Welcome back to Higher Law, our weekly briefing on all things cannabis. I'm Cheryl Miller, reporting for Law.com from Sacramento, where the state Democratic Party chairman recently called for a boycott of In-N-Out after the eatery gave California Republicans $25,000. Politicians from both parties started publicly binging on Double-Doubles and shakes, and Bauman backed off.

Weedmaps has donated more than $57,000 to the California Democratic Party since June 1. I wonder what the appropriate political response to that should be.

This week, we consider Elon Musk and the pot puff seen 'round the world. Plus, some breaking news on a medical marijuana prosecution. And scroll down to see who got the work.

Thanks for reading and for the feedback. Keep it coming. If you've got a great story idea, a case to brag about or an In-N-Out order recommendation, send those along too. You can reach me via email at [email protected] or you can call me at 916-448-2935. Follow me on Twitter at @capitalaccounts.

 

 

Musk Re-Ignites Workplace Weed Debate

It's not clear whether Elon Musk took a real drag or just Bill Clinton'd that tobacco-marijuana joint on Joe Rogan's podcast. Either way, the Tesla CEO's pot puff sent his company's stock tumbling, It also led the U.S. Air Force to “look into” whether Musk, also CEO of SpaceX, violated marijuana prohibitions that apply to some military contractors.

Welcome to the latest episode of weed woes in the workplace, colorful CEO edition.

Let's be clear: Musk broke no state laws. Recreational marijuana is legal in California, where “The Joe Rogan Experience” is recorded. But he may have violated his own company's policies. According to CNBC, Tesla's Code of Business Conduct says employees “should report to work without being under the influence of illegal drugs or alcohol.”

Was Musk at work and representing his company when he sparked up? He talked about his work, but so do a lot of people off-the-clock.

Was it fair to Musk's employees? Bloomberg News reported that a former Tesla worker said she was fired in 2017 for testing positive for THC after she used medically prescribed marijuana. “It was just like a slap in the face to me and my son,” said Crystal Guardado, a single mother who said she was ousted after working four months at Tesla's Fremont, California, plant.

California doesn't offer workplace protections for legal marijuana users. Other states do. In Connecticut this month, a federal judge found that a rehabilitation center discriminated against a would-be employee after she failed a drug test because of her state-qualified medical marijuana use.

Should it matter that a CEO openly and legally smoked pot? Ben Curren, the founder and CEO of Green Bits, noted in Forbes that Musk also sipped some whiskey on the show and nobody seemed to care.

“That such a miniscule part of a wide-ranging interview is all that most will hear about or remember says everything about the current state of affairs and the stigmas that linger even despite rapid legalization efforts and successes,” Curren wrote. “Sooner or later we are going to have to overcome the double standard that exists.”

For now though, the workplace weed quandaries continue.

 

Ninth Circuit Rules in State-Federal Pot Case

The Ninth Circuit on Thursday morning offered new hope to former California dispensary owner Charles Lynch, who is fighting 10-year-old federal drug charges.

A split three-judge panel sent his case back to a district court judge to determine if his Central Coast Compassionate Caregivers was operating in compliance with state law when federal agents raided the Morro Bay dispensary in March 2007.

If it was, continued prosecution may be stymied by the federal appropriations rider that bars taxpayer-funded prosecution of state-legal marijuana operations. If it wasn't, Lynch is looking at a potential five-year prison sentence after he was charged and convicted in 2008 of marijuana distribution and sales to minors.

Here's how Judge Paul Watford put it in the opening lines of his dissent (he would have ordered a new trial outright):

“By its very nature, a case of this sort touches a sensitive nerve from a federalism standpoint. At the time of Lynch's trial in 2008, the citizens of California had legalized the sale and use of marijuana for medicinal purposes; the federal government nonetheless sought to prosecute a California citizen for conduct that arguably was authorized under state law.”

Lynch's prosecution, a symbol of the ongoing state-federal tension over cannabis, has been closely watched by those in the medical marijuana industry. His case now returns to U.S. District Judge George Wu of California's Central District.

>> You can read our story on the Ninth Circuit's ruling here.

Who Got the Work

• Pacific Northwest firm Lane Powell has added three attorneys to its cannabis practice. Joshua Ashby and Sativa Rasmussen have joined the firm from Ashby Law Group PLLC in Seattle, and Ben Pirie has joined from 7 Point Law in Portland. Ashby, who authored Lost in the Weeds, which examines Washington state's marijuana law, will serve as co-chair of the firm's marijuana team alongside Justin Hobson.

• Amy Jenkins, senior policy director for the California Cannabis Industry Association, has opened her own Sacramento-based lobbying and consulting shop, Precision Advocacy Group. Jenkins said the firm will work with cannabis, local government and private sector clients.

• Katy Young, founding partner of Ad Astra Law Group in San Francisco, was elected president of the National Cannabis Bar Association at the organization's recent Cannabis Law Institute in Washington, D.C. Mary Shapiro of Evoke Law will serve as secretary and Lauren Rudick of Hiller, PC will be the group's treasurer.

In the Weeds

>> More than two dozen requests to grow marijuana for federally approved research are languishing at the U.S. Drug Enforcement Agency. The DEA took a pro-research position on pot in 2016 under then-President Barack Obama. Since then there have been no approvals or rejections of 26 pending applications. The DEA has not explained the delay. The agency reports to the Department of Justice, where Attorney General Jeff Sessions has made clear his disdain for marijuana. [The Wall Street Journal]

>> Federal prosecutors should be “banging the drum the loudest” to get banks to open accounts for marijuana businesses. That's what former U.S. Department of Justice attorney and current Hypur general counsel John Vardaman told those attending the Cannabis Law Institute. Banks would provide more transparency to regulated marijuana operators, and their scrutiny would help weed out any illicit activity, he said. [The National Law Journal]

>> Ohio's medical marijuana program was supposed to launch Sept. 8. As expected, it did not. Delays in issuing grow licenses and challenges to the license-awarding process have slowed the system. Department of Commerce Director Jacqueline Williams says product should be on the shelves “in a matter of a few months.” [WKSU]

>> Michigan has again extended the deadline for existing medical marijuana businesses to get licensed. More than 100 facilities can continue operating until Dec. 15 while the state continues processing their license applications, according to rulesissued Sept. 11. The state has already extended the deadline twice before because of delays in the licensing process. [AP]

>> Massachusetts' growers are threatening to sue the Cannabis Control Commission if state regulators don't start scrutinizing statutorily required agreements between marijuana businesses and their “host” communities.The Massachusetts Grower Advocacy Council and others contend that cities and towns are exacting too many fees and other concessions before granting the agreements necessary to obtain licenses from the state. The commission has questioned whether it has the authority to review the local pacts. [State House News Service]

>> Did Colorado potrepreneurs really cross breed a Venus Flytrap with cannabis? Sadly, no. Viral video that purports to show a new and potent, yet creepy strain is actually footage of a California barnacle, according to the fact-checking site Snopes.com. Maybe some day … [Snopes]

 

Ready, Set, Go: Mark Your Calendars

Sept. 20: California's Bureau of Cannabis Control's Cannabis Advisory Committeemeets in Eureka. Committee members will hear about plans for the state's track-and-trace system.

Sept. 20: Massachusetts' Cannabis Control Commission meets and may issue final licenses for retail outlets.

Sept. 21: The Oregon Cannabis Association PAC hosts its annual fundraiser in Portland. Scheduled speakers include Oregon Attorney General Ellen Rosenblum.

Sept. 25-26: The State of Cannabis Conference 2.0 will be held in Long Beach, Calif.