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California may have legalized recreational cannabis, but questions carry on over how “in-your-face” the public messaging should be. State legislature rows are brewing over splashy marijuana business billboards that have been erected across the state. As our Los Angeles marijuana business lawyers can explain, such advertising is considered essential by industry insiders who rightfully point note the legal market is barely treading water. Opponents, however, argue that such ads incentivize a potentially harmful substance to impressionable youth. Los Angeles cannabis business lawyer

Assembly Democrats have introduced two competing bills that would allow for two very different approaches to public advertising of cannabis businesses and their products. The more restrictive CA AB 273(21R) would prohibit any cannabis-related billboard from being visible from a highway. The other, CA AB 1302 (21R) would allow billboard advertising of cannabis companies along most thoroughfares in the state, but it would discourage sales interstate, which is still unlawful at the federal level, by banning marijuana billboard ads within 15 miles of any highway border into another state.

Although advertising may seem like a minor detail, the reality is some of these nuances could have a significant impact on the legal cannabis market in the state. Consider that the biggest tech companies – Google, Facebook, and YouTube – effectively ban cannabis marketing to online consumers. That means outdoor advertising is crucial for the marijuana industry. Prohibition that unreasonably restricts content and placement is going to further impede any business’s ability to effectively compete against other providers, particularly in markets teeming with unlicensed businesses that sell cheaper products because they are uninhibited by taxes, regulatory fees, compliance testing, etc. Continue reading

Starting this summer and prompted by a new federal law, the U.S. Postal Service will begin prohibition of vape product shipments – a move that concerns some California cannabis companies. Los Angeles cannabis lawyer

As our Los Angeles marijuana business lawyers can explain, the measure was tucked quietly into an appropriations bill late last year that was passed to keep the government running.

Not a single mention of “marijuana” or “hemp” is contained in the Preventing Online Sales of E-Cigarettes to Children Act, but investors and entrepreneurs in both sectors are concerned – and rightly so. They will be expected to comply with it.

To the extent any industry is involved in selling vape products, it will apply to them. That includes manufacturers and retailers. Continue reading

The State of California is doling out more than $15 million in grants to nearly a dozen cities and counties that have onboarded social equity programs – including California. The intention is to aid minorities and those harmed by the failed war on drugs in becoming stakeholders in the state’s legal cannabis market. The allocation is in addition to $40 million previously awarded by the state for the same cause. But will it make a real difference? Los Angeles marijuana business lawyer

Our Los Angeles marijuana business lawyers know that many cannabis company entrepreneurs who had been banking on this help have felt overlooked by the L.A. government in particular. Our goal is to assist these companies in building a solid framework by establishing workable business plans that are not only profitable but legally protected.

As detailed in a recent L.A. Times article, politicians in Los Angeles vowed help for those hit hardest by pot prohibition through the social equity program, which targets those with low incomes, prior marijuana arrests and who live in areas disproportionately impacted by enforcement of marijuana prohibition laws. But some lament they’ve been left stranded with little local aid. The city granted licenses to some of the long-standing marijuana operations that met city requirements, but newer social equity program retailers have not seen expedited license approvals. Continue reading

California cannabis business operators are hopefully eyeing a newly-reintroduced Safe and Fair Enforcement Banking Act (SAFE) that appears to be gaining some steam in Congress. Last session, it died in the U.S. Senate, but with new members seated, a new president and a growing trend toward public acceptance of cannabis companies as legitimate, cannabis banking may be more than a pipe dream. Los Angeles cannabis lawyer

As our Los Angeles cannabis lawyers can explain, the goal is to establish a safe, legal means for banks and other financial companies to work with marijuana businesses that are state-legal. As it stands, 47 states plus Washington, D.C. have legalized the substance in some form or another.

Sponsors are optimistic that this is much less of a partisan issue than it was in the past, particularly in light of the tax revenue it produces.

Why Cannabis Banking Remains Burdensome

Banking is recognized as one of the most slippery slopes for cannabis companies. They’re cut off from traditional bank accounts, which is what provides many businesses safety, security and legitimacy. Unlike other companies, cannabis retailers and many ancillary companies have no choice but to haul bundles of cash around. Not only is that impractical, it’s dangerous. COVID-19 presented a whole new layer of danger with this prospect, and many customers didn’t want to deal in cash. Continue reading

As we’re rolling into our third year of California’s legal recreational marijuana market, industry operators might expect heightened tax enforcement could be on the horizon. With an increasing number of audits already underway, there is concern some marijuana businesses could find themselves drowning in delinquent tax bills – some possibly as high as tens of millions of dollars. California marijuana lawyers

The three-year milestone is noteworthy because that’s the cutoff for California Department of Tax and Fee Administration auditors for examination of corporate tax returns.

Prior to 2018, marijuana companies were already required to pay sales taxes. As our Los Angeles cannabis lawyers know first hand, many were were routinely subject to state audits. In 2018, when the state first allowed legal cannabis sales for recreational use, they were required to pay two new taxes – a cultivation tax and a 15 percent excise tax.

As some CPAs note, audits like these can be very advantageous for the state of California, so it should come as no shock that these are starting. In fact, the state is pumping up all its general business audits too, so it’s not necessarily that marijuana companies are being singled out. Still, the high tax rates and significant penalties associated with marijuana sales could spell trouble for some marijuana businesses if anything is amiss. Continue reading

What recourse do marijuana companies with provisional licenses have if regulators choose to revoke them? Can they appeal? It’s a question that’s likely to get some answers as the case of Harrens Lab Inc. v. Bureau of Cannabis Control works its way through the courts. California cannabis lawyer

In that case, a marijuana testing lab forced to close earlier this year after the California Bureau of Cannabis Control revoked its provisional license said the move was unconstitutional because they were denied due process by not being allowed to appeal the decision. But in a recent filing before the Superior Court in Alameda County, the state’s attorney general argued that no cannabis business in California operating on a provisional license is entitled to due process under state law. Continue reading

Adults in California can smoke marijuana (or consume it a myriad of other ways) without fearing jailtime. However, use after-hours can still have adverse consequences for one’s employment prospects. A new bill introduced in the state legislature would change that, five years after voters legalized recreational cannabis. California marijuana employment lawyer

As longtime Los Angeles marijuana lawyers also well-versed in California employment law, we recognize this could be a substantial benefit not only for workers, but cannabis companies as well.

Assembly Bill 1256 would put a stop to the common practice of common employers who require workers to be tested for marijuana use. It would also prohibit employers from using certain kinds of evidence of prior marijuana use (urine tests, hair follicle tests, etc.) from being used to discriminate against the worker or denying them employment opportunities. The measure is sponsored by California NORML. Continue reading

Although 36 states and Washington D.C. have some form of legalized marijuana (15 of those for recreational use), it’s still strictly illegal to cross state lines with these products. It all comes back to federal prohibition. Crossing state lines with marijuana will cause you to run afoul of federal law. Each state dictates the movement of marijuana in its own borders, but intrastate commerce is federal jurisdiction. California marijuana lawyer

More than likely though, this will change – not so much a matter of if, but when. For one thing, we’re looking at a brighter than ever possibility of federal legislation that would end prohibition and legalize the drug. Beyond that, however, there’s a clause in the U.S. Constitution that bars states from unfairly restricting commerce between states under something known as the dormant commerce clause. State laws that restrict marijuana commerce with other states are probably unconstitutional under this clause (though it hasn’t been tested). As of right now, though, states don’t have any significant incentive to change it because it’s bolstering the economy of their own citizens. There haven’t been any lawsuits to challenge it either (yet) probably because litigation is expensive, it’s unknown how the value of limited licensing in marijuana-legal states would be impacted and fiercer competition is still an unknown for these burgeoning industries.

How Marijuana Trade Between States Would Impact the Legal Industry

As longtime Los Angeles marijuana business lawyers, we’ve seen the industry ushered through many major changes. Interstate commerce would be another significant one for nearly every sector. High-quality boutique offerings could find a bigger market. Larger firms that commoditize cheaper products would be in high demand. We’d likely see an immediate demand in more efficient supply chain and logistics experts.

Retailers might not see an impact right away (unless they are close to a state border). Even if/when marijuana prohibition ends at the federal level, most retail is likely to stay local. It’s probable that federal lawmakers would want to impose limitations or an outright ban on shipping marijuana via mail. (The same is done for tobacco products.)

What is less clear is how the value of state-issued permits would become. Continue reading

A cigarette manufacturer has filed a trademark infringement lawsuit against a California cannabis company alleging the smaller firm swiped their long-standing brand. The case highlights the fact that trademark registration and branding are valuable assets for any cannabis company, but accusations of trademark infringement can damage your reputation as well as your pocketbooks.marijuana lawyer

Bloomberg Law reports that the owner of Kool menthol cigarette brand alleges in Los Angeles federal court that the logo used by the cannabis company Bloom Brands is far too similar to the interlocking “O” letters used by Kool. The marijuana business has reportedly applied for federal trademarks for the branding images that would cover its oral vaporizers and e-cigarettes. The company that owns Kool, however, sent the firm a cease-and-desist letter late last year.

Now, according to the lawsuit, the cannabis business is accused of trying to profit off the established branding of Kool in a “transparent rip-off.” Continue reading

Renewed hope of federal marijuana legalization in 2021 have been restored after several senators – including Senate Majority Leader Chuck Schumer – recently vowed to press forward with expansive legislation to end U.S. prohibition on cannabis. As our Los Angeles marijuana lawyers can explain, this is the next logical step given that so many states – including California – have already lifted prohibition (albeit to varying degrees). marijuana legalization

The reform that Schumer and other lawmakers are discussing would also have a restorative justice element for those previously convicted of marijuana-related offenses.

The failed “War on Drugs” has inevitably proved to be a war on people (namely, people and communities of color). Ending prohibition is essential, but it’s really just the start. Some of the damage can never be undone, but restorative justice measures that erase criminal records for non-violent marijuana-related offenses is necessary to begin turning the tide and helping the communities that have been decimated by these drug policies.

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