The US Justice Department has announced plans to crackdown on the medical marijuana industry in California, despite a 1996 voter-approved initiative to legalize it. Federal officials said they are cracking down on the state’s medical-marijuana dispensaries, threatening to confiscate marijuana – an medical industry that, by state estimates, generates more than $1 billion in annual sales and employs thousands.
Advocates in California, the first state to pass a law legalizing marijuana use for patients with doctors’ recommendations, have scheduled a joint news conference to “outline actions targeting the sale, distribution and cultivation of marijuana.”
Their offices refused to provide details in advance of what moves the officials are taking or how many of the state’s hundreds of store-front marijuana shops would be affected.
Proposition 215, or the Compassionate Use Act, which allows the use of medical marijuana, passed with 56% of the votes in 1996.
Initial stories indicated that all medical-marijuana dispensaries in California had been ordered to shut down, but the actual target remains unclear.
At least 16 marijuana shops or their landlords received letters this week warning they would face criminal charges and confiscation of their property if the dispensaries do not shut down in 45 days.
The letters state that federal law “takes precedence over state law and applies regardless of the particular uses for which a dispensary is selling and distributing marijuana.”
Dale Gieringer, the director of California NORML, which backs legalizing marijuana, said “the crackdown apparently will be tailored to fit the regional differences in the state.” He adds “They want to do a clean sweep in San Diego, whereas in Northern California they can’t possibly do a clean sweep.”
Federal prosecutors announced an aggressive crackdown against California marijuana dispensaries Friday, vowing to shut down dozens of operations and saying that the worst offenders are using the cover of medical marijuana to act as store-front drug dealers.
Many of the drug trafficking ventures are using California’s 15-year-old medical marijuana law to operate in plain sight, said U.S. Attorney Melinda Haag, the top federal law enforcement officer for the San Francisco Bay area. “I understand there are people in California who believe marijuana stores should be allowed to exist, but I think we can all agree we don’t need marijuana stores across the street from schools and Little League fields,” she said.
Not all of the thousands of store-front marijuana dispensaries thought to be operating in the state are being targeted in the crackdown, which also involves new indictments and arrests of marijuana growers throughout the state over the past two weeks, said U.S. Attorney Benjamin Wager, who represents the state’s Central Valley.
Instead, federal officials are initially going after marijuana shops located close to schools, parks, sports fields and other places where there are a lot of children and what Wagner termed “significant commercial operations.” He said that includes farmland where marijuana is being grown. “California’s marijuana industry supplies the nation,” he said. “And huge amounts of money are flowing back in the other direction.”
The strategies they are using vary somewhat, with warning letters issued by the U.S. attorney in San Diego giving recipients 45 days to comply and 38 property owners in Los Angeles and the Central Coast given just two weeks to evict marijuana dispensaries or growers.
The letters come just days after the IRS ruled that the largest dispensary on the West Coast, Harborside Health Center, owes millions in back taxes. The IRS said it won’t allow dispensaries to deduct normal business expenses such as payroll and rent, a potentially devastating financial blow to the industry.
U.S. Attorney Melinda Haag said the move is not designed to clamp down on patients who grow their own marijuana for medical use. But dispensaries that were not part of the initial wave of warning letters “shouldn’t take any comfort,” she said. “They are illegal under federal law.”
The move comes a little more than two months after the Obama administration toughened its stand on medical marijuana. Two years before that, federal officials had indicated they would not move aggressively against dispensaries in compliance with laws in the 16 states where marijuana is legal for people with doctors’ recommendations.
The stepped-up enforcement escalates the Obama administration’s efforts to rein in the spread of marijuana stores, which accelerated after the attorney general announced in 2009 that federal prosecutors would not target people using medical marijuana in states that allow it.
Bill Panzer, a criminal defense lawyer who represents dispensaries said “It looks like there is a concerted effort for an offensive against the dispensaries in California,” and added “The Obama administration, for all the talk that he gave during the campaign, the reality is his policies haven’t been that different from Bush’s.”
“They’re cherry-picking,” Panzer said. “They want to look good in the press, so better to go after one that’s near a school.”
According to Panzer, the Justice Department four dispensaries because they are within 1,000 feet of schools or parks where children play. There is no state law against having a dispensary within 1,000 feet of a school, but under federal law, selling drugs near a school can carry a higher sentence.
The Department of Justice issued a policy memo to federal prosecutors in late June stating that marijuana dispensaries and licensed growers in states with medical marijuana laws could face prosecution for violating federal drug and money-laundering laws. The effort to shut California dispensaries appeared to be the most far-reaching effort so far to put that guidance into action.