DOJ: Marijuana Businesses Will Not Receive Bankruptcy Aid

Marijuana business owners have many reasons to carefully manage their assets. Now, a recently-published article by the U.S. Department of Justice’s Executive Office for U.S. Trustees gives another: Marijuana businesses cannot expect help with liquidation or restructuring in the event of bankruptcy. The executive office for trustees is the watchdog agency over bankruptcy proceedings. marijuana business lawyer

Like so many complex legal issues for cannabis business owners, this comes down to the conflict between state and federal law. Although California voters approved the legalization of recreational marijuana with Proposition 64 last year (and medical marijuana more than 20 years prior), it is still an illegal Schedule I substance under 21 U.S.C. Section 811, the Controlled Substances Act.

Per the recent article Justice Department officials published in the ABI Journal, the bankruptcy system cannot be used by cannabis businesses because:

  • Bankruptcy cannot be used as an instrument in the ongoing commission of a crime, and thus reorganization plans that allow or require the continuation of illegal activity can’t be confirmed;
  • Bankruptcy trustees and other fiduciaries of estates cannot be made to administer asserts if the act of doing so would necessitate violation of federal criminal law.

This is most unfortunate because bankruptcy is a vehicle through which businesses can be salvaged and emerge more financially sound. Many businesses face insurmountable financial problems, and the cannabis industry is more unstable than most. Chapter 7 bankruptcy allows a company to liquidate the business and discharge debts, while a Chapter 11 bankruptcy helps a business temporarily suspend certain obligations while …

California Now Accepting Recreational Marijuana Business License Applications

Last week, the state of California started accepting applications from marijuana businesses and start-ups seeking to operate within the state’s legalized marijuana industry in 2018. This is a major milestone from this burgeoning market, and it’s being furthered by a new online system that will allow retailers, distributors and product testing services to obtain the licensing necessary to engage in business under newly unveiled state regulations.marijuana business lawyer

Sales of recreational marijuana in California will begin Jan. 2nd. Although our state was the first to approve of medical marijuana with Proposition 215 in 1996, we have lagged when it comes to implementing recreational marijuana sales. Still, as the largest state to enact such a law, many other states following suit will be watching carefully. The state’s Bureau of Cannabis Control (the Bureau of Medical Cannabis Regulation prior to the passage of Proposition 64) announced that with applications beginning to be submitted, we’re one step closer to the issuance of the first commercial cannabis business approvals.

The launch of the online system appeared to be going well, with officials saying visitors were mostly just exploring the site as opposed to actually sending in full applications. Some got started on an application, submitting certain bits of information, and then saved it to finish later. Temporary licenses, which are effective for four months, won’t be effective until the beginning of the year, and businesses must first obtain a local permit before they can successfully apply for a state-issued license. These temporary licenses cost $1,000 per application fee. A …

L.A. Slated to Become the Largest U.S. City With Legalized Recreational Marijuana

With the approval of regulations for recreational marijuana, the L.A. City Council has paved the way for the city to become the biggest city in the U.S. to allow legal marijuana growth, sales and use.l.a. marijuana lawyer

The council’s decision followed many months of political wrangling and bitter disputes. But now, the city has clear rules that will kick off the beginning of commercial cannabis sales.

Although new cannabis businesses in Los Angeles could be open as early as January 1st, there is some skepticism about whether the floodgates will truly be open by then, given the fact that the new year is only a few weeks away and the holidays tend to be an extremely busy time, with lots of government office closures that could slow the process. There is plenty of motivation, however, given the fact that there are throngs of eager buyers in this city of 4 million people.

Marijuana has been legal in California for the last 20 years, but recreational marijuana was only approved by voters last year. While the state has its own regulations, individual cities are also scrambling to decide what additional rules and restrictions they want to impose, if any. 

In Los Angeles, the new rules passed in a 12-0 vote. The regulations that were approved are complex and extensive and, governing where and how marijuana can be grown and sold. Among the new regulations:

  • Retail marijuana businesses in L.A. will only be allowed to operating in specially-zoned industrial and commercial regions of the city.
  • Cannabis companies won’t

Marijuana Sales are Reducing Alcohol Sales

Many comparisons have been made to recreational marijuana and alcohol, particularly in how advocates have recommended regulation. Although there are similarities, we know that recreational alcohol use, dependence and abuse has caused far more issues than marijuana, and evidence suggests that trend may continue, even as marijuana legalization spreads. In fact, new research indicates that legalizing marijuana may have the added benefit of reducing the impact of alcohol-related societal woes.

During alcohol prohibition, there were some major arrests made, but organized crime benefited more than anyone else from what history shows. Alcohol is a potentially dangerous and addictive drug. However, because it is generally considered socially acceptable, anyone over 21 can purchase as much alcohol as they want. This is not the case for marijuana under the laws in what is constantly becoming a smaller minority of states and the federal law.

cannabis business lawyersWhile many people drink socially, many others drink to cope with the stress of daily life, various mental health conditions, including anxiety and depression, and other forms of trauma.  Even though most studies show that dependence on alcohol only makes those medical conditions worse, alcohol is often used as a form of self-medication even when it results in abuse.  Alcohol also is well-known to cause liver poisoning, organ failure, and now it is suspected of causing cancer, according to a recent study that was popularized via a Netflix documentary on the same subject.

Marijuana does not have these issues, and according to a recent news article from the Washington Post, legalized …

Marijuana as a Replacement to Opioids

There is no question that we are in the midst of a major opioid abuse epidemic in the U.S.  While it has gotten a lot of attention in the media lately, the solutions proposed by those in power have generally been limited to cracking down on the smuggling of illegal narcotics across U.S. border, spending small amounts of money on public health programs to fight addiction, and threatening to rollback efforts to lessen prison sentences for those arrested for non-violent drug offenses.

Many have been advocating for medical marijuana as a possible alternative to prescription painkillers that are very addictive and prone to abuse, but these efforts have so far only resulted in a lot of push back.

marijuana attorneyThe reason these conventional efforts are not making an impact is because most who abuse prescription opioids started out with a work-related injury or some type of trauma such as from a serious car accident, and then were prescribed narcotic painkillers. At some point, the insurance companies wanted to avoid paying for more of the drugs, or the doctors became concerned the patient was becoming addicted, and the prescriptions were simply cut off.  This led to typical drug seeking behavior and the problem just gets worse where some find themselves addicted to illicit street drugs.  Even though these drugs are clearly more addictive than medical cannabis, and a whole lot more dangerous, the U.S. Attorney General has just said he is looking at how to crack down on marijuana even in states where it is legal.…

Addressing Claims That Marijuana Induces Vomiting Sickness

There have been many reasons claimed that marijuana was highly dangerous and addictive by those who want to keep it illegal under federal law no matter how many states choose to legalize medical or recreational cannabis.  There are as of the time of this article, 29 states that have legalized either medical marijuana or recreational use of marijuana as well as the District of Columbia.

business cannabisOne of the reasons they argue it is dangerous is because it has been labeled a so-called gateway drug.  The many times disproven theory is that if someone uses marijuana, even though many do not see it as harmful, that a person is far more likely to try “harder” drugs such as cocaine and heroin.  In other words, marijuana is a gateway to the dangers of all sorts of illicit drug use. If we take this argument another step, some with claim these marijuana users are not only addicted to marijuana at this point, and have moved no to cocaine and heroin, but they are also engaging in all sorts of street crime to fund their pricey habit. 

As our Los Angeles medical marijuana attorneys can explain, though this theory sounds laughable to many, it is the basis for much of the opposition to the legalization of medical marijuana and the recreational use of marijuana. In addition to the gateway theory, many also argue that marijuana itself has all kinds of negative health consequences. Even though there is hardly any evidence to support any of these claims, they will …

Honolulu Police Aim to Get Guns Out of The Hands of Medical Marijuana Patients

Even in states where medical marijuana is legal under the relevant state law, it is still illegal under federal law.  This conflict of law manifests in many ways, most recently in a directive in Hawaii, where medical marijuana users in Honolulu are being asked to voluntarily surrender any firearms they may own. Officials have given them 30 days to comply with this voluntary directive.  While this may sound strange, according to a recent article from Task & Purposes, that is what the police are doing now that the state’s first medical marijuana dispensary opened a few months prior to this new plan.

marijuana defenseAccording to the local police department, a state statute essentially says that a fugitive shall not own a firearm, and neither can any person who is prohibited from owing or possessing a firearm under a relevant federal statute. The felon in possession portion of the statute is present is in the criminal code of most if not every state’s criminal code, so this is not a new argument, but those using medical marijuana are not convicted felons for the reason of using medical cannabis.  They may be convicted felons for other reasons, and if that is the case, there is no question they are not allowed to own or possess a firearm.

As our Orange County medical cannabis attorneys can explain, the second part of the statute is where it gets a bit murkier.

While this is their state law, the law in California goes somewhat further and says that a …

Medical Marijuana Expands to More States

Medical marijuana has been legal in California since 1996 as our state was the first to legalize.  Since that time, more than half of the states and the District of Columbia have legalized either medical marijuana, recreational marijuana use, or both. California, while not leading the legal recreational use movement, has recently legalized it for anyone over the age of 21 as of 2018.

cannabis defense attorneysAccording to a recent news article from the Washington Post, medical marijuana has finally arrived in dispensaries throughout the state of Maryland, and more are opening each month.  This is not to say marijuana has just been legalized for medical use in the state, but it is finally in dispensaries. The law was passed years ago, but there were so many delays and legal battles, many patients desperately in need of medical cannabis were wondering if this day would ever come. 

As our Los Angeles medical cannabis attorneys can explain, this is not a new phenomenon.  In some states, there were medical marijuana laws passed either by the legislature or direct voter action as is what happened in California, and then it took around a decade for some of these states to get the dispensaries open and filled with medical marijuana products.

One of the reasons for this is because marijuana is still illegal under the U.S. Controlled Substances Act (USCSA).  It is classified at the highest schedule, because in the 1970s, poorly informed Congress members stated that cannabis is highly addictive, very dangerous, and has a high probability …