Los Angeles Marijuana Dispensaries

May 1, 2011

Attorneys Successful in Staying Judge’s Order to Close Lake Forest Marijuana Dispensaries

Our Orange County medical marijuana attorneys have been successful in securing a stay against Lake Forest’s orders to close two dispensaries located within 600 feet of a school.

As the Orange County Register reported, the judge on Friday issued a temporary restraining order permitting the city to close 7 pot shops near Montessori Children’s School House on Raymond Way. The judge ruled the dispensaries violate state law by operating within 600 feet of a school.

Lake Forest Dispensary Lawyer Damian Nassiri, who represents two of the dispensaries — the Lake Forest Wellness Center and Collective and the Independent Collective of Orange County — asked the appeals court to stay the judge’s order. That request was granted.

“The school is not a licensed K-12 school,” Nassiri said. “There are teachers who are providing instruction to that age, but there is no actual kindergarten. This is overreaching, and this school does not meet the requirement that went into place Jan. 1. The amendment excludes day care and colleges.”

It is the second time the CANNABIS LAW GROUP has been successful in staying the judge’s order for closure. The same judge ordered the businesses closed last July, based on the city’s argument that they violated local zoning code.

Nassiri also argues that the new restrictions only apply to businesses that need licenses, and thus do not apply in this instance because Lake Forest does not require business licenses.

The victory was good news for patients — dozens of whom were calling the collectives, concerned they might shut down. Operators say they have seen an increase in patients being treated for multiple sclerosis, carpel tunnel syndrome and PTSD.
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April 27, 2011

More Companies Join the Fight against the Medical Marijuana Lottery in Los Angeles

By Cannabis Law Group

This past week, six medical marijuana dispensaries in California filed separate legal challenges to the Los Angeles ordinance that uses a random drawing to select 100 pot stores that would be allowed to continue their operations. At least eight lawsuits are currently seeking to completely toss out the law, according to the Los Angeles Times.

The new lawsuits call the lottery, deciding who will stay and who will go, “a game of chance” and denounce it as “arbitrary, capricious and irrational.” The lawsuit argues that the lottery violates the constitutional rights of the dispensaries.

The Los Angeles medical marijuana lawyers at the Cannabis Law Group remain dedicated to protecting the rights of legally operating medical marijuana growers, distributors and their patients against the overreaching actions of cities throughout the Los Angeles area. No city should be allowed to enact restrictions, ordinances or other hindrances to business operating legally under California law.

The Los Angeles City Clerk’s Office is currently reviewing 231 applications from medical marijuana dispensaries that have applied to be part of the lottery. Officials intent to arbitrarily choose 100 that the city will permit to operate, according to the Los Angeles Times.

The dispensaries are asking that the Los Angeles County Superior Court judge stops the city from holding the lottery as it serves as an unfair technique that will decide the future of many companies.

The dispensaries to recently join the fight are Downtown Natural Caregivers, God’s Gift, Kush Korner V, Medical Kush Beach Club, New Era Caregivers and Safe Life Caregivers.

While city officials have moved ahead with setting up the lottery, they have also appealed a court ruling that invalidated parts of an earlier ordinance that would have allowed them to use a different method to reduce the number of dispensaries in the city, according to KTLA.

April 19, 2011

Medical Marijuana Dispensary in L.A. Shut Down After Raid

By Cannabis Law Group

A storefront pot doctor that lures patients with barkers was raided and shut down last week, according to the Los Angeles Times. The eye-catching, only-in-California feature was forced to close up shop when the state medical board and law enforcement officers raided three locations linked to Medical Kush Doctor. Officials confiscated at least two large plastic bags appearing to contain marijuana, roughly five pounds, from the California medical marijuana dispensary. Out of the deep-blue building next to Muscle Beach that houses a doctor’s office, cops investigated the smoke shop and a popular dispensary called the Medical Kush Beach Club.

Our Los Angeles medical marijuana lawyers continue to report on the challenges facing the medical marijuana industry. Whether doctors and dispensaries are operating legally can be a difficult call. Hiring an experienced defense lawyer is the best course of action for protecting your freedom and your financial well-being.

Spokeswoman for the Medical Board of California, Jennifer Simoes, said the warrant was sealed. Simoes declined to discuss the reason for the board’s investigation, but said that the warrant was served on Ocean Front Walk.

The warrant allegedly authorized a search of the offices, vehicles and other property. It supposedly also allowed officials to seize various records related to the unlicensed practice of medicine. The raid reportedly began a little after 10:15 a.m.

The doctor reportedly rents the spaces and provides promotional services for medical marijuana doctors. The provider reported to have believed that the doctors he distributed to followed all of the state laws in issuing recommendations for marijuana use to their patients.

The operation was conducted with the Los Angeles County district attorney’s office, the Los Angeles Police Department, the county Sheriff’s Department and the state Department of Corrections and Rehabilitation, which provided search dogs, according to the LA Times.
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April 7, 2011

San Diego’s Medical Marijuana “plan” another Disaster in the Making

By Cannabis Law Group

If you need any evidence that there is strength in numbers — even if everyone is ill informed and willing to spend millions of tax dollars to prove it — you need look no further than San Diego, where the Union-Tribune reports officials plan to vote on a measure that would force all medical marijuana dispensaries to close and then apply to reopen.

Our Los Angeles medical marijuana dispensary attorneys are representing more than a dozen dispensaries and collectives in Los Angeles and the surrounding area. A judge’s recent rejection of the criminal element of the L.A. ordinance proves victory is possible. Many collectives are choosing to remain open and fight. City leaders must chase them for civil fines in court — as if forcing them out of business was not the ultimate civil penalty anyway.

As politicians in cities and counties across Southern California push this issue — it gets them on television and is sexier than tackling the real issues of the day like budget deficits and the education and safety of our children — they are spending millions and millions of tax dollars, often ignoring the advice of their own legal teams, and generally creating a legal disaster that will take most of the next decade to resolve. We think it most likely that the dispensaries and collectives that stand and fight will prevail in the end.

San Diego’s proposal would require every storefront in the city to close and then apply for an operating permit. Thousands of patients would lose access to medical marijuana in the interim.

The permit process could take more than a year. There is no agreement on how many collectives would even be permitted to operate — although it would be far fewer than the 165 that now exist.

Can you imagine? What if the city decided all convenience stores must shut down by week’s end. They could apply to remain open, but no guarantees. Not sure how the permitting process would work. Don’t know how many would be issued. Most would agree that business owners should sue the city for millions. And win. We don’t think the medical marijuana issue is radically different. These businesses are operating legally under state law. Some have been in business for years. All of a sudden a used car salesman elected to city council decides to break out his pencil and order all of them closed?

Good luck with that.

Meanwhile, the patients have legal rights, too. Officials are planning for (taxpayer funded litigation). They know either they will sue or some of the dispensaries or patients will sue. In all likelihood, everyone will sue and rightfully so. The city will spend millions upon millions upon millions of tax dollars litigating a losing case. Many of the dispensaries will stay open anyway.

At least 50,000 people in the county have a doctor’s recommendation for medical marijuana.
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April 4, 2011

Los Angeles Receives more than 200 Medical Marijuana Dispensary Applications

By Cannabis Law Group

The Los Angeles City Clerk’s Office is reviewing 231 applications from medical marijuana dispensaries that have applied to be part of a lottery to choose 100 the city will permit to operate, according to the Los Angeles Times.

The city clerk’s handling of the medical marijuana ordinance has been nearly as disastrous as council’s. Our Los Angeles medical marijuana defense lawyers expect lost paperwork, bad rejections and more or less arbitrary decisions to be commonplace. Our attorneys currently represent more than a dozen dispensaries and collectives in Los Angeles and the surrounding area. We recommend fighting for your rights. The judge has already rejected criminal penalties for dispensaries that remain open — while you may be subjected to a civil lawsuit, we see forced closure as the ultimate civil penalty anyway. Those dispensaries that are fighting for their rights are enjoying the best chances for success.

Displaying the attention to detail that always makes for a good clerk, the city clerk’s office initially announced 228 filings, then said it had accidentally left three off the list. It now estimates it could take 4 weeks to determine which applicants are “eligible.”

We would suggest saving the city a lot of time by deeming all of the applicants eligible under state law. The city has decided to conduct the drawing because its ill-conceived ordinance, which went into effect last summer, has been so disastrous it would have forced the closure of nearly all of the city’s more than 400 dispensaries.

On March 9, the city released a list of 141 dispensaries ordered to close.

The city is now attempting to shut them down under a new ordinance — a judge gutted much of the previous ordinance. The new interim emergency ordinance is likely to fair no better but the city is moving before there has been enough time for legal challenges.
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April 3, 2011

Feds Reportedly Pressing Banks to Dump or Seize Accounts of Medical Marijuana Dispensaries

By Cannabis Law Group

Recordnet is reporting that the federal government is attempting to pressure banks to make it more difficult for medical marijuana businesses to get banking services.

Our Los Angeles medical marijuana lawyers continue to report on the challenges facing the medical marijuana industry. Collectives and dispensaries should have an attorney of record as a routine matter of business. The relationship you have with your law firm is confidential and you can discuss issues like taxation, banking and non-profit status. The reality is the local, state and federal authorities are making up the rules as they go along. It is the businesses that have quality legal representation, and which fight for their rights, that have the best chances of surviving.

As we reported recently on our Marijuana Lawyer Blog the industry has established a lobbying presence in Washington as the Internal Revenue Service has moved to crackdown on medical marijuana sales, which remain illegal under federal law.

Now, dispensaries are getting letters from their banks notifying them that their accounts are frozen or closed. A spokesperson for Wells Fargo declined to comment other than to say the bank has decided not to offer services to medical marijuana businesses.

Dispensary operators elsewhere in California, including Sacramento, are telling similar stories. While President Obama said in 2009 that the federal government would respect state’s rights when it comes to the medical marijuana issue, selling marijuana remains illegal under federal law. By last year, Congress had received complaints from 14 states that federal regulators were pressuring banks to close accounts.

When questioned, federal regulators were quick to pass the buck from Congress, to the Treasury Department, to the Federal Deposit Insurance Corporation to the Office of the Comptroller of Currency.

Of course, nobody had any information about any such pressure being directed at banks. Nobody knew nothing!

Third grade all over again. If you are in the medical marijuana business in Southern California, do yourself a favor and get yourself and experienced law firm to stand up for your rights.
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April 1, 2011

Lobbying Feds Could Benefit Los Angeles Medical Marijuana Dispensaries

By Cannabis Law Group

The medical marijuana industry has officially opened the doors of its lobbying association in Washington D.C., the San Francisco Chronicle reported.

Our Los Angeles medical marijuana lawyers applaud the move. We understand it is the patients, growers, collectives and dispensaries that fight for their rights that are most likely to prevail against unfair regulation in the end. As we reported recently on our Marijuana Lawyer Blog, medical marijuana is a nearly $2 billion-a-year industry.

And, while California was the first and remains the most well-known state to permit medical marijuana, the drug is currently legally sold to patients in California, Colorado, Michigan, Montana, Oregon, Washington and New Mexico. Five other states will open for business this year, including Arizona, Maine, New Jersey, Rhode Island and the District of Columbia.

Yet it remains illegal under federal law and we recently reported the Internal Revenue Service is causing tax problems for marijuana dispensaries. The federal government and the amateur politicians at the local level remain the two biggest threats to the legitimacy and survival of the medical marijuana industry.

“We simply feel that our industry should be treated like any other legitimate industry,” said Aaron Smith, director of the National Cannabis Industry Association. He spoke at a news conference kicking off the association’s first day of lobbying, which included meetings with lawmakers on Capitol Hill.

While the Obama Administration has directed federal prosecutors not to pursue medical marijuana cases in states where the drug is legal, dispensaries, collectives and medical marijuana farms exist in a legal twilight zone as far as the federal government is concerned.

Lobbyists will work to promote changes in the tax code, which still categorizes dispensary owners as drug traffickers.

California has 76 percent of the nation’s medical marijuana market — the state has issued 51,550 medical marijuana cards in the last 5 years.
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March 31, 2011

San Diego approves Tough New Rules for Medical Marijuana Dispensaries

By Cannabis Law Group

San Diego, the state’s second-largest city, approved restrictions on medical marijuana dispensaries, barring them from doing business within 600 feet of places of worship, parks, schools and other “sensitive” locations.

As our Los Angeles medical marijuana lawyers reported on our Marijuana Lawyer Blog, proponents had pushed for new pot shops to obtain permits and prove they were nonprofit businesses. This could be particularly problematic because proving non-profit status requires filing with the federal government, which still deems the sale of marijuana illegal under federal law.

SFGate reported council voted 5-2 to enact the ordinance, which will apply to more than 150 existing medical marijuana clinics and pot shops. The initial restrictions called for a 1,000 foot buffer zone, but that was amended to 600 foot.

Critics argued 1,000 foot would push clinics into far flung industrial zones near the U.S. Mexican border. That area is patrolled by federal agents. More than 3,700 people wrote to council, requesting less severe restrictions so that AIDS patients, veterans and other patients could maintain access to medical cannabis.
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March 29, 2011

IRS Rules could Result in Capone-like Prosecution for L.A. Marijuana Dispensaries

By Cannabis Law Group

Forbes reports that the feds could use the Al Capone treatment to target those dealing in medical marijuana in states where it is legal, including California.

Our Los Angeles medical marijuana dispensary attorneys reported recently on our Marijuana Lawyer Blog about the recent IRS audit of an Oakland dispensary.

In 1931, mobster Al Capone was finally put behind bars for tax evasion. Forbes reports the IRS is now notifying many California dispensaries of audits, which could result in medical marijuana businesses being cited for millions in back taxes. At issue is IRS Code 280E, which “precludes deductions for any business trafficking in controlled substances.”

Because marijuana is legal under federal law, the IRS is arguing that many normal business expenses cannot be deducted from dispensary income. A Fairfax, California dispensary was the first to be hit with this ruling earlier this month. The owner told the media that the IRS disallowed all of her business expenses, like renting office space and hiring employees. The agency then hit her with a tax bill totaling several million dollars.

By some accounts, at least a dozen California dispensaries have been notified of pending IRS audits.
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March 26, 2011

Los Angeles Orders more Medical Marijuana Dispensaries to Close

By Cannabis Law Group

Our Los Angeles medical marijuana dispensary attorneys urge any dispensary or collective who receives a medical marijuana shutdown order from the city to call us for a confidential consultation to discuss your rights.

The dispensaries that have sought legal representation and chosen to fight have enjoyed a number of recent court victories. As we reported on our Marijuana Lawyer Blog, a judge has ordered the city into settlement negotiations with attorneys for dispensaries after several legal victories. But dispensaries that have not fought the city are facing increasing harassment and are among those receiving shutdown orders.

The Los Angeles Times reports the city has widened its campaign, ordering another 60 dispensaries to close their doors immediately. Two weeks ago, the city’s attorney’s office notified 141 operators and their landlords that they must close. A judge rejected the city’s attempt to attach criminal penalties to noncompliance. The letters warn of possible lawsuits and financial penalties (as if being forced out of business wasn’t a financial penalty).

By the city’s own admission, it is unsure whether some of the locations are open and has no information as to whether or not they are selling marijuana — we guess the threats are just in case.

And they want the businesses to respond! As in, do the city’s job for it.

The city said it will use police resources to “gather evidence” and will then need to file lawsuits to force the closure of marijuana businesses that are not in compliance. Of course, what constitutes compliance is very much open for debate since most of the ordinance passed last year has either been rejected in court or has been changed by the city.

The city said dispensaries continue to open, close and reopen and that it was not possible to get an accurate count, let alone to know which ones are, in the city’s opinion, operating illegally.
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