California Marijuana Dispensaries Are In For A Roller Coaster Ride

The Los Angeles Times reports that a trial judge in Los Angeles County has issued an injunction prohibiting the sale of so called Medical Marijuana, concluding state law does not allow collectives to sell the drug:

L.A. prosecutors believe it is the first legal ruling to conclude that state law does not allow collectives to sell pot. If upheld, it would have a dramatic impact on how the drug is distributed.

My hope is that the ruling is appealed and upheld on appeal because that is when the law becomes binding statewide, and all lower courts are required to follow it. This current ruling is only a trial court ruling impacting the lawsuit in Eagle Rock only; however, it’s impact could be felt statewide if more and more prosecutors go after these so called clinics, which in reality appear to be nothing more than a front for recreational drug users.

A Los Angeles County Superior Court judge Friday ordered an Eagle Rock dispensary to stop selling medical marijuana in a decision city prosecutors believe is the first to conclude that state law does not allow collectives to sell the drug.

Judge James C. Chalfant’s preliminary injunction applies only to Hemp Factory V, a small outlet on Colorado Boulevard near the Glendale border, but would have a dramatic impact on how medical marijuana is distributed if a higher court upholds it. The decision came in the pretrial phase of the city’s lawsuit against the dispensary.

Hundreds of collectives in Los Angeles and throughout California sell marijuana, as Hemp Factory V does, to anyone who shows up with a doctor’s recommendation and signs a form to become a member. The state’s courts have ruled on many medical marijuana issues, but have not directly addressed whether this widespread practice is legal.

Chalfant concluded that collectives can only grow marijuana and receive reimbursement for reasonable costs.

“A retail store that sells marijuana to its members simply does not satisfy the requirement of a collective to cultivate marijuana,” he wrote in his 16-page decision.

You can read Attorney General Brown’s analysis and guidelines for the sale of medical marijuana here. It’s pretty clear from these guidelines that folks who get together and call themselves and dispensary, and start selling marijuana–a schedule I drug under federal law–clearly do not meet these guidelines. The proposed medical marijuana dispensary proposed for Nipomo, likewise does not meet these guidelines.

Anthony P. Malecki, an attorney for Hemp Factory V and its operator, Gevork Berberyan, did not challenge Chalfant’s conclusions in the courtroom. He said he would consult with Berberyan before deciding whether to appeal.

The city’s attorney, Asha Greenberg, noted that the decision was only a trial court ruling, but said that it should be a warning to collectives.

“They should pay attention to it,” she said. “A lot of cases have not been as clear-cut. This judge’s analysis was right on. I think it’s valuable for that reason.”

In his decision, Chalfant endorsed the interpretation of state law and recent court decisions advocated by Los Angeles City Atty. Carmen Trutanich, who has become one of the most outspoken opponents of medical marijuana sales in the state.

Trutanich sued Hemp Factory V in October in his first attempt to use the courts to close a dispensary in Los Angeles, which has seen hundreds open while city officials failed to enforce a moratorium.

The state law adopted in 2003 to expand on California’s 1996 medical marijuana initiative allows patients and their caregivers to form collectives to cultivate marijuana. It does not explicitly allow marijuana to be sold, although the practice is commonplace. Prosecutors and law enforcement officials have increasingly argued that the law allows patients to work cooperatively to cultivate marijuana, but not to sell it over the counter.

Dispensary operators, including Berberyan, say they do not sell marijuana, but ask for voluntary donations to cover the costs of growing marijuana. Many, including Berberyan, also say they give the drug free to patients who cannot afford the price, which at Hemp Factory is typically around $60 for an eighth of an ounce.

Berberyan, a 33-year-old former truck driver, said in a deposition earlier this month that he and six other patients grow marijuana for about 500 to 600 members. He said he started to raise pot at the dispensary’s location in December. In a declaration filed after his deposition, he said Hemp Factory V had just 171 members. His attorney declined to comment on the discrepancy.

Herein lies the truth. Many, if not all of these so called dispensaries are merely fronts for recreational drug users to obtain an illegal federal schedule I drug. Mr. Berberyan, a 33 year old truck driver has gone into the marijuana business. Why is that I wonder. The article is silent, but I would love to read his deposition. Is he a cancer victim? Does he suffer from aids? What exactly is the reason a 33 year old male is toking medical marijuana? More interesting is his sworn deposition testimony, where he admits to growing pot for some 500 to 600 members–only later to admit, under oath in another document, that there are actually only 171 members.

Regardless of which number is actually the truth, are we to believe they are all 83 year old grandma’s or grandpa’s suffering from stage four cancer? I’m thinking probably not.

Chalfant said those numbers demonstrate that the dispensary’s principal function is retail sales, not cultivation. “Hemp Factory’s evidence does not show that members are collectively raising marijuana as a crop,” he wrote.

The debate over whether marijuana can be sold, rooted in the law’s murky language, was one of the main reasons Los Angeles labored many months to draft an ordinance. City Council members struggled with whether to outlaw sales, as Trutanich and Los Angeles County Dist. Atty. Steve Cooley insisted they should. In the end, the council skirted the issue, adopting language allowing cash contributions, but also requiring dispensaries to comply with state law.

“We did win this issue with City Council, it’s unfortunate that this judge is going in a different direction,” said Joe Elford, the chief counsel for Americans for Safe Access, a medical marijuana advocacy group. He said Chalfant and the prosecutors have misinterpreted key court decisions.

Chalfant’s injunction underscores just how much remains unclear about the state’s medical marijuana laws, even as voters in California are likely to decide in November whether to legalize marijuana sales for personal use.

The decision could embolden Trutanich and other prosecutors who have threatened to pursue dispensaries for selling marijuana. Officials with the city attorney’s office declined to discuss whether they plan to bring additional cases, but the district attorney’s office has continued to prosecute dispensary operators.

In addition to maintaining that sales are illegal, Trutanich also has pressed the novel argument that the state’s food and drug safety law, known as the Sherman Law, applies to sales of medical marijuana.

He reached the conclusion after he had asked a federal lab to test samples of marijuana that undercover police officers bought at dispensaries, including Hemp Factory V, and found pesticides, including some banned ones.

Chalfant agreed with Trutanich that selling medical marijuana would trigger the Sherman Law’s requirements, which include labeling drugs properly and ensuring that they do not contain poisonous substances. In his order, Chalfant also barred Hemp Factory V from selling marijuana that contains pesticides.

This is an interesting legal wrinkle I had not heard before. Can you imagine the impact it would have on these state wide dispensaries if they were required to start labeling their product? I say, bravo to the Eagle Rock City Attorney’s office, and wish them the best in their quest against these store fronts for recreational drug abusers.