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Harborside and the Feds' Failed Medical Marijuana Communications

Harborside is in the news again today. Two weeks ago we noted the premiere (and largest) dispensary had won a battle in state court. Facing threats by federal authorities over Harborside's marijuana distribution, their landlord attempted to evict them, only to be rebuffed by a judge because she had authorized Harborside to engage in exactly that business there in the lease.

Harborside video
Today a federal judge began hearing three related motions on the matter, according to NBC Los Angeles -- two from the landlord's lawyers asking to evict them, one from the City of Oakland opposing those motions, asking they be stayed until their own effort to stop the federal government's forfeiture proceeding on the property gets heard.

"We invited (U.S. Attorney) Melinda Haag to come to Harborside to tour to take a look at the way we do things," Harborside Executive Director Steve DeAngelo said Thursday outside court [according to NBC]. "Because I think the federal government should be studying Harborside not trying to close us down. We've developed a great model for responsible and legitimate distribution of cannabis."
 

According to the LA Times, the city's lawsuit "contends that federal prosecutors missed a five-year statute of limitations to seize Harborside's properties and misled Oakland officials with a 'pattern of false promises' that they would not go after dispensaries that were complying with state and local laws." The feds in turn say they've always reserved the right to go after any dispensary, and dismissed attorneys' arguments about the needs of patients who will be driven to the illicit market.

Those issues will in all likelihood be decided based on the technical legal merits, and we've known all along we faced tough prospects in the courts, especially since the Raich ruling. Still, the city's arguments, whether legally persuasive or not, are accurate. Obama administration officials did mislead the city -- the country -- about their intentions with regard to state medical marijuana laws. Whether they did so deliberately or through mere inconsistency is irrelevant. When Sen. Patrick Leahy (D-VT) asked the attorney general to make the administration's intentions toward marijuana legalization in Washington and Colorado known, the unspoken corollary is how inappropriately they've handled communications about medical marijuana. That's bad enough when a business or city gets harmed. But some of the victims are in prison or dead.

Haag must see that she is on the losing side of history by now. The question is how much carnage she and her cohorts will inflict by holding out. It would be better to have some reason from the feds sooner rather than later -- some reason and some decency.

P.S. Watch why Scott Morgan considers Harborside The Best Place in the World to Buy Marijuana:

The Top Ten Drug Policy Stories of 2012 [FEATURE]

In some ways, 2012 has been a year of dramatic, exciting change in drug policy, as the edifice of global drug prohibition appears to crumble before our eyes. In other ways it is still business as usual in the drug war. Marijuana prohibition is now mortally wounded, but there were still three-quarters of a million pot arrests last year. The American incarceration mania appears to be running its course, but drug arrests continue to outnumber any other category of criminal offense. There is a rising international clamor for a new drug paradigm, but up until now, it's just talk.

The drug prohibition paradigm is trembling, but it hasn't collapsed yet -- we are on the cusp of even more interesting times. Below, we look at the biggest drug policy stories of 2012 and peer a bit into the future:

1. Colorado and Washington Legalize Marijuana!

Voters in Colorado and Washington punched an enormous and historic hole in the wall of marijuana prohibition in November. While Alaska has for some years allowed limited legal possession in the privacy of one's home, thanks to the privacy provisions of the state constitution, the November elections marked the first time voters in any state have chosen to legalize marijuana. This is an event that has made headlines around the world, and for good reason -- it marks the repudiation of pot prohibition in the very belly of the beast.

And it isn't going away. The federal government may or may not be able to snarl efforts by the two states to tax and regulate legal marijuana commerce, but few observers think it can force them to recriminalize marijuana possession. It's now legal to possess up to an ounce in both states and to grow up to six plants in Colorado and -- barring a sudden reversal of political will in Washington or another constitutional amendment in Colorado -- it's going to stay that way. The votes in Colorado and Washington mark the beginning of the end for marijuana prohibition.

2. Nationally, Support for Marijuana Legalization Hits the Tipping Point

If Colorado and Washington are the harbingers of change, the country taken as a whole is not far behind, at least when it comes to public opinion. All year, public opinion polls have showed support for marijuana legalization hovering right around 50%, in line with last fall's Gallup poll that showed steadily climbing support for legalization and support at 50% for the first time. A Gallup poll this month showed a 2% drop in support, down to 48%, but that's within the margin of error for the poll, and it's now a downside outlier.

Four other polls released this month
demonstrate a post-election bump for legalization sentiment. Support for legalization came in at 47%, 51%, 54%, and 57%, including solid majority support in the West and Northeast. The polls also consistently find opposition to legalization strongest among older voters, while younger voters are more inclined to free the weed.

As Quinnipiac pollster Peter Brown put it after his survey came up with 51% support for legalization, "This is the first time Quinnipiac University asked this question in its national poll so there is no comparison from earlier years. It seems likely, however, that given the better than 2-1 majority among younger voters, legalization is just a matter of time."

Caravan for Peace vigil, Brownsville, Texas, August 2012
3. Global Rejection of the Drug War

International calls for alternatives to drug prohibition continued to grow ever louder this year. Building on the work of the Latin American Commission on Drugs and Democracy and the Global Commission on Drug Policy, the voices for reform took to the stage at global venues such as the Summit of the Americas in Cartagena, Colombia, in April, the International AIDS Conference in Washington in July, and at the United Nations General Assembly in September.

While calls for a new paradigm came from across the globe, including commissions in Australia and the United Kingdom, this was the year of the Latin American dissidents. With first-hand experience with the high costs of enforcing drug prohibition, regional leaders including Colombian President Santos, Guatemalan President Perez Molina, Costa Rican President Chinchilla, and even then-Mexican President Calderon all called this spring for serious discussion of alternatives to the drug war, if not outright legalization. No longer was the critique limited to former presidents.

That forced US President Obama to address the topic at the Summit of the Americas and at least acknowledge that "it is entirely legitimate to have a conversation about whether the laws in place are doing more harm than good in certain places" before dismissing legalization as a policy option. But the clamor hasn't gone away -- instead, it has only grown louder -- both at the UN in the fall and especially since two US states legalized marijuana in November.

While not involved in the regional calls for an alternative paradigm, Uruguayan President Mujica made waves with his announcement of plans to legalize the marijuana commerce there (possession was never criminalized). That effort appears at this writing to have hit a bump in the road, but the proposal and the reaction to it only added to the clamor for change.

4. Mexico's Drug War: The Poster Child for Drug Legalization

Mexico's orgy of prohibition-related violence continues unabated with its monstrous death toll somewhere north of 50,000 and perhaps as high as 100,000 during the Calderon sexenio, which ended this month. Despite all the killings, despite Calderon's strategy of targeting cartel capos, despite the massive deployment of the military, and despite the hundreds of millions of dollars in US aid for the military campaign, the flow of drugs north and guns and money south continues largely unimpeded and Mexico -- and now parts of Central America, as well -- remain in the grip of armed criminals who vie for power with the state itself.

With casualty figures now in the range of the Iraq or Afghanistan wars and public safety and security in tatters, Calderon's misbegotten drug war has become a lightning rod for critics of drug prohibition, both at home and around the world. In the international discussion of alternatives to the status quo -- and why we need them -- Mexico is exhibit #1.

And there's no sign things are going to get better any time soon. While Calderon's drug war may well have cost him and his party the presidency (and stunningly returned it to the old ruling party, the PRI, only two elections after it was driven out of office in disgrace), neither incoming Mexican President Enrique Pena Nieto nor the Obama administration are showing many signs they are willing to take the bold, decisive actions -- like ending drug prohibition -- that many serious observers on all sides of the spectrum say will be necessary to tame the cartels.

The Mexican drug wars have also sparked a vibrant and dynamic civil society movement, the Caravan for Peace and Justice, led by poet and grieving father Javier Sicilia. After crisscrossing Mexico last year, Sicilia and his fellow Mexican activists crossed the border this summer for a three-week trek across the US, where their presence drew even more attention to the terrible goings on south of the border.

5. Medical Marijuana Continues to Spread, Though the Feds Fight Back

Eighteen states and the District of Columbia have now legalized the use of marijuana for medical purposes, and while there was only one new one this year, this has been a year of back-filling. Medical marijuana dispensaries have either opened or are about to open in a number of states where it has been legal for years but delayed by slow or obstinate elected officials (Arizona, New Jersey, Washington, DC) or in states that more recently legalized it (Massachusetts).

None of the newer medical marijuana states are as wide open as California, Colorado, or Montana (until virtual repeal last year), as with each new state, the restrictions seem to grow tighter and the regulation and oversight more onerous and constricting. Perhaps that will protect them from the tender mercies of the Justice Department, which, after two years of benign neglect, changed course last year, undertaking concerted attacks on dispensaries and growers in all three states. That offensive was ongoing throughout 2012, marked by federal prosecutions and medical marijuana providers heading to federal prison in Montana. While federal prosecutions have been less resorted to in California and Colorado, federal raids and asset forfeiture threat campaigns have continued, resulting in the shuttering of dozens of dispensaries in Colorado and hundreds in California. There is no sign of a change of heart at the Justice Department, either.

6. The Number of Drug War Prisoners is Decreasing

The Bureau of Justice Statistics announced recently that the number of people in America's state and federal prisons had declined for the second year in a row at year's end 2011. The number and percentage of drug war prisoners is declining, too. A decade ago, the US had nearly half a million people behind bars on drug charges; now that number has declined to a still horrific 330,000 (not including people doing local jail time). And while a decade ago, the percentage of people imprisoned for drug charges was somewhere between 20% and 25% of all prisoners, that percentage has now dropped to 17%.

That decline is mostly attributable to sentencing reforms in the states, which, unlike the federal government, actually have to balance their budgets. Especially as economic hard times kicked in in 2008, spending scarce taxpayer resources on imprisoning nonviolent drug offenders became fiscally and politically less tenable. The passage of the Proposition 36 "three strikes" sentencing reform in California in November, which will keep people from being sentenced to up to life in prison for trivial third offenses, including drug possession, is but the latest example of the trend away from mass incarceration for drug offenses.

The federal government is the exception. While state prison populations declined last year (again), the federal prison population actually increased by 3.1%. With nearly 95,000 drug offenders doing federal time, the feds alone account for almost one-third of all drug war prisoners.

President Obama could exercise his pardon power by granting clemency to drug war prisoners, but it is so far a power he has been loathe to exercise. An excellent first candidate for presidential clemency would be Clarence Aaron, the now middle-aged black man who has spent the past two decades behind bars for his peripheral role in a cocaine deal, but activists in California and elsewhere are also calling for Obama to free some of the medical marijuana providers now languishing in federal prisons. The next few days would be the time for him to act, if he is going to act this year.

7. But the Drug War Juggernaut Keeps On Rolling, Even if Slightly Out of Breath

NYC "stop and frisk" protest of mass marijuana arrests
According to annual arrest data released this summer by the FBI, more than 1.53 million people were arrested on drug charges last year, nearly nine out of ten of them for simple possession, and nearly half of them on marijuana charges. The good news is that is a decline in drug arrests from 2010. That year, 1.64 million people were arrested on drug charges, meaning the number of overall drug arrests declined by about 110,000 last year. The number of marijuana arrests is also down, from about 850,000 in 2010 to about 750,000 last year.

But that still comes out to a drug arrest every 21 seconds and a marijuana arrest every 42 seconds, and no other single crime category generated as many arrests as drug law violations. The closest challengers were larceny (1.24 million arrests), non-aggravated assaults (1.21 million), and DWIs (1.21 million). All violent crime arrests combined totaled 535,000, or slightly more than one-third the number of drug arrests.

The war on drugs remains big business for law enforcement and prosecutors.

8. And So Does the Call to Drug Test Public Benefits Recipients

Oblivious to constitutional considerations or cost-benefit analyses, legislators (almost always Republican) in as many as 30 states introduced bills that would have mandated drug testing for welfare recipients, people receiving unemployment benefits, or, in a few cases, anyone receiving any public benefit, including Medicaid recipients. Most would have called for suspicionless drug testing, which runs into problems with that pesky Fourth Amendment requirement for a search warrant or probable cause to undertake a search, while some attempted to get around that obstacle by only requiring drug testing upon suspicion. But that suspicion could be as little as a prior drug record or admitting to drug use during intake screening.

Still, when all the dust had settled, only three states -- Georgia, Oklahoma, and Tennessee -- actually passed drug testing bills, and only Georgia's called for mandatory suspicionless drug testing of welfare recipients. Bill sponsors may have been oblivious, but other legislators and stakeholders were not. And the Georgia bill is on hold, while the state waits to see whether the federal courts will strike down the Florida welfare drug testing bill on which it is modeled. That law is currently blocked by a federal judge's temporary injunction.

It wasn't just Republicans. In West Virginia, Democratic Gov. Roy Tomblin used an executive order to impose drug testing on applicants to the state's worker training program. (This week came reports that only five of more than 500 worker tests came back positive.) And the Democratic leadership in the Congress bowed before Republican pressures and okayed giving states the right to impose drug testing requirements on some unemployment recipients in return for getting an extension of unemployment benefits.

This issue isn't going away. Legislators in several states, including Indiana, Ohio, Texas, and West Virginia have already signaled they will introduce similar bills next year, and that number is likely to increase as solons around the country return to work.

9. The US Bans New Synthetic Drugs

In July, President Obama signed a bill banning the synthetic drugs known popularly as "bath salts" and "fake weed." The bill targeted 31 specific synthetic stimulant, cannabinoid, and hallucinogenic compounds. Marketed under brand names like K2 and Spice for synthetic cannabinoids and under names like Ivory Wave, among others, for synthetic stimulants, the drugs have become increasingly popular in recent years. The drugs had previously been banned under emergency action by the DEA.

The federal ban came after more than half the states moved against the new synthetics, which have been linked to a number of side effects ranging from the inconvenient (panic attacks) to the life-threatening. States and localities continue to move against the new drugs, too.

While the federal ban demonstrates that the prohibitionist reflex is still strong, what is significant is the difficulty sponsors had in getting the bill passed. Sen. Rand Paul (R-KY) put a personal hold on the bill until mandatory minimum sentencing requirements were removed and also argued that such efforts were the proper purview of the states, not Washington. And for the first time, there were a substantial number of Congress members voting "no" on a bill to create a new drug ban.

10. Harm Reduction Advances by Fits and Starts, At Home and Abroad

Harm reduction practices -- needle exchanges, safer injection sites, and the like -- continued to expand, albeit fitfully, in both the US and around the globe. Faced with a rising number of prescription pain pill overdoses in the US -- they now outnumber auto accident fatalities -- lawmakers in a number of states have embraced "911 Good Samaritan" laws granting immunity from prosecution. Since New Mexico passed the first such law in 2007, nine others have followed. Sadly, Republican Gov. Chris Christie vetoed the New Jersey bill this year.

Similarly, the use of the opioid antagonist naloxone, which can reverse overdoses and restore normal breathing in minutes, also expanded this year. A CDC report this year that estimated it had saved 10,000 lives will only help spread the word.

There has been movement internationally as well this year, including in some unlikely places. Kenya announced in June that it was handing out 50,000 syringes to injection drug users in a bid to reduce the spread of AIDS, and Colombia announced in the fall plans to open safe consumption rooms for cocaine users in Bogota. That's still a work in progress.

Meanwhile, the UN Commission on Narcotic Drugs unanimously supported a resolution calling on the World Health Organization and other international bodies to promote measures to reduce overdose deaths, including the expanded use of naloxone; Greece announced it was embracing harm reduction measures, including handing out needles and condoms, to fight AIDS; long-awaited Canadian research called for an expansion of safe injection sites to Toronto and Ottawa; and Denmark first okayed safe injection sites in June, then announced it is proposing that heroin in pill form be made available to addicts. Denmark is one of a handful of European countries that provide maintenance doses of heroin to addicts, but to this point, the drug was only available for injection. France, too, announced it was going ahead with safe injection sites, which could be open by the time you read this.  

This has been another year of slogging through the mire, with some inspiring victories and some oh-so-hard-fought battles, not all of which we won. But after a century of global drug prohibition, the tide appears to be turning, not least here in the US, prohibition's most powerful proponent. There is a long way to go, but activists and advocates can be forgiven if they feel like they've turned a corner. Now, we can put 2012 to bed and turn our eyes to the year ahead.

Medical Marijuana Update

Dispensary wars continue in California, a package of restrictive bills passes in Michigan, and DC's long-awaited dispensaries are a step closer to opening.

California

Last Tuesday, a Sacramento dispensary operator pleaded guilty to federal drug charges. Bryan Smith, 28, had operated R&R Wellness Center that was first raided by local law enforcement and then turned over to the feds to prosecute. He and his colleagues got caught with more than 400 marijuana plants and $256,000 in cash. He agreed to a sentence of not less than five years in federal prison.

Also last Tuesday, Oakland Mayor Jean Quan said the feds should back off from trying to run Harborside Health Center out of business. The statement came in court filings ahead of a court date set for Thursday.

Last Thursday, two Bakersfield dispensaries sued Kern County, claiming they spent a total of $99,000 to set up under state and local laws, only to have the county fine them $100,000 for doing it. A third dispensary sued earlier, seeking the return of $280,000 in fines.Kern County passed an ordinance in 2009 removing restrictions on where medical marijuana dispensaries could operate. Under the new ordinance, dispensaries could operate anywhere in unincorporated areas except within 1,000 feet of a school. But last year, the county adopted two new ordinances: one banning cultivation of medical marijuana, and the other banning marijuana collectives from unincorporated areas, to take effect 30 days after adoption. The dispensaries want the county to pay for changing the rules on them and they want an end to efforts to ban them.

Last Friday, Murrieta officials shut down the Diamond Star Remedies dispensary for alleged code violations. The dispensary owner, John Szwec, said he had applied for a business license but been denied. Two other dispensaries -- Cooperative Medical Group and Greenhouse Cannabis Club -- that attempted to operate in the city have also since shut their doors.

On Tuesday, LA city officials said a referendum to keep most of the city's dispensaries had enough signatures to go to the voters. The Medical Marijuana Collectives Initiative Ordinance awaits verification of signatures, which could happen as early as January 2. At that point the Clerk will forward the initiative to the City Council, which can vote to make it law, call a special election, or place the matter before voters during the next scheduled election, which is May 21.Another referendum that would allow only 128 dispensaries has already been approved for a vote.

Also on Tuesday, Yuba County supervisors gave final approval to a medical marijuana ordinance. Growing on less than an acre would be limited to 12 mature plants with no more than six growing outdoors, and no more than 18 plants overall. Supervisors and grower advocates said in the long run, the ordinance should push growing out of residential areas and into more rural ones.

Also on Tuesday, the California Supreme Court said it had taken up the appeal of a Temecula dispensary. In City of Temecula v. Cooperative Patients Services Inc., the Riverside-based Fourth District Court of Appeal, Division Two, followed its pattern of denying an appeal from the clinic and upholding the city's preliminary injunction against its operation. But unlike others cases from that court, the vote was 2-1.

Colorado

Last Friday, three dispensaries in the town of Dacono sued to stay open. They asked the Weld County District Court to block the city's ban of marijuana-related businesses. Without legal protection, all three will have to shut down at the beginning of the new year. The town council passed a ban in June, but a petition drive will bring the issue to a vote next year. But it won't enable the dispensaries to stay open in the meantime.

On Monday, a medical marijuana grower sued the Larimer County sheriff after his 42 plants were destroyed. Kaleb Young was arrested and his plants and equipment seized during a drug raid even though he was in compliance with state law and had paperwork to prove it. He was acquitted of all criminal charges last year. His attorney, Rob Corry, said he would ask for $5,000 for each destroyed plant, based on sheriffs' estimates of the plants' value when they were seized. "Typically, the agency will preserve the plants as they're required to do under the (Colorado) constitution," Corry said. "Here, they just straight-up cut them down and destroyed them."

Massachusetts

Last Wednesday, a medical marijuana evaluation company said it has lost its lease after its landlord received negative feedback from local residents and businesses. California-based CannaMed had announced two weeks earlier that they would open a Framingham office by mid-month, but the building's owner, Jumbo Capital Management, terminated the lease after receiving letters from other tenants objecting to CannaMed moving in.

Michigan

Last Friday, the state legislature passed a package of bills adding restrictions to the state's medical marijuana law. HB 4834 says that registry cards will expire after two years, HB 4856 requires medical marijuana to be transported in the trunk of a car, and HB 4851 puts new limits on when doctors can recommend medical marijuana. Gov. Snyder (R) is expected to sign them, and they will take effect April 1 if he does.

Montana

On Tuesday, federal prosecutors agreed to drop six of eight charges against Chris Williams, who was set to be sentenced to 85 years or more after being convicted of marijuana cultivation and gun charges. Under the deal, the federal government dropped convictions for conspiracy to manufacture and possess with the intent to distribute marijuana; manufacture of marijuana; possession with intent to distribute marijuana; and three counts of possessing a firearm in furtherance of a drug trafficking crime. His convictions for one count of possessing a firearm in connection with drug trafficking and one count of possession with intent to distribute marijuana will stand. He faces a maximum term of five years for the distribution of marijuana charge and a mandatory minimum of five years -- and a maximum of life -- for the firearm-related charge. In return, he waives his right to appeal. He was a partner in Montana Cannabis, which was hit hard by DEA raiders in March 2011.

Washington, DC

On Tuesday, DC officials okayed the occupancy permits for the city's first medical marijuana cultivation center and dispensary. Medical marijuana is coming to the District; it's just taken 14 years since the voters approved it and three years since Congress stepped out of the way.

Obama Comments Beg the Question on Marijuana Legalization

In an interview last Friday with ABC News' Barbara Walters, President Obama said going after marijuana smokers in states that have legalized it should not be a "top priority" of federal law enforcement, but he failed to address how the federal government would respond to efforts by state governments in Colorado and Washington to implement taxation and regulation schemes for legal marijuana commerce.

President Barack Obama (whitehouse.gov)
Amendment 64 in Colorado and Initiative 502 in Washington were both approved by voters in last month's elections. Their provisions legalizing marijuana possession (and cultivation in Colorado) are already in effect, but officials in the two states are now charged with crafting those taxation and regulation rules.

The looming question is what the federal government will do about that. President Obama's comments Friday did not shed new light on that topic.

"We've got bigger fish to fry" than going after individual pot smokers in Colorado and Washington, Obama said. "It would not make sense for us to see a top priority as going after recreational users in states that have determined that it's legal."

That is in parallel with the administration's approach to medical marijuana. It has not gone after individual patients, but in the past two years, the Obama Justice Department has vigorously and aggressively targeted medical marijuana cultivators and dispensaries for raids, threats of asset forfeiture, and, more rarely, federal criminal prosecutions.

Obama also told Walters that he does not support marijuana legalization "at this point," but he added that shifting public opinion -- polls are now showing majorities in favor of legalization -- and questions about how to allocate limited government resources are good reasons to seek to find a middle ground on dealing with the weed.

The president also said he had asked Attorney General Eric Holder and the Justice Department to look into how to resolve the conflict between state and federal laws. Marijuana remains a Schedule I drug under the federal Controlled Substances Act.

"I head up the executive branch; we're supposed to be carrying out laws. And so what we're going to need to have is a conversation about is how do you reconcile a federal law that still says marijuana is a federal offense and state laws that say that it's legal?" Obama said.

Holder said last Wednesday that he expected a Justice Department review to be completed "relatively soon."

While Obama notoriously partook of the weed in his youth, being a leading member of the "Choom Gang" of serious recreational puffers, according to biographer David Maraniss, he has downplayed his own use and not favored marijuana legalization. He told Walters Friday he had regrets over his youthful behavior.

"There are a bunch of things I did that I regret when I was a kid," Obama told Walters. "My attitude is, substance abuse generally is not good for our kids, not good for our society. "I want to discourage drug use," he added.

Washington, DC
United States

Senate Judiciary Committee to Hold Hearings on Marijuana Policy

Senate Judiciary Committee Chairman Patrick Leahy (D-VT) said in a statement last Thursday that he intends to hold a hearing seeking information about how the Obama administration plans to respond to the successful marijuana legalization initiatives in Colorado and Washington. Leahy said he expects to hold the hearing when Congress reconvenes early next year.

Senate Judiciary Committee Chairman Patrick Leahy (leahy.senate.gov)
Leahy also released a letter he sent earlier this month to Gil Kerlikowske, director of the Office of National Drug Control Policy (ONDCP -- the drug czar's office) asking him what recommendations the agency will make to the Justice Department and how, given the fiscal constraints the administration faces, it intends to use federal resources in light of the legalization votes in Colorado and Washington. The veteran Vermont lawmaker also asked Kerlikowske what assurances the administration can give to state officials responsible for the licensing of marijuana retailers to ensure they will face no criminal penalties for carrying out their duties under those state laws.

"The Senate Judiciary Committee has a significant interest in the effect of these developments on federal drug control policy," Leahy wrote. "Legislative options exist to resolve the differences between federal and state law in this area and end the uncertainty that residents of Colorado and Washington now face. In order to give these options full consideration, the committee needs to understand how the administration intends to respond to the decision of the voters in Colorado and Washington.  I look forward to hearing your thoughts on this matter."

The Obama administration has yet to formally respond to the legalization votes, but Attorney General Eric Holder said last Wednesday the Justice Department will announce "relatively soon" where it stands on federal enforcement of the pot laws in the two states.

"There is a tension between federal law and these state laws,” Holder said in response to questions after a speech in Boston. "I would expect the policy pronouncement that we’re going to make will be done relatively soon."

A series of public opinion polls this month have found little public support for federal interference with state marijuana laws in states where it is legal, with majorities calling for the feds to keep out of the way. Support for federal non-interference is strongest among key Obama constituencies, including Democrats, independents, and young voters.

Washington, DC
United States

Senate Judiciary Committee to Take Up Legalization Next Year

http://stopthedrugwar.org/files/pat-leahy.jpg
Pat Leahy
Huge news this morning: Senate Judiciary Committee chairman Patrick Leahy (D-VT) has sent a letter to the drug czar about the Washington and Colorado initiatives, Benjy Sarlin at Talking Points Memo noted today:

Leahy wants information:

How does the Office of National Drug Control Policy intend to prioritize Federal resources, and what recommendations are you making to the Department of Justice and other agencies in light of the choice by citizens of Colorado and Washington to legalize personal use of small amounts of marijuana? What assurance can and will the administration give to state officials involved in the licensing of marijuana retailers that they will not face Federal criminal penalties for carrying out duties assigned to them under state law?
 

But it's even bigger than that. Leahy is planning committee hearings on marijuana legalization, to include consideration of legislative options, including "amend[ing] the Federal Controlled Substances Act to allow possession of up to one ounce of marijuana, at least in jurisdictions where it is legal under state law."

I am wondering just how huge this may be. Leahy has good views, but he's also a careful senator who would not care to be at odds with his fellow Democratic committee members or the president. He's also a former prosecutor who dislikes uncertainty or disorder in the law and its implementation.

On the other side of the aisle are Tea Party and other Republicans who may or may not like legalization, mostly don't want to say so if they do, but have campaigned on states' rights. One Colorado Republican, Mike Coffman, has cosponsored a recent bill to allow for state marijuana legalization, despite having voted against the Colorado initiative himself. Word is that at least a couple more Republicans are likely ready to join the group. And recent polls have found that more Americans favor letting states decide about legalization than even support legalization. Micah Cohen at the FiveThirtyEight blog noted the CBS poll found 49% of people who oppose legalization favor letting states decide.

In any case things are further along in Congress than before. The Frank-Paul bill to end federal marijuana prohibition, H.R. 2306, got a few Republicans, but the hard-line House Judiciary chair Lamar Smith (R-TX) would not allow hearings. (Smith was the only member of Congress to oppose crack sentencing reform -- our Judiciary Committee chair!) Incoming chair Bob Goodlatte (R-VA) is said to be reasonable on some issues, but not particularly positive on ours. Still, given what happened last month and what is happening now, it may just look a little too bad for Goodlatte to disallow even hearings, as Republicans struggle to redefine their profile in the wake of a tough election for them.

Medical Marijuana Update

Lots of action -- good, bad, and ugly -- in California this week, plus a Washington appeals court ruling that appears to clear the way for dispensaries. Let's get to it:

California

Last Tuesday, Humboldt County supervisors extended a moratorium on new dispensaries. The extension was the second one and lasts for one year. The county began the moratorium last December after the federal government began threatening local governments with legal action over medical marijuana-related ordinances.

Last Wednesday, an appeals court ruled a Rancho Mirage dispensary must shut down until the city's efforts to close it are resolved. Rancho Mirage Safe Access Wellness Center must close while the city's appeal of a Riverside County Superior Court judge's ruling allowing it to stay open is under consideration by Division Two of the Fourth District Court of Appeals, the court said, granting a request from the city.

Also last Wednesday, Palm Springs police put un-permitted dispensaries on notice that they must shut down or face fines that begin at $1,000 and rise to $5,000 for each week they remain open. Palm Springs is the only Coachella Valley city to permit the sale of medical marijuana, but it limits the number of available licenses to three. There are about 10 collectives in Palm Springs without a city permit. The city and the un-permitted collectives have battled with competing lawsuits, and no end is in sight.

Also last Wednesday, an appeals court held that medical marijuana use alone is not sufficient cause for removing a child, reversing a trial court order that the father undergo drug testing and parenting courses because of his medical marijuana use. The court found that, "Although father uses medical marijuana pursuant to a physician's recommendation, there is nothing in the record to indicate that he has a substance abuse problem." Accusing a parent of child abuse or neglect merely for using medical marijuana "without any evidence that such usage has caused serious physical harm or illness or places a child at substantial risk of incurring physical harm or illness is unwarranted and will be reversed," the court said.

Last Friday, Los Angeles activists handed in 70,000 voter signatures for a referendum that would regulate but not ban dispensaries in the city. "The Medical Marijuana Regulation and Control Act" is supported by Americans for Safe Access and a local committee and is a response to the city council's effort to ban all dispensaries. If the city fails to regulate the dispensaries, the referendum will be waiting.

On Monday, a new Murrieta dispensary was served notice of the city's moratorium on dispensaries. Diamond Star Remedies opened despite being denied a business license, and its operator, John Szwec, said he had plans to pave his lot and put up a permanent building as soon as the city is willing "to stop harassing and start following state laws." Murrieta city council voted in September to extend its moratorium for one year while it awaits a state Supreme Court decision on whether cities have the power to regulate medical marijuana dispensaries in their jurisdictions.

On Tuesday, Yuba County supervisors approved a progressive grow ordinance. The ordinance allows up to 18 plants to be grown on parcels of less than an acre, while up to 99 plants may be grown on parcels greater than 20 acres. The ordinance eliminates a misdemeanor provision for violators and instead allows penalties and gives the county the authority to remove marijuana that doesn't follow growing guidelines.

Also on Tuesday, the city of Concord moved closer to banning outdoor grows. The move comes after the council heard complaints about offensive odors from residential grows and the risk of robbery or theft. The city council voted unanimously to review the city of Moraga's ordinance and possibly follow the Moraga model, which bars outdoor cultivation and demands that indoor grows be hidden from view.

Also on Tuesday, Pittsburg city planners recommended a ban on dispensaries. Planning commissioners approved the ban on a 4-1 vote, with a final vote before the city council set for January 22. The city has had a two-year moratorium on dispensaries, which expires in April, while staff studied whether to permanently ban them.

Also on Tuesday, Mendocino County supervisors hired a San Francisco attorney to deal with the federal government's subpoena of the county's medical marijuana records. Supervisors announced after a closed-door meeting with county counsel that the board "has retained the legal services of William Osterhoudt of San Francisco to assist the county in representation regarding the subpoenas." The subpoenas from the US Attorney Office for Northern California seek "any and all records" for the county's medical marijuana cultivation ordinance from January 1, 2010 to the present, including those with third-party garden inspectors and Mendocino County Board of Supervisors. The county quit issuing permits under its program in March, when federal prosecutors threatened to file an injunction against the county's medical marijuana cultivation ordinance and seek legal action against county officials who supported it. The county has until January 8 to respond to the records request.

Also on Tuesday, Sonoma County supervisors rejected repealing the county's outdoor grow guidelines. The guidelines, in place since 2006, allow patients or caregivers to grow up to 30 plants in up to 100 square feet of space. Repeal would have meant reversion to the "state minimum" of six plants, but was voted down 5-0. Supervisors did agree to consider a proposal to ban the use of unoccupied residential buildings for grows and to establish a working group that would help the county shape its medical marijuana program.

Colorado

Last Friday, the state agency in charge of regulating dispensaries announced it is preparing a broad rewrite of the rules. The Department of Revenue's Medical Marijuana Enforcement Division, or MMED, said it will release a draft of the rewritten rules by December 28. The draft rules will be the subject of three public hearings beginning in January. "Based on industry feedback, and its own experience, the MMED has determined that the majority of the existing medical marijuana rules... are in need of amendment," MMED said.

Maine

On Monday, a state representative said he would introduce a bill to eliminate the categories that limit when medical marijuana can be authorized by a doctor. The proposed legislation would also allow any physicians to recommend medical marijuana, not just a few licensed to do so. Rep. Mark Dion (D-Portland) said he would submit the bill next month.

Montana

Last Thursday, a judge pushed back the trial date for medical marijuana provider and former University of Montana quarterback Jason Washington. He is accused of violating federal drug laws in a case arising from the federal crackdown on medical marijuana in Montana in early 2011. Washington and prosecutors now have a court date of January 14 and a January 3 deadline to reach a plea agreement. If that doesn't happen, Washington will become only the second medical marijuana provider in the state to stand trial. The other, Chris Williams, was convicted and is looking at up to 80 years. Five of Washington's co-defendants have already cut plea deals.

Washington

On Tuesday, an appeals court overturned the conviction of a Spokane dispensary operator. Scott Shupe opened the first dispensary in Spokane, only to be charged with and convicted of marijuana trafficking under state law. But the Division III Court of Appeals threw out the conviction, saying that Spokane Police did not have probable cause to search Shupe’s residence and business and that Spokane County prosecutors did not have sufficient evidence to justify Shupe’s convictions. But the opinion went further, and appears to have agreed with Shupe and that the law allows providers to sell marijuana to one person at a time rather than the state’s interpretation of providers selling only to one person, period.

HSBC Bank Admits Cartel Money Laundering

The London-based HSBC Group, Europe's largest banking entity, has agreed to forfeit $1.256 billion and pay an additional $600 million-plus in fines for laundering money for Mexican drug cartels and other objects of American ire, federal officials announced Tuesday. The agreement was part of a deal to avoid criminal prosecution of the bank by the Justice Department and will result in deferred prosecution provided the bank lives up to its agreements with the Justice Department.

The bank was accused of violating the Banking Secrecy Act, the International Emergency Economic Powers Act, and the Trading with the Enemy Act -- the latter two types of violations having to do with its transactions on behalf of customers in Cuba, Iran, Libya, Sudan, and Burma, all of which were subject to sanctions enforced by the Office of Foreign Assets Control at the time of the violations. The Banking Secrecy Act violations have to do with the banks laundering of at least $881 million for Mexican drug trafficking organizations.

"HSBC is being held accountable for stunning failures of oversight -- and worse -- that led the bank to permit narcotics traffickers and others to launder hundreds of millions of dollars through HSBC subsidiaries, and to facilitate hundreds of millions more in transactions with sanctioned countries," said Assistant Attorney General for Criminal Affairs Lanny Breuer. "The record of dysfunction that prevailed at HSBC for many years was astonishing. Today, HSBC is paying a heavy price for its conduct, and, under the terms of today's agreement, if the bank fails to comply with the agreement in any way, we reserve the right to fully prosecute it."

"Today we announce the filing of criminal charges against HSBC, one of the largest financial institutions in the world," said US Attorney for Eastern New York Loretta Lynch. "HSBC’s blatant failure to implement proper anti-money laundering controls facilitated the laundering of at least $881 million in drug proceeds through the US financial system. HSBC's willful flouting of US sanctions laws and regulations resulted in the processing of hundreds of millions of dollars in OFAC-prohibited transactions. Today's historic agreement, which imposes the largest penalty in any BSA prosecution to date, makes it clear that all corporate citizens, no matter how large, must be held accountable for their actions."

HSBC may have been slapped with the largest penalties ever, but it is hardly the only bank to have been caught profiting off prohibition. In 2010, Wachovia forfeited $110 million to avoid criminal prosecution for money laundering for the cartels, Sigue Corporation forfeited $15 million in 2008, American Express International Bank paid $65 million in fines and Union Bank of California forfeited $21.6 million in 2007, and Bank Atlantic paid a $10 million fine to avoid prosecution for laundering drug cartel profits in 2006. Like HSBC, all of those banks agreed to reform their banking practices and submit to federal oversight as part of the agreement.

HSBC is accused of under-staffing its anti-money laundering program and failing to monitor billions of dollars in purchases of physical dollars by its Mexican affiliate, HSBC Mexico. It reportedly failed to monitor over $670 billion in wire transfers and the purchase of over $9.4 billion in US dollars.

According to the Justice Department, "HSBC Mexico's own lax AML controls caused it to be the preferred financial institution for drug cartels and money launderers."

The unanswered question is why a government that lets bankers who launder hundreds of millions of dollars of drug profits routinely sends crack-slingers to federal prison for decades for selling a few dollars worth of drugs. Perhaps if those drug dealers had a few million dollars they could hand over to the feds, they could walk, too.

New York, NY
United States

Cato Policy Analysis and Forum on State Legalization and Preemption

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Cato Institute (cato.org)
The libertarian Cato Institute has published a Policy Analysis, "On the Limits of Federal Supremacy: When States Relax (or Abandon) Marijuana Bans." The author of the brief is Robert A. Mikos, professor of law and director of the Program in Law and Government at Vanderbilt University Law School. Mikos is speaking at a Cato forum tomorrow here in Washington, DC, as is former congressman and DEA chief Asa Hutchinson.

I haven't read Mikos's analysis yet, but the following excerpt gives a hint at what he might say tomorrow:

Using medical marijuana as a case study, I examine how the anti-commandeering principle protects the states' prerogative to legalize activity that Congress bans. The federal government has banned marijuana outright, and for years federal officials have lobbied against local efforts to legalize medical use of the drug. However, an ever-growing number of states have adopted legalization measures. I explain why these state laws, and most related regulations, have not been -- and cannot be -- preempted by Congress. I also develop a new framework for analyzing the boundary between the proper exercise of federal supremacy and prohibited commandeering.
 

It's not surprising that a professor friendly to Cato would take a friendly view toward state legalization measures. But Mikos is not the only one. Just today on a phone conference I participated in, a former prosecutor told us that his community sees the courts preempting the state laws as a reach and less than likely, though some DOJ officials want to try for it.

Hutchinson may see things differently, but who knows, maybe we'll be surprised. Perhaps he will have interesting insights to offer on the likely federal response. Hutchinson is a rarity among DEA types in being willing to come out and debate, and he has been known to make reasonable statements about the issue on occasion, though I'm sure we still disagree on most aspects of drug policy.

Should be an interesting talk -- check back at the link for video if you can't come out for it. In the meanwhile, you can read some of my own thoughts on the preemption question here, and a discussion with experts in our newsletter here.

Marijuana Is Now Legal in Colorado! [FEATURE]

And then there were two. On Monday, December 10, 2012, Colorado Gov. John Hickenlooper signed an executive order certifying last month's Amendment 64 victory and legalizing the use, possession, and limited cultivation of marijuana by adults 21 and over.

Colorado now joins Washington as states where voters approved marijuana legalization last month and where the will of the voters has now become law. In both states, it is only the possession (and cultivation in Colorado) parts of the new laws that are now in effect. Officials in Denver and Olympia have a matter of some months to craft and enact regulatory schemes for commercial marijuana cultivation and distribution -- provided the federal government does not seek to block them from doing so.

While the federal government may seek to block implementation of regulations, it cannot make the two states recriminalize marijuana possession. And the states have no obligation to enforce federal marijuana laws.

In both states, however, it remains illegal to sell marijuana or cultivate it commercially pending the enactment of regulatory schemes. Still, pot possession is now legal in Washington and Colorado.

"Voters were loud and clear on Election Day," Hickenlooper wrote. "We will begin working immediately with the General Assembly and state agencies to implement Amendment 64."

In addition to the executive order certifying the election results, Hickenlooper also signed an executive order establishing a 24-person task force charged with coming up with a way to implement Amendment 64's taxation and regulation provisions. The task force consists of government officials and other stakeholders, including representatives of medical marijuana patients, producers, and non-medical consumers, and will make recommendations to the legislature on how to establish a commercial marijuana market.

"All stakeholders share an interest in creating efficient and effective regulations that provide for the responsible development of the new marijuana laws," the executive order said. "As such, there is a need to create a task force through which we can coordinate and create a regulatory structure that promotes the health and safety of the people of Colorado."

Issues that will be addressed include: the need to amend current state and local laws regarding the possession, sale, distribution or transfer of marijuana and marijuana products to conform them to Amendment 64's decriminalization provisions; the need for new regulations for such things as security requirements for marijuana establishments and for labeling requirements; education regarding long-term health effects of marijuana use and harmful effects of marijuana use by those under the age of 18; and the impact of Amendment 64 on employers and employees and the Colorado economy.

The task force will also work to reconcile Colorado and federal laws such that the new laws and regulations do not subject Colorado state and local governments and state and local government employees to prosecution by the federal government.

"Task force members are charged with finding practical and pragmatic solutions to the challenges of implementing Amendment 64 while at all times respecting the diverse perspectives that each member will bring to the work of the task force," the executive order emphasized. "The task force shall respect the will of the voters of Colorado and shall not engage in a debate of the merits of marijuana legalization or Amendment 64."

Marijuana legalization supporters cheered the issuance of the executive orders.

"This is a truly historic day. From this day forward, adults in Colorado will no longer be punished for the simple use and possession of marijuana. We applaud Gov. Hickenlooper for issuing this declaration in a timely fashion, so that adult possession arrests end across the state immediately," said Mason Tvert, one of the two official proponents for Amendment 64 and newly appointed communications director for the Marijuana Policy Project.

"We look forward to working with the governor's office and many other stakeholders on the implementation of Amendment 64," Tvert continued. "We are certain that this will be a successful endeavor, and Colorado will become a model for other states to follow."

Not everyone was as thrilled as Tvert. Both US Attorney for Colorado John Walsh and Colorado State Patrol James Wolfinbarger issued statements Monday warning respectively that marijuana is still illegal under federal law and that driving while impaired by marijuana is still a crime.

"The Department of Justice is reviewing the legalization initiatives recently passed in Colorado and Washington state," Walsh said in his statement. "The Department's responsibility to enforce the Controlled Substances Act remains unchanged. Neither states nor the executive branch can nullify a statute passed by Congress. In enacting the Controlled Substances Act, Congress determined that marijuana is a Schedule I controlled substance. Regardless of any changes in state law, including the change that will go into effect on December 10th in Colorado, growing, selling or possessing any amount of marijuana remains illegal under federal law. Members of the public are also advised to remember that it remains against federal law to bring any amount of marijuana onto federal property, including all federal buildings, national parks and forests, military installations, and courthouses."

"The Colorado State Patrol would like to remind motorists that if you chose to consume marijuana and make the decision to drive that you are taking a huge risk," Wolfinbarger said. "Drivers must realize that if you are stopped by law enforcement officials and it is determined that your ability to operate a motor vehicle has been affected to the slightest degree by drugs or alcohol or both, you may be arrested and subjected to prosecution under Colorado's DUI/DUID laws. It is imperative that everyone takes responsibility for public safety when driving on Colorado's highways."

While the implementation of regulations for marijuana commerce in Colorado and Washington is by no means assured, the legalization of pot possession in the two states is a done deal. And with it, a huge hole has been blown through the wall of marijuana prohibition. Since the election last month, public opinion polls have shown increasing support -- and in three out of four cases, majority support -- for marijuana legalization, as well as little patience for federal interference in states that have legalized.

Marijuana prohibition may not be dead yet, but voters in Colorado and Washington have delivered a mortal blow. The clock is ticking.

Denver, CO
United States

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