach only one conclusion: the federal Controlled Substances Act trumps the Arizona Medical Marijuana Act. And Keyt said states cannot change federal law.”
“Arizona Medical Marijuana Law: State Sues U.S. Justice Department”
“Arizona sues Justice Dept. over medical marijuana”
“Brewer attempts to thwart medical marijuana law”
“is anyone else disturbed at how a scarcity of dispensaries combined with thousands of qualified patients equals more black-market weed sales? By failing to defend the will of the people, Brewer and Horne will boost illegal drug sales. What concerns us most is how the politicians might use this fact to later criticize the program. My gosh, they’ll say, look how Prop 203 ended up fueling the cartels! What a bad law! But, of course, they’ll be the ones responsible if that happens.”
Brewer vs. United States: Arizona Sues Asking Federal Court to Rule on Whether Arizona can Implement Proposition 203
On May 27, 2011, Arizona sued the United States and asks the federal court to “declare the respective rights and duties of the Plaintiffs and the Defendants regarding the validity, enforceability, and implementation of the AMMA [Arizona Medical Marijuana Act]” and to “determine whether strict compliance and participation in the AMMA provides a safe harbor from federal prosecution.” The defendants in the lawsuit are:
- UNITED STATES OF AMERICA
- UNITED STATES DEPARTMENT OF JUSTICE
- ERIC H. HOLDER, JR., Attorney General of the United States of America, in his Official Capacity
- DENNIS K. BURKE, UnitedStates Attorney for the District of Arizona, in his Official Capacity
- ARIZONA ASSOCIATION OF DISPENSARY PROFESSIONALS, INC., an Arizona corporation
- JOSHUA LEVINE
- PAULA PENNYPACKER
- DR. NICHOLAS FLORES
- JANE CHRISTENSEN
- PAULA POLLOCK
- SERENITY ARIZONA, INC., an Arizona nonprofit corporation
- HOLISTIC HEALTH MANAGEMENT, INC., an Arizona nonprofit corporation
- JEFF SILVA
- ARIZONA MEDICAL MARIJUANA ASSOCIATION (an unincorporated anonymous group loved by the media)
Why did Arizona name the people and entities as defendants? I will refer to these people and entities collectively as innocent by standers? Does the State expect the innocent by standers to hire a lawyer to file an answer and defend the lawsuit on the merits? Does the State want the innocent by standers to sign a statement consenting to or acknowledging something? Is the State hoping one or more innocent by standers will not file an answer to the complaint so the State can get a default judgment against one or more innocent by standers?
Read the entire Brewer_vs_United States complaint and the attached exhibits. The complaint is an excellent summary of developments with respect to states that have legalized medical marijuana and the public positions taken by the U.S. Attorney with respect to enforcement of federal marijuana criminal laws in the 16 states that have legalized medical marijuana.
East Valley Tribune: “The top federal prosecutor in Arizona said Gov. Jan Brewer and Attorney General Tom Horne are distorting the facts on the issue of medical marijuana and risks of federal prosecution.” This a must read article. The following text contains only a few of the zingers U.S. Attorney Dennis Burke fired at Governor Brewer and Arizona Attorney General Tom Horne. Dennis Burke:
“said that letter never mentioned state workers. ‘It’s fair to read into my letter what I included and what I didn’t,’’ he said. ‘And if I didn’t include state employees, I think that’s telling in itself.’’ And Burke said there was a simple way of dealing with the question. ‘You would think that a letter back from Attorney General Horne, as opposed to ‘I’m going to file a lawsuit and have a press conference,’ might have been a better course of action,’’ he said.”
“Burke said there appear to be elements of political grandstanding in both the press conference by Brewer and Horne earlier this week as well as the decision to sue.”
Given that Arizona’s U.S. Attorney is on record saying that the Governor and the Arizona Attorney General can get the answer they want to whether state employees will be charged with violating federal marijuana criminal laws without suing, Jan Brewer and Tom Horne should wipe the egg off their faces, dismiss their lawsuit and write a letter to Dennis Burke. That course of action will be cheaper and quicker than a federal lawsuit that will waste precious Arizona funds, takes months or years to resolve and will almost certainly cause the State of Arizona to be sued because it fails to implement Propostion 203, a duly enacted law of Arizona.
If Governor Brewer does not take the Arizona U.S. Attorney’s advice, she will have to invent another reason to stop the implementation of Arizona’s medical marijuana industry because she won’t be able to say she is worried about state employees being prosecuted. Dennis Burke has made it clear that state employees involved in implementing and administering Arizona’s medical marijuana laws will not be prosecuted.
Maricopa County Attorney Bill Montgomery Tells Board of Supervisors to Put the Brakes on Medical Marijuana Dispensaries
Arizona Republic: “Maricopa County Attorney Bill Montgomery on Thursday formally advised the Board of Supervisors to opt out of the state’s medical-marijuana program ‘unless and until the potential criminal prosecution of county employees is resolved.’ He urged supervisors not to accept or process any more applications for medical-marijuana dispensaries or cultivation sites, or to issue any permits on county-controlled land pending the outcome of the state’s lawsuit.”
The following is the Maricopa County Attorney’s summary of the issues he addresses in a May 26, 2011May 26,2011, letter to the Maricopa County Board of Supervisors:
“In light of the potential that County employees could be subject to federal prosecution for violation ofthe Controlled Substances Act if they participate in actions that would implement the Arizona Medical Marijuana Act, my Office advises the Board that it issue directives to the effect that, unless and until this apparent threat is conclusively removed, no County employee should: (a) accept any further applications for medical marijuana d ispensaries or cultivation sites; (b) further process any such pending applications; or (c) issue any certificates, permits or other authorizations or justification for medical marijuana dispensaries or cultivation sites. This advice is based up the legal analysis done by this Office and is not a ‘policy’ based recommendation.”
Arizona Republic: “Arizona will ask a federal court today to clarify whether its voter-approved medical-marijuana law conflicts with federal drug statutes, launching what probably will be a lengthy legal battle that could cripple the state’s fledging industry and spark more legal action. Gov. Jan Brewer also will put a temporary halt to the state’s permit process for marijuana dispensaries, set to begin Wednesday, with an executive order issued by Tuesday, her office said. She does not plan to stop issuance of medical-marijuana user-ID cards.”
The article quotes U.S. Attorney for Arizona Dennis Burke talking out of both sides of his mouth when he said:
“We have no intention of targeting or going after people who are implementing or who are in compliance with state law,” Burke said. “But at the same time, they can’t be under the impression that they have immunity, amnesty or safe haven.”
Arizona Republic: “Arizona Attorney General Tom Horne will file a lawsuit by week’s end, asking a federal judge to weigh in on the legality of Arizona’s Medical Marijuana Act and whether those who manufacture or distribute pot under the law are subject to federal prosecution. . . . When asked whether she intended to instruct DHS to not issue dispensary permits, Brewer said, ‘we are moving in that direction.’ Her spokesman, Matthew Benson, said later that the governor’s advice to DHS on the subject was ‘imminent, in the next few days’.”
See “Arizona: Your Votes Don’t Count on Medical Marijuana,” in which the Marijuana Policy Project said:
“We cannot think of a single individual — aside from possibly illegal drug dealers — who would benefit from Governor Brewer’s actions today. She has done a disservice to her state and its citizens. . . . the only decision on whether the licensing of dispensaries would be federally preempted has also found it would not be. It looks like Jan Brewer is having a contest with San Diego County to see who can waste the most taxpayer money on a futile attempt to overturn the will of voters.”
See also “Lawsuit could put hold on Arizona medical marijuana,” which says
“Brewer sidestepped repeated questions of why the state is not mounting a vigorous defense of the law.”
Arizona Governor Jan Brewer Puts Arizona’s Medical Marijuana Law on Hold While Arizona Sues for Guidance
What follows is the text of Arizona Governor Jan Brewer’s May 24, 2011, press release.
Governor Jan Brewer today announced that she has directed Arizona Attorney General Tom Horne to file suit by the end of the week seeking a declaratory judgment from a federal court regarding the legality of the Arizona Medical Marijuana Act (AMMA).
“For the state employees charged with administering the medical marijuana program or the Arizonans who intend to participate as consumers, it’s important that we receive court guidance as to whether they are at risk for federal prosecution,” said Governor Brewer. “As explained in a recent letter from the U.S. Attorney for Arizona, the federal government considers marijuana a controlled substance. Arizonans deserve clarity on an issue with such dire legal implications.”
The Arizona Department of Health Services had been diligently implementing voter-approved AMMA provisions until it received a letter, dated May 2, 2011, from U.S. Attorney Dennis Burke. Burke’s letter warned that marijuana remains a Schedule I Controlled Substance, meaning that “growing, distributing and possessing marijuana, in any capacity, other than as a federally authorized research program, is a violation of federal law regardless of state laws that purport to permit such activities.” Burke declared that his office would “vigorously prosecute individuals and organizations that participate in unlawful manufacturing, distribution and marketing activity involving marijuana, even if such activities are permitted under state law.”
The U.S. Attorney’s letter raises significant questions about the legality of both the AMMA and related Arizona Administrative Code provisions. In particular, Governor Brewer is concerned for the vulnerability of state employees charged with administering the AMMA, including, but not limited to, the issuance of dispensary licenses and qualified-patient registration cards. If a federal prosecutor were to decide that such activities are contrary to federal law, state employees may be subject to federal prosecution.
Medical marijuana also presents uncertainty for state law enforcement. The U.S. Attorney’s letter calls into question the ability of the Arizona Department of Public Safety (DPS) to maintain federal grant monies, the department’s enforcement activities and federal task force actions, and the employment status of DPS employees who could be in violation of federal law while participating as consumers in the AMMA.
For these reasons and others, a declaratory judgment action regarding medical marijuana in Arizona is necessary to determine whether AMMA violates federal law and, therefore, is void.
“The State of Arizona has worked to follow the wishes of voters,” said Governor Brewer. “But I won’t stand aside while state employees and average Arizonans acting in good faith are unwittingly put at risk. In light of the explicit warnings on this issue offered by Arizona’s U.S. Attorney, as well as many other federal prosecutors, clarity and judicial direction are in order.”
Will Humble said the following on his blog today about the Governor’s action:
“We understand that the Governor and the Attorney General are seeking a declaratory judgment in federal court regarding the implementation of the Arizona Medical Marijuana Act. When further information is available, ADHS will update you. Until then, the Department will continue to issue Qualifying Patient and Designated Caregiver Registry Cards on our website.”
KOLD News 13: “As Arizona’s medical marijuana laws go into effect, dispensaries are still waiting for word as to when they can open their doors, but some people are not waiting for them. Applicants who have already received medical marijuana cards and the green light to cultivate pot for personal use, have already started cultivating the plant at home. We got a sneak peak at one of the first grow operations in Tucson.”
ABC 15: “Medical marijuana businesses are beginning to open their doors around Arizona. Green Horizons University in Scottsdale opens their doors to the public Monday morning. They are one of a handful of stores that plan to cash-in on Arizona’s new industry. ‘We are an educational facility to teach everybody everything from A to Z about the medical marijuana industry,’ said Daniel Halbert, who founded Green Horizons University.
Whitter Daily News: “Culminating a three-month investigation, police brought a hammer down Wednesday on unlicensed medical marijuana dispensaries, shutting down two underground clinics, including one operating across from East Whittier Middle School. They also served a search warrant at a medical office in the 7200 block of Greenleaf Avenue, where they arrested a physician on suspicion of aiding and abetting an unlicensed medical marijuana dispensary.”
See “Four people arrested in police crackdown on illegal pot dispensaries could face charges.”
Arizona Republic: “Maricopa County Attorney Bill Montgomery advised the Board of Supervisors this week against issuing permits to medical-marijuana dispensaries on county-controlled lands, fearing a backlash from the federal government. . . . Montgomery said although the federal government clearly will not prosecute seriously ill patients using pot as medicine, the same legal ‘safe haven’ does not exist for dispensary agents or local government employees who implement the state’s law.”
“‘I’m not comforted by a wink and a nod’ from the federal government, Montgomery said”
Arizona Republic: “More than 2,300 Arizona residents have state permits to grow marijuana in their homes – for now. That will end in a few months when medical-marijuana dispensaries start opening and household gardeners must pull the plug on their grow lights or face criminal charges if they live within 25 miles of a dispensary. But it’s unclear who will enforce the shutdown, and spokesmen for local law-enforcement agencies say they expect that will be a challenge.”
ACLU Sends Letter to U.S. Attorney General Asking Feds to Backoff on State Legal Medical Marijuana Dispensaries
In a letter to the United States Attorney Eric Holder dated May 9, 2011, the American Civil Liberties Association (ACLU) expressed “deep concerns about recent threatening letters from several United States Attorneys from across the country regarding the potential initiation of federal prosecutions against persons who are complying with state medical marijuana laws.” The letter says in part:
“We further assume that the low priority status extends not only to patients, but also those who license and distribute medical marijuana in full compliance with state laws that are designed to protect public safety by ensuring an orderly and appropriately circumscribed distribution process for medical marijuana.
The recent U.S. Attorneys’ letters also reflect a policy of obstructionism in the face of the complex and evolving issue of medical marijuana, which nearly one-third of the states have now decriminalized in recognition of the unique and substantive benefit this drug provides to patients with certain serious conditions. The states to which the recent U.S. Attorneys’ letters have been directed have wisely recognized not only the needs of patients and the value of marijuana as a medicine, but also the need for a rational distribution scheme that channels this drug to humanitarian uses without contributing to a black market. As a policy matter, the same protections that extend to patients should also be extended to state-licensed distributors or state employees who are in clear compliance with state law. The laws of the affected states further recognize that it is not enough to permit patients to use the medicine; there must be a mechanism for growing and distributing medicine that provides a safe method of access. The state laws and detailed regulations implementing distribution promote both public health and public safety. The U.S. Attorneys’ implied threats of prosecution against those who are merely following state law are thus inconsistent with the administration’s announced intention to end the “war” on drugs and adopt a public health approach to drug policy.”
Spokane Weekly: “Jessica Nuna says she was standing behind the counter talking with a patient when the first agents came in. ‘I’m with the DEA,’ she says that one of them calmly told her–he was the only Drug Enforcement Administration member out of a team of about a dozen Spokane Police officers. By the time the team had left Nuna’s work–the Medical Herb Providers pot dispensary on Frea Street in Spokane–they had taken around 32 pot plants, $1,400 in cash, several ounces of ready-to-smoke marijuana and a several laptops, cells phones and other electronic devices.”
Arizona Republic: “The most likely way Glendale residents will know if a medical-marijuana facility sets up shop in the city is when the business opens. The City Council in February adopted regulations for medical-marijuana facilities that don’t require merchants to apply for a conditional-use permit, which could trigger a public hearing. . . . Glendale has received nine applications since March 25. Five were either rejected by city planners because the location conflicted with the zoning or were withdrawn by the applicant.”
Associated Press: “Two medical marijuana providers have accused the U.S. government of civil rights violations in what may be the first lawsuit of its kind in response to a federal crackdown on pot operations across the nation.”
Denver Post: “One of the first known doctors in Colorado to be charged with writing a shoddy medical-marijuana recommendation had the case against him thrown out this week. Dr. Toribio Robert Mestas had been facing charges of forgery, attempt to influence a public servant, marijuana distribution and conspiracy to distribute marijuana after writing a recommendation to an undercover police officer early last year in Englewood. But, in an order handed down Wednesday, Arapahoe County District Judge Kurt Horton ruled Mestas had complied with the requirements of Colorado’s constitution in making his recommendation.”
Los Angeles Times: “Los Angeles, which has struggled for years to find an efficient way to force hundreds of medical marijuana dispensaries out of business, scored a quick win Wednesday when one of the seven stores the city sued last week announced it had closed its doors. The decision came after the city’s attorneys pressed the landlord to evict Cancare Collective and after the operators decided to avoid costly litigation.”
The Daily Courier: “Mohave County will have eight dispensaries, one of which will be located somewhere in one the county’s largest medical marijuana zones containing Kingman, Golden Valley and Oatman but also extending south about 60 miles to include Wikieup, Yucca, Franconia and Nothing. Reynolds said the members of Kingman’s Planning and Zoning Commission were hoping to make the city’s regulations so strict that it would be too difficult to operate a dispensary within the city limits. That was before the city attorney advised the commission that a zoning ordinance that strict would probably fall outside the proposition’s allowance for ‘reasonable’ rules.”
LA Times: “A second large marijuana growing operation was discovered in the San Gabriel Valley this week, this time in three warehouses near the City of Industry. Los Angeles County sheriff’s deputies found about 1,900 marijuana plants, valued at about $2 million, in a sophisticated pot-growing operation in the unincorporated community of Bassett.”
Arizona Republic: “Charles Greenbaum is banking on a dream business that could go up in smoke if the state denies him a medical-marijuana dispensary license. . . . But the Chandler resident says he never imagined what he was in for when he decided to invest in opening a medical-marijuana dispensary in Tempe. Now, with nearly $100,000 invested in Greentree Herbal Therapy Center,
Greenbaum says he can’t stomach the idea of losing his life savings.”
What should MMJ entrepreneurs expect from their insurance agent? Besides providing the correct coverages for one’s business, a dedicated insurance professional can deliver other services that support your goal of obtaining an ADHS dispensary license.
For example: to help prospective dispensary owners finalize their applications, agents can provide them with quotes for all pieces of the business: General Liability, Professional Liability, Property (to include Crop Coverage), Business Auto, Directors & Officers coverage for your Board, Med Mal and Workers Compensation for your staff. Doing so will make your application that much more appealing to ADHS.
Another advantage of working with your agent, especially right now, is that fine-tuning your building layout and operational plans will help you to realize all available premium discounts for meeting the safety and security criteria insurance carriers have.
Your agent can also help you win a Special or Conditional Use Permit by writing a letter in support of your zoning request to the city or county you want to locate in; a personal appearance on your behalf is even better.
My experience has been that those in advisory or decision-making positions find it compelling when a risk-management professional testifies that MMJ businesses pose no more threat to the community than pharmacies, jewelry stores or even the local Circle K.
One issue often overlooked is the effect an MMJ business will have on the landlord; many of their current “Lessor’s Risk” policies will be canceled by mainstream (“preferred” or “admitted”) carriers when a medical marijuana use begins operations in their building. Your agent should be on top of this so that you don’t end up paying for a big premium increase to your landlord’s policy.
Correctly insuring your dispensary, grow, delivery service or testing lab demands knowledge of the MMJ industry, because Medical Marijuana surely ain’t tiddly-winks. Find an agent that knows the business, has their ear to the ground and offers value-added service to get the most from your partnership.
Doug Banfelder is a Commercial Insurance Specialist. He can be reached at www.PremierDispensaryInsurance.com or by calling 480-315-9051
KVOA.com: “Medical marijuana is almost here and the plant isn’t the only green popping up, we’re talking cash. When medical marijuana was approved by the voters there were a lot of people wanting to get their hands on some but at the same time there were others waiting to cash in on it. To have a good business you have to satisfy a need and based on the November election there’s a huge need for medical marijuana.”
Bakersfield.com: “The latest in a long line of defendants charged after a 2007 raid on a Bakersfield medical marijuana dispensary was sentenced to three and a half years in prison . . . . In California, medical marijuana is legal under state law. But federal law says pot is illegal and the Drug Enforcement Administration can bust medical marijuana dispensaries at any time. There are certain rules the dispensaries must follow. For example, they can’t make a profit. The DEA has said Nature’s Medicinal was doing millions of dollars in business a year.”
Rhode Island News: “Peter F. Neronha, the U.S. Attorney for Rhode Island, is not alone among the top federal prosecutors in New England when it comes to threatening raids on large-scale marijuana dispensaries that have opened or plan to open and sell medical marijuana. . . . The action is more than just a threat out West. In Montana and Washington, federal authorities have executed search warrants at various medical dispensaries and grow sites. They also seized about $4 million from banks in three Montana cities. . . . In Arizona, Gov. Jan Brewer has been an outspoken critic of medical-marijuana dispensaries, but she said she respects the will of the people and does not plan on blocking the licensing of 126 dispensaries. She took offense at U.S. Attorney Dennis K. Burke’s threat to crack down on Arizona’s dispensaries. ‘You know what I would say to Dennis Burke?’ she said. ‘Why don’t they enforce their immigration laws’?”
SF Weekly: “The cofounder of San Francisco’s slickest medical cannabis dispensary and a member of the San Francisco Medical Cannabis Task Force has been charged with multiple felonies stemming from a Sonoma County marijuana grow, according to news reports. Joseph Erich Pearson, 34, co-founder of the award-winning Mission Street dispensary San Francisco Patient and Resource Center (SPARC), was arrested”
See “Founder of Upscale Pot Dispensary Arrested.”