Articles Posted in California marijuana business lawyers

California is posed to instantly become the country’s largest marijuana market when lawful sales of cannabis for recreational use begin on January 2, 2018. While this presents vast opportunity for investors and entrepreneurs, it also presents a wealth of regulatory challenges. Businesses often face greater regulation in California than other states, simply due to the size of California’s legal and regulatory codes. Cannabis businesses will have the added headache of new and changing regulations in a brand new industry. Yet, with preparation and planning, and skilled legal advice from an experienced marijuana business compliance attorney, business owners can keep their operations compliant and profitable throughout the coming changes in regulatory framework applicable to California’s cannabis industry.cannabis compliance lawyers

California’s Compliance Rating

Forbes reports on recent compliance data issued by Adherence Compliance, a cannabis compliance company based in Denver, Colorado. Adherence Compliance has applied predictive analytics and machine learning to the cannabis industry in order to determine the compliance areas in which a business is likely to fail. Its data has found California cannabis business owners to be the least compliant across the country. Here, owners average sixteen compliance infractions per inspection, and score an average of 74.4 out of 100 on Adherence’s compliance metrics. By contrast: Illinois was found to be the most compliant state, and averaged 91.1 out of 100 on the same tests. It is worth noting that Illinois has a relatively new and small program of strict regulation. Colorado, in comparison, has an older and larger program of regulation, which has complex applications for both recreational and medicinal use. Its cannabis business owners scored an average of 82.9 out of 100 on the Adherence Compliance metric. Continue reading

For years, industry and academia have partnered to find better ways of delivering a better product to consumers. This model has allowed entrepreneurs to take advantage of scientific findings and reliable data to improve their operations and products. Now, one cannabis company is partnering with academic researchers to better understand marijuana.cannabis business lawyers

An Unusual Partnership

The Denver Business Journal reports that Front Range Biosciences – an agricultural biotechnology company based in Lafayette, Colorado which specializes in marijuana – has partnered with the University of California-Davis to study marijuana. The deal began with a $150,000 gift – one of several installments – provided to the University of California by the company, which says it is designed to advance understanding of the medicinal and nutraceutical uses of cannabis. In turn, a professor in the UC-Davis Department of Viticulture and Enology says the college is excited to have the opportunity to study and decode the hemp genome, which will enable new insights into the genetic bases of complex pathways of secondary metabolism in plants. The company also seeks to reduce pesticide residues and excessive application of fertilizers in compounds with medicinal benefits.

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As with any retail business, cannabis entrepreneurs find themselves with increased sales around the holiday season. Businesses which are prepared for these opportunities can invest in growth which will sustain profitability well into the new year.cannabis business attorneys

Fall Festivities

There are many ways to market cannabis products for the fall season. GOOD Co-op, a cannabis company based in Oakland, has introduced a “pumpkin spice blondie”. According to Fortune, the cookies are made with real pumpkin, a special blend of spices, and organic cannabis butter. The edibles will be sold exclusively through the Eaze platform in the Oakland area. There are many possibilities for similarly autumn-themed cannabis edibles and products. Apple butter, pumpkin buttercream, and similar autumn scents can be incorporated in many different formats. Edible treats, lotions and salves, bath products, candles, and many other products can carry popular autumn scents. Autumn festivals, carnivals, and other events give cannabis business owners more formats in which to introduce their products to consumers.

In the wake of devastating wildfires in Northern California, many cannabis farmers were dealt a particularly hard financial blow. Cannabis businesses are generally unable to obtain insurance coverage. This is because the insurance industry is regulated by federal law – a federal law which classifies marijuana as an illegal substance. For this reason, when millions of dollars of crops were destroyed, the losses were not compensable. The wildfires also destroyed cash reserves of many businesses. Many cannabis businesses are forced to operate entirely in cash for the same reason – federal law prohibits regulated banks from offering financial services to cannabis businesses. With large cash reserves on site and many evacuation orders coming instantaneously, business owners were not always able to save their business funds. Now, the state Department of Insurance is speaking to cannabis business owners to learn about the challenges they face, and how the insurance industry can better meet the future needs of the cannabis industry.cannabis business lawyers

A New Option for Protecting Cannabis Business Assets

A series of recent moves within California’s insurance industry indicate that cannabis business owners may be better able to protect their assets from future acts of force majeure. The Insurance Journal reports that, for the first time, a carrier admitted to the California Department of Insurance has filed to provide coverage to legal cannabis businesses within the state. Other carriers have expressed the desire to file with the Department to offer similar products to the legal cannabis industry. Standardized insurance forms for the cannabis industry may also be available in the very near future.

Identifying the target market of a business is an important step for any entrepreneur. Profitability can be enhanced by spending advertising budgets effectively, and expanding into markets which have the best potential for sustained business growth and profitability. Entertainment icon Whoopi Goldberg is now breaking into the cannabis industry with this strategy. She and her business partner, Maya Elisabeth, are marketing their products to the medical needs of women.cannabis business lawyers

The Whoopi & Maya Market

Goldberg and Elisabeth launched their cannabis brand, Whoopi & Maya, with a focus on female users. The Daily Beast reports that this has allowed them to gain traction in California’s expanding market for topical cannabis products. And as their business has expanded its efforts to meet the needs of women, Goldberg herself has become vocal on another issue: the use of medical marijuana to treat menstrual pain. She lives in New Jersey, where Governor Chris Christie has rejected legislative efforts to add menstrual pain to the list of qualifying conditions for accessing medical marijuana in that state. Goldberg claims that Christie has stated “several times” that he doesn’t believe period pain is real pain. This has spurred her efforts to market Whoopi & Maya products to sufferers of menstrual pain, and raise awareness of the issue in her public appearances. Continue reading

In April 2017, Governor Jerry Brown signed an executive order which declared an end to the state of emergency in California related to the drought. This lifted many of the legal restrictions placed on water use of California residents and businesses. Unfortunately, California’s water woes are far from over. Marijuana farmers and grow operations are finding it particularly difficult to meet their high water consumption requirements while meeting obligations under state water laws.cannabis business lawyers

 

The Conflict Between Business Needs and Conservation of State Resources

California’s Mojave Desert is the site of many new cannabis grow operations. News Deeply reports that American Green (the country’s largest publicly traded marijuana company) purchased the entire town of Nipton, California. Nipton is home to twenty residents on eighty acres of land. American Green plans to turn it into the first cannabis resort in the United States. The resort will boast Wild West themed amenities, employee housing, and bottled water infused with cannabis. Unfortunately for American Green, the huge water demand of these activities could conflict with the provisions of California’s new Sustainable Groundwater Management Act. For the first time in California’s history, groundwater users must ensure that aquifers to not suffer from chronic depletion. Business owners now have a legal obligation to ensure that their depletion rate of groundwater aquifers does not chronically outpace the recharge rate by precipitation.  This places responsibility on private business owners to manage their use of valuable natural resources. In the area surrounding Nipton – where a golf club and the world’s largest solar thermal power plant have already placed significant demands on area groundwater – this responsibility could become onerous. Continue reading

While we are now the verge of having a legalized recreational marijuana industry in California, many in Los Angles fear they won’t be able to join this growing and prosperous industry due to having a conviction involving marijuana on their record. As discussed in a recent article from Civilized, marijuana laws disproportionately affect those in minority communities, and some city lawmakers in Los Angeles are hoping to reverse these negative effects.

cannabis defense lawyersThe theory behind this program is that since marijuana laws have been proven to have had disproportionate effects on African Americans and the Hispanic community, and those who suffered should not also be excluded from being able to legally make money in the medical cannabis and recreational marijuana industries. Continue reading

Throughout October 2017, devastating wildfires have taken lives and caused millions of dollars in damage all across California. While the destruction is tragic for all Californians who have been affected, one particular group of small business owners have been hit especially hard by damage. Marijuana growers are generally prohibited from insuring their businesses. This has left many Northern California marijuana growers with vast amounts of property damage and destruction, but no manner of recouping their losses. Worse, the losses come just as legal marijuana sales are set to begin in January.cannabis business lawyers

Why Marijuana Farmers Cannot Insure Their Businesses

Marijuana is entirely prohibited under federal law. There are no provisions for personal or even medicinal usage. Because of this, insurance carriers – most of whom are subject to federal regulations – are prohibited from insuring the businesses, products, or assets of marijuana businesses. Even when businesses are cultivating cannabis lawfully under the state’s Medical Marijuana Program (California Health and Safety Code §11362.7 to 11362.85), they are not able to access insurance coverage. These business losses have been even greater due to the timing of these wildfires. Salon reports that many business owners have spent “their life savings” getting permits and preparing their crops for legal sales on January 2, 2018. Continue reading

The conflict between state and federal law has caused many challenges and legal confusion for Californians ever since medical marijuana was legalized by state law in 1996. Beyond these procedural inconveniences, the legal conflict has sparked broader discussions about the role of marijuana in American society, and California, specifically. These issues came to a head when Californians approved the recreational use of marijuana on November 8, 2016. Now, all adults in California have the right to use marijuana for recreational purposes. The California government has now taken yet another step toward addressing the chasm between state and federal marijuana laws.Orange County cannabis lawyers

The Joint Resolution

Forbes reports that, in September 2017, the California Assembly passed a joint resolution to call upon the federal government to reclassify marijuana. The Resolution specifically requests reclassification for the purpose of legal research and development of cannabis for medical use. Currently, marijuana is classified as a Schedule I drug under federal law. This designation is reserved for drugs with no medical value and a high risk of abuse. For comparison: cocaine and methamphetamine are classified in the less-restrictive Schedule II category.

In addition to research and medical developments, the Assembly also identified concerns with access to financial services for cannabis businesses. The current federal prohibition on marijuana means that most marijuana businesses are prevented from using traditional banks and lending institutions. Many of these businesses simply operate on a cash basis, which makes them vulnerable to theft and violent crime, and also makes it difficult to collect tax revenues on income which is legitimate under state law, but considered illegal drug money under federal law. Continue reading

Preparations for legal sales of recreational marijuana sales in California have impacted the state economy in many ways. Not all of this growth has occurred directly in the cannabis industry. The Concord Monitor reports that the state government is on a “hiring binge” to fill jobs for scientists, tax collectors, analysts and lawyers. Hundreds of positions have been created by the daunting task of regulating an entirely new industry – one which will immediately become the largest marijuana market in the country. Thousands more jobs are projected to be added by city, country, and local governments. But what, exactly, will these workers be doing?cannabis employment lawyers

The Scope of the Task of Regulation

Regulating an entire industry – let alone an industry on the scale of California’s marijuana market – takes volumes of work beyond the simple processing of business license applications. Background checks must be run on applicants. Environmental conditions must be monitored, such as the level of cannabis derivatives in streams near grow houses and farms. Enforcement, too, will be a large part of the work of state and local governments, which must ensure businesses operate within existing legal regulations, and that illegal operations are shut down. Each of these tasks requires a variety of professional expertise. Stream levels, for example, will require the input of environmental scientists to develop acceptable standards. Engineers must monitor groundwater and water diversion patterns. Environmental lawyers will be needed to help the state government resolve complex matters of environmental law that are created by the new grow operations. All of this is in addition to the administrative tasks of processing applications and issuing business licenses. Continue reading