California cannabis business attorneys

July 12, 2023

San Jose’s Cannabis Tax Revenue Dips: A Call for Regulatory Revisions and Market Expansion

San Jose, a city known for its thriving cannabis industry, is facing a significant drop in cannabis tax revenue this year. The decline, projected to be in the millions, is attributed to the growing competition from the black market and cannabis delivery services. With a predicted $19 million budget shortfall for next year, boosting tax revenue from the cannabis sector remains crucial.

The city’s budget surplus currently stands at $35 million. However, the decline in cannabis tax revenue is a significant concern. In response, the San Jose City Council has shown interest in easing the regulatory burden on cannabis businesses. Recent moves include loosening cannabis business licensing laws governing where dispensaries can establish themselves and reevaluating penalties placed on legal businesses.

Illegal sellers appear to be capitalizing on the market, often operating as seemingly legitimate delivery services, without generating any tax revenue for the city. Sean Kali-rai, a lobbyist and founder of the Silicon Valley Cannabis Alliance, expressed his concern over the growing prevalence of unauthorized dealers. He stressed the importance of the city’s Division of Cannabis Regulation in overseeing and regulating the cannabis market.

July 12, 2023

Laguna Woods: A Senior City in Orange County May Welcome Cannabis Businesses

By Cannabis Law Group

In a surprising turn of events, Laguna Woods, a city in Orange County known for its high percentage of senior citizens, is considering welcoming local cannabis shops. This move is a testament to the growing recognition of the medicinal and recreational benefits of marijuana among all age groups, including seniors.

Longtime Cannabis attorney Damian Nassiri explained to us that Laguna Woods is home to the highest percentage of senior citizens in Orange County. The city is now in discussions about allowing local cannabis shops to provide residents with easier access to medicinal and recreational marijuana. The city council is holding a public hearing on July 19 to gather more input from residents and city staff about potential regulations for these businesses.

At a preliminary discussion on June 21, council members discussed the potential look and feel of cannabis shops in the city. Most residents who publicly commented were in support of allowing cannabis storefronts. In November 2022, Laguna Woods residents passed Measure T with 61.03% of the vote, approving a tax rate on cannabis businesses. The council later set this tax rate at 10%, the maximum amount allowed under state law.

October 14, 2021

California Cannabis Company Wins Industry’s First Anti-Trust Case

By Cannabis Law Group

The cannabis industry’s first anti-trust case to reach trial was decided in favor of pot shop owners who alleged they’d been illegally edged out of the market by a would-be competitor’s unfair business practices. Jurors awarded $5 million (tripled to $15 million under the Cartwright Act) plus attorney’s fees. Los Angeles cannabis business lawyer

In Richmond Compassionate Care Collective v. 7 Stars Holistic Foundation, an independently-owned dispensary, RCCC, in Contra Costa County, sued the owners of the Richmond Patients’ Group (RPG) over allegations of conspiring to block RCCC from opening a new shop. Evidence presented at trial included evidence the defendant impeded access to the finite amount of commercial property zoned for medical marijuana distribution.

Plaintiffs argued the defendant, a potential competitor, intentionally thwarted their opportunities by submitting fraudulent letters of intent, leases, and purchase agreements to landlords of commercial properties, effectively tying up those spaces until RCCC’s permits became expired. (Local ordinance in Richmond, Calif. requires cannabis shop permit holders open up a shop within six months or lose their permit.) The defendants reportedly even went door-to-door, trying to persuade landlords to avoid leasing to RCCC. Defendants also made efforts to compel a change in city ordinance that would reduce the number of cannabis permits available (in this, they were successful). RPG was also accused of trying to influence city officials to deny RCCC’s licensing permit.

As our Los Angeles cannabis attorneys can explain, trying to compel a change in local ordinance or state law isn’t illegal. But the plaintiffs underscored it as evidence of the defendant’s purpose and intention with regard to the other actions.

RCCC alleged RPG’s efforts ensured they were closed off at every turn by RPG’s actions and eventually lost their permit – and millions of dollars in investments and potential profits. This, they allege, was in direct affront to the California Cartwright Act, the state’s antitrust law prohibiting efforts to block fair competition in the free market. Continue reading

March 25, 2020

California Marijuana Companies Under Investigation Amid Federal Prosecution Probe

By Cannabis Law Group

Los Angeles marijuana tax lawyers Prosecutors for the U.S. attorney’s office in the Eastern District of California have launched a grand jury subpoena, calling for records from Californian marijuana based companies, including the parent company of Weedmaps.

Criminal prosecutors for the U.S. attorney ordered records from 30 cannabis companies, including Ghost Management Group LLC, owner of the subsidiary Weedmaps. Through its website, Weedmaps not only provides consumers with lists of nearby cannabis retailers, it also allows consumers to find retail deals, place delivery orders, and rate compare and cannabis stores.

March 19, 2020

California Cannabis Company Facing Fraud Charges

By Cannabis Law Group

cannabis lawyer Three separate law suits have been filed, alleging that a Californian-based marijuana company and its key executive defrauded $1.2 million in loans from investors.

The suits allege that Case Mandel and his Cannadips business operations, used fictional projections — inflated by as much as 2,000 percent — to deliberately mislead lenders into investing in his cannabis companies, then Mandel supposedly held the funds without ever intending to repay them.

March 11, 2020

California Sheriff’s Office Raids Model Cannabis Farm

By Cannabis Law Group

marijuana business Arroyo Verde farm, owned by Barry Brand in Carpinteria, was considered a prime example of how a legal cannabis business could flourish under close regulation from Santa Barbara County. Then in January, a sheriff-led raid of the farm found evidence to suggest the farm was not only selling licensed products, but also selling products on the illicit market too.

This came as a surprise to some. Barry Brand had a reputation among county officials and industry investors as an honest businessman.

He was so well trusted by officials, that when a licensed cultivator property tour was given by the county to show reporters just how well cannabis regulations were going, Brand’s farm was chosen. Ironically, the tour intended, among other things, to demonstrate just how impossible it would be for a grower to siphon off crop to sell on the illicit market.

March 7, 2020

California’s Legal Cannabis Market Dogged by Industry Divisiveness and Illicit Competition

By Cannabis Law Group

California’s cannabis industry is sitting on a not-so-well kept secret — that many of its licensed, above board, legal business operators have also traded unlawfully, at some point, and to one extent or another. marijuana business

As many industry insiders have echoed, anyone turning a profit in this new era, has to have at least one hand in unregulated dealings. Chris Coulombre, CEO of Pacific Expeditors in Sonoma, has said “I have to imagine that 60 percent of the market overall is probably playing in a parallel markets, but I don’t think they enjoy that. It’s truly a decision of necessity.”

Whispers of retailers selling counterfeit products are rife. Cultivators are known to sell unregulated product on the side. But how can we blame them? Suffering terribly at the hands of price undercutting from illegal competitors, these unregulated exchanges are all taking place in hopes of keeping doors open, and businesses afloat. Continue reading

February 14, 2020

Sacramento Could Lead the Way in Cannabis Social Equity

By Cannabis Law Group

Cannabis business attorney Sacramento, California could lead the way in showing other cities throughout the state how to institute new, and broaden existing, marijuana social equity plans.

A number of Californian municipalities are yet to meet the ideal cannabis social equity standings, largely due to cannabis businesses tussling with numerous other issues, like licensing hurdles, tax hikes and the continued strength of the illegal market.

That said, of late, a pressing for increased social equity within the state’s capital has emerged. A finite focus has been set on providing both business guidance and financial support for minority communities, as well as those disadvantaged by the war on drugs.

Equity applicants take note — the state’s capital aims to grant as many as 10 of its next dispensary licenses to applicants who meet the equity criteria.

February 12, 2020

California Lawmakers Propose Cutting Pot Taxes to Give Regulated Industry a Boost

By Cannabis Law Group

marijuana business California lawmakers, in late January, breathed new life into a proposal that could cut the state’s taxes on marijuana for the short term, to help boost the struggling legal market.

Gov. Gavin Newsom has shown his support for the bill, as he now takes aim at updating California’s cannabis regulations.

Assembly Bill 1948, introduced by Assembly Members Rob Bonta, Ken Cooley, Reggie Jones-Sawyer, Tom Lackey, and co-authored by Assembly Member Mark Stone, seeks for three years to:

lower marijuana retail sales state tax from 15 percent to 11 percent; and
eliminate the cultivation tax altogether.

February 9, 2020

Where Does California’s $635M in Marijuana Tax Money Go?

By Cannabis Law Group

marijuana banking The state of California has now permitted the legal use of marijuana for two years. And tax dollars collected from the cannabis industry are already showing great impact across a variety of sectors.

Since its passing in 2016, Prop 64 has earmarked its entire cannabis industry tax revenue, minus regulatory costs, to supporting public health, repairing the environment, and bettering public safety.

New parks, healthier children, broader educational opportunities, forest clean ups, drugged drivers removed from the roads, and criminal records cleared are just some of the areas already seeing big improvements thanks to Prop 64 tax revenue contributions.

And this is just the beginning. In mid January this year, Gov. Gavin Newsom proclaimed another $332.8 million in cannabis tax revenue would be allocated to social services for the 2020-2021 fiscal year.