Articles Posted in California marijuana business lawyers

Last month, industry and media reports detailed two bankruptcy cases of individuals with financial connections to the marijuana industry. One a landlord and another an employee of a cannabis worker staffing agency. Although the staffing agency employee was denied the right to pursue bankruptcy, U.S. Court of Appeals for the Ninth District, which has jurisdiction in California cases, granted permission for the landlord who rented to a dispensary.

Marijuana Company Workers, Landlords, Contractors Seek Financial Shelter in Bankruptcy

Bankruptcy is an important right in the U.S. after moving away from the practice of debtors’ prisons in the 19th Century. Both Chapter 11 and Chapter 13 bankruptcy provide individuals with a fresh financial start and shot at a real future, free of looming debt they would have no hope of ever paying off.
Chapter 11 is a reorganization of debts, while Chapter 13 involves creating a manageable plan of repayment stretched over a period of time.
To deny this critical avenue of relief to those just because they work for or do business with a state-legal cannabis company is unconscionable.

Chapter 13 Bankruptcy Denied to Oregon Marijuana Ancillary Business Employee

One of those involves a woman from Oregon employed by a marijuana staffing agency. Marijuana Business Daily reports the appointed federal trustee is a bankruptcy monitor employed by the U.S. Department of Justice.
She had filed for personal Chapter 13 bankruptcy. protection The trustee filed court documents asserting the woman did not have the right to relieve for personal bankruptcy because her earnings were tied to marijuana sales and citing federal prohibition on the drug.
As longtime cannabis business attorneys, we found this ruling troubling in scope.
The good news is, that court’s ruling is not the final word on this.

Appellate Courts Issue Conflicting Rulings on Cannabis and Bankruptcy

That same month, the 9th DCA in Garvin v. Cook rejected the argument of the DOJ’s trustee to deny the landlord Chapter 11 bankruptcy protection, affirming the bankruptcy court’s decision to allow plaintiff’s right to bankruptcy protection.
The DOJ trustee responsible to oversee the bankruptcy cases argued before both the bankruptcy court and the appellate judges that Chapter 11 bankruptcy was not appropriate in this case, as the landlord rented commercial space to a marijuana dispensary.

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Two cannabis delivery companies – one Californian, one Canadian – are facing off in a San Francisco civil lawsuit involving customer payment processing fraud. The Toronto-based firm is accusing the other of carving an unfair market advantage by using European shell companies to illegally processing customer payments via credit or debit card.cannabis credit card processing

By processing both debit and credit card payments from customers through its online platforms, plaintiff alleges its biggest cannabis services competitor committed wire and bank fraud. A spokesman for the stateside company called these allegations, “false.”

As longtime Southern California marijuana lawyers, we recognize that in any other industry with any other product – this would not be an issue. Unfair business practices lawsuits crop up fairly often enough, but most competitors aren’t concerned with how each other’s payments are processed. Cannabis commerce is the only place we see this because of the labyrinth of laws varying. It starts with the statutes in 34 states plus Washington, D.C. that directly conflict with federal classification of the drug and only gets more confusing from there. Continue reading

Once seemingly-impenetrable marijuana regulations loosening their grip across the globe. With that, California cannabis business and industry leaders are ramping up efforts to establish shops and services that are not just licensed, stocked and accessible, but that give them an edge on increasingly fierce competition. That means strategic locations, expanded delivery services, a diversified product line and experts as employees.cannabis company lawyer

Cannabis stocks have risen sharply in recent years, and despite hesitation given that it remains a Schedule I narcotic, the trend is expected to continue through the Q3 and Q4 of 2019.

But cannabis business attorneys urge entrepreneurs to carefully consider the full picture before taking their stock public. The process is complex and expensive – and risky. That risk can pay off, but it’s imperative to first discuss your marijuana business plan with a qualified lawyer because surging forward without careful deliberation and sound reasoning. Continue reading

If a Louisiana coroner’s report is to be believed, a 39-year-old woman in the Bayou State became the first person on record who died of a marijuana overdose. On the other hand, marijuana experts are highly suspicious of the coroner’s cause-of-death listing, especially as she indicated it with “100 percent certainty.”cannabis attorney blog

But that certainty stemmed from the fact she could find no other obvious cause for why a woman with healthy organs, no alcohol or other drugs in her system and no obvious illness would have been discovered dead on her couch.

Can THC Really Result in a Fatal Overdose?

Probably not. Although this may have been a tough case to crack, the reality is Americans use billions of cannabis products annually. This has been true for a long time, not just since legalization came about, and this is the very first time an overdose has been formally attributed to cannabis – and skeptics abound.

The coroner noted that THC, the psychoactive ingredient in marijuana, can result in severe heart palpitations and anxiety, perhaps leading to heart failure, and it was present in 15 times the detectable amount in this patient. Although this might seem startling at first, the reality is marijuana in the bloodstream is not like alcohol; it passes slowly through the system and lingers, long after the effects. A regular user could have high levels of concentration in their blood, yet not even be “high.”

While our cannabis lawyers concede the circumstances are puzzling, a number of medical and scientific experts have expressed deep skepticism, especially given an asserted conclusion of 100 percent certainty when the report reflected circumstantial evidence and process of elimination AND there have been no recorded deaths attributable to marijuana overdose, per to the National Institute on Drug Abuse. A number of medical experts quoted in a series of media reports called the coroner’s conclusion “highly unlikely.” Continue reading

Licensed marijuana business leaders are fed up with pervasive scofflaws, saturating the market with unfair competitive advantage (they’re not paying for exorbitant taxes, seed-to-sale tracking and quality testing). Customers are swayed by lower prices, and some may even be tricked by ripped-of branding/copyright violations.marijuana lawyer

One of those companies is now threatening the city with legal action if they don’t start enforcing statutes and ordinance against unlawful business practices. The licensed cannabis company sent a letter to to the city attorney specifically requesting beefed up enforcement against illegal pot shops. By some estimates, these number in the hundreds.

In that letter, the cannabis company opened by saying that during the slow roll-out of regulated recreational marijuana sales, the city attorney’s office as well as the city attorney himself “overlooked” and “ignored” the businesses interests of licensed, regulated shops, as well as city residents – South Los Angeles especially, where there seems to be the greatest concentration of illegal pot stores.

What Duty Does the L.A. City Attorney Have to Address Illegal Pot Shops?

Following a 2017 special election, voters approved Measure M, which spelled out the city’s regulatory and tax framework as well as plans for criminal and civil penalties imposed on unauthorized shops. These included various civil fines for nuisance offenses by these operators and landlords, as well as enhanced punishments/fines for actions like disconnecting power and water utilities. Continue reading

The first step in any successful marijuana business plan is knowing your audience. For marijuana entrepreneurs, that means paying careful attention to the fact that not only are one-third of U.S. adults over 21 interested in trying legal cannabis, but also understanding why.medical marijuana attorney

The answer may surprise some folks: It’s not to get high, but for medicinal reasons.

Studying Cannabis Consumer Motivation

A recent survey conducted by market analysts at Nielsen reveals those interested in trying cannabis wanted to do so for wellness-related reasons, often for treatment of pain. The breakdown for motivation is as follows:

  • To ease chronic pain (migraines, arthritis, neck & back pain, menstrual cramps) – 85 percent
  • Improve mental health state – 82 percent
  • Treatment of minor injuries – 82 percent
  • Use as a sleep aid – 77 percent
  • Relaxation – 74 percent

Treatment of a non-pain-related medical condition or disease, overall improvement of public health and enjoyment with family and and friends were other reasons noted. Continue reading

Just 25 years ago, virtually every company in America enjoyed freedom from virtually any duty to accommodate workers who used cannabis. At the time, California was still a handful of years away from being the first state to legalize medicinal marijuana and the thought of legalized cannabis for recreation seemed a laughable pipe dream. marijuana drug test work California

The tides have rapidly turned, with 33 states permitting some degree of access to medicinal marijuana, soon-to-be-11 states allowing recreational sales and use and still others on the fence. The drug does, however, remain a Schedule I narcotic per Title 21 of U.S. Code, the U.S. Controlled Substances Act.

As it pertains to rights and duties of employees and employers, those working in the federal government must be especially careful – particularly if they are in the military and/or require security clearance to do their jobs. Even something as benign as investing in marijuana stock has been used as an excuse to revoke security clearance.

But federal employees aren’t the only ones whose jobs may be on the line if they test positive for marijuana – even if they have a recommendation from a medical doctor. Continue reading

Dozens of bipartisan Congressional leaders signed onto a letter pressing top law enforcement agencies for faster action in approving marijuana cultivation for government research. The Associated Press reports the letter advocated for more analysis of the medicinal properties, benefits and potential risks of the drug.marijuanaresearch-300x200

Orange County marijuana farming lawyers know this would be a substantial first step to decriminalizing cannabis at the national level, a move that could have significant implications for state-legal dispensaries. Because cannabis remains illegal under the U.S. Controlled Substances Act – especially in the highest-risk classification – California marijuana farms, production centers, labs, landlords and ancillary businesses know the Cole Memo is little more than a tenuous truce. They are largely at the mercy of political whims, and while it seems certain legalization (or at least lower classification) will be inevitable, the question is: When?

A Schedule I narcotic like marijuana is considered by law to be extremely dangerous, highly addictive and have no medicinal value. Even those opposed to federal legalization for recreation know this description is absurd. The problem is its classification has prevented reputable study for decades. Yet the government has argued it doesn’t have enough data to eschew the Schedule I categorization – so it becomes a catch-22. Continue reading

Industrial hemp agriculture and production is now legal in California. Following the passage of the 2108 Farm Bill, followed by the recent launch of the California Industrial Hemp Program, following approval of Division 24 of the California Food and Agricultural Act. This measure allows registered growers and established agricultural research institutions the green light to grow industrial hemp.hemp attorney

Farmers in Orange County are finally ready to dig in, looking to carve a market niche of one of hemp’s many products, including:

  • Textiles
  • Lotions
  • Paper
  • Biofuels
  • Animal feed

The list goes on for miles, which sets the stage for this incredibly versatile part of the cannabis plant to quickly become an invaluable cash crop and one of the fastest-growing cannabis markets in Southern California. We may even see some marijuana dispensaries and related companies shift their sights more to this sector, given that the glut of black market recreational marijuana and intense state regulatory requirements have left many pot shops struggling to stay afloat

Our Orange County hemp attorneys do urge industrial hemp entrepreneurs to be diligent in the exercise of abundant caution with respect to careful following of local, state, federal and international regulation for hemp cultivation and sales. Basic information costs, restrictions and licensing is on the state’s industrial hemp program page. However, any question hemp law firm that can help establish a business plan, ensure licensing is and navigate the complex regulatory scheme by which hemp growers need to abide for above-board cultivation. Continue reading

A number of cannabis trademark infringement lawsuits have been cropping up nationally. Many involve other dispensaries or ancillary businesses in nearby marijuana markets, but an increasing number pit other plant businesses against pot shops. Horticulture, lumber and other “green product” companies are more likely than other industries to discover an overlap, considering many use shades of green and plant icons in their brand bibles.Los Angeles cannabis trademark attorney

L.A. marijuana trademark attorney noted the latest in this trend is an established Idaho lumber company suing a Massachusetts cannabis dispensary. The allegation is that the “tree” logo used by the New England dispensary bears striking similarity to that of the lumber company, using the same green or alternative black color and an encircled tree with six branches.

This, plaintiff tree company says, has the potential to cause confusion among its office supply and wood products customers – one of whom is the U.S. government. As a $5 billion federal contractor in business 55 years, it is compelled to provide a drug-free work environment, which includes cannabis, and conducts random drug-testing of employees. Defendant dispensary, meanwhile, opened just a few months ago. It also uses a green-tree-in-a-circle logo, though their tree has four branches.

The firm is seeking monetary damages and an order that the new company halt use of the trademark.

L.A. Marijuana Attorneys Can Assist With California Cannabis Branding Strategy

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