doesnt matter how many scripts, how many business licenses, or how much taxes you pay......the new federal attorneys in northern california (melinda Haag) and in Southern Cali (cooley) are gonna shut down MMJ regardless of state law...
http://www.sfweekly.com/2011-04-06/...lder-legalization-dispensaries-chris-roberts/
That familiar odor wafting from San Francisco street corners, storefronts, and the neighborhood growhouse? It's the smell of legality. Medical cannabis is the law of the land in California, 14 other states, and the District of Columbia. Yet, as many marijuana users will tell you, protection under state law hasn't guaranteed protection under federal law at all.
It was more obvious under the George W. Bush administration, which pledged to "ignore" state medical marijuana laws and go after marijuana users. For eight years, the federal government "subverted" the will of the states, according to the ACLU, and in the process ignored the Constitution's guarantees of state sovereignty, as many a pot user has tried to argue in court.
So when Barack Obama's new administration delivered a message on medical marijuana in February 2009, it was heard loud and clear: The federal government was getting out of the business of busting pot in California and other states where voters had approved medicinal application of the plant. Obama the candidate promised as much during the campaign, and now the new attorney general, Eric Holder, had made it so by issuing guidelines protecting those following state law. Federal policy on medical marijuana had changed.
For that campaign promise — and for pledges to end the Iraq war and reform health care — Obama won many votes from San Franciscans, including people like the 30 medical cannabis users gathered at a former brothel on Mission Street on a recent evening. The low- and no-income folk who constitute the patient advocacy and activist network Axis of Love cannot use their Medicare and Medi-Cal benefits to buy their preferred tonic — federal law makes it thus — and so they must rely on the charity of a few San Francisco cannabis dispensaries for their medicine. Pot and meals are dispensed daily, free of charge, under the supervision of activist Shona Gochenaur. "Obama got a ton of votes from our community," she says, "for the many campaign promises he made that things would change."
That the man in the White House was even willing to put "medical" and "marijuana" together in the same sentence was a step forward for California's cannabis advocates. They had endured such spectacles as the sentencing to five years in federal prison of a pair of El Dorado County providers — Mollie Fry, a breast cancer survivor, and Dale Schafer, a hemophiliac — and the DEA seizing six plants belonging to Angel Raich, who had an inoperable brain tumor. Legal outdoor growers were living in fear after an unprecedented string of DEA raids in the state's pot-producing counties in 2007. In the Bay Area, the U.S. Attorney's Office, headed in the last years of Bush's presidency by Reagan appointee Joseph Russoniello, sought stiff sentences against two brothers for running a dispensary in Hayward.
To hear Obama say change had come to California's pot users was welcome balm indeed. That Obama's DEA had raided dispensaries in Los Angeles, Lake Tahoe, and San Francisco was an aberration, the White House said: Our guys aren't in yet.
Enforcement is still needed. There are plenty of straight-up pot dealers out there, including some unscrupulous types posing as "medical" marijuana enterprises, not to mention Mexican cartels growing thousands of plants in national forests. Exactly how many of these outlaws are getting busted, and how many legitimate, state-law-abiding operations get swept up with them, the government can't say. "We don't keep track of cases that way," says Jack Gillund, spokesman for the local U.S. attorney.
One man sitting at Axis in what was once the brothel's waiting room, declining pulls from the bags full of marijuana vapor the Axis members pass around, could tell you all about federal enforcement. If Scott Feil had the time, he'd explain how he was the first California medical cannabis dispensary owner to beat an alleged drug asset forfeiture in court, which found no wrongdoing at the dispensaries in Los Angeles and Ukiah he'd run in the infancy of the medical marijuana movement.
But he can't stay. "I've got this thing strapped to my ankle," he says by way of apology, lifting one trouser leg to reveal the homing device attached there. He is one of the Californians the Justice Department wants to put away for committing crimes for which the state of California provides business licenses.
Feil can tell you that much of what is going on at Axis is a violation of the federal Controlled Substances Act, which neither Obama nor Holder have changed one bit. He is one of at least 74 state-licensed medical marijuana providers raided nationwide under the Obama administration. "Everybody assumes that the president and Holder were saying, 'It's okay, it's okay,'" he says. "But that's absolutely not what they're saying. Yet that's the way the public heard it. Thousands of people think that."
Put another way, "the United States government said it was okay for me to grow weed," says Tom Carter, a Lake County contractor who faces 10 years for allegedly selling 500 marijuana clones — tiny seedlings that are not counted as marijuana under state possession laws — to an undercover federal agent posing as the owner of a legal dispensary. "And now they're coming back and saying that I can't? That's bullshit."
"Know what I think?" he adds. "Barack Obama and Eric Holder are lying sacks of shit."
Most Democratic politicians swing to the center when taking their games national. One of Obama's sharpest shifts may have been on marijuana. There was a time when he thought pot should be decriminalized — sort of. "The war on drugs has been an utter failure," the newly elected senator told a Chicago audience in 2004. "We need to rethink and decriminalize our marijuana laws." That remark drew a smattering of applause before he amended it with, "but I'm not someone who believes in legalization."
On the presidential campaign trail in 2008, Obama displayed a "practical view, more than anything else," he said, when asked about medical pot when he and Hillary Clinton were jockeying for liberal votes. If his position had shifted, he said, it was still one from which he could still dispense his favorite tonic — hope — to medical marijuana users. "If it's an issue of a doctor prescribing medical marijuana to a glaucoma or a cancer patient... really, there's no difference between that, and the doctor prescribing morphine or anything else," he said. Spending "political capital" on marijuana reform was "not likely ... but what I'm not going to be doing is using Justice Department resources to circumvent state law on this issue."
It wasn't long into the administration — February 2009 — before Obama and Holder were forced to address the marijuana question again. A few weeks earlier, the DEA had raided four California pot clubs. "Was that a decision by you, by the Justice Department?" a reporter asked Holder. "As a prediction of policy going forward, do you expect those sorts of raids to continue?"
The attorney general had an answer ready. "What the president said during the campaign, you'll be surprised to know, will be consistent with what we'll be doing here in law enforcement," he replied. "What he said during the campaign is now American policy."
The media reacted. "DEA to end medical marijuana raids," MSNBC reported the following day. "U.S. to yield marijuana jurisdiction to states," a report in the Chronicle read, in which a White House spokesman was quoted as saying, "The president believes that federal resources should not be used to circumvent state law."
Smokers and squares alike loved what they heard. "February 25th, 2009," wrote Russ Belville, outreach coordinator of the National Organization for the Reform of Marijuana Laws (NORML). "Mark it as the day on your calendar when the beginning of the end of adult marijuana prohibition happened." Even Sen. Barbara Boxer (D-Calif.) was feeling it. "It's good news for people in California who are so ill that they have gotten a doctor's note in compliance with the law," she said "If you have a doctor's note, you should be able to get whatever medicine you need."
The change, however, was not in federal law — Congress declared marijuana a dangerous illegal drug in 1970, and so it remains — but in federal policy. Only marijuana operations in violation of both federal and state law would be on the feds' radar, as Holder told The Los Angeles Times in March 2009, which duly repeated the earlier headline, "Medical marijuana dispensaries will no longer be prosecuted."
A new day had dawned, though at first it was strangely similar to the old day. About a month after Holder's announcement, the DEA raided Emmalyn's, a San Francisco dispensary South of Market, for alleged problems with taxes (no charges have yet been filed). This was an indication that Holder's remark wasn't binding policy, even in San Francisco. It was merely a "sort of offhand comment," Russoniello told a UC Hastings discussion forum on medical marijuana shortly after the raid.
Other judges and prosecutors on all levels were similarly unmoved. Anyone trying to use Holder's statement as a legal defense was getting laughed out of federal court, according to one criminal defense attorney who asked not to be named. "They said, 'You can't rely on what some guy said at a press conference,'" he recalls.
Meanwhile, 2009 proved the biggest year on record for federal marijuana busts. In California alone, the DEA reported the seizure of 7.5 million illegal pot plants and 1,738 arrests, up from 5.3 million and 1,313 the year before. Some saw this as an aberration; Holder and Obama playing tough for the FOX News crowd. Meanwhile, Feil, who was waiting for the Ninth Circuit's decision on his forfeiture case, was raided by the DEA at his Lake County home for the dispensaries he'd run in Ukiah and Los Angeles four years earlier.
The administration still hadn't provided medical marijuana users with anything they could use in court. Then the Justice Department came back in October with a memo. Maybe this was finally it. "Investigations and Prosecutions in States Authorizing the Medical Use of Marijuana," read the header for what was presented as "formal guidelines for federal prosecutors in states that have enacted laws authorizing the use of marijuana for medical purposes." It was penned by Deputy Attorney General David W. Ogden — who would be out of the Justice Department and back in private practice within six weeks — and so became known in medical marijuana lore as the "Ogden memo."
Holder explained that the memo was meant as a request to U.S. attorneys to lay off medical pot where there was "clear and unambiguous" compliance with state law. Medical marijuana was by no means embraced — "no state can authorize violations of federal law," the memo reminded — and though U.S. attorneys should focus on other crimes before hauling cancer patients into court, "nothing herein precludes investigation or prosecution" of them or anyone else.
This memo had "far-reaching political and legal implications," the New York Times reported. It must be so, because Republicans were pissed. "The administration is tacitly condoning the use of marijuana in the United States," fumed Rep. Lamar Smith (R-Texas). If so, the Justice Department still gave nothing of substance for defense attorneys. "It was not, 'You must lay off' — it's 'You should probably lay off,'" according to UC Hastings law professor Rory Little. Lost in the hubbub was the DEA's own stance, issued via press release: "We will continue to identify and investigate any criminal organization or individual who unlawfully grows, markets, or distributes marijuana or other dangerous drugs."
Attorney General Eric Holder and local U.S. Attorney Melinda Haag say their stance is clear: Pot is illegal and can be prosecuted at any time.
Associated Press
Attorney General Eric Holder and local U.S. Attorney Melinda Haag say their stance is clear: Pot is illegal and can be prosecuted at any time.
Scott Feil says the feds are pursuing a “vindictive prosecution” against him.
Frank Gaglione
Scott Feil says the feds are pursuing a “vindictive prosecution” against him.
The Ogden memo had an impact on Erik Stacy, Robert Dodson, Charles Kisor, Charles Klause, and Geoffrey Bliss. In 2010, they decided to open a dispensary in Ridgecrest, a small desert town in Kern County best-known for the nearby Navy missile- and rocket-testing range at China Lake.
Their dispensary, B&C Natural Things, did not last long. Somehow, a local police department investigation into marijuana cultivation operations was handed over to investigators from the U.S. Navy Criminal Investigative Service, stationed at China Lake. That made it a federal case, which began on Oct. 26, 2009, one week to the day after the Ogden memo. That was when investigators thought Stacy, who had a doctor's recommendation, grew pot in his home. (Through their attorneys, the defendants declined to comment.)
According to the criminal complaint, it wasn't until December 2009, when one of the defendants made the first of three cash deposits (with money that "smelled like marijuana," according to court filings) into a business bank account for B&C Natural Things that the feds began to build their case.
The feds sent in a confidential informant, who acquired four ounces of pot from Stacy on three occasions. Yet no mention of a monetary transaction is made in the feds' filings, nor is there mention of whether the informant had a medical recommendation. That means the deal could have been legal under state law.
The defendants certainly thought it was. "We have a collective ... and it's legal," one of them was heard saying on a wiretap. In raids conducted on April 27, 2010, on their homes and the dispensary, authorities found a total of 1,040 marijuana plants at two locations. That may sound like a large-scale grow, but there were enough medical recommendations for it to be all legal under state law, according to attorney Allison Margolin, who is representing Kisor.
It's a similar situation in the case of USA vs. Joseph Nolan, Mark McGrath, Dustin York, Joseph Taylor and Jeremy Dunn, whose grand jury indictment for Controlled Substances Act violations was returned on April 1, 2010. During a bust the month before, agents found 1,161 plants, 54.8 pounds of pot, and 15 gallons of hash oil at a Bakersfield warehouse. Again, that's a substantial amount of marijuana — but again, it's legal if the defendants had on-site the requisite number of recommendations, according to Margolin, who is also representing Taylor.
In any event, investigators found no evidence of illegal sales, such as pounds shipped out of state or marijuana sold outside of legal dispensaries. Indeed, the DEA found no evidence any of the defendants had sold pot at all, aside from a check made out to the Blue Banana dispensary in Northridge.
In the counties that comprise Northern California's pot country, government helicopters are so routine as to be noted only by outsiders. The locals in Lake County knew something was up, however, when four helicopters and two dozen black Cadillac Escalades — a surefire sign of a big federal raid — converged on Tom Carter's home near Upper Lake on August 19, 2009.
The feds claimed that one of his employees, Brett Bassignani, allegedly sold 500 marijuana seedlings, known as "clones" in growers' parlance, to an undercover DEA agent who had posed as the owner of a legal dispensary. Some interpretations would suggest that the transaction would have been legal even if nobody had medical recommendations: Clones and seedlings are not considered marijuana under Senate Bill 420, which states "only the mature processed flowers of female cannabis plants ... shall be considered when determining allowable quantities of marijuana."
Later that day, the feds also hit the home of Scott and Diana Feil as well as that of Steven Swanson, a retired New York City police detective who managed United Medical Caregivers Clinic, the Los Angeles dispensary, after Feil left the business in 2005. Los Angeles police had raided it twice, on one occasion neglecting to tell the judge signing the warrant that it was a legal storefront dispensary before seizing $186,000. That was a key point in the Ninth Circuit's decision to uphold Feil's lawsuit against the government and order the return of the cash. No charges in Los Angeles were ever filed, yet the federal government later indicted the Feils and Swanson for conspiring to sell 100 kilos of marijuana at UMCC over a six-year period. (For comparison, consider that a small-time dispensary with 100 patients a day, roughly the average in San Francisco, could dispense 100 kilos in less than a year.)
The defendants in all these cases claim to be following state law. As proof, they present piles of documents, many of them provided by the state of California: business licenses, Board of Equalization sellers' permits, articles of incorporation at the Secretary of State's Office. This same evidence that would be sufficient to earn an acquittal in state court — and, indeed, is necessary to legally dispense cannabis in the first place — will be used to earn a conviction in federal court. In USA vs. Feil, prosecutors Tarek Helou and Arvon Perteet entered all the above as evidence, as well as newspaper articles, bank records, and the testimony of Feil himself, who was "a perfect gentleman" in answering all the DEA's questions, Special Agent Tom Hughes said in deposition.
Yet state law may never be allowed into the courtroom. With one exception, state medical marijuana law has not been allowed testimony in a federal court.
But what about Holder's statements prior to the Feil raid, and what about the memo prior to the raids on Margolin's clients? In Northern California at least, Russoniello "completely ignored the memo, I'm sure," says Peter Keane, a former defense attorney and dean emeritus of Golden Gate University's law school. Elsewhere, even with Holder — the pot-friendliest attorney general yet — in charge, the Ogden memo meant squat. "It's absolutely worthless" in court, says Stanford law professor Robert Weisberg. But not entirely ineffective: "The federal government made the Controlled Substances Act harder to understand when it chose to publicize the Ogden memo," he adds. "And it created a feeling." Namely: The feds don't care about busting pot in California. Which, the feds will tell you when you ask, isn't the case at all.
If medical cannabis patients thought the Ogden memo signaled President Obama's approval, the Justice Department's next move put all pot users on notice. In February 2010, the president nominated Michele Leonhart to head the DEA. She had been temporary head of the agency since Bush nominated her in 2003. Leonhart told senators in her confirmation hearings, "I have seen what marijuana use has done. ... It's bad."
If dispensary operators think that paying taxes, acquiring licenses, and submitting to routine police inspections provides safety from the feds, they are sorely mistaken, at least in the Northern District of California, where Melinda Haag took over as U.S. Attorney in 2010. "I've certainly heard people say that the Ogden memo gave people safe harbor. If that's their interpretation, it's inaccurate," she says. "There's no safe harbor from federal prosecution [for marijuana]. None."
If dispensaries or other operations were to ask whether they were in the clear, Haag would not tell them: "I can't give legal advice to anyone but my client, and my client is the United States government." Asked to clarify what she interprets as "clear and unambiguous compliance" with state law, she deflects. "I've never had to analyze state law," she says. When asked whether the 500 seedlings in Carter's case are legal, as state law would indicate, she replies, "What do you think?"
There is nothing stopping Haag or any other U.S. attorney from raiding and prosecuting every one of California's dispensaries, all of whom commit felonies just by opening their doors every day.
Further muddying the picture is the enforcement of state law itself, which, to the ire of cops and marijuana users alike, varies from county to county and from department to department. Oakland has several "adult-use" marijuana clubs that do not require members to produce medical documentation, all of which operate with full knowledge of the Oakland Police Department (it's unclear whether the DEA knows, or what it would do if it did). It's hard to imagine operations like that tolerated in Los Angeles, where District Attorney Steve Cooley, the 2010 Republican nominee for state attorney general, has stated that all medical dispensaries are illegal and wants them shut down.
This uncertainty means that medical marijuana growers and users must often rely on the personalities of the cops who are policing them to find out what may put them in jail. In San Francisco, outdoor marijuana cultivation is forbidden. In Mendocino County, which is roughly the size of Connecticut, growing pot outside is the chief industry — and is saving cops' jobs.
Mendocino County Sheriff Tom Allman won the title "Medical Marijuana Growers' Best Friend" from the Anderson Valley Advertiser for his zip-tie program, in which legit growers pay the department to inspect their gardens and attach zip-ties to the verified legal plants. This is meant to ensure legal protection — though the first participant in the program, Joy Greenfield, was raided by the DEA in July 2010 — and yet the fee revenue for the county will reportedly save deputies' jobs this year.
In Mendocino, Allman says, the feds get involved only when local cops can't keep a handle on things. Greenfield, he says, was cleared of all wrongdoing and is participating in the program this year. Yet Allman has his own interpretation of state law, which appears to be the law of the land in Mendocino: "Ninety-nine plants max per parcel, 25 plants max per recommendation," he tells SF Weekly.
Yet that's not the law of the land in nearby Lake County, where at least one Mendocino grower, tired of Allman's sheriffs busting his legal grows, has fled. In any case, from the feds' perspective, as Allman says, "marijuana is no more legal in Mendocino County than it is in downtown Los Angeles."
Dale Gieringer was not fooled into thinking Obama was on his side. The veteran marijuana activist and head of California NORML knew the federal government hadn't changed a thing. "Our team of lawyers pointed out very explicitly that [the memo] was pretty empty," says Gieringer, whose analysis somehow failed to gain traction in the mainstream media, or indeed, with NORML writer Belville, who declared the war on pot to be over. When asked whether the Justice Department should be blamed for misleading the public, Gieringer pauses. "What can you say when things are couched in such vague language in the first place?" he says. "It's typical Obama policy."
To be fair, the federal government has been contradicting itself on pot for decades. It says marijuana is a dangerous illegal drug, one the federal government itself has been dealing for 30 years. Under the watch of the National Institute on Drug Abuse — which admits that "scientists have confirmed that the cannabis plant contains active ingredients with therapeutic potential for relieving pain, controlling nausea, stimulating appetite, and decreasing ocular pressure" — the University of Mississippi grows and distributes pot to a select group of people, mailing 11 ounces in prerolled joints to each of them every month. Irvin Rosenfeld, a Florida stockbroker with bone cancer, wrote a book about how he benefited from the arrangement.
Just last week, news broke that the National Cancer Institute had listed medical marijuana as an effective drug for cancer patients. So is it medicine or a dangerous drug? The government can't seem to decide, but it reserves the right to lock people up for it just the same.
For California's taxpaying dispensaries, Obama's drug policy means that a federal agent doesn't need to be in Kevlar to shut down a marijuana operation. IRS auditors recently informed two Bay Area dispensaries that they owed the taxman millions of dollars because business "expenditures in connection with the illegal sale of drugs" cannot be deducted from taxes. The IRS told the Fairfax-based Marin Alliance for Medical Marijuana that it owes "millions and millions," according to operator Lynette Shaw, who has pledged to fight the government in court. If she loses, and dispensaries can't deduct the price of pot on their taxes, "every dispensary in the nation, past present and future, is dead," she says. A similar IRS investigation is under way at Oakland's Harborside Health Center, the nation's biggest dispensary, with an estimated $22 million in annual sales. These are just the dispensaries which have gone public with their IRS struggles.
Meanwhile, dispensaries are paying more local and state taxes than ever. The Board of Equalization has audited "dozens" of Bay Area dispensaries in recent months, famously slapping a $6.4 million past-due bill on Berkeley Patients Group, second in size only to Harborside. Last month, the city of Los Angeles joined San Jose, Oakland, and Berkeley in levying gross-receipts taxes on dispensaries. In other words, the federal offense of selling medical marijuana could be helping to pay cops and firefighters' salaries.
It is highly unlikely Obama's Justice Department will halt the prosecutions begun under Bush and Russoniello, according to UC Hastings' Little: "It's a sad part of the federal criminal justice system: once a case is filed, it's very hard to unfile the case," he says. Dismissing the Feil case, he adds, would make headlines in which Obama and Haag both appear "soft on crime." And once a trial is in court on a quantity of drugs carrying a mandatory minimum sentence if convicted, "the judge's hands are tied." This applies to defendants appealing previous sentences in the federal system, such as Fry and Schafer — and it was Obama's Justice Department that defeated their appeal at the Ninth Circuit. When the pair surrender by May 2 to begin their five-year sentences, Schafer's condition means his term will be served in a prison hospital.
The Justice Department may even have had a political hand in defeating Proposition 19. The October 2010 announcement that, should it pass, the DEA and Justice Department would "vigorously enforce" the Controlled Substances Act is credited with helping defeat the measure (which received more votes than Meg Whitman did).
"There is a huge disconnect," says Oaksterdam University chancellor and Prop 19 spokeswoman Dale Sky Jones, a member of the committee pushing a similar ballot measure for 2012, "between what this administration says and what it does." At the same time, she adds, "It is clear that this administration sees the political value in having voters think it is friendly to medical marijuana."
That appears to be a common misconception. Winslow Norton is awaiting a trial date in federal court for the crime of running Compassionate Caregivers of Alameda County. He and his brother were busted despite constant cooperation from then-Sheriff Charles C. Plummer, who said at a public meeting that "the federal government is not interested in coming in here if ... people are getting what they need."
Norton tells of a visit to HempCon, one of the numerous marijuana-themed expos to sprout up in medical marijuana states in 2010, the year after the memo. The brothers rented a booth space to drum up support, or at least awareness of their plight. Instead, they got free legal advice from attendees as well as attorneys. As Winslow recalls: "They said, 'Why don't you just show them the memo?'"
A COUPLE QUESTIONS/POINTS I HAVE
1. who voted these scumbag US attorneys in power, and why are they single handedly reversing the will of the state of california?
2. the fate of most dispensaries seems to lie on an upcoming court decision about their costs being tax deductible...that might really screw most dispensaries up....driving everything back to black market
3. california is losing its grip on MMJ, in san diego and LA many dispensaries are being shut down and in northern cali many are being audited.....
http://www.sfweekly.com/2011-04-06/...lder-legalization-dispensaries-chris-roberts/
That familiar odor wafting from San Francisco street corners, storefronts, and the neighborhood growhouse? It's the smell of legality. Medical cannabis is the law of the land in California, 14 other states, and the District of Columbia. Yet, as many marijuana users will tell you, protection under state law hasn't guaranteed protection under federal law at all.
It was more obvious under the George W. Bush administration, which pledged to "ignore" state medical marijuana laws and go after marijuana users. For eight years, the federal government "subverted" the will of the states, according to the ACLU, and in the process ignored the Constitution's guarantees of state sovereignty, as many a pot user has tried to argue in court.
So when Barack Obama's new administration delivered a message on medical marijuana in February 2009, it was heard loud and clear: The federal government was getting out of the business of busting pot in California and other states where voters had approved medicinal application of the plant. Obama the candidate promised as much during the campaign, and now the new attorney general, Eric Holder, had made it so by issuing guidelines protecting those following state law. Federal policy on medical marijuana had changed.
For that campaign promise — and for pledges to end the Iraq war and reform health care — Obama won many votes from San Franciscans, including people like the 30 medical cannabis users gathered at a former brothel on Mission Street on a recent evening. The low- and no-income folk who constitute the patient advocacy and activist network Axis of Love cannot use their Medicare and Medi-Cal benefits to buy their preferred tonic — federal law makes it thus — and so they must rely on the charity of a few San Francisco cannabis dispensaries for their medicine. Pot and meals are dispensed daily, free of charge, under the supervision of activist Shona Gochenaur. "Obama got a ton of votes from our community," she says, "for the many campaign promises he made that things would change."
That the man in the White House was even willing to put "medical" and "marijuana" together in the same sentence was a step forward for California's cannabis advocates. They had endured such spectacles as the sentencing to five years in federal prison of a pair of El Dorado County providers — Mollie Fry, a breast cancer survivor, and Dale Schafer, a hemophiliac — and the DEA seizing six plants belonging to Angel Raich, who had an inoperable brain tumor. Legal outdoor growers were living in fear after an unprecedented string of DEA raids in the state's pot-producing counties in 2007. In the Bay Area, the U.S. Attorney's Office, headed in the last years of Bush's presidency by Reagan appointee Joseph Russoniello, sought stiff sentences against two brothers for running a dispensary in Hayward.
To hear Obama say change had come to California's pot users was welcome balm indeed. That Obama's DEA had raided dispensaries in Los Angeles, Lake Tahoe, and San Francisco was an aberration, the White House said: Our guys aren't in yet.
Enforcement is still needed. There are plenty of straight-up pot dealers out there, including some unscrupulous types posing as "medical" marijuana enterprises, not to mention Mexican cartels growing thousands of plants in national forests. Exactly how many of these outlaws are getting busted, and how many legitimate, state-law-abiding operations get swept up with them, the government can't say. "We don't keep track of cases that way," says Jack Gillund, spokesman for the local U.S. attorney.
One man sitting at Axis in what was once the brothel's waiting room, declining pulls from the bags full of marijuana vapor the Axis members pass around, could tell you all about federal enforcement. If Scott Feil had the time, he'd explain how he was the first California medical cannabis dispensary owner to beat an alleged drug asset forfeiture in court, which found no wrongdoing at the dispensaries in Los Angeles and Ukiah he'd run in the infancy of the medical marijuana movement.
But he can't stay. "I've got this thing strapped to my ankle," he says by way of apology, lifting one trouser leg to reveal the homing device attached there. He is one of the Californians the Justice Department wants to put away for committing crimes for which the state of California provides business licenses.
Feil can tell you that much of what is going on at Axis is a violation of the federal Controlled Substances Act, which neither Obama nor Holder have changed one bit. He is one of at least 74 state-licensed medical marijuana providers raided nationwide under the Obama administration. "Everybody assumes that the president and Holder were saying, 'It's okay, it's okay,'" he says. "But that's absolutely not what they're saying. Yet that's the way the public heard it. Thousands of people think that."
Put another way, "the United States government said it was okay for me to grow weed," says Tom Carter, a Lake County contractor who faces 10 years for allegedly selling 500 marijuana clones — tiny seedlings that are not counted as marijuana under state possession laws — to an undercover federal agent posing as the owner of a legal dispensary. "And now they're coming back and saying that I can't? That's bullshit."
"Know what I think?" he adds. "Barack Obama and Eric Holder are lying sacks of shit."
Most Democratic politicians swing to the center when taking their games national. One of Obama's sharpest shifts may have been on marijuana. There was a time when he thought pot should be decriminalized — sort of. "The war on drugs has been an utter failure," the newly elected senator told a Chicago audience in 2004. "We need to rethink and decriminalize our marijuana laws." That remark drew a smattering of applause before he amended it with, "but I'm not someone who believes in legalization."
On the presidential campaign trail in 2008, Obama displayed a "practical view, more than anything else," he said, when asked about medical pot when he and Hillary Clinton were jockeying for liberal votes. If his position had shifted, he said, it was still one from which he could still dispense his favorite tonic — hope — to medical marijuana users. "If it's an issue of a doctor prescribing medical marijuana to a glaucoma or a cancer patient... really, there's no difference between that, and the doctor prescribing morphine or anything else," he said. Spending "political capital" on marijuana reform was "not likely ... but what I'm not going to be doing is using Justice Department resources to circumvent state law on this issue."
It wasn't long into the administration — February 2009 — before Obama and Holder were forced to address the marijuana question again. A few weeks earlier, the DEA had raided four California pot clubs. "Was that a decision by you, by the Justice Department?" a reporter asked Holder. "As a prediction of policy going forward, do you expect those sorts of raids to continue?"
The attorney general had an answer ready. "What the president said during the campaign, you'll be surprised to know, will be consistent with what we'll be doing here in law enforcement," he replied. "What he said during the campaign is now American policy."
The media reacted. "DEA to end medical marijuana raids," MSNBC reported the following day. "U.S. to yield marijuana jurisdiction to states," a report in the Chronicle read, in which a White House spokesman was quoted as saying, "The president believes that federal resources should not be used to circumvent state law."
Smokers and squares alike loved what they heard. "February 25th, 2009," wrote Russ Belville, outreach coordinator of the National Organization for the Reform of Marijuana Laws (NORML). "Mark it as the day on your calendar when the beginning of the end of adult marijuana prohibition happened." Even Sen. Barbara Boxer (D-Calif.) was feeling it. "It's good news for people in California who are so ill that they have gotten a doctor's note in compliance with the law," she said "If you have a doctor's note, you should be able to get whatever medicine you need."
The change, however, was not in federal law — Congress declared marijuana a dangerous illegal drug in 1970, and so it remains — but in federal policy. Only marijuana operations in violation of both federal and state law would be on the feds' radar, as Holder told The Los Angeles Times in March 2009, which duly repeated the earlier headline, "Medical marijuana dispensaries will no longer be prosecuted."
A new day had dawned, though at first it was strangely similar to the old day. About a month after Holder's announcement, the DEA raided Emmalyn's, a San Francisco dispensary South of Market, for alleged problems with taxes (no charges have yet been filed). This was an indication that Holder's remark wasn't binding policy, even in San Francisco. It was merely a "sort of offhand comment," Russoniello told a UC Hastings discussion forum on medical marijuana shortly after the raid.
Other judges and prosecutors on all levels were similarly unmoved. Anyone trying to use Holder's statement as a legal defense was getting laughed out of federal court, according to one criminal defense attorney who asked not to be named. "They said, 'You can't rely on what some guy said at a press conference,'" he recalls.
Meanwhile, 2009 proved the biggest year on record for federal marijuana busts. In California alone, the DEA reported the seizure of 7.5 million illegal pot plants and 1,738 arrests, up from 5.3 million and 1,313 the year before. Some saw this as an aberration; Holder and Obama playing tough for the FOX News crowd. Meanwhile, Feil, who was waiting for the Ninth Circuit's decision on his forfeiture case, was raided by the DEA at his Lake County home for the dispensaries he'd run in Ukiah and Los Angeles four years earlier.
The administration still hadn't provided medical marijuana users with anything they could use in court. Then the Justice Department came back in October with a memo. Maybe this was finally it. "Investigations and Prosecutions in States Authorizing the Medical Use of Marijuana," read the header for what was presented as "formal guidelines for federal prosecutors in states that have enacted laws authorizing the use of marijuana for medical purposes." It was penned by Deputy Attorney General David W. Ogden — who would be out of the Justice Department and back in private practice within six weeks — and so became known in medical marijuana lore as the "Ogden memo."
Holder explained that the memo was meant as a request to U.S. attorneys to lay off medical pot where there was "clear and unambiguous" compliance with state law. Medical marijuana was by no means embraced — "no state can authorize violations of federal law," the memo reminded — and though U.S. attorneys should focus on other crimes before hauling cancer patients into court, "nothing herein precludes investigation or prosecution" of them or anyone else.
This memo had "far-reaching political and legal implications," the New York Times reported. It must be so, because Republicans were pissed. "The administration is tacitly condoning the use of marijuana in the United States," fumed Rep. Lamar Smith (R-Texas). If so, the Justice Department still gave nothing of substance for defense attorneys. "It was not, 'You must lay off' — it's 'You should probably lay off,'" according to UC Hastings law professor Rory Little. Lost in the hubbub was the DEA's own stance, issued via press release: "We will continue to identify and investigate any criminal organization or individual who unlawfully grows, markets, or distributes marijuana or other dangerous drugs."
Attorney General Eric Holder and local U.S. Attorney Melinda Haag say their stance is clear: Pot is illegal and can be prosecuted at any time.
Associated Press
Attorney General Eric Holder and local U.S. Attorney Melinda Haag say their stance is clear: Pot is illegal and can be prosecuted at any time.
Scott Feil says the feds are pursuing a “vindictive prosecution” against him.
Frank Gaglione
Scott Feil says the feds are pursuing a “vindictive prosecution” against him.
The Ogden memo had an impact on Erik Stacy, Robert Dodson, Charles Kisor, Charles Klause, and Geoffrey Bliss. In 2010, they decided to open a dispensary in Ridgecrest, a small desert town in Kern County best-known for the nearby Navy missile- and rocket-testing range at China Lake.
Their dispensary, B&C Natural Things, did not last long. Somehow, a local police department investigation into marijuana cultivation operations was handed over to investigators from the U.S. Navy Criminal Investigative Service, stationed at China Lake. That made it a federal case, which began on Oct. 26, 2009, one week to the day after the Ogden memo. That was when investigators thought Stacy, who had a doctor's recommendation, grew pot in his home. (Through their attorneys, the defendants declined to comment.)
According to the criminal complaint, it wasn't until December 2009, when one of the defendants made the first of three cash deposits (with money that "smelled like marijuana," according to court filings) into a business bank account for B&C Natural Things that the feds began to build their case.
The feds sent in a confidential informant, who acquired four ounces of pot from Stacy on three occasions. Yet no mention of a monetary transaction is made in the feds' filings, nor is there mention of whether the informant had a medical recommendation. That means the deal could have been legal under state law.
The defendants certainly thought it was. "We have a collective ... and it's legal," one of them was heard saying on a wiretap. In raids conducted on April 27, 2010, on their homes and the dispensary, authorities found a total of 1,040 marijuana plants at two locations. That may sound like a large-scale grow, but there were enough medical recommendations for it to be all legal under state law, according to attorney Allison Margolin, who is representing Kisor.
It's a similar situation in the case of USA vs. Joseph Nolan, Mark McGrath, Dustin York, Joseph Taylor and Jeremy Dunn, whose grand jury indictment for Controlled Substances Act violations was returned on April 1, 2010. During a bust the month before, agents found 1,161 plants, 54.8 pounds of pot, and 15 gallons of hash oil at a Bakersfield warehouse. Again, that's a substantial amount of marijuana — but again, it's legal if the defendants had on-site the requisite number of recommendations, according to Margolin, who is also representing Taylor.
In any event, investigators found no evidence of illegal sales, such as pounds shipped out of state or marijuana sold outside of legal dispensaries. Indeed, the DEA found no evidence any of the defendants had sold pot at all, aside from a check made out to the Blue Banana dispensary in Northridge.
In the counties that comprise Northern California's pot country, government helicopters are so routine as to be noted only by outsiders. The locals in Lake County knew something was up, however, when four helicopters and two dozen black Cadillac Escalades — a surefire sign of a big federal raid — converged on Tom Carter's home near Upper Lake on August 19, 2009.
The feds claimed that one of his employees, Brett Bassignani, allegedly sold 500 marijuana seedlings, known as "clones" in growers' parlance, to an undercover DEA agent who had posed as the owner of a legal dispensary. Some interpretations would suggest that the transaction would have been legal even if nobody had medical recommendations: Clones and seedlings are not considered marijuana under Senate Bill 420, which states "only the mature processed flowers of female cannabis plants ... shall be considered when determining allowable quantities of marijuana."
Later that day, the feds also hit the home of Scott and Diana Feil as well as that of Steven Swanson, a retired New York City police detective who managed United Medical Caregivers Clinic, the Los Angeles dispensary, after Feil left the business in 2005. Los Angeles police had raided it twice, on one occasion neglecting to tell the judge signing the warrant that it was a legal storefront dispensary before seizing $186,000. That was a key point in the Ninth Circuit's decision to uphold Feil's lawsuit against the government and order the return of the cash. No charges in Los Angeles were ever filed, yet the federal government later indicted the Feils and Swanson for conspiring to sell 100 kilos of marijuana at UMCC over a six-year period. (For comparison, consider that a small-time dispensary with 100 patients a day, roughly the average in San Francisco, could dispense 100 kilos in less than a year.)
The defendants in all these cases claim to be following state law. As proof, they present piles of documents, many of them provided by the state of California: business licenses, Board of Equalization sellers' permits, articles of incorporation at the Secretary of State's Office. This same evidence that would be sufficient to earn an acquittal in state court — and, indeed, is necessary to legally dispense cannabis in the first place — will be used to earn a conviction in federal court. In USA vs. Feil, prosecutors Tarek Helou and Arvon Perteet entered all the above as evidence, as well as newspaper articles, bank records, and the testimony of Feil himself, who was "a perfect gentleman" in answering all the DEA's questions, Special Agent Tom Hughes said in deposition.
Yet state law may never be allowed into the courtroom. With one exception, state medical marijuana law has not been allowed testimony in a federal court.
But what about Holder's statements prior to the Feil raid, and what about the memo prior to the raids on Margolin's clients? In Northern California at least, Russoniello "completely ignored the memo, I'm sure," says Peter Keane, a former defense attorney and dean emeritus of Golden Gate University's law school. Elsewhere, even with Holder — the pot-friendliest attorney general yet — in charge, the Ogden memo meant squat. "It's absolutely worthless" in court, says Stanford law professor Robert Weisberg. But not entirely ineffective: "The federal government made the Controlled Substances Act harder to understand when it chose to publicize the Ogden memo," he adds. "And it created a feeling." Namely: The feds don't care about busting pot in California. Which, the feds will tell you when you ask, isn't the case at all.
If medical cannabis patients thought the Ogden memo signaled President Obama's approval, the Justice Department's next move put all pot users on notice. In February 2010, the president nominated Michele Leonhart to head the DEA. She had been temporary head of the agency since Bush nominated her in 2003. Leonhart told senators in her confirmation hearings, "I have seen what marijuana use has done. ... It's bad."
If dispensary operators think that paying taxes, acquiring licenses, and submitting to routine police inspections provides safety from the feds, they are sorely mistaken, at least in the Northern District of California, where Melinda Haag took over as U.S. Attorney in 2010. "I've certainly heard people say that the Ogden memo gave people safe harbor. If that's their interpretation, it's inaccurate," she says. "There's no safe harbor from federal prosecution [for marijuana]. None."
If dispensaries or other operations were to ask whether they were in the clear, Haag would not tell them: "I can't give legal advice to anyone but my client, and my client is the United States government." Asked to clarify what she interprets as "clear and unambiguous compliance" with state law, she deflects. "I've never had to analyze state law," she says. When asked whether the 500 seedlings in Carter's case are legal, as state law would indicate, she replies, "What do you think?"
There is nothing stopping Haag or any other U.S. attorney from raiding and prosecuting every one of California's dispensaries, all of whom commit felonies just by opening their doors every day.
Further muddying the picture is the enforcement of state law itself, which, to the ire of cops and marijuana users alike, varies from county to county and from department to department. Oakland has several "adult-use" marijuana clubs that do not require members to produce medical documentation, all of which operate with full knowledge of the Oakland Police Department (it's unclear whether the DEA knows, or what it would do if it did). It's hard to imagine operations like that tolerated in Los Angeles, where District Attorney Steve Cooley, the 2010 Republican nominee for state attorney general, has stated that all medical dispensaries are illegal and wants them shut down.
This uncertainty means that medical marijuana growers and users must often rely on the personalities of the cops who are policing them to find out what may put them in jail. In San Francisco, outdoor marijuana cultivation is forbidden. In Mendocino County, which is roughly the size of Connecticut, growing pot outside is the chief industry — and is saving cops' jobs.
Mendocino County Sheriff Tom Allman won the title "Medical Marijuana Growers' Best Friend" from the Anderson Valley Advertiser for his zip-tie program, in which legit growers pay the department to inspect their gardens and attach zip-ties to the verified legal plants. This is meant to ensure legal protection — though the first participant in the program, Joy Greenfield, was raided by the DEA in July 2010 — and yet the fee revenue for the county will reportedly save deputies' jobs this year.
In Mendocino, Allman says, the feds get involved only when local cops can't keep a handle on things. Greenfield, he says, was cleared of all wrongdoing and is participating in the program this year. Yet Allman has his own interpretation of state law, which appears to be the law of the land in Mendocino: "Ninety-nine plants max per parcel, 25 plants max per recommendation," he tells SF Weekly.
Yet that's not the law of the land in nearby Lake County, where at least one Mendocino grower, tired of Allman's sheriffs busting his legal grows, has fled. In any case, from the feds' perspective, as Allman says, "marijuana is no more legal in Mendocino County than it is in downtown Los Angeles."
Dale Gieringer was not fooled into thinking Obama was on his side. The veteran marijuana activist and head of California NORML knew the federal government hadn't changed a thing. "Our team of lawyers pointed out very explicitly that [the memo] was pretty empty," says Gieringer, whose analysis somehow failed to gain traction in the mainstream media, or indeed, with NORML writer Belville, who declared the war on pot to be over. When asked whether the Justice Department should be blamed for misleading the public, Gieringer pauses. "What can you say when things are couched in such vague language in the first place?" he says. "It's typical Obama policy."
To be fair, the federal government has been contradicting itself on pot for decades. It says marijuana is a dangerous illegal drug, one the federal government itself has been dealing for 30 years. Under the watch of the National Institute on Drug Abuse — which admits that "scientists have confirmed that the cannabis plant contains active ingredients with therapeutic potential for relieving pain, controlling nausea, stimulating appetite, and decreasing ocular pressure" — the University of Mississippi grows and distributes pot to a select group of people, mailing 11 ounces in prerolled joints to each of them every month. Irvin Rosenfeld, a Florida stockbroker with bone cancer, wrote a book about how he benefited from the arrangement.
Just last week, news broke that the National Cancer Institute had listed medical marijuana as an effective drug for cancer patients. So is it medicine or a dangerous drug? The government can't seem to decide, but it reserves the right to lock people up for it just the same.
For California's taxpaying dispensaries, Obama's drug policy means that a federal agent doesn't need to be in Kevlar to shut down a marijuana operation. IRS auditors recently informed two Bay Area dispensaries that they owed the taxman millions of dollars because business "expenditures in connection with the illegal sale of drugs" cannot be deducted from taxes. The IRS told the Fairfax-based Marin Alliance for Medical Marijuana that it owes "millions and millions," according to operator Lynette Shaw, who has pledged to fight the government in court. If she loses, and dispensaries can't deduct the price of pot on their taxes, "every dispensary in the nation, past present and future, is dead," she says. A similar IRS investigation is under way at Oakland's Harborside Health Center, the nation's biggest dispensary, with an estimated $22 million in annual sales. These are just the dispensaries which have gone public with their IRS struggles.
Meanwhile, dispensaries are paying more local and state taxes than ever. The Board of Equalization has audited "dozens" of Bay Area dispensaries in recent months, famously slapping a $6.4 million past-due bill on Berkeley Patients Group, second in size only to Harborside. Last month, the city of Los Angeles joined San Jose, Oakland, and Berkeley in levying gross-receipts taxes on dispensaries. In other words, the federal offense of selling medical marijuana could be helping to pay cops and firefighters' salaries.
It is highly unlikely Obama's Justice Department will halt the prosecutions begun under Bush and Russoniello, according to UC Hastings' Little: "It's a sad part of the federal criminal justice system: once a case is filed, it's very hard to unfile the case," he says. Dismissing the Feil case, he adds, would make headlines in which Obama and Haag both appear "soft on crime." And once a trial is in court on a quantity of drugs carrying a mandatory minimum sentence if convicted, "the judge's hands are tied." This applies to defendants appealing previous sentences in the federal system, such as Fry and Schafer — and it was Obama's Justice Department that defeated their appeal at the Ninth Circuit. When the pair surrender by May 2 to begin their five-year sentences, Schafer's condition means his term will be served in a prison hospital.
The Justice Department may even have had a political hand in defeating Proposition 19. The October 2010 announcement that, should it pass, the DEA and Justice Department would "vigorously enforce" the Controlled Substances Act is credited with helping defeat the measure (which received more votes than Meg Whitman did).
"There is a huge disconnect," says Oaksterdam University chancellor and Prop 19 spokeswoman Dale Sky Jones, a member of the committee pushing a similar ballot measure for 2012, "between what this administration says and what it does." At the same time, she adds, "It is clear that this administration sees the political value in having voters think it is friendly to medical marijuana."
That appears to be a common misconception. Winslow Norton is awaiting a trial date in federal court for the crime of running Compassionate Caregivers of Alameda County. He and his brother were busted despite constant cooperation from then-Sheriff Charles C. Plummer, who said at a public meeting that "the federal government is not interested in coming in here if ... people are getting what they need."
Norton tells of a visit to HempCon, one of the numerous marijuana-themed expos to sprout up in medical marijuana states in 2010, the year after the memo. The brothers rented a booth space to drum up support, or at least awareness of their plight. Instead, they got free legal advice from attendees as well as attorneys. As Winslow recalls: "They said, 'Why don't you just show them the memo?'"
A COUPLE QUESTIONS/POINTS I HAVE
1. who voted these scumbag US attorneys in power, and why are they single handedly reversing the will of the state of california?
2. the fate of most dispensaries seems to lie on an upcoming court decision about their costs being tax deductible...that might really screw most dispensaries up....driving everything back to black market
3. california is losing its grip on MMJ, in san diego and LA many dispensaries are being shut down and in northern cali many are being audited.....
