Welcome back to Higher Law, our weekly briefing on all things cannabis. I’m Cheryl Miller, reporting for Law.com from Sacramento. Thanks for stealing away from the Brett Kavanaugh saga for a bit to check out the latest in the world of legal weed.
This week we’re looking at the Canadian border cannabis conundrum and why crossing into the U.S. can be so risky for some in the industry. Scroll down to see Who Got the Work, and check out In the Weeds to read about a cannabis partnership that’s gone very bad, very publicly.
Cannabis Consternation at the Border
Canada is like a cannabis money magnet these days. With recreational marijuana going legal across the Great White North in a few weeks, American companies and investors are flocking to Canada and its stock exchanges.
The U.S., and more specifically its border with Canada, however, has not been as welcoming to its northern neighbors. Stories abound of Canadian workers, investorsand even a landlord with ties—sometimes tangential ties—to the cannabis industry being turned around at the border by enforcement agents.Some have even been permanently banned from the U.S.
“There’s nothing new in terms of the law,” said Henry Chang, a partner with Blaney McMurtry in Toronto. “What’s new is the legalization of marijuana.”
I spoke with Chang and Danielle Rizzo, senior counsel at Harris Beach in Buffalo, N.Y., who have both written about Canadian cannabis troubles at the U.S. border. Both say cannabis professionals have been denied entry at U.S. land entries, particularly at West Coast crossings.
Neither have heard about any lawyers in the cannabis industry being stopped—yet.
U.S. immigration law allows border agents to bar would-be entrants for having a drug addiction or for admitting they smoked recreational pot prior to the Oct. 17 legalization. Canadian employees and investors, however, face a potentially worse fate–a lifetime ban from the U.S.–if agents decide they are “traffickers” for having a business tie to state-legal, but still federally illegal, marijuana enterprises south of the border.
“That’s pretty serious,” said Chang. “You’re up there with Pablo Escobar.”
A U.S. Customs and Border Protection official told Politico this month that agents don’t quiz everyone coming from Canada about their marijuana use. But if they smell a suspicious odor from someone’s car or see a related hint, such as a business card with a marijuana leaf logo, they may start asking more questions. If an officer determines someone is lying, they can get slapped with a lifetime ban.
“There’s really no getting around the issue,” Rizzo said. Making the situation more confusing, Chang says the level of scrutiny from border agents can vary from crossing to crossing. “It’s the Wild West here right now,” he said.
No one has challenged the law in court yet; a state-legal marijuana business in the U.S. may be wary of doing that for obvious reasons. Lawyers like Chang and Rizzo are left looking for clarity on policy enforcement. Offering clear guidance to clients is difficult.
“Cannabis companies should be very concerned about their employees being turned away or being banned as traffickers,” said Chang.
Who Got the Work
• The Biopharmaceutical Research Company of Castroville, Calif. has retained The Normandy Group to lobby policymakers on manufacturing and distributing cannabis to federal research facilities. The filing follows a House Judiciary Committee voteon Sept. 13 to issue two more licenses for growing research-bound cannabis. Earlier this month, the DEA approved a request from researchers at the University of California at San Diego to import marijuana capsules from Canadian company Tilray Inc. to study their effects on tremors in patients.
• Norris McLaughlin‘s partner Andrew Linden has been named to the New Jersey State Bar Association’s new Cannabis Law Committee, the firm announced. Linden, a business litigator, represents clients in the cannabis and alcoholic beverage industries.
In the Weeds
>> The U.S. Drug Enforcement Administration has classified the cannabidiol-derived Epidiolex as a Schedule 5 drug, a low-restriction designation that also covers some cough medicines containing codeine. United Kingdom-based manufacturer GW Pharmaceuticals says that, with the DEA’s approval, it expects to have the anti-epileptic drug on the market with in six weeks.
Epidiolex is the first non-synthetic cannabis-derived drug approved by the U.S. Food and Drug Administration and could open the door for other CBD-based products. In an order scheduled to be published Friday in the Federal Register, the DEA “places FDA-approved drugs that contain CBD derived from cannabis and no more than 0.1 percent tetrahydrocannabinols in schedule V.” [CNBC]
>> Former partners in an Oregon cannabis company are going through a very bad, and very public, split. Oregrown Industries Inc. in August sued ex-head grower Justin Crawn for $2.6 million, alleging defamation, trademark infringement and a crop failure that resulting in “complete losses.” Now Oregrown’s CEO, Aviv Hadar, has sued Crawn and his nephew, Jordan Crawn, for alleged online harassment. Justin Crawn’s attorney, Cecil Grill of the Law Offices of Cecil Grill in Portland,, said the allegations are false. [The Bulletin and The Oregonian]
>> Could Pennsylvania be the next state to legalize recreational marijuana? A state lawmaker introduced legislation this week to do just that. Rep. Jake Wheatley’s bill would allow residents to possess up to six marijuana plants, and it would amend criminal statutes to expunge marijuana convictions and release from jail people convicted on cannabis charges. Gov. Tom Wolf said in August that he didn’t think Pennsylvania was ready to expand beyond its medical marijuana program [Pittsburgh Tribune-Review]
>> Ohio business interests trying to secure medical marijuana licenses raised nearly $60,000 for attorney general candidate Dave Yost at the same time he was auditing the state’s marijuana program, according to the Dayton Daily News. A Yost campaign spokeswoman denied any connection between the two events. [Dayton Daily News]
>> State-legal marijuana hasn’t created an epidemic of stoned workers. That’s what the results of year-to-year workplace drug testing suggests. Workers testing positive for drugs has increased nationwide, according to testing company Quest Diagnostics. But the rate of positive tests isn’t going up faster in states where marijuana is legal than the national figure. [CBS News]
>> Should employers have to cover the legitimate medical marijuana costs of job-injured workers? Yes, says Louis Locascio, of counsel to of Gold, Albanese, Barletti & Locascio. “If an employee sustains a work related injury for which a doctor prescribes an opioid for pain, the employer must pay for the treatment,” Locascio writes. “If the same employee, with the same work related injury, is prescribed medical marijuana, which is cheaper and less addictive, should not the employer also pay?” [New Jersey Law Journal]
>> Sorry, baked lobsters. Maine officials say an eatery can’t mellow out its crustaceans with marijuana smoke before cooking them alive. Stoned lobsters would be “adulterated and therefore illegal,” according to a spokeswoman for the state health inspection agency. Charlotte Gill, the owner of Charlotte’s Legendary Lobster Pound in Southwest Harbor—who’s also a licensed medical marijuana caregiver—said she’ll continue with her herbed-up lobster plans after making some adjustments. [The New York Times & Bangor Daily News]
All the Calendar Things
Sept. 27-28: The International Cannabis Business Conference will be held in Portland, Oregon. Scheduled speakers include Ted Roe of Veritas Business Law; Aaron Pelley, founding member of the Cannabis Defense Coalition Legal Committee; and Bernard Chamberlain, of counsel at Emerge Law Group.
Oct. 2: The California Cannabis Insurance Association hosts a cannabis insurance symposium in Los Angeles. Scheduled speakers include insurance commissioner Dave Jones and Cat Packer, the executive director of the Los Angeles Department of Cannabis Regulation.
Oct. 4: The Bar Association of San Francisco’s Cannabis Law Committee hosts the Cannabis Conference. The event starts with a “regulatory check-in” with Nicole Elliott, director of the San Francisco Office of Cannabis.
Oct. 4: Viridian Capital Advisers and Burns Levinson host The State of the Cannabis Industry Conference in Boston. The scheduled keynote speaker is Sundie Seefried, CEO and president of Partner Colorado Credit Union.