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(Posted Oct. 26, 2010)

California and its Medical Cannabis Laws: A State of Confusion

        In 2003, the California Legislature tried to “fix” the Compassionate Use Act (Proposition 215) which California voters passed in 1996.  The problem with the original voter initiative was simple:  it did not allow for a safe, legal and consistent supply of cannabis for patients.    When the legislative “fix” took effect on January 1, 2004, one short provision in it changed the legal framework but it also caused massive confusion.   California Health and Safety Code section 11362.775 states the patients can associate “…collectively or cooperatively to cultivate marijuana for medical purposes…”  Prior to 2004, under the old framework of Proposition 215, two patients sitting in a room together could not give each other cannabis.  Arguably, under the new law, if the two patients are members of an association such as a cooperative, they could distribute cannabis to each other.  I say arguably because the law is still very unclear. 

        Look at the language of the statute:  it specifically says that patients who associate “…to cultivate…”  are protected.  But what if the association/cooperative doesn’t cultivate, a common industry reality?  Law enforcement agencies who are frightened of cannabis (mostly because they know, consciously or unconsciously, that legalization will eventually mean loss of jobs and budgets for their agencies) claim that a group of patients who want to invoke this law to protect them against criminal sanctions must “cultivate” cannabis together.    In the example of the two patients in the room, if both purchased cannabis from a cooperative that didn’t cultivate and shared it with each other, some law enforcement agents would say the cooperative isn’t valid and therefore the sharing would be illegal.  In an even more extreme position, if the two members join a cooperative that does cultivate but they only purchase from the cooperative rather than take part in the cultivation, some law enforcement agencies have indicated that is also illegal.  Finally, many conservative law enforcement organizations in the state take the position that any cash transfers for cannabis are also unlawful.

        Let’s look at the rest of the language of the statute.  It says that the patients and caregivers who associate together to cultivate “shall not solely on the basis of that fact [cultivating together] be subject to state criminal sanctions under Section 11357 [possession of cannabis], 11360 [transportation of cannabis], 11366 [maintaining a place for the sale, giving away or use of cannabis], 11366.5 [making available premises for the manufacture, storage or distribution of a controlled substance, e.g. cannabis],, or 11570 [abatement of a nuisance created by premises used for manufacture, storage or distribution of a controlled substance].”

What does that mean?

For at least one court [People v. Urziceanu  (2005) 132 Cal.App.4th 747, 785], that phrase was interpreted broadly.  The court said that the Legislature’s “specific itemization of the marijuana sales law indicates it contemplates the formation and operation of medicinal marijuana cooperatives that would receive reimbursement for marijuana and the services provided in conjunction with the provision of that marijuana.”

Well, that’s extremely helpful and a lot better than the position of law enforcement.  Under this decision, a cooperative can sell marijuana to its patients.  And the court also said that a cooperative could purchase cannabis on the black market for its patients!  Of course, the Attorney General, charged with writing regulations under SB420, later (in 2008), wrote that the cooperatives must be a “closed circuit” of cultivation and consumption.   But even the Attorney General is not the final word on cannabis cooperatives (which is a good thing since conservative LA District Attorney, Steve Cooley, running for State Attorney General, will probably win and if he does win, he will most likely withdraw the generally favorable Jerry Brown guidelines currently in place and replace them with guidelines that will make conservative law enforcement happier, e.g., no sales, no money exchanged, cultivation only, etc.

Stay tuned for more on these issues

Los Angeles:  To Cannabis or Not To Cannabis

I have to admit that when LA medical cannabis industry and its “operators” arrived en masse on the scene after SB 420 passed (going from something like 0 to 1000 dispensing operations in less than 3 years) I didn’t want to go to LA and work with them.   The scene struck me as anarchic, out of control and clearly, almost every LA operations violated numerous state laws.  Why risk my license to practice?  Plus, it looked to me like the attorneys were letting their clients lead them around by the nose.  If the client wanted to make money and if the attorney wanted to make money off the client, the attorney said sure, do what you want.  It just felt dirty.  Northern California seemed like a better place for my in every way.

So, why did I finally relent and open up an office in LA?

First, Mike Chernis, an attorney, colleague and friend begged me to come down and help him challenge the LA Ordinance.  He said it was horrible and violated patients’ rights.  I reviewed it with him and came to the conclusion that it did violate patients’ rights to privacy, to associate freely and violated their equal protection rights as well (all under the California Constitution.)

Second, I knew that eventually, the industry would have to become more realistic about California’s vexing non-profit requirement and that the models our Firm developed for successful cooperative formation and compliance would become popular among those willing to make the critical compromise, trading money for safety.  I wanted to make sure that our model and our approach would be available to the industry.   Too many attorneys were setting up structure that made their clients vulnerable to law enforcement action.

Third, as the nation’s largest and most experienced law firm serving the medical cannabis industry, I believed that we must have a presence in the Nation’s second largest City and the City with the most patients and cooperatives.

So, almost 8 months later, here’s what we’ve been doing in LA.

1.    We are lead counsel in Anderson v. The City of Los Angeles, BC 438671, a class action lawsuit brought on behalf of medical cannabis patients residing in Los Angeles, challenging the constitutionality of the City’s medical cannabis ordinance.   Judge Mohr, who has been assigned all of the medical cannabis cases brought against the City, has so far scheduled 3 separate days for oral arguments (the next one is set for November 3 and we’ve had two so far) and I have been at counsel table as the main attorney handling the argument for the plaintiffs so far.  On the first day we had about 200 lawyers, media and patients crowding a courtroom the judge moved us to in order to accommodate the huge crowd.   Stan Kimmel spent the first part of the hearing discussing whether the State’s Uniform Controlled Substances Act pre-empted the criminal penalties in the Ordinance.  We then spent the bulk of the session, about an hour and a half, discussing whether the City could lawfully require the cooperatives to disclose the names of their patients/members to the police without a warrant or subpoena.  My favorite moment in that hearing came when the Court asked the City’s attorneys what they planned to do with the patient information.  The reply?  We will give it to the police!  I had been standing up to continue arguing but when I heard that, I sat down. 

 

At the second session the judge continued the discussion about privacy rights and if I had to guess, I’d say that he will find the provision unconstitutional.  We then moved onto associational issues.  This is about our government guaranteeing that we have the choice to associate with whomever we please without interference.  For medical cannabis patients who must join a cooperative to comply with State law of face a criminal sanction, it’s difficult to see how the City can not only tell people who to associate with but also tell them they can only join one cooperative. 

 

The next hearing is set for 1:30 – 4:30 in Judge Mohr’s courtroom at the Central Civil West courthouse located at 600 South Commonwealth Avenue, Los Angeles.  Anyone can attend and if you’re interested in the politics and legal issues, it’s a fascinating discussion.   Meanwhile, I hope we can get the judge to see that treating medical cannabis patients like criminals is just wrong!

 

2.      We opened an office downtown at the Wells Fargo Center, [333 S. Grand Avenue, 25th Floor, Los Angeles, CA 90071  Tel. (213) 943-1385] where we hold workshops and meet with clients.  We may move and a number of different options are available to us.  We’ll keep everyone posted if we do decide to move.

 

3.      We’ve made ourselves available to the legal community for advice and consultation and to partner on cases.  Because we’ve got over 30 years of combined experience addressing medical cannabis issues nationally (between us and our Denver staff) we feel responsible for ensuring that clients receive the best legal advice possible, even it that advice comes from another attorney!   We freely share our briefs and legal theories with other attorneys.  One colleague referred to us as “free market collaborators.”  There’s an enormous amount of work ahead of us and we want to help organize the legal community to take it on and coordinate as much as possible.  Civil rights attorneys in the South during the Civil Rights Movement worked together and with their constituencies/clients closely and those combined efforts paid off in countless ways.  We see medical cannabis as a civil rights issue and encourage everyone to think about medical cannabis not only as an important economic boon to our community but as way to put an end to this outrageous, stigmatizing, divisive, and class- and race-based, drug war.

(posted July 2010)

I.  California

    A.  Problems with SB 420

The language of SB 420, also known as the Medical Marijuana Program Act,  passed by the California Legislature in 2003, continues to vex and confuse patients and cause roadblocks for the development of an organized and well-regulated industry throughout the State.  Law enforcement and cities and counties, have taken advantage of the ambiguous language to either ban or unduly restrict patients cooperatives, or, in some cases, even arrest the patients running the dispensing operation.

The problem finds its source in Health and Safety Code section 11362.775 (part of SB 420) which states that, "[q]ualified patients...who associate within the State of California in order collectively or cooperatively to cultivate marijuana for medical purposes, shall not solely on the basis of that fact be subject to state criminal sanctions under Section 11357, 11358, 11359, 11360, 11366.5, or 11570." (those sections of the Health and Safety Code prohibit the sale, distribution, manufacture, cultivation etc. of cannabis.)

Taken literally, the statute says that patients can join together to cultivate cannabis for medical use.  It does not say however, that the patients can do anything else such as distribute the cannabis.  Luckily, no one, including law enforcement, has taken that restrictive an approach.  However, law enforcement has interpreted the statute very restrictively to mean that patients can form cooperatives and grow medical cannabis but that there can be no cash transactions.   This approach is taken by DA's around the state, from LA where Steve Cooley is trying to shut down as many cooperatives as possible, to northern DA's such as Jim Fox in San Mateo County.  This approach is also found in most other counties and cities.  By removing any possibility that patients can reimburse their cooperatives for supplying them with medical cannabis, law enforcement is attempting to cut off access for patients.  Ironically, and in sharp contrast to the approach taken by conservative law enforcement, the California Attorney General in his August, 2008 Guidelines, specifically allows patient cooperatives to seek reimbursement from the patient-members. 

Steve Cooley is running for California Attorney General in November, 2010.   His opponent is Kamala Harris, the District Attorney of San Francisco.  If Cooley wins, we expect that he will withdraw the current guidelines and impose more restrictive guidelines that will disallow an cash transactions at cooperatives.

     B.  Problems with Local Cities and Counties

Despite the fact that State law allows and authorizes patient cooperatives, most of the State's cities and counties have used their local zoning laws and their business license laws to block cooperatives.  Our firm has litigated against the City of Stockton, the City of Mountain View, the City of Los Angeles, the City of Vallejo, the City of Richmond, Sonoma County, and Humboldt County, to name only some of the most recognizable governmental entities, and in only one case did a judge agree that patients should not be subjected to restrictive ordinances.  Essentially, the judge ruled that medical cannabis patients should be allowed the same access to their medicine as patients who need prescription medicines.  Unfortunately, Sonoma County appealed that ruling on an emergency basis and in a rare judicial act, an appellate court blocked the judge's order before the full appeal could be heard.  We are awaiting the chance to address the appellate panel on the issues. 

We have noticed that judges are skeptical and cynical about the medical cannabis laws and focus on the abuses rather than on the patients who need the medicine.  One judge in LA told us essentially that he saw doctors handing out recommendations on Venice Beach at tables and that if the doctors were not going to be the proper gatekeepers, then he would assume that role.   This attitude permeates the local judges and has been difficult to penetrate.  Of course, the fact that most operators of dispensaries are doing so in an unlawful manner, mostly by pocketing profits and operating in a casual, non-professional manner, has made our task of protecting patients very difficult.