Articles Posted in California marijuana business lawyers

California marijuana farmers are facing a crisis. Currently, all 9,464 state issued temporary cannabis cultivation licenses, have expired. Meant to be replacing those, for businesses continuing to meet the required regulations, are either provisional or permanent annual cannabis business licenses.

The catch though, the California Department of Food and Agriculture (CDFA) is yet to show its ability to approve those provisional or permanent licenses, at the same pace applications are being lodged.

California Cannabis License Attorney

The backlog on approvals may be due to the complexity of the licensing application process itself. Tellingly, by mid July 2019, only 2,053 provisional licenses and 230 permanent licenses had been granted. As it stands, when applying for prospective licenses, cannabis farmers are expected to demonstrate compliance with the stringent California Environmental Quality Act (CEQA), as well as submit:

  • Background checks;
  • Surety bonds;
  • Real property documents;
  • Detailed site plans;
  • Farm management practices;
  • Waste management protocols;
  • Security procedures; and
  • Pesticide measures.

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The California Department of Justice recently released a summary review of the state’s marijuana laws, leaving cannabis industry insiders are anticipating a crackdown on the black market.cannabis regulations

Attorney General Xavier Becerra’s 16-page document is being referred to as California’s Marijuana Bible summarizes state laws and draws clearer lines as to what is legal – and what’s not – when it comes to medical cannabis. The guidelines are especially focused on the growth, enforcement, transportation and use of medicinal marijuana, and they come after significant changes in the state’s laws pertaining to recreational cannabis.

The record scans through two decades of state law, regulations and guidelines of the growth, sale and transport of medicinal marijuana. Although the Attorney General’s Office referred to it as a reflection on the evolution of the state’s laws, many cannabis lawyers and others see it as a warning shot to unlicensed marijuana operations. Continue reading

California cannabidiol (CBD) products are on the map, and investors are taking notice. But given that CBD-infused products are still relatively new to market, regulators continue to closely review the category. For this reason, acquisition strategies may be a ways off yet, but industry insiders predict consumer companies will see high minority investment interest in the short term.

CBD is naturally found in cannabis plants, and is widely known for its relaxing properties. But CBD won’t produce a ‘high,’ as it lacks the psychoactive tetrohydrocanabidiol (THC), found in marijuana.  CBD-derived products have quickly grown in popularity, thanks largely to a wide range of potential health benefits, including relieving pain, anxiety, seizures and brain injuries.

California Cannabis Investors

According to Michael Lux, partner at Crowe accounting firm, the next 6-12 months will involve strategic minority investments in the CBD space. He noted too that while the majority of CBD companies are of interest to investors, they are still less than five years old, so they’d likely need a little more time before preparing to engage in full exit strategies.

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A California city is facing litigation brought by a cannabis company claiming the rule barring deliveries from out-of-county retailers into unincorporated areas violates state statute.marijuana delivery
In East of Eden Cannabis Co. v. Santa Cruz County, filed in the local Superior Court, the Salinas-based firm is fighting for the right to be allowed to deliver to these regions. Los Angeles cannabis attorneys know that precedence set in this case could potentially impact how other courts decide similar cases in the future. 
In particular what is interesting about this case is not so much the substance of the complaint, but the fact that it echoes a familiar refrain echoed following the passage of Prop. 64, which gave local governments broad discretion in regulating marijuana growth, sales and distribution in their jurisdictions. This has led to a patchwork of laws that can be as confusing as they are frustrating.
What is allowable in county or city may not be in those neighboring. The onus is on the company or individual to know what the rules are – which is why consulting with an attorney in the course of your business planning is imperative.  

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marijuana dispensariesCalifornia has kicked off a multi-lingual public awareness campaign, urging cannabis users throughout the state to ensure they’re purchasing from legal dispensaries.

Amid growing calls from licensed cannabis dispensaries, The California Bureau of Cannabis Control’s “Get#weedwise” program aims to educate consumers on the risks they face when buying from unlicensed retailers. It also advises that safest pot purchases are made with licensed dispensaries and warns illegal business operators of consequences they can expect if they continue to trade without a license.
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marijuana businessMarijuana supporters in California rejoiced late last month as legislation passed by the U.S. House of Representatives could afford the industry more freedom to grow. Currently, the recreational use and sale of marijuana is legal in California, along with 10 other states, and Washington D.C. But federal law continues to classify cannabis as a Schedule 1 narcotic. While it is yet to happen, this makes folks in the cannabis industry weary, as the door remains open for the federal government to prosecute against cannabis related businesses, even in states that have legalized marijuana.

The Blumenauer-McClintock Amendment
The lauded legislation, known as the Blumenauer-McClintock amendment, would prohibit the Department of Justice from using federal funds to interfere with California state laws, or the laws in any state or district, legally permitting the regulated adult-use of cannabis.

Supporters for marijuana law reform are praising the legislation. Justin Strekal, Political Director for pro-marijuana organization, NORML, called it “the most significant vote on marijuana reform policy that the House of Representatives has ever taken.” That’s because the cannabis industry would certainly welcome extended protections within states that already permit the legal use and sale of marijuana.
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California shoppers are about to see a brand new line of cannabidiol (or CBD)-infused beverages hit supermarket shelves this week, despite the fact such products are still illegal. Even though federal U.S. law now allows for the creation of CBD based products (in the form of tinctures, capsules, lotions and oils, etc.), FDA guidelines restrict CBD food and beverage interstate product sales.Los Angeles cannabis business attorney

Alternative health food observers can likely tell you that locally made CBD food products have been steadily propping up all across the country for a couple of years now. As functional foods, CBD products have grown in popularity thanks to their relaxing properties, but they won’t produce a ‘high’ as they lack the psychoactive tetrohydrocanabidiol (THC) found in marijuana.

To buy CBD products until now, consumers have typically had to seek out alternative health food stores, neighborhood dispensaries, or mom-and-pop market stalls. Now, the Oki brand is about to change that. With its CBD-infused, flavored water and iced tea lines, Phivida – the premium functional food and beverage manufacturers of the Oki brand – is among the first to mass produce CBD-infused beverages and is poised to make its 360,000 bottles already produced, available in mainstream grocery stores.
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Federal reclassification of marijuana could soon be on the horizon sooner than we think, thanks to a recent appellate ruling in a case that pits parents of sick children against the U.S. Department of Justice. cannabis lawyer

The case, Washington v. Barr (previously Washington v. Sessions), challenges marijuana’s status as on of the most dangerous narcotics listed in the U.S. Controlled Substance Act, on par with heroin and LSD.

Such challenges aren’t new, and it appeared initially as if this case might go the way of all the others. But what our cannabis lawyers noted as unique – and possibly groundbreaking – in the recent U.S. Court of Appeals for the Second Circuit’s ruling wasn’t only that justices denied the government’s motion to dismiss and allowed the case to proceed, but that the court:

Took the rare step of asserting it would retain jurisdiction of the case, holding it in abeyance, citing the dire medical needs of children involved;

Effectively put the U.S. Drug Enforcement Administration on notice of the expectation that reclassification needs to happen soon – within a matter of months. Continue reading

The threat of marijuana monopolies seem like a tangible possibility in many markets across California, where costly regulation, a still-thriving black market and retail “slotting” practices that charge up to $50,000 a month for prime shelf space. Small cannabis companies are being squeezed for every penny, a growing number broke and out of the game.marijuana monopoly

Monopolies run contrary to basic free-market capitalism, and both federal and state laws exist to break them up.

In the California cannabis industry, the fear is that monopolies or near-monopolies will lead to reduced product quality, fewer mom-and-pop small businesses and more revenue funneled to large outside entities.

In some regions, just getting in the game in the first place without money or clout proves an efficient enough barrier. This is suspected by some in the city of Oceanside, an hour south of Los Angeles. Continue reading

The legal cannabis is a high-stakes game, and many companies are clamoring for insurance. It’s a $9 billion industry (expected to hit $21 million by 2022) where regulation and standards remains spotty, rules are a mishmash depending on jurisdiction, companies deal largely in cash, the product itself alters chemical brain function and remains against federal law.cannabis insurance attorney

At The Cannabis Law Group,  our Los Angeles legal team has noted that while it is getting markedly easier for many marijuana business clients and related ancillary firms to obtain insurance coverage, it’s still a hugely under-served market, particularly given its vulnerability to litigation on several fronts.

Almost all businesses face some type of legal threat at some point or another, which is the whole point of why they buy insurance. But firms that deal in marijuana aren’t “just any other firm.” Continue reading