A Johny-Come-Lately Who Witnessed the Legend

I first met Dennis Peron at Tony Serra’s office, sometime in 1996 or 1997.  I was working on section 1983 (civil rights) litigation at the time, some cases with Randy Daar, one of Tony’s partners, and had developed a side area, helping local, small businesses with incorporations, and other mundane business matters.  That business work wasn’t a passion but it paid the bills in the beginning when I was building a civil rights practice with a brand new baby at home and a wife who was taking care of her.

Randy recommended I go to a celebration of the passage of the Compassionate Use Act in Santa Cruz the weekend after the successful vote.  I decided to go and was happy to meet some of the luminaries of the medical cannabis movement like Jeff Jones and Valeria Corral.  It was an education for me as I started to learn what these folks had been doing for years.  It was all new to me.

I remember around the same time I had a meeting with Randy at his office on Pier 5 and Dennis was there with Tony discussing some legal matter.  I can’t remember which legal issue he was dealing with but we were introduced and Dennis learned I was doing some business law.   He started asking me business-related questions and assumed, correctly, that a civil rights lawyer like me was going to help him for free.  Dennis liked lawyers around him who worked for free.   I honestly thought it was all pretty funny and amusing, (Dennis was definitely very funny!), because, at that time, I was not a cannabis lawyer and was not involved in the cannabis legalization fight at all.  I thought you smoked pot to get high.  I had no idea there was something called medical use.   

I think Dennis was asking me about insurance and employee issues and I gave him the best advice I could, taking into account that what he was doing was definitely over the line.  A club selling cannabis to its members in San Francisco based on a law that gave cannabis patients a defense to criminal charges?   It wasn’t an issue in my wheelhouse but I was happy to shed whatever little light I could for him.

But, it became clear to me soon after the 1996 vote that this issue was not only NOT going to go away, but there was going to be an explosion.  The activists, led by Dennis and others, were simply not going to stop advocating and distributing cannabis to patients.  When the State Legislature opened the door for patients to work together to grow and distribute cannabis n 2003, that’s when the show really opened up.

The simple truth is that Dennis and his allies were passionate, made a lasting impression on me, and were inspiring.  I started to look more closely at the myriad legal and political issues medical cannabis raised and I started to do more and more to assist patients around the state.   I guess, looking back, I was one of Dennis’s recruits.  Thanks Dennis. It’s been a great fight and we’ll all carry it on until we finally win.  Don’t worry!

The New Medical Cannabis Law

MAUCRSA is now the law in California, regulating commercial cannabis operations while enshrining the new criminal laws passed by the voters in November, 2016 (Prop. 64).  Many people are confused about what the new law entails and how they can position themselves to obtain a license once the State starts issuing them.  

Please contact my office for more information about the new law and how it will impact those seeking to obtain a license, whether they currently operate a cannabis cooperative in California or not.

Cooperatives and The Future of State Licensing in 2018

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.  And, while this law will lapse once licensing takes effect, likely by late 2018 or early 2019, patients in the state of California must still belong to a legally formed and legally operating cooperative until then.  Make sure you have some corporate entity in place that is not allowed to make a profit.  I have used a cooperative corporation for my clients, governed by California Corporations Code section 12200 to 12704, since January, 2004. I believe that since the California Attorney General also recommends this form in his August, 2008 Guidelines, licensing authorities will reward those who followed those Guidelines as closely as possible, including setting up the cooperative corporation. 

 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.   That concept is enshrined in the MAUCRSA.  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.  Once licensing starts in 2018, we expect that it will be difficult, it not impossible, to challenge the formal bans that many cities and counties have already enacted.

Thus, those interested in getting a state license will need to ensure they have local approval first before applying to the state in 2018.  Plan to have a budget for local lobbying of the city council or board of supervisors in the jurisdiction where you plan to operate.  Also, make sure you are not planning to operate in a city or county that has enacted a ban, unless you plan to start a political campaign to overturn that ban or to elect friendlier lawmakers who will overturn it.  Either of those options is time-consuming and costly.