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Maryland Town Headed to Mediation Over Profits From Its 5% Stake In Trulieve

8/24/2023

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The town of Hancock, Maryland is headed to mediation with multi-state cannabis company Trulieve over the profits of its 5% equity stake in the company, the Washington Post reports. The town, in 2015, entered into the unique agreement with Harvest Inc., in exchange for a medical cannabis license; however, Trulieve acquired Harvest this year in a $2.1 billion deal.

During a recent Facebook chat with residents, Town Manager Michael Faith said the town and Trulieve disagree “on what constitutes a profit,” prompting the mediation.

Steve White, then-chief executive of Harvest and now president of Trulieve, told the Post that Hancock “will receive what we have agreed accounts for a 5% equity interest in the business” and “they will receive more money if the entity in Maryland does better.”

In an email to the Post, Faith said the town has received a total of $703,193.96, with a $500,000 payment made in July 2021. During one of the town’s prior negotiations with Trulieve, a former mayor said, Hancock asked for $50,000 in annual payments, and, according to Faith, payments of $50,000 were made in July 2021 and March 2022.

The town has also lost about $600,000 plus interest in federal grants due to the deal – the government reclaimed the funds over concerns about giving tax dollars to a town that is involved in a federally outlawed enterprise, namely the cannabis trade.

Hancock officials have not provided an estimate of what they believe they are owed by Trulieve. The mediation is set for August 30.

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Pennsylvania Vape Shop Sues County After Hemp-Derived Cannabis Products Seized Without Warrant

8/24/2023

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A Lancaster, Pennsylvania vape shop is suing the district attorney and other law enforcement officials claiming they searched the business without a warrant and seized legal hemp-derived THC products, FOX43 reports. The lawsuit by Smooth Vape, LLC names District Attorney Heather Adams, a lieutenant with the Lancaster County Drug Task Force (LCDTF), three unnamed members of the LCDTF, and Lancaster County itself.

The lawsuit alleges that Adams ordered the LCDTF to carry out raids on smoke shops and vape shops and that four members of the LCDTF entered the Smooth Vape shop and produced a memo – not a search warrant – from Adams declaring that the officers would be seizing “all products in plain view labeled or advertised as containing Delta-8 THC or Delta-10 THC.”

Employees claim the officers gave them the option to either surrender to the search and seizure or have the shop shut down. Jerad Najvar, an attorney representing Smooth Vape, told FOX43 that the raid “came as a complete surprise” to his client.

“These products are expressly recognized as legal under Pennsylvania law. For years these products have been sold openly.” — Najvar to FOX43

In all, the LCDTF seized tens of thousands of dollars’ worth of merchandise from the store which resulted in a huge loss for the business owner. The lawsuit is seeking compensatory and punitive damages for violations of the plaintiff’s constitutional rights; a declaratory judgment that hemp-derived cannabis products that contain no more than 0.3% delta-9 THC, including products without any delta-9 THC, are not subject to enforcement under the Pennsylvania Controlled Substance Act; reasonable attorneys’ fees and costs; and any other relief that the court deems just and appropriate, the report says.

The enforcement action was announced by the LCDTF in June and agents ultimately seized nearly $300,000 worth of product from 25 stores throughout Lancaster County.

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Ohio Gov. and Health Commissioners Oppose Cannabis Legalization

8/23/2023

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Ohio Gov. Mike DeWine (R) has come out in opposition of adult-use cannabis legalization in the state, telling the Governor’s Executive Workforce Board last week that the reforms would “be a real mistake,” WSYX reports. On Tuesday, the Ohio Association of Health Commissioners (AOHC), which represents Ohio’s 112 local health departments, also urged citizens to vote “no” on the proposal.

Ohio Secretary of State Frank LaRose last week confirmed that the campaign seeking to legalize cannabis for adult use had gathered enough signatures to put the issue on November ballots.

DeWine said he opposes the reforms due to the “unmitigated disaster” he heard about from physicians and law enforcement in Colorado post-legalization, and that today’s cannabis products are “not your grandparents’ marijuana.”

Tom Haren, chair of the Cannabis Law Group in Cleveland and spokesman for the legalization campaign pushed back against DeWine’s comments, telling WSYX that “The governor must not have spoken to anybody from Colorado recently, because what I can tell you is their program is a huge success.”

“I’ll tell you why it’s not your grandfather’s marijuana: your grandfather’s marijuana wasn’t tested in a pharmaceutical-grade testing lab. It wasn’t produced in a GMP (Good Manufacturing Practice) quality cultivation facility, right? It wasn’t subject to a statewide rigorous regulatory framework.” — Haren to WSYX

In a press release announcing the health commissioners’ opposition, authored by Protect Ohio Workers and Families which opposes the legalization campaign, AOHC Executive Director Beth Bickford argued that “Making marijuana more accessible through legal recreational use and retail sales hurts Ohio, creates serious new risks for children’s health” and makes “workplaces and highways less safe.”

“Public health departments advance policies and resources that help all Ohioans live healthier lives and that includes helping them avoid and overcome drugs of addiction like marijuana,” she wrote. “With Ohio’s rates of opiate abuse and overdoses still among the highest in the country, we need to be helping Ohio find solutions to addiction, not facilitating it or the interests of an industry that profits from it.”

Haren noted that Ohio already has an adult-use market – the illicit market – and that street dealers “are happy to sell to the kids.”

“An adult use program is going to benefit almost everybody in the state, whether you’re participating in the market, whether you finally have an alternative to the black market to purchase adult use cannabis products,” he told WSYX. “Everybody lives in a community here in Ohio, and this additional tax revenue that we’re going to generate under our proposal is going to be reinvested back into our local communities. So we think this is going to be a great thing for the entire state.”

The Ohio Children’s Hospital Association and the Ohio Adolescent Health Association also oppose the reforms.

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TILT Holdings Cuts Ties With Three Black- and Woman-Owned Brands

8/23/2023

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Phoenix-based TILT Holdings unexpectedly cut three cannabis brands from its portfolio last week in addition to pausing its partnership with the New York Shinnecock Nation, Debra Borchardt reports for Green Market Report.

The three brands include Black Buddha Cannabis, a multi-state social equity cannabis brand founded by Roz McCarthy, who is also the founder and CEO of Minorities for Medical Marijuana Inc.; Her Highness, a woman-owned and female-centric New York brand; and Highsman, a cannabis lifestyle brand founded by former pro football player Ricky Williams, the report said.

TILT Holdings’ interim CEO Tim Conder said in an earnings call that the move was part of “evaluating and rationalizing our brand and product portfolio” as TILT aims to “refine” its strategy.

“In doing so, we came to the hard realization that Her Highness, Highsman, and Black Buddha are not the right long-term fit given the direction we are headed, and we really are not the right partner for them given the support they need to build their brands. We are working collaboratively with these brands’ respective teams through this transition to ensure that we support them the best way we can as they offboard from our platform.” — Conder, via Green Market Report

McCarthy said she was surprised by the sudden shift because Black Buddha’s partnership with TILT was formed just last year. Additionally, McCarthy said the announcement came during a capital raise for the company and that the news had driven away at least one potential investor.

“You got rid of the woman-owned, the black-owned, and then the woman- and black-owned brand,” she told Green Market Report. “How do I take that? I never want to hear from Tilt that they are focused on social equity.”

TILT also announced it was putting on hold its partnership with the New York Shinnecock Nation due to “challenges,” including “unlicensed operators selling cannabis on Shinnecock land and the inability to bring in cannabis products from New York state license holders or sell cannabis products to New York state license holders.” Conder said the company would evaluate the partnership but, for now, “construction has been put on hold.”

But the Shinnecock Nation told Green Market Report following the announcement that the dispensary project would “move forward” despite TILT’s disengagement.

“Much like New York state, we as a tribal nation are addressing the unlicensed operators and have made significant progress regarding illegal sales and delivery,” the Council of Trustees, Shinnecock Nation Tribe, said in a statement. “This matter has not caused Shinnecock to delay our development to have the first tribally owned legal adult-use dispensary on our sovereign land in Eastern Long Island.”

Editor’s note: A previous version of this article incorrectly referred to all three brands dropped by TILT as “social equity” brands, implying that all were participants in state social equity programs. We regret the error and thank Black Cannabis Magazine for bringing it to our attention.

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Alabama’s Plan to Void and Reissue Medical Cannabis Licenses Attracts Another Lawsuit

8/23/2023

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The Alabama Medical Cannabis Commission (AMCC) is set to, again, void and revoke the licenses it awarded two weeks ago with plans to re-award them during the same meeting without going into an executive session, according to a court filing outlined by the Alabama Political Reporter. The use of the executive session in awarding the previous round of licenses is the subject of a lawsuit brought by several cannabis companies.

The AMCC on Monday was also hit with a lawsuit by Verano Holdings which claims that the agency had no right to revoke any licenses, including the one it had awarded the company in the first round of licensing in June, according to an Alabama Reflector report. Verano claims the agency’s move to rescind and re-award the licenses “both exceeds and conflicts with the authority provided to it by the Alabama Legislature.”

“Regardless of the commission’s intent when it decided to issue the stay and subsequently ‘re-award’ the licenses, its decision to ‘void’ previously awarded licenses without following the Legislature’s – and its own – clearly established rules and regulations, exceeds and violates the statutory authority it has been granted, violates its own rule, and is clearly erroneous. As such, Verano Alabama’s awarded license remains valid.” — Verano, in the lawsuit, via the Reflector

Because Verano was not included in the second round of licensing, the company is not set to receive a license in the upcoming meeting which will see the licenses again revoked and re-awarded.

It’s also unclear whether the AMCC’s approach will satisfy the plaintiffs in the lawsuit concerning the agency’s use of the executive session. The companies in that lawsuit allege that the agency violated the state’s open meetings law with its use of the executive session during the previous awarding of licensing. John McMillan executive director of the AMCC had defended the board’s use of the session, saying it “had a number of pass, fail issues, background checks, and issues” that were all part of the decision to hold the closed-door session. A judge put a hold on the state’s medical cannabis program last week due to the lawsuit.

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Medical Cannabis Sales in Arizona at Lowest Point Since Launch of Adult-Use Market

8/23/2023

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Medical cannabis sales in Arizona in May fell to their lowest point since the launch of the adult-use market in January 2021, the AZ Mirror reports. Adult-use sales totaled $82.9 million, while medical cannabis sales reached $28.3 million, according to state Department of Revenue (ADOR) data outlined by the Mirror.

Since the launch of the adult-use market, medical cannabis sales in the state have topped $1.4 billion, while adult-use sales have surpassed $2 billion.

Adult-use sales were also initially estimated by ADOR at more than $100 million in March, but in May the agency revised that total down by about $1 million in May, and, at the same time, increased sales estimates in April from $86.5 million to $90.1 million, the report says.

Combined cannabis sales in the state are still regularly topping $100 million in the state but in July 2021 medical cannabis sales fell below $40 million for the first time and have never recovered. According to ADOR data, as of July, there were 126,938 qualifying medical cannabis patient cardholders, down from 127,288 in May and less than half of the 299,054 qualifying patients reported in January 2021.

So far this year, the adult-use cannabis tax has generated about $182.3 million for the state, which has already surpassed 2022’s total of $132.8 million.

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New Missouri Cannabis Rules Require Testing Labs to Double-Check Each Other’s Work

8/22/2023

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New rules implemented in Missouri allow regulators to instruct the state’s certified cannabis testing laboratories to double check the work of other labs – an effort to cut down on so-called ‘lab shopping,’ the Missouri Independent reports. Under the regulations, the state will, up to 10 times a year, instruct labs to test cannabis samples tested by another lab. Then the state will review the test results to make sure they have similar results in THC potency, and that one lab isn’t passing a sample for pesticide residue while another one is failing it.

Kim Stuck, CEO of the cannabis and psychedelics compliance firm Allay Consulting, told the Independent that lab shopping “has been an issue in the industry from the beginning” and that she hasn’t “seen any state really make sure that those testing labs are getting the results they’re supposed to be getting, not yet at least.”

In an interview with the Independent, Anthony David, owner and COO of Green Precision Analytics Inc., pushed back on the rule, arguing that by gathering 10 tests a year for 10 labs – 100 total samples – is “nowhere even close to enough data to know whether someone is an outlier, or whether they’re testing in regulation.”

“Yes, we all want better ways to test. We all want methods that are validated and that everyone can use across the entire United States and testing laboratories. But it’s an obtuse way of thinking for the state to think that they can do it.” — Davis to the Independent

David added that similar rules in Colorado and California, which require the interlaboratory testing twice per year, have done little to stop lab shopping by cannabis companies and that Missouri’s regulations are just another unnecessary hurdle and cost to operators.

Earlier this month, The Missouri Division of Cannabis Regulation recalled nearly 63,000 cannabis products produced by Delta Extraction; however, the recall was not linked to failed testing, rather that the products were not tracked through the state’s seed-to-sale tracking system.

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Ohio Cannabis Legalization Question Approved for November Ballots

8/22/2023

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Ohio voters will decide whether to legalize cannabis for adult-use in the state in November. Last week, Secretary of State Frank LaRose confirmed the campaign had gathered enough signatures to put the issue on ballots.

Late last month, advocates had fallen short of the signature goal but were able to gather an additional 679 valid signatures ahead of an August 4 deadline. In all, the Coalition to Regulate Marijuana like Alcohol submitted 127,772 valid signatures.

In a Facebook post, coalition spokesman Tom Haren said advocates “are grateful to the thousands of Ohioans” who backed the proposal and that the group is “excited” to bring the proposal to voters.

Ohio voters in 2015 rejected a proposal by ResponsibleOhio to legalize both medical and adult-use cannabis in the state. That proposal was marred by concerns that the proposal would create a monopoly in the state’s cannabis industry.

According to a study published this month by Ohio State University researchers, adult-use cannabis sales in the state could generate between $275 million and $403 million by the fifth year of operations.

State lawmakers have also introduced legislation to enact the reforms, but that bill has not been introduced in the full House and remains in the chamber’s Finance Committee. It’s unlikely to see any movement before November’s vote.

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Montana Fish and Wildlife Commission Funding Buoyed by Cannabis Tax Revenues

8/22/2023

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The Montana Fish and Wildlife Commission last week approved a spending plan that, for the first time, includes funding from state cannabis taxes, the Bozeman Daily Chronicle reports. The cannabis tax contributions have buoyed the account to about $1.13 million; typically, the commission is funded by contributions by residents who check off the fund on their state income tax forms, which usually generates between $30,000 and $40,000.

The state legalization law requires that 4% of cannabis-derived sales taxes are used for nongame wildlife programs. Montana collects a 20% tax on adult-use cannabis sales and a 4% tax on medical cannabis sales.

Montana Fish, Wildlife and Parks wildlife division administrator Ken McDonald told the commission that the six-figure totals are a “really a nice infusion to help with management and conservation of a significant number of species” in the state.

The work plan includes habitat restoration and conservation work officials hope will keep “species of great conservation need” under state authority, rather than see those species become endangered, McDonald said.

McDonald identified two species – the pygmy rabbit and pinyon jays – as having been petitioned for listing under the Endangered Species Act and the commission will use some of the funds to “help provide and improve habitat for these species,” he said. The work plan also includes a project to monitor bat populations for white-nose syndrome.

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New York Judge Extends Injunction Against Processing and Licensing New Cannabis Retailers

8/21/2023

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A New York judge on Friday ruled that the state Office of Cannabis Management (OCM) cannot process or approve any pending Conditional Adult-Use Retail Dispensary (CAURD) licenses pending the outcome of a hearing this week, Spectrum News reports. The injunction was first imposed on August 7 and applies to all licenses new or pending on that date.

The lawsuit, filed by service-disabled military veterans, argues that OCM created a licensing system that runs afoul of the state’s adult-use cannabis law and improperly limits initial licenses to people with cannabis convictions rather than a wider category of social equity applicants. The lawsuit claims that the cannabis regulators overstepped their authority by creating the licensing category for people with convictions because that decision was not approved by the Legislature and that the decision violates the state constitution.

In a statement, the veterans said the legal fight is about “equal access to this new and growing industry.”

“We believe in a robust, accessible, and thriving adult-use cannabis sector for New York State and today’s decision-by correctly recognizing the irreparable harms we are facing through the Board’s and OCM’s failures to follow the law-will help put the State back on track toward achieving this goal. OCM has resoundingly failed to create the legal cannabis market envisioned by New York’s Marihuana Regulation and Taxation Act (MRTA), in large part by keeping licenses out of the hands of service-disabled veterans and other minority groups the law prioritizes. Every day that the adult-use program was limited to only the CAURD program was another day the MRTA-designated priority groups and New York State farmers were left out in the cold. We remain steadfast in our responsibility to fight for all the social equity priority groups being overlooked right now by the OCM through the CAURD program.” — The plaintiffs, in a statement, via Spectrum News

Officials plan on opening a licensing application window for service-disabled veterans in October, Law.com reports. The action would likely end the lawsuit and associated injunction.

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Cannabis Tax Revenues Outpace Other ‘Sin’ Taxes in Colorado

8/21/2023

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Cannabis tax revenues in Colorado are outpacing those of cigarettes, and other tobacco and nicotine products, and alcohol, according to an August 16 analysis from the Colorado Legislative Council Staff (LCS). In the 2022-2023 fiscal year, Colorado collected $282.3 million in cannabis tax revenue, compared to $233.9 million from cigarettes, $60.5 million from tobacco products, $56.4 million from nicotine products, and $56.1 million from alcohol.

Adult-use cannabis sales in the state carry a 15% excise tax, 15% special sales tax, and 2.9% general sales tax; the general sales tax also applies to medical cannabis sales.

Colorado cannabis taxes are used for a number of programs, including:

$55.9 million for school construction;
$52.4 million for school funding;
$30.7 million for the general fund;
$21.9 million got local governments;
$16.6 million for substance use disorder services;
$15.3 million for affordable housing construction grants and loans;
$15 million for school health and professionals grant program;
$6.1 million for mental health services;
$4.4 million to combat the illicit market and for the state toxicology lab;
$1.2 million for pesticide control;
$1.1 million for a cannabis impaired driving awareness campaign;
$1 million for school bullying prevention and education.

Additionally, the revenues are distributed among state agencies including:

$57.5 million for the Department of Human Services;
$23.6 million for the Department of Public Health and Environment;
$17.5 million for the Department of Local Affairs
$11 million for the Department of Higher Education;
$7.6 million for the Department of Public Safety;
$14.1 million for “other,” which includes a number of smaller agencies.

The state has seen its cannabis-derived tax revenues from their fiscal year 2020-2021 peak of $425 million to $366 million in fiscal year 2021-2022 and $282 million in fiscal year 2022-2023.

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Tilray Acquires Truss Beverage Co. From Molson Coors Canada

8/21/2023

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Cannabis company Tilray Brands Inc. last week acquired Truss Beverage Co. from Molson Coors Canada. Tilray said the deal positions it as a “leader in adult-use cannabis beverages in Canada, with a combined pro-forma market share of about 36%.”

In a statement, Blair MacNeil, president of Tilray Canada, said the “acquisition further strengthens Tilray’s number one cannabis market share position in Canada and positions the company at the forefront of the adult-use beverage sector.”

“We are excited to build upon our leading portfolio of beloved cannabis brands and to further diversify our product offerings while broadening our consumer reach and enhancing consumer’s lives.” — MacNeil in a press release

The company added that, in Canada, cannabis beverages are a nearly $100 million sector and that they are expecting “the regulatory landscape for beverage distribution to evolve, with authorities re-evaluating their consumer policies.”

Tilray’s expanded cannabis portfolio now includes the beverage brands XMG, Mollo, House of Terpenes, and Little Victory.

Tilray had been a part owner in the beverages firm, but the deal saw the company acquire the remaining 57.5% equity ownership in the brand.

The company estimates that, in Canada, there are more than 10.6 million potential cannabis beverage customers that remain untapped.

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Germany’s Cabinet Passes Adult-Use Cannabis Reforms

8/18/2023

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Germany’s cabinet on Wednesday passed a bill to legalize adult cannabis use and cultivation, Reuters reports. The measure still requires approval from parliament.

Under the proposal, adults would be allowed to possess up to 25 grams, grow up to three plants, and acquire cannabis as associates of non-profit clubs. Young adults would be allowed to purchase up to 30 grams per month, while older adults would be able to purchase up to 50 grams.

During a press conference, Health Minister Karl Lauterbach indicated that the reforms would include a risk awareness campaign, which would help curb cannabis consumption. According to the Health Ministry, the share of adults in Germany between 18 and 25 years old that consumed cannabis at least once nearly doubled in 2021 from the previous decade to 25%.

“With the current procedures we could not seriously protect children and young people, the topic has been made a taboo. … We have rising, problematic consumption, we couldn’t simply allow this to go on. So this is an important turning point in our drug policy.” — Lauterbach via Reuters

Originally, the government planned on allowing dispensaries throughout the nation; however, under the revised plan, a pilot program would first allow a limited number of licensed shops in some regions to test the effects of a commercial supply chain of cannabis over five years, the report says. Germany’s hemp association told Reuters that the regulations outlined in the proposal were “unrealistic” and the illicit market could only be beaten by allowing cannabis sales in retail shops.

If approved, the German law would be Europe’s most liberal cannabis-related reforms. In 2021, Malta became the first in the European Union to legalize cannabis for adult use. Under Malta’s law, adults can legally possess up to seven grams of cannabis and cultivate up to four plants.

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NIH Survey Finds Cannabis Use Among Adults Highest Ever Recorded by Agency

8/18/2023

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The National Institutes of Health (NIH) 2022 Monitoring the Future survey found past-year and daily cannabis use among adults 19-30 years old are at the highest levels ever recorded by the agency. The survey found 44% of the cohort consumed cannabis in the past year, while 11% consumed cannabis daily.

Comparatively, past-year cannabis use among 19- to 30-year-olds was 35% in 2017 and 28% in 2012, while daily cannabis use among the cohort was 8% in 2017 and 6% in 2012.

Reports of past-year cannabis use among adults aged 35 to 50 also reached an all-time high of 28% in 2022; an increase from 25% in 2021, 17% in 2017, and 12% in 2012.

Past-year cannabis vaping was reported by 21% of adults 19 to 30 years old in 2022, the highest levels found in the survey since the question was first added in 2017 (12%). In 2021, that figure was 19% and 12% in 2017. Past-year nicotine vaping among the younger adult group also reached a historic high of 24% in 2022, nearly double the rate (14%) reported in 2017, when the NIH first added the question to the survey.

Among adults aged 35 to 50, reports of past-year cannabis vaping remained at similar levels (9% in 2022) since 2019, when these questions were first available in this age group. Prevalence of past-year nicotine vaping has also remained steady in this age group since it has been reported, with 7% reporting in 2022.

The survey found that, among adults aged 19 to 30, 8% reported past-year use of hallucinogens. Five years ago, the share was 5%, and in 2012 the share was 3%. Types of hallucinogens reported by participants included LSD, MDMA, mescaline, peyote, psilocybin mushrooms, and PCP. Most of past-year use in 2022 reported by adults in this age group involved hallucinogens other than LSD (7% in 2022).

Past-year hallucinogen use reached historically high prevalence among adults 35 to 50 years old, reported by 4% in 2022. In 2021, the share was 2%, and five and 10 years ago the share was no greater than 1%.

Over the past decade, the survey has found rates of alcohol use – including past-month use, daily drinking, and binge drinking – declined for adults 19 to 30 years old; however, past-year drinking slightly increased for this age group in 2022 (84%) compared to five years ago (82% in 2017).

The survey also found that alcohol use among adults aged 35 to 50 has shown a gradual increase over the past 10 years, with past-year drinking increasing from 83% in 2012 to 85% in 2022. Binge drinking in this older group reached its highest levels (29% in 2022), and increased over the past year, five years, and 10 years (26% in 2021; 25% in 2017; 23% in 2012).

The study also suggests that past-year use of cigarettes, sedatives, and non-medical use of opioid medications showed a 10-year decline for both adult age groups and reported past-year amphetamine use continued a 10-year decrease among 19- to 30-year-olds and a 10-year increase among 35- to 50-year-olds.

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Alabama Medical Cannabis Licensing on Hold, Again

8/18/2023

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Alabama’s medical cannabis licensing process is on hold, again, after a judge on Thursday granted a temporary restraining order after several cannabis companies claimed the Alabama Medical Cannabis Commission (AMCC) violated the state’s open meetings law, WSFA reports. The lawsuit, brought by Alabama Always LLC and six other firms, was filed last month and alleges that the AMCC improperly erased recordings of its meetings.

In the most recent hearing, the plaintiffs contend that the AMCC also met behind closed doors for four hours during its latest meeting. The state’s lawyer argued that it would have been impractical to discuss the issues otherwise.

John McMillan executive director of the AMCC told WSFA that the board “had a number of pass, fail issues, background checks, and issues” that were all part of the decision to hold the closed-door session.

“And those are the kinds of things you know, you, you hate to just lay it out there. But they keep insisting so they may get their wish. … We hate any delays because there are patients suffering every day that need these products.” — McMillan to WSFA

Will Somerville, a lawyer for the plaintiffs, told WSFA that the delays are caused by the AMMA’s “refusal to follow the law at every turn.”

“They keep on doing things they shouldn’t do,” he said. “And they keep on being stopped from it.”

McMillian was unable to say how long until medical cannabis would be available to patients in light of the litigation. The licensing process was previously paused in June after the AMCC said it had found “potential inconsistencies in the tabulation of scoring data.” New licenses were awarded last week.

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Missouri Auditor to Investigate Adult-Use and Medical Cannabis Industries

8/17/2023

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The Missouri Auditor is investigating the state’s adult-use and medical cannabis programs to make sure they are operating legally, KCTV reports. Auditor Scott Fitzpatrick’s office said the review will cover a five-year period from 2018 through June 30, 2023.

Voters approved a constitutional amendment to legalize medical cannabis in November 2018 and another to legalize adult-use cannabis in 2022.

“The medical and recreational marijuana programs created by these amendments are responsible for establishing a new industry in our state which has already generated more than $1 billion in sales. The rules and regulations promulgated for these programs govern hundreds of marijuana facilities all across Missouri that cultivate and sell cannabis products to hundreds of thousands of Missourians each year. Considering the enormous impact they have had on our state, it’s important that we conduct a thorough assessment of these programs to ensure they are operating in a manner that is efficient, accountable, and transparent.” — Fitzpatrick in a statement to KCTV

Fitzpatrick noted that the cannabis legalization amendments “represent some of the most substantial changes” to the state’s constitution “in recent memory” and “now make up more than one-fifth of the language” in the state constitution.

The audit comes as the state is preparing to license its first round of microbusiness licenses and following the recall of more than 63,000 products that were not tracked in the state’s seed-to-sale inventory system.

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Workers at Connecticut’s Largest Cannabis Grow Facility Join Union

8/17/2023

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Workers at Connecticut’s largest cannabis cultivation facility have joined United Food and Commercial Workers Union (UFCW) Local 919, the News Times reports. More than 70 workers at CTPharma’s facility in Rocky Hill voted to join the union on June 13 and the contract was ratified later in the month.

CTPharma is owned by Verano, which is based in Illinois.

The CTPharma workers are the second cannabis cultivation facility employees to join a union in the state – in May workers at Advanced Grow Labs voted to join Local 919, becoming the first cannabis cultivation employees in the state to do so.

In a statement, UFCW Director of Organizing Emily Sabo said the workers joined the union because they wanted “to make sure that they have a voice that matters at work and that this industry is equitable for the workers, too.”

“So whatever that looks like, with how automation changes will end up affecting the cannabis industry inevitably, just like every other industry, they want to have those workplace protections and those conversations and the ability to talk about those things with their employer.” — Sabo via the News Times

Under Connecticut law, cannabis business licensees are required to have a labor peace agreement in place. Sabo explained that while every cannabis business in the state is required to have such an agreement, that does not mean a union will form, though it’s more likely to happen.

“A labor peace agreement means that an operator will remain neutral and fair if workers want to form a union,” she told the News Times. “In return, the union agrees and the workers are agreeing not to picket, no work stoppages, strikes, etc., in exchange for the neutrality.”

The union includes workers in all areas of the facility.

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Study: Cannabis Legalization in Ohio Could Be Worth Up to $403M in Tax Revenues

8/17/2023

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A study published this month by Ohio State University researchers suggests that adult-use cannabis sales in the state could generate between $275 million and $403 million by the fifth year of operations.

The analysis, “What Tax Revenues Should Ohioans Expect If Ohio Legalizes Adult-Use Cannabis?,” uses cannabis tax data from Michigan fiscal year 2021 as its focal point for Ohio cannabis tax revenue estimates “given the demographic and tax structure similarities.”

The researchers use three different scenarios for rate of diminishing retail sales growth through year five of an operational legal adult-use program; state population figures as the basis for calculating per capita cannabis tax revenue rates; and model for three different Ohio pricing scenarios.

Ohio advocates are seeking to put the issue on 2024 ballots and earlier this month submitted an additional batch of petition signatures after state officials said they were short in their initial batch.

State lawmakers have also introduced legislation to enact the reforms, but that bill has not been introduced in the full House and remains in the chamber’s Finance Committee.

Ohio voters first considered adult-use cannabis legalization in 2015 but ultimately rejected the proposal, which had drawn criticism for containing monopoly-like elements that would have kept cannabis cultivation rights exclusive to a handful of anonymous donors.

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Delta-8 THC Derived from CBD is Illegal, According to DEA Email

8/16/2023

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A letter written in 2021 by the U.S. Drug Enforcement Administration’s Drug & Chemical Evaluation Section Chief Terrence Boos has revealed that DEA considers delta-8 THC, when synthesized from CBD, to be federally illegal. The letter was revealed late last week by attorney Shane Pennington via his “On Drugs” Substack.

“Arriving at delta-8-THC by a chemical reaction starting from CBD makes the delta-8-THC synthetic and therefore, not exempted by the [Agriculture Improvement Act]. Any quantity of delta-8-THC obtained by chemical means is a controlled substance.” — Boos, via the “On Drugs” Substack

The Agriculture Improvement Act, better known as the 2018 Farm Bill, allowed states to implement their own hemp programs. Since then, companies selling hemp-derived cannabinoids have sprung up around the country, but some have gone even further in synthesizing the hemp-based cannabinoids — which are generally nonintoxicating — into more psychoactive cannabinoids such as delta-8 or even delta-9 THC.

The letter puts plainly what many experts have suspected for months — DEA communicated during a May 4 conference presentation that the agency supported adding all synthetic cannabinoids that contain THC, including hemp-derived delta-8 THC, to the list of federally controlled substances. Additionally, in February, Boos wrote to another attorney that minor cannabinoids including delta-8 THC-0 and delta-9 THC-0 are illegal because they can only be synthesized and do not appear in nature, Marijuana Moment reports.

Notably, delta-8 THC does appear naturally in cannabis plants but only in trace amounts, but the vast majority of consumer delta-8 products are made using delta-8 THC that was synthesized from hemp-derived CBD.

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Lawsuit Seeks to End Connecticut’s Cannabis Programs

8/16/2023

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A lawsuit filed last week in Connecticut Superior Court is challenging cannabis legalization in the state and asking a judge to stop cannabis sales, CT News Junkie reports. The complaint was filed by the Stamford Neighborhoods Coalition and more than a dozen individual plaintiffs and names Mayor Caroline Simmons and the city’s Zoning Board as defendants.

The group is seeking an injunction to ban cannabis business operations in Stamford and the state as a whole on the grounds that the 2021 law legalizing cannabis possession and commercial sales was preempted by the federal Controlled Substances Act.

In the complaint, attorney David Herz argued that “Under federal law anyone involved in the growing, manufacturing, distribution or dispensing, or possession with intent to manufacture, grow, distribute or dispense marijuana is marijuana trafficking subject to federal prosecution under the federal Controlled Substances Act.”

“It is therefore unconstitutional and can not be relied upon by the City of Stamford or its Zoning Board to permit the illegal enterprise that is every Cannabis business.” — Herz, in the complaint, via CT News Junkie

The lawsuit also claims that the social equity provisions in the cannabis law violate an equal rights provision of the state constitution. The law created a Social Equity Council intended to ensure that the retail market benefited the Connecticut communities most impacted by the enforcement of cannabis prohibition. The complaint refers to the creation of the council as a “scheme” that is “impermissibly selected based on race.”

“The purpose of the Social Equity Counsel is to entitle a certain set of people to exclusive public emoluments,” the lawsuit argues.

A Congressional Research Service report published in March found that while the federal government has taken a largely hands-off approach to cannabis reforms enacted by the states, “The Department of Justice (DOJ) has nonetheless reaffirmed that marijuana growth, possession, and trafficking remain crimes under federal law irrespective of states’ marijuana laws.”

“Federal law enforcement has generally focused its efforts on criminal networks involved in the illicit marijuana trade,” the report says.

Adult-use cannabis sales in Connecticut reached $13 million in July.

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Cannabis Industry Exchange-Traded Fund to Shut Down this Month

8/16/2023

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One of the leading exchange-traded funds in the cannabis space will see its final day of trading this month, CNBC reports. The Poseidon Dynamic Cannabis ETF, managed by AdvisorShares, plans to stop trading on August 25 and will liquidate assets and pay shareholders by September 1.

In a statement to CNBC, co-founder Morgan Paxhia said the fund was not “immune to the broader macro-economic environment and, more specifically, the dramatic shift in investor sentiment that has impacted the cannabis industry.”

Poseidon Investment Management started in 2013 as one of the first cannabis-focused hedge funds in the U.S. but it has seen its ETF lose roughly 74% in value since it was founded, versus a 1.7% decline in the S&P 500, the report says. On Tuesday, the day of the closure announcement, it was trading at under $1.00 and its value has fallen 65% in the last year.

The fund’s downturn is due, in part, to the U.S. government’s inaction on cannabis law reforms – it remains a Schedule I drug, and cannabis businesses still do not have access to traditional financial services. Additionally, cannabis wholesale prices have declined, and publicly-traded cannabis businesses have struggled to scale profits. State-legal cannabis companies, meanwhile, must also persevere through high excise taxes, additional tax complications from Section 280E of the Internal Revenue Code, and competition from the generally unregulated sale of hemp-derived THC products, as well as from the illicit cannabis marketplace.

Pure US Cannabis ETF, another fund in the cannabis industry managed by AdvisorShares, has also lost about 60% of its value in the last year.

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Combined Cannabis Sales in Missouri Top $123M in July

8/16/2023

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For the sixth consecutive month, combined medical and adult-use cannabis sales in Missouri topped $100 million, totaling $123.2 million in July, Greenway Magazine reports. Since the launch of medical cannabis sales in October 2020, cannabis sales in the state have exceeded $1.35 billion.

Adult-use sales in July were $98.7 million while medical cannabis sales totaled $24.5 million. Combined sales in July represented a 1.57% increase over the previous month.

This year, cannabis sales in the state are projected to exceed $1.4 billion; year-to-date adult-use sales have reached $542.70 million, while medical cannabis sales to July have totaled $209.8 million, the report says.

Those projections, however, could be negatively impacted by a recent recall of nearly 63,000 products produced by Delta Extraction, LLC. The recall was implemented by the Missouri Division of Cannabis Regulation (DCR) on Monday because they were not tracked by METRC, the state’s seed-to-sale tracking system. DCR said in a press release that because METRC was not used, the agency could not “verify that the products came from marijuana grown in Missouri or that the product passed required testing prior to being sold at dispensaries.” DCR added that “no adverse reactions for this product have been reported” to the agency.

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Federal Appeals Court Rules Gun Ban for Cannabis Consumers Is Unconstitutional; DOJ Contests Decision

8/15/2023

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In a brief filed on Friday, the Justice Department informed a federal appeals court that it believes a separate court’s recent ruling that the federal ban on cannabis consumers owning or possessing firearms is unconstitutional was “incorrectly decided,” Marijuana Moment reports. The DOJ shared its opinion with the U.S. Court of Appeals for the Eleventh Circuit while preparing for another lawsuit related to the gun ban for cannabis consumers.

The decision in question — which was announced last week by the U.S. Court of Appeals for the Fifth Circuit — marked the latest in a string of victories for advocates seeking to normalize gun ownership laws for cannabis consumers. District courts have also ruled that the ban on cannabis consumers owning guns violates the Second Amendment but the Fifth Circuit is the most powerful court yet to reach the decision.

According to the report, legal arguments for ending the ban generally hinge on a 2022 Supreme Court ruling that found restrictions on firearms must be consistent with the historical context of the Second Amendment.

In the Fifth Circuit’s ruling last week, U.S. Circuit Judge Jerry Smith wrote that U.S. drug laws have historically “regulated the combination of guns and intoxicating substances.”

“But at no point in the 18th or 19th century did the government disarm individuals who used drugs or alcohol at one time from possessing guns at another. In short, our history and tradition may support some limits on an intoxicated person’s right to carry a weapon, but it does not justify disarming a sober citizen based exclusively on his past drug usage.” — Smith, excerpt from the opinion for the U.S. Court of Appeals for the Fifth Circuit

If the U.S. Court of Appeals for the Eleventh Circuit were to uphold the gun ownership ban — contradicting the decision by the Fifth Circuit court — it could set the stage for the Supreme Court to intervene, the report said.

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