With several states now moving forward with legalized medical or recreational marijuana regulatory schemes, how to obtain business financing remains a hurdle legal marijuana growers and distributers have yet to solve. As noted in a recent New York Times article, “financial institutions, security providers and landlords that serve marijuana businesses can be prosecuted for

On Thursday, the U.S. Department of Justice finally addressed its enforcement strategy as it relates to the recent Washington and Colorado initiatives legalizing marijuana in those jurisdictions.  In a memo issued to U.S. Attorneys (PDF), Deputy Attorney General James M. Cole announced that the United States would not sue the states to overturn the voter-endorsed

Several news sources reported on Wednesday, July 24, 2013, that U.S. Drug Enforcement Administration (DEA) agents raided a number of medical marijuana dispensaries in the Puget Sound area. However, DEA Spokesperson Jodie Underwood did not provide details about how many dispensaries were being targeted or how many search warrants were being executed.

These raids come

Stoel Rives attorneys Susan Johnson and Jim Shore will be part of the faculty for a one-day Law Seminars International conference on June 11 regarding Washington’s Initiative 502 that legalized the recreational use of marijuana. Susan will serve as co-chair of the conference, while Jim will present on I502 implications for employer policies and procedures.

Marijuana logo required under WA Initiative 502 draft rulesWatch for our I-502 draft rules cheat sheet, coming soon!

The wait is officially over, folks. Yesterday, the Washington State Liquor Control Board (WSLCB) met its projected mid-May deadline to issue initial draft rules implementing Initiative 502 (I-502) (PDF), Washington state’s recently enacted marijuana reform law. The 46-page proposed addition to the Washington Administrative Code gives the public a glimpse into how the WSLCB will potentially regulate such areas as from marijuana product testing, growing licenses, advertising, and package labeling.

For instance, the Board is proposing a number of security requirements on licensed marijuana growers, processors, and retailers. According to the draft rules, (1) marijuana production must take place within a fully enclosed secure indoor facility or greenhouse with rigid walls, a roof, and doors, (2) all employees in any licensed premises must display an identification badge at all times while in a licenses premises, (3) each licensed premises must have a security alarm system on all perimeter entry points and perimeter windows, (4) the licensed premises must have a complete video surveillance and recording system for control areas, and (5) all marijuana licensees must have a traceability mechanism to track the marijuana from seed to sale. Continue Reading Washington Liquor Control Board Releases Draft I-502 Rules: what you need to know

As we discussed in our December 19, 2012, and January 14, 2013, blog posts here and here, there is inherent tension between I-502’s marijuana legalization policy and federal law. Under the Controlled Substances Act (“Act”), marijuana is classified as a Schedule I drug, making the possession and sale of marijuana illegal under federal law. Since the passage of legalization measures in both Washington State and Colorado, federal authorities have undertaken to review the new laws and issue a response. Although the Obama Administration has been reviewing its options for some time, it has not yet taken a position on the issue.

However, despite the delay in a decision from the federal government, the Washington State Liquor Control Board has not shown any hesitation in moving forward with implementation. The agency is currently progressing along its proposed implementation timeline and expects to begin issuing marijuana producer licenses as early as mid-August of this year.  

In remarks before the U.S. Senate Judiciary Committee on Wednesday, March 6, Attorney General Eric Holder confirmed that the Administration was “still considering” the federal government’s reaction to the Washington and Colorado legalization initiatives, though he asserted that it would be completed soon. Continue Reading U.S. Attorney General Eric Holder Still Silent on Federal Government’s Response to I-502

This week, the Washington State Liquor Control Board (WSLCB) held the first two of six public forums it intends to host across Washington State regarding the implementation of Initiative 502. The first forum was held at the WSLCB Headquarters in Olympia on Tuesday night. According to news reports, hundreds of people flocked to the event to not only provide comments, but to be part of history. Board members were surprised to see that there was standing room only at the event. WSLCB Chair Sharon Foster opened the forum with one word, “Wow!” The Board admitted that they had underestimated how many people would attend the public forums.

Last night’s I-502 public forum in Seattle had a similar turnout. As an article in this morning’s Seattle Times put it, “They came in suits and cowboy hats, with cropped gray hair and long ponytails, and they filled one room at Seattle City Hall and spilled into another, about 400 strong.” At the beginning of the forum, Board members took time to briefly explain the new law to attendees and describe the steps in the rulemaking process that WSLCB will take over the coming months to implement I-502. They also emphasized the importance of public input.

Following that introduction, there were comments directed specifically at the taxes the new law intends to impose. Some urged that the 25% excise tax that will be applied at each level of the licensing system that will eventually be created – producer to a processor, processor to a retailer, and retailer to the customer – is too high. Others countered that the tax was necessary. WSLCB officials noted that they do not have the authority to change the taxes that were voted for by the public. Instead, a change to the tax structure would have to come from the legislature. During the first two years a change to the initiative would require a two thirds majority.Continue Reading Initial Public Forums on Washington’s Initiative 502 Draw Large Crowds