July 26, 2014

Spark the Discussion: Broken Promises and Federal Threats – A Roller Coaster for the Medical Marijuana Industry

“Spark the Discussion” is a monthly Legal Connection column highlighting the hottest trends in the emerging field of medical marijuana law. This column is brought to you by Vicente Sederberg, LLC, a full-service, community-focused medical marijuana law firm.

By Christian Sederberg and Joshua Kappel

Medical Marijuana activists were ecstatic when President Barack Obama was elected in 2008 due to his campaign promises that an Obama administration would not use the U.S. Justice Department’s limited resources on circumventing state medical marijuana laws.

Shortly after President Obama’s inauguration, he appeared to be honoring that commitment. On October 19, 2009, then Deputy U.S. Attorney General David W. Ogden published a memorandum directing various U.S. Attorneys’ offices to not use “federal resources in [their respective] States on individuals whose actions are in clear and unambiguous compliance with existing state laws providing for the medical use of marijuana.” In response, medical marijuana activists and patients in Colorado and around the country began to step out of the darkness in large numbers. In Colorado, tens of thousands of patients signed up to receive their state medical marijuana cards from the Colorado Department of Public Health and Environment and numerous individuals began opening up small businesses to help patients obtain the medicine that their doctor had recommended to them. Due in large part to the need to regulate this rapidly expanding industry, the Colorado state legislature passed strict laws in the 2010 legislative session that created a statewide regulatory scheme for medical marijuana businesses.  Several other states quickly followed suit, and the so-called “green rush” was in full force. After facing hundreds of raids under President Bush’s administration, there was a great sense that the future was bright for the nation’s medical marijuana community.

However, things started to change in the first two years of Obama’s presidency. In February of 2011, Melinda Haag, the United States Attorney for the Northern District of California, sent a memo threatening federal criminal enforcement in response to a proposal by the city of Oakland to license large scale medical marijuana cultivation facilities that seemed to be outside the scope of California’s medical marijuana laws. This sparked a flurry of similar memos from various U.S. Attorneys reaffirming their commitment to enforce the federal Controlled Substance Act (CSA), including a memo from the recently appointed Colorado U.S. Attorney John Walsh and another memo from the Deputy U.S. Attorney General, James Cole. All of these memos maintained that prosecuting patients and their immediate caregivers was not a high enforcement priority of the federal government, but emphasized that the federal government reserves the right to prosecute anyone who violates the CSA, particularly large-scale, commercial medical marijuana businesses.

During this tumultuous time, the Colorado medical marijuana industry remained hesitantly optimistic because the federal government had taken what appeared to be a “hands off” approach to the state’s closely-regulated medical marijuana industry.  On December 8, 2011, that optimism grew when U.S. Attorney General Eric Holder reaffirmed—while being questioned by Colorado’s Rep. Jared Polis– that targeting Colorado medical marijuana businesses conforming with state laws is not a high priority for the federal government.  Watch the video here.

In a striking turn, the following week various news agencies reported that a confidential federal official was claiming that the government was considering a “crackdown” in Colorado on any medical marijuana business located near a school, despite an express allowance in the Colorado Medical Marijuana Code, C.R.S. 12-43.3-101 et seq., permitting localities to allow such businesses within a 1000 feet of a school. The federal crackdown will reportedly take the form of “landlord letters”, similar to the letters sent to landlords in California earlier this year, demanding that the landlord evict their medical marijuana business tenants within 45 days or face federal asset forfeiture.

The most recent letters in California did result in many businesses closing their storefront operations or relocating, even though there has been little actual federal enforcement action.

Matt Cook, the former head of the Colorado Department of Revenue’s Enforcement Division and considered by some to be the father of Colorado’s Medical Marijuana Code, found a silver lining in the recent federal threats.  Mr. Cook told the Denver Medical Marijuana Work Group on December 14, 2011 that the federal government’s actions could be seen as an implicit endorsement of our highly regulated system, specifically as it relates to all medical marijuana businesses not within 1000 feet of a school.

If President Obama breaks his campaign promise to respect state medical marijuana laws and his local US Attorneys make good on their threats, the President risks losing the votes of over 88,000 Colorado medical marijuana patients, their families, and supporters– which could make his path to reelection much more difficult in this battleground state.

Christian Sederberg, Esq., is a founding member of Vicente Consulting, LLC, a law firm providing legal solutions for the medical marijuana community. Christian has focused his practice on representing small and medium sized businesses, with a primary focus on real estate, commercial and business transactions. In addition, he provides general guidance to medical marijuana businesses, ancillary businesses, and caregivers about local and state medical marijuana ordinances, regulations and laws.

Joshua Kappel, Esq., recently graduated in the top 10% of his class at the University of Denver, Sturm College of Law. While in law school, Josh received both the Patton Boggs Public Policy Fellowship and the Public Interest Law Clerkship to work for Sensible Colorado. Josh also  interned with the National ACLU’s Drug Law Reform Project in Santa Cruz and the Colorado Criminal Defense Bar. 

The opinions and views expressed by Featured Bloggers on CBA-CLE Legal Connection do not necessarily represent the opinions and views of the Colorado Bar Association, the Denver Bar Association, or CBA-CLE, and should not be construed as such.

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