Following in the steps of Washington and Colorado, Oregon voters passed Ballot Measure 91 (PDF) on November 4, opening the door to legalized recreational marijuana in the state. Beginning July 1, 2015, the Control, Regulation and Taxation of Marijuana and Industrial Hemp Act allows Oregonians 21 years and older to possess up to eight ounces
What the Federal Government’s New Marijuana Guidance Means for Washington Businesses
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
U.S. Attorney General Eric Holder Still Silent on Federal Government’s Response to I-502
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
A Cautionary Tale in the Conflict Between Federal and State Law Over Marijuana Legalization
As we pointed out in our post “Understanding the Conflict Between Federal Law and Washington Initiative 502,” possession and sale of marijuana remains illegal under federal law even as states push to legalize marijuana for medical or recreational use. We quoted Jenny Durkan, the U.S. Attorney for the Western District of Washington, as stating that the U.S. Department of Justice’s (“DOJ”) “responsibility to enforce the Controlled Substances Act remains unchanged” in the face of state initiatives like Washington Initiative 502, that legalized the possession of certain amounts of marijuana.
Adam Nagourny of the New York Times reported today on the sobering case of Matthew R. Davies, who was indicted last July on federal charges of cultivating marijuana, following a DOJ raid on two dispensaries and a warehouse filled with nearly 2,000 marijuana plants that Davies owned and operated. Davies reportedly saw a big business opportunity after California legalized the use of marijuana for medical purposes. “We thought, this is an industry in its infancy, it’s a heavy cash business, it’s basically being used by people who use it to cloak illegal activity,” Nagourny quotes Davies as saying. “Nobody was doing it the right way. We thought we could make a model of how this should be done.”Continue Reading A Cautionary Tale in the Conflict Between Federal and State Law Over Marijuana Legalization
Part II: Understanding the Conflict Between Federal Law and Washington Initiative 502
In Part I of our “Understanding Washington Initiative 502” (“I-502”) series, we described how I-502’s licensing regime is scheduled to go into effect late next year. There is no question that I-502 legalizes possession of certain amounts of marijuana under Washington law, and the state licensing structure aimed at regulating the production, distribution, and retail sale of marijuana reflects this fact. But as a Schedule I drug subject to the federal Controlled Substances Act (“Act”), possession and sale of marijuana remains illegal under federal law. I-502 does not change this basic fact, regardless of whether the Washington State Liquor Control Board succeeds in establishing the rigorous regulatory regime envisioned by I-502.
I-502 intends to establish a well-regulated market that will allow Washington state to tax a commodity that had been pushed into the underground economy. Achieving that goal depends on capital investments in the regulated marijuana market in Washington State. But will investors be willing to fund a marijuana start-up if federal law diverges significantly from state law – particularly when federal law includes criminal sanctions? That will depend on the federal government’s response to states like Washington and Colorado that have chosen to de-criminalize marijuana.Continue Reading Part II: Understanding the Conflict Between Federal Law and Washington Initiative 502
As Wine Industry Evolves, Local Regulation Remains King
Litigation concerning the direct shipment of wine has garnered a significant amount of attention in the years since the United States Supreme Court’s seminal decision in Granholm v. Heald. Generally speaking, these disputes have played out in the federal courts, far removed from the typical family winery.
Although direct shipment will remain an important issue both for wineries and for the attorneys who represent them—indeed, it is one of the topics covered in Stoel Rives’ Law of Wine treatise—a winery’s long-term financial success may be just as likely to hinge on the outcomes of lower-profile controversies litigated in front of local government bodies. Depending on the state and locality, these local governments may have the power to prohibit the construction of new tasting rooms or restaurants—a growing source of revenue for many wineries1 —or to regulate the number and character of marketing events held by a winery.Continue Reading As Wine Industry Evolves, Local Regulation Remains King
State Law Restrictions on Direct Sales to Consumers Are Ripe for Challenge
In the 2005 case Granholm v. Held, the U.S. Supreme Court struck down Michigan and New York laws that effectively prevented out-of-state wineries from shipping directly to in-state consumers but that allowed in-state wineries to conclude in-state direct sales. The Court held that these laws violated the U.S. Constitution’s Commerce Clause. Since then, lower