As we wrote back in 2011, “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.”
Last week, the U.S. attorney for Northern California, Melinda Haag, filed a forfeiture proceeding against 2441 Mission Street which is leased to the “Shambhala Healing Center,” a city-licensed medical marijuana dispensary. It is the first such forfeiture filing for a leased dispensary’s real estate in San Francisco.
From the San Francisco Examiner:

Shambhala Healing Center shut down in summer 2012 after receiving a letter from Haag in February 2012. Property owners Ebrahim and Valentin Poura, of Beverly Hills, then attempted to evict the dispensary from the building they have owned outright since the 1970s.

However, since the dispensary had a long-term lease and did not violate state or local law, Shambhala could not be evicted through the state courts system, where eviction cases are heard, according to Eric Safire, an attorney for the Pouras.

“We did everything within our legal bounds to comply [with Haag’s demands],” Safire said. “The tenant has a lawful business … and a lawful, long-term lease.”

The dispensary resumed operating this past November.
A Real (Estate) Attack On Medical-Marijuana Dispensaries [SocketSite]
Feds move to seize SF pot club building [Examiner]

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Comments from “Plugged-In” Readers

  1. Posted by 49yo hipster

    Gawd I’d hate to be a small LL caught up in this.

  2. Posted by mission

    This landlord needs a better lawyer. Their tenant is violating federal law and they can sue for eviction. They may not be able to use the landlord-tenant court but they can file a lawsuit for ejectment. However, from the Feds perspective the LL never should have signed the lease in the first place allowing an illegal use of the building.
    It blows me away every time I think about how many people plunged into this business even though it’s a clear violation of federal law. People have put their liberty and entire life savings on the line. Unreal.

  3. Posted by Getting Real

    So why is it that pot can’t be dished out of SFGH or the various DPH clinics around the city? Is it the case that then the City would then be out of sync with State and Fed law? If so then how is it that it would otherwise be permitted to be dispensed out of private property. Seems the LL knew the risk before they agreed to the tenant and the proposed use.

  4. Posted by mission

    Getting Real: Yes, I think the City and the individuals who participated in such use would be in trouble. The feds have specifically targeted municipal officials over this issue. Oakland wanted to tax the clubs but the Feds threatened to prosecute individual city employees if they got involved. It gets really crazy where people who have their pot confiscated now routinely request to have it returned to them by police departments because they are medical marijuana users. There are court hearings on the issue. That’s the problem with states getting out ahead of the feds without some kind of agreement.
    I do think the federal goverment has to pay heed when voters in states authorize certain uses (the whole democracy thing), but states should try working with congress or the administration before encouraging this industry develop to the peril of lots of people.

  5. Posted by conifer

    So why is it that pot can’t be dished out of SFGH or the various DPH clinics around the city?
    The real answer is the obvious. Marijuana (like alcohol) is not a medicine, and potheads are not patients, and stores that sell it are not pharmacies or dispensaries. The “medical” marijuana opera has always been a conceit to get around the law.
    If the government decides to legalize it, that is one thing. But the current system is a corruption of the medical profession.

  6. Posted by Brahma (incensed renter)

    It blows me away every time I think about how many people plunged into this business even though it’s a clear violation of federal law. People have put their liberty and entire life savings on the line. Unreal.

    I don’t know why people are surprised; Prop. 215 was as much about legalizing drug dealing as it was about so-called “compassionate use” for people with terminal illnesses, and Proposition 19 was unabashedly about legalizing drug dealing.
    I heard (directly) from some friends of friends that they were clearing over $10,000 per month selling pot to “cannabis dispensaries” just in the Bay Area, and that’s essentially spending no money on marketing.

  7. Posted by mission

    drug dealing I get. What I am surprised by is the number of poeople openly operating these clubs and openly operating as growers or distributors. I read an article recently about a guy in Sacramento facing a huge federal prison sentence for growing and distribution- the cops found his warehouse when they caught someone esle trying to break into it. The guy has two young kids and his lawyer complained that he had “done everything right” to set up the operation in compliance with the law. Except that it cannot be in compliance with the law. Now that guy is probably going to prison and his kids grow up without their dad. I think the state needs to either get some kind of agreement with the feds on enforcement or quash this medical marijuana “business” altogether.
    The California Supreme Court just held that cities can zone the pot clubs out of existence and more the 200 cities have done so. I think more will.

  8. Posted by Freedom

    The problem is the stupid FEDS. They are totally out of line and out of control and need to be kicked to the curb. Talk about profit motive, they are the most corrupt agency around.
    With luck, federal law will soon be updated to end this stupidity.

  9. Posted by Live Smart

    The Feds should target and prosecute city and state officials simultaneously with the landlords since the city is granting permits (and thus taking money) for pot clubs. Until this issue of federal law versus state/local law is cleared up, the SF Board of Supervisors should not be discussing zoning parts of SF specifically for pot clubs.

  10. Posted by jill

    agree with Live Smart. That should put the people in jail who are granting the permits.

  11. Posted by GetOffthe Ivy

    Is it me or do all the posters against the medical use of MJ have the same writing style?

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