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Although California cannabis business attorneys know significant strides have been made with regard to legitimization of California’s marijuana industry, a ruling by the U.S. Tax Court underscored once again that until there are significant changes at the federal level, marijuana businesses are still illegal drug-smugglers under the eyes of the law. Orange County marijuana lawyer

In Harborside Health Center v. Commissioner of Internal Revenue, what is admittedly one of the largest marijuana dispensaries in California – and possibly the U.S. – requested the usual tax deductions that any legitimate business owner might seek. It also sought to be treated just like any other corporation because it abides the law in California, as our California cannabis business lawyers know many such distributors in the state do, and federal prosecutors opted not to take any type of civil forfeiture action against the firm.

The IRS, however, sees it much differently. In the eyes of federal law, as long as the U.S. Controlled Substances Act remains in place (designating marijuana as a Schedule I narcotic), the IRS sees Harborside (and presumably others like it) nothing more than a large drug trafficking ring, not entitled to those deductions or even allowed to capitalize indirect costs into its inventory, and further subject to potentially millions of dollars in penalties for taking several contrary positions on tax returns from 2007 through 2012.  Continue reading

Many retailers extend promotional offers to drum up new business or garner awareness of a new product. However, just as with almost every other aspect of operation and sales, California cannabis companies must be especially careful about how they market and promote their product. Otherwise, as our California cannabis lawyers can explain, distributors may find their green business deep in the red – and themselves in handcuffs. marijuana lawyer

Recently, The Olympian reported recently that a pot shop owner in a Washington state suburb drew the attention and ire of state regulators for allegedly passing out free samples in violation of the state’s recreational marijuana laws. An undercover investigation was launched after officials received an anonymous tip about an alleged illegal marijuana club on site. Social media advertisements indicated free samples to the product were provided upstairs. Undercover officers began investigating the pot shop, and were offered free samples by an employee, who told them they could try it in another section of the building that wasn’t licensed. The officers reported that when they got to this portion of the building, they saw several individuals smoking marijuana.

The problem is marijuana retailers cannot, as Los Angeles cannabis business lawyers can explain, offer a ‘try it before you buy it” sort of deal for marijuana customers. This is largely owing to the fact marijuana business licensees in California, just as in Washington, are required to keep track of their product from seed to sale. By diverting products to be distributed as free samples, they are in violation of the law.  Continue reading

Los Angeles marijuana attorneys know the cannabis industry has worked diligently since Proposition 64 was passed to shed its past image of lawlessness. An alleged plot in San Diego isn’t helping, though the case has helped bring to light certain marijuana businsess regulatory loopholes that state lawmakers are now working to address. Los Angeles marijuana lawyers

Local news media is reporting a prominent property owner and marijuana owner, along with two associates, is accused of cooking up a plan to kidnap and murder a business partner while in Mexico. He has been arrested on charges of criminal conspiracy, leaving the Southern California cannabis community stunned. Many trade industry groups have refused to discuss this case, and while our Los Angeles marijuana attorneys will point out that the accused is innocent until proven guilty, it is important to point out that even if proven, this conduct is not reflective on the rest of the cannabis business community – despite the way in which staunch prohibitionists in many communities will undoubtedly attempt to twist it.

The truth of the matter is concerns regarding public safety that were raised time and again by die-hard cannabis prohibitionists haven’t been realized. The truth of the matter is in San Diego, where these individuals reportedly worked, has not reported any noticeable uptick in violence among operators of the city’s lawful marijuana dispensaries. Of those violent incidents that have been reported, almost all involved illegal, unregulated cannabis dispensaries. Legalization and regulation is a form of protection not only for owners and operators of the business itself, as well as neighbors, customers and connected industries.  Continue reading

A couple from Minnesota was recently convicted on federal possession with intent to distribute charges after they were accused of hauling more than 1,000 pounds of California cannabis in their RV and were on their way home when they were stopped in Montana. They face between 5 and 40 years in prison for the charges, plus a $5 million fine and up to four years of supervised release. It’s not clear exactly how officers were tipped off to the pair, though Los Angeles marijuana business lawyers understand Montana authorities were notified via the Minnesota drug task force before they were stopped leaving a casino. Defendant reportedly told authorities he was paid $20,000.Los Angeles marijuana lawyer

Transport of marijuana across state lines has always been a federal crime, and the fact the drug can now be obtained legally by adults in states like California has not changed that. Even traveling from a state like Washington to California – where the drug is legal for recreational purposes in both states – is technically a crime in the eyes of federal law. It may even be considered trafficking, and you could face five years in prison for possession with intent to distribute as little as 50 grams.

Practically speaking, if you transport cannabis across state lines from one state to another where both have legalized cannabis for recreation, you may not incur any serious penalty. But if this is something you are thinking about or planning, take no action before first speaking with a Los Angeles marijuana attorney because technically, to do so IS a crime. Continue reading

Although cannabis has been legal in California for recreational use since the start of this year, Los Angeles marijuana lawyers know there continues to be much confusion as to what is allowable and what isn’t in the course of conducting business. One legal woe cropping up of late involves marijuana shipping and transport. Shipping out-of-state (or sometimes even in-state) is fraught with legal pitfalls. If you are not careful, you and/ or your associates could wind up facing serious criminal charges, not to mention hefty fines.Los Angeles marijuana business lawyer

Because the federal government considers marijuana to be a dangerous narcotic, it is a federal felony offense to transport it interstate. Because of the Supremacy Clause in the U.S. Constitution, the federal government can prosecute you for federal crimes, even if your actions are legal under state law. In-state transfers can be done lawfully, but it depends on the circumstances.

California’s Bureau of Cannabis Control lays the groundwork for the state’s digital track-and-trace system and is responsible for licensing every vehicle used to transport marijuana across the state. Continue reading

This year was the first in which Californians could freely grow, sell, buy and use marijuana purely for purposes of recreation without the constant threat of criminal law enforcement intervention. However, almost nowhere in the Golden State can new marijuana business owners say it’s been an easy road.Los Angeles dispensary lawyer

Prop. 64, which opened the doors to recreational marijuana, imparted a significant amount of power and discretion to local jurisdictions to decide the type and volume of marijuana businesses that would be allowable. Some communities, like San Jose and San Francisco, embraced commercial cannabis at the outset. Meanwhile, others like Fontana have tried to outlaw the shops entirely. Those with the harshest restrictions have in some cases (Fontana, for instance) been successfully challenged.

For the most part, communities agree the drug should be legal, but just practically speaking, it takes time to supplant an unregulated market. Questions have still arisen regarding how the wealth should be distributed, who gets a chance to participate and how tight should restrictions be. A dedicated California marijuana dispensary attorney can advocate on behalf of all types of cannabis corporations, whether a brick-and-mortar store, a delivery service, farmers or ancillary business.  Continue reading

Amid the booming Southern California cannabis industry, the City of Sacramento is weighing whether to lift the existing cap on the number of marijuana dispensaries licensed to operate in the city, the primary goal being to offer more opportunities to minorities. Since 2014, the number of pot dispensaries permitted by the city has been capped at 30. When recreational marijuana was legalized in California almost a year ago, the city maintained that cap, allowing only those dispensaries that already existed authorization to continue selling. No new licenses were distributed. Of those dispensary owners, not a single one is black. This is problematic and has been vocally opposed by the California Urban Partnership. City officials say they don’t track dispensary owner race. California marijuana dispensary attorneys

Still, it is considered an issue worth addressing, particularly considering people of color are more likely to have been victimized by the failed War on Drugs and have prior drug-related convictions. The city did form a program, CORE, that will waive permit fees for new dispensaries, but because of the cap, no new dispensaries can even be opened once the program officially launches.

Talk of raising the number of dispensaries allowed in the city arose for this reason, though the mayor conversely suggested preference could be given to minorities should one of the existing dispensaries happen to close. However, that’s fairly unlikely, given how lucrative California marijuana dispensaries are and will almost certainly continue to be.  Continue reading

When California voters approved Proposition 64, it included a provision that give wide discretion to individual communities regarding how much of a berth they wanted to give cannabis companies and customers. In San Bernardino County, Fontana marijuana lawyers soon understood that in this community, authorities were eager to take a hard line stance – particularly on home grow operations. Fontana marijuana lawyer blog

Now, Fontana’s de facto ban on home cannabis grow operations has been nixed in a San Bernardino Superior Court ruling, finding the city’s rule’s to be “excessive,” paving the way for individuals to grow and possess amounts of the drug that are more in line with state provisions, which are far more lax.

This is likely to prompt other municipalities to look carefully at their own policies if they are tighter than provisions of state law.  Continue reading

For as long as the people of California have sought marijuana, the black market has existed. Even when the state legalized medicinal use in 1996 and then paved the way for lawful recreational use with a ballot measure last year, Los Angeles marijuana lawyers know the reality is illicit pot shops and sales have always outpaced the legal market. The hope was we’d see a shift, a significant tapering off of demand for illegal marijuana now that with recreational pot now available. But as of right now, they have retained a larger hold than facilities operating according to the stringent regulatory guidelines set forth by state and local officials.Los Angeles marijuana lawyers

Los Angeles marijuana lawyers had seen many long-time operators on the California cannabis scene try to work their way into the newly-forged legal market to finally be legitimate, only to end up continuing to work the riskier – bit more lucrative – illicit market. This includes unlawful medical marijuana collectives, cannabis delivery services and cultivation farms that haven’t been properly vetted according to stringent state law.

Some of these individuals are focused on pursuing “OT” money, generated from “out-of-towners.” Of course, such sales are especially risky because, as our Los Angeles marijuana lawyers know, rules can vary from city to city and certainly from state-to-state and country-to country. Black market sales are playing with fire given the uncertainty of how federal authorities are going to handle future sales. Despite the Jan. 1st legalization of recreational use and sales in the Golden State, cannabis is considered an illegal crop from the top-down under the Controlled Substances Act, and as a Schedule I narcotic, it’s one of the most most heavily regulated – despite being one of the most commonly-cultivated and sold. And it’s going to be extremely difficult to move away from that given its history with illicit sales and use.  Continue reading

While the California marijuana market has scored some major wins in recent years, most notably with recreational legalization in 2016, there have been a number of significant growing pains along the way. A couple of the more significant issues our Los Angeles marijuana business attorneys see facing clients is problems with legal permitting for pot shops in L.A. and litigation over intellectual property, such as trademarks and propriety business information. marijuana business license

Poised to be the largest marijuana market in the world, the way in which Los Angeles tackles these issues is likely to be closely watched and highly influential (for better or worse). But, unfortunately, many hundreds of marijuana entrepreneurs have been left cooling their heels as the city works through the regulatory rollout of its commercial cannabis oversight.

Marijuana Business Licensing Headaches

Unfortunately, there is no guarantee that’s going to pay off because the significant snag is licensing. City officials gave the green light to nearly 170 marijuana retailers. Meanwhile, among farmers, producers/ edibles manufacturers, distributors, quality control test labs and others, the number of combined permits the city has issued is: Zero. Zip. None.  Continue reading