Washington Officials Warn Against Cannabis Delivery ‘Loophole’

3/06/2020

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In a policy bulletin last week, Washington cannabis regulators said, explicitly, that retail cannabis home delivery is “not legal” despite language in the law that would appear to provide a loophole for the service.

According to the Liquor and Cannabis Board bulletin, “some companies claim to have found a way around the delivery prohibition” with the part of the law that states:

“The delivery by a person twenty-one years of age or older to one or more persons twenty-one years of age or older, during a single twenty-four hour period, for noncommercial purposes and not conditioned upon or done in connection with the provision or receipt of financial consideration, of any of the following marijuana products, is not a violation of this section, this chapter, or any other provisions of Washington state law.”

The bulletin clarifies that the “exception is specifically for non-commercial, and non-financial purposes.”

“It does not exempt licensees from their prohibition on home delivery, and there is no legal pathway for commercial delivery, delivery service, or a delivery app to be used to facilitate home delivery from retail licensed locations to customers.” – Washington Liquor and Cannabis Board, February 26, 2020, Bulletin No. 20-01

According to an Inlander report, the bulletin is targeting Pelican Delivers, which provides an app for retail cannabis home delivery in the state. Through the app, the company facilitates payment from the customer to a dispensary and provides a delivery driver, who is paid for the service, with the customer and the dispensary, the report says.

It’s unclear, however, who pays the driver, which has led to the confusion about the legality of the service as it could be argued that the driver is simply delivering a legal product but is not accepting cash from the customer; however, the LCD bulletin appears to clarify the agency’s position.

“Retail licensees cannot participate in home delivery, home delivery services, or apps for home delivery that violate any of the two stipulations [in the law],” the bulletin says. “If approached with proposals claiming to allow for legal home delivery, please contact your enforcement officer.”

Last year, regulators sent draft legislation to the members of the state’s cannabis industry that included adding retail delivery for producers that cultivate 2,000 square feet or less in an effort to give them a “leg up” over larger-scale producers, LCB spokesman Brian Smith told the Spokesman-Review last summer. That bill has yet to materialize in the Legislature.

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Former Canopy Growth Execs Launch Hemp and CBD Investment Firm

3/06/2020

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Former Canopy Growth CEO Bruce Linton has launched a new company, Collective Growth, focused on investment opportunities in the hemp and CBD space, Yahoo Finance reports. The firm is co-founded by Geoff Whaling, the current chairman of the National Hemp Association who worked with Linton at Canopy and supervised the company’s buildout of its New York Cultivation facility.

The venture aims to raise up to $150 million in an initial public offering as a special purpose acquisition company and filed Monday with the Securities and Exchange Commission to eventually list on the Nasdaq under the CGROU symbol, the report says.

“Where we have a space right now is hemp shouldn’t just be viewed as CBD. Hemp has so many virtues that are under-realized. What we want to take is the whole plant and create a profit from every element of it.” – Linton to Yahoo Finance

Linton will serve as the Chairman and CEO of the firm, while Whaling was named president. The leadership team also includes form Canopy Growth Chief Financial Officer Tim Saunders, who held the same role with Canopy for four years until last May, New Cannabis Ventures reports.

According to a Renaissance Capital report, the company plans to raise $150 million by offering 15 million units at a price of $10. Each unit comprises one Class A share and one-half of a redeemable warrant, which is exercisable at $11.50. At the proposed deal size, Collective Growth would hold a market value of $190 million, the report says.

Linton was ousted by Canopy Growth last July amid a shakeup at the company that saw four directors installed by Constellation Brands – an alcohol distributor that holds about 38 percent of the company’s stock. He was named executive chairman of Vireo Health in November.

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Scott Goldie: Scaling a Cannabis Farm in California

3/05/2020

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We recently interviewed Scott to ask about Goldenseed‘s award-winning products and his experience so far in the California marketplace. Scroll down to check out the biggest lessons he’s learned, which Goldenseed products have performed the best, Scott’s future plans for expansion, and more!

Ganjapreneur: What are some of the most popular Goldenseed products or genetics in the California market?

Scott Goldie: Our pre-roll terpene tip joints have been incredibly popular – winning two first place awards at High Times and Hempcon competitions and being picked up in close to 50 dispensaries already. In general, our flower has been well-received by the market due to the high terpene profiles and with many strains exceeding 20% THC. This year we will be expanding our product offerings significantly, leveraging the lifestyle brand we have created and our rapidly-expanding distribution. On the hemp side, we have highly-desired genetics that have very high CBD percentages with strong terpene profiles. Recently, we partnered with a company to manufacture hemp cigarettes.  They did a nationwide search and determined we had the best genetics for their product.

Does the brand have plans to acquire producer licenses in other states? Which markets?

One of the reasons we chose to do a stock offering to the general public was to build the brand nationally, even though we can’t sell cannabis products outside of California yet. When cannabis becomes legal at the federal level, we will have name recognition and a foothold in many states and we think this will give us a leg up on other brands. We’ve already had people apply to invest from more than 40 states and 14 countries, and we just got started with the stock offering. It will be nice to have investors across the country knowing who Goldenseed is, telling their friends, family and local dispensaries about us. Of course, with hemp and CBD products, we can already market around the country, which will also help us build name recognition. While we have explored several licensing opportunities on the West Coast, at this time we are focused on building our infrastructure and distribution here in California. As we become identified as an iconic California lifestyle brand, we think our message and product offerings will resonate and become highly-desired in other states. A parallel I like to draw is the desirability of a Napa Valley cabernet, a well-established icon coveted by wine aficionados throughout the country and even recognized by many casual wine drinkers. As we build the Goldenseed cannabis brand and expand our identity in other states through our stock offering, we feel licensing opportunities will be more likely.

How does Goldenseed acquire their genetics? Do you breed new strains or acquire genetics from reputable breeders?

Our grower has been growing for nearly four decades. Over that time period, he has amassed a library of some of the best genetics in terms of taste, appearance, aroma, yield, terpene profiles, THC content, grow time and disease resistance. While he has sourced some genetics historically, he takes great pride in being a breeder.  He is constantly on pheno hunts — cross-breeding and back-breeding to create the best and most consistent strains.

Goldenseed is almost completely vertically integrated — which aspects of the supply chain are owned or controlled in-house, and which aren’t?

Goldenseed is completely integrated at this point, starting with a worm farm that produces vermicompost for our plants, nursery, cultivation, manufacturing and retail products.  While we have a distribution license, we are currently using third party distributors to bring our products to the market.

Why did Goldenseed decide to start raising public funds using Regulation A fundraising?

In addition to name and brand recognition nationally, we really wanted to give everyday people a chance to join us on this journey at an early stage by investing – even a small amount.  Why should the wealthy and the well-connected be the only ones who get to invest in a company like ours at an early stage where there is growth potential? We saw this stock offering as a way to democratize the investment process for the little guy and to give them a chance to own a piece of something that they love and believe in. It’s heartening to hear from them as they go through the investment process and tell us how much it means to them to have a chance to invest in us and in the cannabis industry. To know we were the first U.S. grower to be able to do this after being qualified by the SEC is really special. A lot of people have told us they still can’t believe they can legally buy weed, much less own a farm that grows it!

What did it take to get SEC approval for a cannabis farm?

A lot of people thought we were crazy going to the SEC and asking them to qualify a stock offering for a company like ours that “touches the plant” — we grow it, we process it, we make and sell products. To ask a federal agency to review what we do — with cannabis illegal at the federal level — was intimidating at first. But we partnered with our securities lawyer, Kendall Almerico, who had a lot of experience with Regulation A, the law that allows a private company like ours to sell stock to the public, and he guided us through the grueling process. We had to submit detailed business plans, audited financial statements, contracts and hundreds of pages of documents that explain pretty much everything about Goldenseed. The management team had to undergo background checks. The entire process took a few months but the examiners at the SEC were very professional to work with. We made it through and proved a lot of people wrong. I think it is a sign that times are changing and hopefully we will see the federal ban on cannabis lifted soon. When that happens, Goldenseed will almost certainly already have a national footprint with investors all over the country, which we think gives us a leg up on all competitors.

What protections do investors have if the necessary funding isn’t raised?

We’re dedicated to making this company profitable and to providing each and every investor with a return on their investment. We are not relying on this stock offering alone to fund the business — we have products to sell and are in a lot of dispensaries already. We have already generated revenues even at our early stage. We have a big hemp harvest already in our processing facility that we plan to monetize. We just planted a new crop of cannabis plants to turn into pre-rolls and flowers to take to market. There are never any guarantees of course, and we all know any investment involves a level of risk. For instance, when you buy stock on the New York Stock Exchange sometimes that stock loses value and some of those companies even go bankrupt.  All an investor can do is put their money and their faith in a company they believe in, who does things the right way. We are doing everything we can to make sure we remain a company our investors, large and small, can be proud to be a part of.

With the proper funding what expansions and plans does Goldenseed plan to undertake?

We would eventually like our California lifestyle brand to be available in every state that allows the sale of recreational cannabis, once the federal ban is lifted.  We think people all over the country will identify with the quality of our brand and the roots of the cannabis industry in the state of California, and that Goldenseed will be a desirable and popular brand as a result. All along, maintaining the award-winning quality of our products and our sustainable and natural farming methods is a huge key. On the hemp side, we are presently planning to roll out hemp cigarettes nationally and internationally very soon, we recently announced a hemp clothing line with Zane Lamprey of Adv3nture, and a number of CBD products that we believe will be of the highest quality we can possibly make are in the works. Remember, our core management team has experience to manage the infrastructure needed to grow this company in a responsible, but fast way — without cutting corners on the quality of our products.

Thanks, Scott, for sharing your input and expertise with our readers! Learn more about Scott Goldie and Goldenseed at GSeed.com.

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Canopy Growth Lays Off 500 and Shuts Down Two Greenhouses

3/05/2020

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Two large Canopy Growth greenhouses were closed in Delta and Aldergrove, B.C. on Wednesday, leaving approximately 500 people without jobs, according to a statement by the Canadian cannabis provider. The two facilities consisted of about three million square feet of production space.

The company will also be stopping all plans for building a third greenhouse in Niagara-on-the-Lake. Canopy blames the closures on changes in federal law pertaining to outdoor commercial cultivation and slow growth in the recreational market.

The announcements come just a few months after Mark Zekulin resigned as CEO and respected investor David Klein was appointed to the position.

“When I joined Canopy Growth earlier this year, I committed to focusing the business and aligning its resources to meet the needs of our consumers. Today’s decision moves us in this direction, and although the decision to close these facilities was not taken lightly, we know this is a necessary step to ensure that we maintain our leadership position for the long-term.” — CEO David Klein, in a press release

According to some market analysts, Canopy Growth’s revenue is expected to reach $424.2 million CAD in 2020 and $725.8 million CAD in fiscal 2021. The publicly-traded company expects to lose around $700-800 million CAD from the employee layoffs in the quarter ending March 31, 2020. Also, they reported an EBITDA of 91.7 million Canadian dollars in the last fiscal quarter.

They are not expected to reach positive EBITDA by 2021 but the amount of debt is expected to continue shrinking exponentially at that time.

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Cannabis Market Launch Delayed In Maine Until June

3/05/2020

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Maine officials now predict the state’s first adult-use cannabis operator will open for business in June, three months later than originally expected, the Portland Press Herald reports.

Erik Gundersen, director of the Office of Marijuana Policy, said Maine is “very close” to wrapping up the licensing process after receiving 197 applications, 80 of which were deemed sufficiently complete. Once an applicant is approved, however, they still will need to secure local authorization before being fully licensed. Additionally, the state also still needs to approve at least one official testing laboratory.

State officials have decided to wait until there is enough infrastructure to support the industry during its early days before the official launch, hence the multi-month delay.

“(That) will allow product to go through the mandatory testing regime, go through the manufacturing process and allow retail stores to fully stock their shelves with a wide array of products. Hopefully, (we’ll) get enough products into the system to withstand the first day, the first weekend, the first week of demand so we don’t have a shortage like we’ve seen in other states.” — Gundersen, via the Press Herald

The delays have prompted major adjustments to the state’s expected amount of cannabis tax revenue in fiscal year 2020, which ends in June.

Maine voters passed an adult-use cannabis legalization initiative in 2016. Meanwhile, neighboring Massachusetts — which voted to legalize during the same election — launched its own adult-use marketplace in 2018.

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Treasury Secretary: Cannabis Cash ‘Creates Problems’ for IRS

3/05/2020

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Treasury Secretary Steven Mnuchin told lawmakers on Wednesday that the cash-only nature of the cannabis industry “creates significant problems” for the Internal Revenue Service and “creates risk” for IRS employees and “people in the community,” according to a report from The Hill.

During his testimony to the House Appropriations subcommittee, Mnuchin didn’t take a stance on the issue of cannabis banking at large but said the Treasury Department “has limited abilities” within the guidance from the agency’s Financial Crimes Enforcement Network (FinCEN) “to direct” the issue. Mnuchin urged lawmakers to “deal with” the issue “one way or another.”

“We have to build cash rooms to take in large amounts of cash where people owe us taxes, because we want to collect the taxes, and those entities are not banked.” – Mnuchin, in remarks to the House Appropriations subcommittee, Mar. 4, 2020, via The Hill

The 2014 policy guideline from FinCEN provides a pathway for cannabis operators in legal states to access traditional financial services but it’s largely at the discretion of the service providers.

In 2018, the agency reported more than 300 banks and about 100 credit unions were providing services to the space, but FinCEN’s rules were muddied by former Attorney General Jeff Sessions, who rescinded the Cole Memo, which had protected state-legal cannabis businesses from federal interference. Following the move by Sessions, FinCEN said their 2014 guidance remained in place; however, most banks, credit unions, and credit card processors still refuse to serve the industry.

Last September, House lawmakers passed the SAFE Banking Act, which would explicitly allow cannabusinesses access to financial services; however, that measure has not been voted on by the Republican-controlled Senate. Sen. Mike Crapo (R), the chair of the chamber’s Banking, Housing, and Urban Affairs Committee, does not support the legislation.

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Kentucky Senate Leader May Block Medical Cannabis Bill’s Progress

3/05/2020

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The chairman of Kentucky’s Senate Judiciary Committee, Sen. Whitney Westerfield (R), said the medical cannabis bill approved by the state House last week “won’t get a hearing” until he is “OK with it,” the Louisville Courier Journal reports. The measure passed the lower chamber in a 65-30 vote on February 20.

Westerfield said he still has questions about the legislation and said there are parts he “would want to change or at least have someone explain … why they’re in there in the first place.” Among his concerns, he said, are whether the bill would allow “people from other countries that have medical marijuana to get it” in the state, and whether using government agencies to choose which businesses would get a license would be “putting a thumb to the market.”

During the House vote, a slight majority of Republican lawmakers joined Democrats in approving the bill, which prohibits smokable forms of cannabis and home grows, and allows municipalities to opt-out of allowing industry operations, according to the Courier Journal.

Westerfield said he wasn’t sure whether the measure had the majority support among the Republican majority in the Senate to give it a hearing in the committee and that he planned on having a conversation with the caucus before he was prepared to move it forward.

Following the bill’s passage, Republican Senate President Robert Stivers described it as having a “narrow path” to approval in the chamber.

Rep. Jason Nemes (R), the bill’s sponsor, said Republican Senate leadership told him the measure would get a “fair chance” in the upper chamber.

“When you have an open mind and when you come to it in fairness, nine out of 10 people turn their opinions. And that’s what I expect it will be in the Senate as well.” – Nemes to the Courier Journal

In February, Foundation for a Healthy Kentucky polling found 90 percent of Kentuckians support medical cannabis legalization, including 95 percent of Democrats, 92 percent of independents, and 90 percent of Republicans.

According to the Courier Journal, medical cannabis reforms have been rebuffed in the state for 10 legislative sessions. The Kentucky legislative session adjourns on April 15.

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Israeli Cannabis & Psychedelic Events Delayed Due to Coronavirus

3/05/2020

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A cannabis conference scheduled for later this month in Tel Aviv, Israel has been postponed until June amid growing concerns over the COVID-19 coronavirus, organizers announced on Tuesday. A sister conference that focuses on psychedelics, PsyTech, was also postponed until June.

CannTech indicated the decision was made based on recommendations from the Israeli Ministry of Health, the World Health Organization (WHO), and the Centers for Disease Control and Prevention.

Saul Kaye, CEO of iCAN: Israel-Cannabis, said the organizers are “fully committed” to holding the events.

“Our number one concern is the health and safety of our attendees and speakers, our partners, our colleagues and our vendors. While we are disappointed to postpone both CannaTech Tel Aviv & PsyTech Summit, we are very confident it will be worth the wait.” – Kaye in a statement

The postponement of the event came one day after Expo West organizers announced their own delay but were not yet able to announce a new date. Expo West, a major natural products tradeshow that includes CBD brands, had been scheduled for this week in Anaheim, California.

The novel coronavirus has also disrupted vape cartridge supplies, such as coils and batteries, which come largely from China.

CannaTech is in its fifth year, while this is the first year PsyTech will be held.

According to Haaretz, Israel has had 15 confirmed cases of the coronavirus as of Wednesday, and officials have ordered a 14-day quarantine for all travelers returning from Germany, Spain, France, Switzerland, and Austria. The country has also banned gatherings of more than 5,000 people.

Out of the 15 confirmed cases of infected Israelis, eight are reported to have contracted the virus in Italy, while four contracted it from people in Israel who tested positive, according to the Haaretz report. The remaining three were aboard the Diamond Princess cruise ship, which was docked in a Japanese port.

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MLB Allows Cannabis Use But Not Cannabis Sponsorships

3/04/2020

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Major League Baseball (MLB) further clarified the league’s cannabis policies this week, confirming players’ right to use cannabis products during off-hours but announcing that, for now, players are not allowed to partner with or accept sponsorships from cannabis companies, ESPN reports.

The policy shift to allow cannabis use was announced in December but officials clarified in a memo last week that cannabis sponsorships, for now, are still off-limits. MLB said it plans to address the issue in the future but, “until such guidance is issued, any such investments or commercial arrangements are still considered to be prohibited in accordance with current practices.”

The league also clarified that players can still face repercussions for cannabis use: Players and team personnel who “appear under the influence of marijuana or any other cannabinoid during any of the Club’s games, practices, workouts, meetings or otherwise during the course and within the scope of their employment” will undergo a “mandatory evaluation” for a potential treatment program, according to the memo.

The league also clarified that players and employees can still face repercussions for cannabis use:

“If players or Club personnel appear under the influence of marijuana or any other cannabinoid during any of the Club’s game’s practices, workouts, meetings or otherwise during the course and within the scope of their employment, they will be referred to a mandatory evaluation under the applicable cannabinoid and alcohol treatment program.” — MLB memo, via Marijuana Moment

Previously, pro baseball players who tested positive for cannabis were subject to mandatory treatment and persistent offenders were charged up to $35,000 in fines per offense.

According to the report, twelve MLB teams — the A’s, Angels, Blue Jays, Cubs, Dodgers, Giants, Mariners, Padres, Red Sox, Rockies, Tigers, and White Sox — are based in cities where adult-use cannabis has been legalized. Medical cannabis, meanwhile, is available in every MLB location except for Georgia, Texas, and Wisconsin.

Major League Baseball is ahead of the National Football League in terms of updating its cannabis policies — the NFL is currently bargaining over a relaxed cannabis policy with the NFL Players’ Association.

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Florida Proposes Capping THC at 10% for Children

3/04/2020

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A proposal in Florida’s House of Representatives would cap medical cannabis THC content at 10 percent for patients under 21-years-old, the News Service of Florida reports. A nearly identical version of the measure stalled in the Senate earlier this week.

The measure, introduced by Rep. Ray Rodrigues (R) as an amendment attached to a Department of Health reform package, would also limit the daily dose of smokable medical cannabis products to .08 ounces (about 2.27 grams) and cap daily edible doses at 200 milligrams of THC with no single dose exceeding 10 milligrams, according to the bill text.

Patients under 21 would only be able to obtain products in excess of the THC cap if their physician gets permission from health officials or if they are terminally ill.

Ron Watson, a lobbyist who represents medical cannabis company MüV Florida, called the 10 percent cap “arbitrary” and “based on inconclusive research” which puts “the most vulnerable medical cannabis patients” in the state at risk.

“We believe a patient’s course of treatment should only be decided by a physician in collaboration with a parent and their child.” – Watson to the News Service of Florida

Children under 18 enrolled in the state’s medical cannabis program are already required to have approval from two doctors.

Sen. Gayle Harrell (R), the Senate Health Policy Chair who introduced a similar version of the bill in the Senate that was ultimately withdrawn after bipartisan pushback in the chamber’s Rules Committee, told reporters that she introduced the bill to see “how the THC limit for children would play out” in the committee but there was “no appetite” for the limit in the upper chamber.

The THC limits for children are a priority for Republican House leaders, according to the report, including Speaker José Oliva; however, the House proposal has not been vetted by any committee in the chamber.

Florida‘s legislative session ends March 13 and House lawmakers could pull the medical cannabis-related amendment from the reform package if they believe it wouldn’t pass in the Senate.

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800+ Rejected Medical Cannabis Applicants File Appeals in Missouri

3/04/2020

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More than 800 appeals have been filed by companies that were denied state licenses to operate a medical cannabis business in Missouri, with many of the appeals arguing that the scoring system used in the licensing process was flawed, the Associated Press reports. The state received 2,266 industry applications by at least 700 groups for just 60 cultivation licenses, 86 manufacturers, and 192 dispensaries.

Nevada-based Wise Health Solutions was hired to score the applications and some rejected applicants argue that the firm assigned different scores for the same answers on applications, the report says.

In an interview with KMOX, Joe Ingrande, who had hoped to open a dispensary in Bowling Green, called the process unfair. He and another investor spent about $60,000 in application and consultants’ fees and securing a potential building but said there was “too much ambiguity” with the testing process. Ingrande argued that in-state applicants were supposed to get priority in the process but many of the winners appeared to be out-of-state corporations.

A review by the St. Louis Post-Dispatch found that about two dozen groups that each won five or more licenses had ties to out-of-state cannabusinesses or the Missouri Medical Cannabis Trade Association, or MoCannTrade.

The process is also subject to at least one lawsuit challenging the constitutionality of the licenses, arguing that the cultivation license cap violates a state constitutional “right to farm,” according to an MJBizDaily report.

Lisa Cox, communications director for Missouri’s Department of Health and Senior Services which has hired three outside attorneys to assist the state’s legal team review of all the appeals, told MJBizDaily that the agency does not anticipate “any delays to the program rollout due to litigation.”

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Medical Cannabis Petition Drive Launched In Nebraska

3/04/2020

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Nebraska activists, including state Sen. Anna Wishart (D), are renewing their push to put a medical cannabis legalization question to voters, KOLN reports. Nebraskans for Medical Marijuana – which is co-chaired by Wishart – need 160,000 to 180,000 signatures by July to get the issue on the ballot.

The organization is working with ADOPT, a legalization group headed by former state senator Tom Garret, and 1st Tuesday Campaigns, a national strategy and consulting firm that has a “100 percent success rate of qualifying … signature initiatives,” Wishart told KOLN.

“What we’ve seen with polling is resoundingly over 70 percent of Nebraskans across the state. Across demographics, across age groups, rural and urban support legalizing access to medical marijuana.” – Wishart to KOLN

Republican Gov. Pete Ricketts opposes the initiative campaign and has penned at least three weekly columns in opposition of medical cannabis reforms. In a column last May, Ricketts argued that medical cannabis legalization is a gateway to adult-use. In a January column, the governor claims that cannabis activists “have been trying to circumvent the medical research process that has helped [the] country produce the most safe and effective healthcare in the world” and points out that the Food and Drug Administration has already approved four medications derived from cannabis.

“While attempts to circumvent the FDA review process may be driven by good will, any legalization effort outside this process puts Nebraskans at risk,” Ricketts wrote in a 2015 column titled Marijuana is a Dangerous Drug. “For this reason, marijuana should not receive special treatment.”

In an interview with KOLN, Ricketts said that voters would “hear the truth” about the dangers of medical cannabis and blamed the tobacco and cannabis industries for pushing medical cannabis legalization in the state.

“This is a bunch of outside money that big industry is trying to avoid regulations,” Ricketts said in the report.

The activist coalition has set up 70 locations throughout the state where citizens can sign petitions. If approved, Nebraska would be the 34th state to legalize medical cannabis.

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Federal Prosecutors Subpoena Weedmaps Records

3/03/2020

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Federal prosecutors have subpoenaed records from Ghost Management Group LLC – owners of Weedmaps – seeking documents related to listed businesses, its ordering service, its staff, and its investors and accounting, according to a MarketWatch report.

In a statement to MarketWatch, a Weedmaps representative said the company would not comment “about any specific legal matters or inquiries with respect to the company or any of its customers.”

“Given our role as the largest technology company in the cannabis sector, from time to time, Weedmaps receives requests for information from government agencies. We cooperate with these requests as we do with all lawful inquiries.” – Weedmaps in a statement to Marketwatch

According to the documents outlined by Marketwatch, prosecutors are seeking documents related to Terra Tech Corp, which rebranded as Onyx Group Holdings following a recent merger, and CannnaCraft one of California’s largest cannabis distributors.

Matt Kumin, a civil-rights lawyer, indicated that federal prosecutors employed a similar tactic in Colorado shortly after legalization aimed at “companies that appeared to be violating state regulations in fundamental ways.” In order for any case to proceed, prosecutors would have to prove the companies were violating state regulations.

Medical cannabis programs and medical cannabis businesses in compliance with their state rules are protected from federal law enforcement under provisions included in the federal budget; however, those protections do not include recreational programs and businesses.

According to the report, the prosecutors are also seeking communications with and any payments to local, state, and federal employees, as well as elected officials and any candidates for those offices.

Weedmaps has come under fire by state regulators in California for allowing unlicensed operators to list on their platform but the company indicated last summer that they would no longer allow businesses to list or advertise on the platform without a state identification number. The subpoena includes a demand for records related to Weedmaps’ policy change.

The case is filed in the Eastern District of California and representatives for the court, TerraTech, and CannaCraft have not commented.

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Coronavirus Update: CBD Brands Face Setback After Expo West Cancellation

3/03/2020

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Many CBD brands were dismayed by the announcement yesterday that the Expo West, the largest natural products tradeshow in the world, has been postponed due to concerns about the spreading coronavirus, a.k.a. Covid-19. The event was scheduled to take place this week in Anaheim, California.

This year’s Expo West was initially expected to draw as many as 85,000 attendees from around the globe, although concerns about a possible pandemic had already sparked hundreds of exhibitors and thousands of attendees to cancel their travel plans.

“It is now clear, despite continued advice from local government and health authorities that the city of Anaheim remains open, that the majority of our community want the show, but they do not want it now,” the New Hope Network, which organizes the event, announced Monday evening.

However, the cancellation poses a particular problem for the CBD industry as Expo West “has become the go-to event” for CBD brands, according to Bethany Gomez, Managing Director at the CBD and cannabis market intelligence firm Brightfield Group.

“Many have invested a considerable amount of money, from already tight budgets, to get in front of retailers, distributors and potential partners…. In the future, brands may rethink their strategy here focusing in on smaller buyer-focused events like ECRM to avoid similar challenges.” — Gomez, in a statement

Prior to the event’s official postponement, Michael Harinen — the Chief Brand Officer for Bluebird Botanicals — said that he hoped Expo West would reschedule.

“Many companies have invested a hefty sum of cash for what will only be a shadow of what they were expecting,” Harinen said. “We’re lucky enough to have a healthy, established company but for some smaller startups, this could spell the end.”

The New Hope Network said organizers will announce a new date for the event in the coming weeks. “It is our intention to work with all our exhibitors and attendees on future credits and support, with particular focus on the many entrepreneurs and small businesses who are the heartbeat of this community, for whom we are going to stand up a rebate fund of $5 million targeted at their specific needs,” the company said.

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Ohio Activists Launch Adult-Use Petition Campaign

3/03/2020

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Activists in Ohio have turned in an adult-use petition with summary language and an initial 1,000 signatures to the state attorney general – the first step to getting the measure on November ballots, the Cincinnati Enquirer reports. The petition comes nearly four years after lawmakers legalized medical cannabis but about one in three registered patients still have never bought products through the program.

The Regulate Marijuana Like Alcohol Amendment initiative is backed by a medical cannabis patient, a mother of twins with autism – a condition not covered under the state’s limited program – Pure Ohio Wellness, a licensed cannabis business, and an Akron-based cannabis cultivator.

Tom Haren, an attorney representing supporters, said patients have a hard time participating in the state program which is serving as a catalyst for the petition drive.

“If you’re a patient in Ohio, it’s hard to participate in Ohio’s medical marijuana program. We were promised a program that worked.” – Haren to the Enquirer

Thomas Rosenberger, associate director for the Ohio Medical Cannabis Industry Association, said the organization is not supporting the measure “at this time” as they remain focused on the medical program.

The amendment would set the purchase and possession limit at 1 ounce and 8 grams of concentrates, along with home grow limits of three mature and three immature plants. It would not change the state laws against driving under the influence of cannabis or employers’ rights to prohibit cannabis use by employees. The medical cannabis program would remain in place.

If approved, the state’s medical cannabis operators would have the first crack at recreational cannabis licenses, which would be capped until 2026. The amendment would allow about 200 retail licenses and 1.5 million square feet of cultivation space for all licensees, which would be regulated by the Department of Commerce. The measure also allows municipalities to ban recreational cannabis businesses.

While the amendment does not set a tax rate, it dictates that 25 percent of cannabis-derived tax revenues would be sent to a special fund for a Commission on Expungement, Criminal Justice, Community Investment, and Cannabis Industry Equity and Diversity; another 50 percent would be allocated to the state’s Local Government Fund; while at least 10 percent would be sent to municipalities where the retail sales occurred, proportional to the number of sales, the report says.

The measure’s summary language must be approved by the attorney general within 10 days to ensure it’s “fair and truthful.” If approved, it would next move to a bipartisan panel led by the Secretary of State which would determine whether it is one or more ballot issues. If it passes both of tests, supporters would need to collect 442,958 valid signatures, including a certain percentage in 44 of the state’s 88 counties, by July 1.

Ohio is bordered by Michigan which legalized cannabis adult-use in 2018.

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Connecticut Legalization Hearing Focuses on Social Equity

3/03/2020

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On Monday the Connecticut Judiciary Committee held a public hearing on Senate Bill 16, the governor-backed bill to legalize and regulate cannabis in the state. The hearing was an opportunity for both administrative agencies, state representatives, and stakeholders to testify in support or opposition of the bill.

Among the top officials that testified in support of the bill was senior advisor to the governor Jonathan Harris.

“We can’t stick our heads in the sand. Cannabis will be increasingly available to the residents of Connecticut. We need to come together on how to most effectively protect our children and public health and safety.” — Harris, during the hearing

Along with legalizing adult use and regulating the sale of cannabis, the bill also includes important social equity and criminal justice reform provisions. Under the bill, a nine-member Equity Commission would be created to “encourage” participation in the cannabis industry by persons from communities that have been disproportionately harmed by cannabis prohibition and enforcement.

“In many places equity might have a seat at the table, where this equity commission gives us a whole table,” said Jason Ortiz, President of the Minority Cannabis Business Association which supports SB 16’s prioritization of creating economic opportunities for disproportionately impacted communities.

Criminal justice reform organizations including the Connecticut Defense Lawyers Association and the Last Prisoner Project also testified in support of the bill, which includes mechanisms for the automatic erasure of past cannabis offenses. The governor’s top criminal justice aide, Mark Pelka, noted that the state has identified 558 collateral consequences to having a criminal record in Connecticut and that a criminal conviction remains on your record for 110 years after your date of birth. “

“That means when most people are buried, the work that they’ve done to atone for the wrongs or to rehabilitate or move forward, that conviction remains on their permanent record,” Pelka said. 

Along with erasure, the bill also includes policy proposals to ensure that individuals with cannabis offenses on their records can participate in the legal industry.

Editor’s note: This article is an editorial contribution from the Last Prisoner Project. Learn more at LastPrisonerProject.org.

 

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Curaleaf Enters Colorado Market with Acquisition of BlueKudu

3/03/2020

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Curaleaf Holdings, one of the nation’s largest cannabis companies, is set to acquire Colorado-based edibles company BlueKudu. Neither the price nor terms of the deal were disclosed.

The acquisition marks Curaleaf’s first foray into Colorado, where BlueKudu has operated since 2011. The edibles manufacturer is best known for using ingredients sourced from Rainforest Alliance Fair Trade Certified farms in its, mostly chocolate, line.

Following regulatory approval, Curaleaf will operate BlueKudu’s 8,400-square-foot kitchen in Denver. The company said the move supports its planned expansion of the Select brand throughout Colorado. Curaleaf finalized the deal with Cura Partners – which included Select and 53 dispensaries and wholesale businesses – last month. While that deal was initially worth about $950 million, it closed at about $400 million following declines in cannabis stock prices and lower overall company valuations.

Curaleaf CEO Joe Lusardi noted in a statement that Colorado cannabis sales surpassed $1.7 billion last year and that BlueKudu “has developed a strong brand for customers seeking premium cannabis products” in its eight years in one of the nation’s pioneering cannabis markets.

“BlueKudu’s established production and distribution capabilities will allow Curaleaf to seamlessly enter the market and expand the Select brand presence in the state of Colorado.” – Lusardi in a press release

Once the deal is completed, Curaleaf will operate in 17 states. Currently, BlueKudu products are available in more than 200 retail locations throughout Colorado.

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Coronavirus Likely to Impact Cannabis Industry

3/02/2020

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The coronavirus outbreak is likely to disrupt the legal cannabis industry supply chain, Mugglehead reports. Specifically, the number of cannabis vaporizer cartridge shipments from China plummeted since the country’s quarantine efforts began.

California-based ProVape said their vape coils, batteries, and other hardware shipments from China have dwindled to a “frightening number.”

“We are constantly told that products are on back order, and are encouraged to stock up with vape hardware to avoid any issues in coming months.” — ProVape executive Art Harutyunyan, via Mugglehead

The company said that about 90 percent of vaporizer hardware worldwide is manufactured by just 1,000 Chinese factories. Supply chains are already suffering but, with quarantine efforts only ramping up, the outbreak is beginning to pose a massive problem for U.S. cannabis markets.

“It’s a huge wake-up call,” Nic Easley, CEO of 3C Consulting, told Marijuana Business Daily. “It’s forcing companies to look at their supply chain. ‘Where do my products come from? Do I have multiple options for vendors? Everyone was looking for the cheapest option forever, and that’s China.”

The coronavirus is believed to have originated in Wuhan, China. It has proven particularly contagious and has a much higher fatality rate than the common flu; quarantine efforts have made international headlines but coronavirus cases have regardless been reported throughout Asia, Europe, and North America. Meanwhile, global stock markets have plummeted as travel restrictions and pandemic paranoia take effect.

As of the time of this publishing, there were nearly 90,000 reported coronavirus cases worldwide with more than 80,000 confirmed in Mainland China.

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Bid to Decriminalize All Drugs Launched In Oregon

3/02/2020

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Activists in Oregon this weekend launched a ballot measure campaign that aims to decriminalize low-level drug possession throughout the state, according to a Marijuana Moment report.

Advocates argue that the “Drug Treatment and Recovery Act,” or IP 44, would address Oregon’s addiction crisis better than current prohibition practices, would reduce unfair prison sentencing, and would free up valuable police time.

“This measure expands access to treatment and removes unfairly harsh punishments for minor, nonviolent drug offenses, so people with addiction can more easily recover. People will no longer be arrested and put in jail simply for possession of small amounts of drugs. Instead, they will receive a health assessment and be connected to the right treatment or recovery services, including housing assistance, to help them get their lives back on track.” — Excerpt from the IP 44 campaign website

The initiative would authorize the use of legal cannabis tax revenue to establish Addiction Recovery Centers throughout the state and would increase the availability of beneficial treatment services, peer support, and housing opportunities for people with substance use disorders. The plan would also improve access to naloxone hydrochloride, which can treat deadly narcotic overdoses, and would offer education including overdose prevention.

Oregon schools, however, may ultimately oppose the campaign’s plan to use cannabis tax revenues, as this would put a cap on the amount of cannabis tax money that goes into education each year — some estimates say schools could see their cannabis tax funding reduced by up to two-thirds.

Activists last year also announced an initiative to legalize medical psilocybin in Oregon.

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Louis CK is a Narc, According to Pete Davidson

3/02/2020

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The latest Netflix standup comedy special features SNL cast member Pete Davidson, a comic known for half-baked jokes and semi-stoned rambling humor. In his opening joke, Davidson tells a story about Louis CK that suggests that the famously red-haired comedian is not only guilty of sexual misconduct, he’s also a narc.

The incident took place before numerous allegations of sexual harassment surfaced against Louis CK, and Davidson recalled that Louis was a highly-respected comedian at the time. As the story goes, after smoking a joint in his dressing room at 30 Rock, something Davidson often does to cope with his Crohn’s Disease, he walked out to the main area where Louis CK was “holding court.” To avoid drawing attention to himself, a common desire among stoned people, Davidson pulled up his hoodie and made a bee-line to the elevator without engaging with the crowd surrounding Louis CK.

That is when Louis CK called out Davidson to those crowded around him and, in Davidson’s recollection, called him a “fucking loser” who is “smoking his career away.” Taking it as a heckle rather than a direct insult, Davidson shook it off at the time. But that was just the beginning.

Soon after that experience, Davidson was called into the office of SNL show-runner Lorne Michaels. Apparently, Louis CK had not only called out Davidson in front of the cast and crew for his cannabis use, but he’d also gone in person to the young actor’s boss and told on him. More specifically, Michaels claimed that Louis had insisted that Davidson get a stern talking to. Although Davidson was called in to meet with Michaels, he was not ultimately fired, and he continues to work as a cast member of SNL.

Although the Netflix special just began streaming last week, this is not the first time Pete Davidson has used the story in his stand-up material; Indie Wire covered his bad blood with Louis CK in January of 2019.

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Utah Dispensaries Open Amid Patient Access Issues

3/02/2020

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Utah’s long-embattled medical cannabis program launches today but, even as the first dispensary opens its doors, patients have reported issues getting signed up for the program, FOX 13 reports.

Qualified cannabis patient Mario Enriquez said he spent about an hour trying to access the Department of Health website over the weekend to finish registering for the program; state officials confirmed there were some hiccups but said everything should be working, now.

“I expected it to be busy. We had a feeling the system would be crashing with the excitement… I think they’re doing the best that they can,” Enriquez told FOX 13.

Utah’s first dispensary — or medical marijuana “pharmacy,” according to state law — is Dragonfly Wellness in Salt Lake City. At least one more dispensary is expected to open in March with seven more set to launch in June. In total, 14 dispensary locations have been announced.

Utah’s medical cannabis law requires that patients get a recommendation letter from their doctor to use or possess medical cannabis products. To access one of the state-licensed dispensaries, however, patients must also register with the Department of Health and have a letter from a QMP or “qualifying medical professional” — there is a catch, however, as not all doctors in the state (only 60, to be exact) are considered QMPs and many patients have found that their doctor’s recommendation does not satisfy the state.

Utah voters approved a state medical cannabis program in November 2018. The next month, however, lawmakers there voted to replace the voter-approved program with their own stripped-down version.

 

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CannaCon Detroit Announces Celebrity Appearances For April Event

2/28/2020

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Two cannabis icons are scheduled to appear this year at CannaCon Detroit. Actor turned activist Tommy Chong will host a Meet and Greet with fans of his work. Also, rapper and entrepreneur Berner will be interviewed live on the second day of the convention. Attendees of this exclusive event will have first-hand access to marketing, branding, and market longevity tips from the founder of the famed Cookies brand. Professionals will soak up information on ROI effective marketing from Cannaclusive co-founder Mary Pryor during sessions. Michigan cannabis business professionals will also gain insights from a seminar on Michigan Marijuana Regulation with Andrew Brisbo, executive director of the Marijuana Regulatory Agency, during two days of insightful seminars. 

Along with educational speeches and seminars enjoy an expo floor filled with market innovations tailored to the cannabis industry. Companies like Futurolla, Summit Research, and Precision Extraction will be among the companies in attendance showcasing their new and updated offerings. Professionals can engage with industry leaders in fields like packaging, extraction, inventory management, software, and more. 

“The most fun you can have at a cannabis event. The best networking opportunity in the industry – by leaps and bounds,” said former attendee Thomas Warinner of Mobius Trimmer.

CannaCon is highly regarded as a premier influential event for cannabis professionals. The event series spans multiple states with successful endeavors now in Washington, Michigan, Massachusetts, Oklahoma, and Illinois. From the education on everything from hemp cultivation to legal regulations to the expo floor featuring cannabis businesses to fulfill any entrepreneurs’ needs, CannaCon serves the entire marijuana industry. 

About CannaCon 

CannaCon is dedicated to creating and strengthening lifelong partnerships within the emerging cannabis industry. It is our mission to provide a global B2B venue for cannabis businesses, marijuana entrepreneurs, investors, and community partners to showcase industry products, people, innovations, and technology. We are committed to cultivating business values within the cannabis industry through education and responsible community involvement.

For more information contact 

Angela Grelle

(425)791-4467 x102

Angela@cannacon.org

http://www.cannacon.org

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USDA Removes DEA Testing Requirements for Hemp

2/28/2020

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The U.S. Department of Agriculture and Drug Enforcement Agency has remove the requirement that hemp crops be tested by DEA-registered laboratories for the upcoming growing season, Hemp Industry Daily reports.

During a meeting of the National Association of State Departments of Agriculture Greg Ibach, undersecretary for the USDA, said that while the agency had reached an agreement with the DEA for this season, the law enforcement agency still expects states “to work with their laboratories to try to achieve certification for the 2021 crop year. The requirement was included in the USDA’s interim final rules for hemp production last October.

Josh Schneider, CEO of San Diego, California-based Cultivaris Hemp, told Hemp Industry Daily, that getting rid of the “ridiculous DEA testing requirement is a step in the right direction by the USDA.

Ibach also suggested that the USDA would change its guidelines about sampling and disposing of hemp but did not indicate what those changes might be.

“We’re going to provide more options and greater flexibility for states that are working with producers that need to provide more options for disposal or more commonly accepted ways to destroy that crop on the farm. There were a lot of comments about sampling, as well, so we’re open to that discussion to gain greater understanding.” – Ibach to Hemp Industry Daily

However, Seric Seenstra, of the advocacy organization Vote Hemp wrote on Twitter that while the rule change “will hemp for the season” it’s not what the group wanted or needed “for the industry to be successful.”

FDA Commissioner Dr. Stephen Hahn, also signaled during the meeting that the agency is working on hemp-derived CBD regulations, and said that attempting to ban the products would be “a fool’s errand.”

“We have to be open to the fact that there might be some value to these products, and certainly Americans think that’s the case,” he said in the report. “But we want to get them information to make the right decisions.”

The comments by the federal officials from the agencies responsible for hemp regulations is the latest indicator of normalization for the industry. Since federal hemp legalization in 2018, the USDA has added the crop to several federal crop insurance programs, created pilot programs to serve hemp farmers, and awarded federal funds for hemp research to researchers at Virginia Tech and the University of Tennessee, Knoxville.

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Lebanon Poised to Legalize Cannabis Cultivation

2/28/2020

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Lawmakers in Lebanon are poised to approve legislation that would legalize cannabis cultivation for medical and industrial purposes, according to an Asharq Al-Awsat report.

The effort is following up on a 2018 plan by global consulting firm McKinsey & Co. to revitalize the economy in Lebanon, which is among the world’s most indebted countries. Lebanon’s medical cannabis and industrial hemp industries would be governed by laws and regulations set forward by lawmakers.

“The Bekaa Valley is considered one of the best lands for cultivating cannabis, which is classified among the finest species in the world, and it does not contain more than 1 percent of narcotic substance.” — Agriculture Minister Abbas Mortada, via Asharq Al-Awsat

According to the McKinsey plan, a legal Lebanese cannabis industry could generate up to $1 billion USD in revenue for the country each year.

“If we sell a kilo for fifty dollars, we would support the Lebanese farmers and secure a great return for the state,” Mortada said. “But if we go towards establishing factories and pharmaceutical plants, then the profits will double, in addition to the possibility that this law would push foreign companies to invest in Lebanon with the aim of manufacturing drugs.”

The plan is not without some controversy: Ismail Sukariyeh, the president of the National Health Authority, has questioned the projected financial returns from legalization and warned against an exploited industry.

“Based on my experience in the medical field, in a worn-out country that does not apply laws, the cannabis cultivation legislation will lead to transgressions from some hospitals and medical agencies, in addition to a monopoly on their export,” Sukariyeh said in the report.

The United Nations currently lists Lebanon as the third-most-common source for hashish in the world.

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