South Dakota Ruling Lets Lawyers Work with Cannabis Industry Clients

The South Dakota Supreme Court has issued updated professional conduct rules allowing attorneys to advise cannabis industry clients, KELO reports. State courts and Bar Associations have often issued rules clarifications for lawyers following medical or adult-use cannabis legalization due to federal law.

“(A) lawyer may counsel or assist a client regarding conduct expressly permitted by South Dakota Cannabis laws, even if the same conduct violates federal law, but the lawyer must inform the client that the conduct violates federal law and advise the client about the legal consequences under federal law of the client’s proposed course of conduct.”—South Dakota Supreme Court rule via KELO

The state Supreme Court follows a decision by the State Bar of South Dakota during its June convention where the bar’s Ethics Committee Chair Sander Morehead called for the endorsement.

Previously, the official conduct rule prevented attorneys from engaging or assisting clients “in conduct that the lawyers know is criminal or fraudulent.”

Last November, South Dakota voters approved both medical and adult-use cannabis legalization; however, a circuit court judge ruled the adult-use law invalid saying that it violated state rules prohibiting ballot questions from covering more than one subject. The state Supreme Court is currently considering the legality of the initiative.

Prior to the 2020 election, the Ethics Committee had determined that lawyers couldn’t assist a client in establishing, licensing, or otherwise operating a cannabis business in the state while cannabis remains federally outlawed.