October 7, 2011

A Real (Estate) Attack On Medical-Marijuana Dispensaries

Perhaps poked by last year’s failed initiative to legalize marijuana for personal use in California, Federal prosecutors are cracking down on medical-marijuana dispensaries, leaning on landlords by way of forfeiture laws to do their dirty work.

Landlords for several dispensaries are being sent letters saying they face jail time if they don’t evict the pot shops, the U.S. Attorneys from Sacramento, San Diego, Los Angeles and San Francisco said today at a press conference in Sacramento. Prosecutors are also targeting large-scale growers and distributors.
In California, the first state to permit marijuana for medical use, about 400,000 people use pot on a daily basis, according to the Board of Equalization, the state’s tax administrator. The clinics have annual revenue of as much as $1.3 billion and produce sales taxes of as much as $105 million, said Anita Gore, a spokeswoman.
“While California law permits collective cultivation of marijuana in limited circumstances, it does not allow commercial distribution through the store-front model we see across California,” said Andre Birotte, the U.S. Attorney in Los Angeles.
Prosecutors said the crackdown involves civil forfeiture lawsuits against properties allegedly used in drug trafficking, letters of warning to clinic operators and landlords, and criminal indictments that charge six people with marijuana trafficking in Southern California.

The Day After: November 2 Real Estate Related Election Results [SocketSite]
Pot-Clinic Crackdown Under Way: Prosecutors [Bloomberg]

First Published: October 7, 2011 2:45 PM

Comments from "Plugged In" Readers

Interesting facts from relevant California law:

"...Although medical marijuana “dispensaries” have been operating in California for years, dispensaries, as such, are not recognized under the law. As noted above, the only recognized group entities are cooperatives and collectives. (§ 11362.775.) It is the opinion of this Office that a properly organized and operated collective or cooperative that dispenses medical marijuana through a storefront may be lawful under California law, but that dispensaries that do not substantially comply with the guidelines set forth in sections IV(A) and (B), above, are likely operating outside the protections of Proposition 215 and the MMP, and that the individuals operating such entities may be subject to arrest and criminal prosecution under California law."

and then:

"..Collectives and cooperatives should acquire marijuana only from their constituent members, because only marijuana grown by a qualified patient or his or her primary caregiver may lawfully be transported by, or distributed to, other members of a collective or cooperative. (§§ 11362.765,11362.775.) The collective or cooperative may then allocate it to other members of the group. Nothing allows marijuana to be purchased from outside the collective or cooperative for distribution to its members."

Posted by: jose at October 7, 2011 4:07 PM

more foreclosures. just what we need. get rid of $100 million in tax revenue and board up some stores. good stuff. maybe we should outlaw alcohol again, we could really board up some businesses

Posted by: hangemhi at October 7, 2011 4:48 PM

This is such bullshit and a waste of time by the Feds. Marijuana should be legalized.

There are thousands of people who benefit from the medicinal effects of the drug, as well as how harmless it is for rec use.

Posted by: Modernqueen at October 7, 2011 5:20 PM

I love how most politicians, Democrats and Republicans, state their support for marijuana legalization, but never while IN office.

Posted by: sf at October 7, 2011 6:41 PM

There simply are not sufficient people in CA who have conditions that anyone thinks might actually benefit from marijuana as medicine to generate $1.3 billion in sales. While I agree that recreational use OUGHT to be legal, it isn't and the abuse of the medical marijuana law has been so flagrant as make a law enforcement response and a public reaction near inevitable. The marijuana advocates have grossly overplayed their hand and thesis the result. If they had behaved responsibly, public acceptance of BOTH medical and recreational use probably would have continued to expand. But now a lot of people are just annoyed by the abuse of the law.

Posted by: BT at October 7, 2011 7:53 PM

So BT, who the hell appointed you to be the Queen of deciding whether medicinal mj is legit or not?

Pretty arrogant and bs statement, if ya ask me.

Posted by: Modernqueen at October 7, 2011 8:03 PM

The stupidity of the Feds is of biblical proportions (no surprise)...And where's the change Obama promised on this one?

Posted by: Sonnyboy at October 7, 2011 9:41 PM

Marijuana prohibition keeps the prison-industrial complex supplied with fresh meat, and they spin off lots of money for politicians.

Posted by: Delancey at October 7, 2011 10:18 PM

interesting how when BT sites science and evidence based medicine to explain the feds current crackdown (while at the same time advocating for legal recreational use) he is accused of being arrogant.

it really shows how emotional people are and how little fact has to do with our current marijuana dilemma. it's kind of like our ongoing tug of war on abortion, 38 years AFTER roe v wade.

there certainly is evidence to support marijuana use - for nausea and wt loss in cancer, HIV, and really any wasting disorder, for glaucoma, for neuropathic pain. i also have patients and friends with nervous system disorders, MS or after strokes, who feel it helps with spasms. i have one chronic pain patient who has gotten off all opiates by substituting marijuana.

the paucity of evidence (controlled, well designed, statistically pure studies) for other uses certainly suggests that many users in california are exploiting the large holes in the current law. most people who ask me for a card simply do not have a qualifying condition and neither do most of my patients with cards. there is no shortage of doctors who will write for a card...after charging you for a really cursory exam and not assuming any responsibility for your subsequent care. maybe anyone who wants to smoke pot should be able to, but that is not our law currently. for the most part doctors are self sorting based on their personal beliefs, libertarian politics, profit motivation, or willingness to try anything short of doing harm.

i guess i shouldn't be surprised that taxation was an easier government attack then physician sanctions and de-licensure.

the government has not really been fair with science either in that it has actively prohibited true research on the role of marijuana as a treatment for years - though it loosened up a little in the last decade and some of this research is now being done at UCSF and UCSD.

Posted by: modernedwardian at October 8, 2011 10:34 AM

It has always bothered me when the government goes after "landlords" rather than the actual “criminals”…

SF landlords have been fined having drug dealers living in their apartments while the city will not arrest the drug dealers or let the landlord evict the drug dealers (you want to make sure to rent in a rent control city if you are planning to deal drugs out of your apartment).

Years ago my Dad was fined by the city of San Mateo for having graffiti on a building. We set up a (VHS) VCR and camera to film the alley and got clear footage of one of the Mexican kids that lived in the apartment behind my Dad’s doing the tagging. The police would do nothing and the city said that it was still a “landlord’s responsibility” to paint over graffiti and suggested that we take the matter to small claims court if we knew who was doing the tagging (they were not interested in the kids name and address).

So today we have a state that will not do anything to people illegally selling marijuana, but they plan on “civil forfeiture lawsuits” against landlords so they will have enough money to send illegal aliens to college…
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/10/09/MND11LEDG1.DTL

Posted by: FormerAptBroker at October 9, 2011 8:55 PM

But now a lot of people are just annoyed by the abuse of the law.

Personally, I'm more annoyed by the inability of the authorities to control the hard-drug market and the deal with the victims it produces. The crackdown (ahem) on pot is a case of do what you can do, not what you should do. Someone's probably building a "tough-on-crime" resume, too.

Posted by: BobN at October 10, 2011 11:44 AM

Check the link in my name. I think it's a perfect example for why this enforcement is appropriate. This was a MAJOR fire on a busy thoroughfare, endangering a number of homes and nearby (legitimate) businesses. And the source was ultimately determined to be a hot meter-bypass so that the growers could use electricity for free. They were already skirting several drug-enforcement laws, what added risk is involved in adding theft right? You're telling me the owner of the building bore no responsibility for this mess created by his tenants? It needn't be about marijuana, but rather not just being an absentee landlord.

Posted by: Average Joe at October 11, 2011 10:40 AM

I'm SHOCKED that people who make a lot of money illegally selling drugs are willing to break the law in other ways and have little regard for the safety of others.

Posted by: A.T. at October 11, 2011 10:56 AM

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