• Oregon Marijuana, the Feds and the Williams Memo
    Seems like a good approach. Once upon a time, the cannabis industry had something called the Ogden Memorandum. That was back in 2009, prior to any state legalizing cannabis for recreational use. The Ogden Memo gave prosecutorial guidelines to U.S. Attorneys in medical marijuana states. Many people read the Ogden Memo too cavalierly for the feds’ liking (to wit, over 1,000 new Colorado dispensaries opened that year), and Eric Holder’s office attempted to cool industry expectations with the first Cole Memo in 2011. A few years later, after Colorado and Washington legalized adult use cannabis, we got the second Cole Memo and its famous eight federal enforcement priorities to help guide state lawmaking. The second Cole Memo, which everyone just called the “Cole Memo”, lasted an astonishing 4.5 years until Jeff Sessions rescinded that guidance in early 2017, with a memo of his own. The Sessions Memo effectively reset everything to a primitive ground zero, lecturing that “marijuana is a dangerous drug and marijuana activity is a serious crime.” Aside from disrupting longstanding federal policy framework on cannabis, the Sessions Memo directed federal prosecutors “to weigh all relevant considerations” in bringing prosecutions for violations of the federal Controlled Substances Act. As of last week, one such prosecutor gave explicit indications as to what relevant considerations will take priority in his district. That U.S. Attorney was Billy Williams of the District of Oregon. So now we now have the Williams Memo. The Williams Memo is a thoughtful if somewhat awkward document. In the classic posture, it reserves prosecutorial discretion and promises nothing to anyone. Instead, it explains that lawyers in Mr. Williams’ office will primarily focus on five enforcement priorities when deciding whether to enforce the draconian federal laws against cannabis operators. Those priorities are: Overproduction and interstate trafficking; Protecting Oregon’s children; Violence, firearms, or other public safety threats; Organized crime – including tax evasion and money laundering; and Protecting natural lands, natural resources, and Oregon’s environment. The one that has state compliant operators a little worried is “overproduction,” given that the Oregon legislature has not capped marijuana licenses and does not require verticality in licensees. When I say “a little worried” I mean very little: So far, of the large number of Oregon cannabis and cannabis-adjacent clients my firm represents, I’ve heard from exactly zero of them with concerns over the Williams Memo. The only people I’ve heard from are reporters. Still, the Williams Memo is important because it could serve as a template for U.S. attorneys in other states, ... read more
    Source: Canna Law Blog – OregonPublished on 2018-05-22
  • The Business of Marijuana in Oregon: Join us June 7th!
    On June 7, our own Vince Sliwoski will chair an all-day continuing legal education (CLE) event called The Business of Marijuana in Oregon, along with Jesse Sweet, a lawyer and senior policy analyst at the Oregon Liquor Control Commission (OLCC). This will be Vince’s fourth year presenting at the event and his third year as chair. The roster of speakers lined up for this CLE is better than any year to date, and everyone, including non-lawyers, would be well served to attend. For a full event description, including topics, speakers and registration links, click here. Looking back over the past four years, it is amazing to see how much things have changed in Oregon cannabis. At this point, the OLCC’s recreational marijuana program is fully built out, with over 3,400 applicants now on file with the state. We are proud to call many of these Oregon producers, processors, wholesalers and retailers our clients, alongside the many investors and ancillary service providers we represent. Sometimes, it is said that pioneers get slaughtered and settlers get rich. Now that the Oregon regulatory groundwork has stabilized, we have begun to see a second wave of entrepreneurs and investors move in on the local industry. Many of these new entrants bring skills, capital and experience from other regulated markets, while others are new to the space. Over the next year or so, we expect to see a fair amount of market consolidation throughout the Oregon cannabis industry. (See our most recent observations on the “state of the State” here). Oregon attorneys and business owners alike need to be familiar with the unique regulatory concepts and industry dynamics that will be discussed on June 7, in order to best serve the Oregon cannabis industry. These concepts include state laws and administrative rules, developments in the highly dynamic federal sphere, and practical approaches to working with and in the cannabis industry. Attendees will hear from regulators, bankers, CPAs, and, of course, lawyers aplenty. We hope you will join us on June 7 for an eight-hour survey of Oregon cannabis that is both broad and deep. And if you are a Harris Bricken client or a friend of the firm, please click here to request a promotional discount code, which can be applied to either the webcast, or to in-person attendance. See you soon. ... read more
    Source: Canna Law Blog – OregonPublished on 2018-05-20
  • Dreaming of an Oregon-California Cannabis Exchange
    Yesterday, we received a call from Congressman Earl Blumenauer’s office here in Portland, Oregon. The purpose of the call was to discuss an idea to deal with the oversupply of marijuana in the state sanctioned Oregon market. Specifically, the idea was to explore the possibility of an interstate compact with California, where Oregon would sell its excess cannabis to the Golden State, much like Oregon has sold its excess renewable energy over the years. Unfortunately, we don’t think it’s a great idea. Could a west coast cannabis exchange really work? We have been writing about the oversupply issue for a while (see here and here). Recently, oversupply has also begun to receive a surge in media coverage (see here, here and here). To be sure, we have a ton of clients who have been affected by depressed cannabis prices lately: These clients include not just farms but processors and retailers who are struggling to move product and cover costs, let alone turn profits. This predictably has resulted in fair bit of industry consolidation as of late, and we have been buying and selling cannabis businesses nonstop for a while now. Various approaches have been suggested to deal with the oversupply issue in the regulated Oregon market. These approaches include having the state legislature cap the issuance of licenses, like Washington, or having the Oregon Liquor Control Commission (OLCC) curtail maximum allowed canopy sizes. To date, neither approach has gained any traction. Instead, policy makers are simply watching the market attempt to sort itself out, which means watching a significant number of operators fail, while others are swept up by out-of-state and even international investment. So why don’t we think an interstate compact with California is a great idea? There are a few different reasons. The first is that California has plenty of cannabis in its own right: It just needs to recalibrate regulations that are currently seen as too restrictive to allow most small and mid-sized operators to enter the regulated market. The second reason is that California’s adult use program is too new: The state will almost certainly wish to keep and grow its own legal cannabis, rather than import product from Oregon while a black market thrives. But the biggest reason of all may be that an interstate compact, while exotic, is legally and politically hazardous. For 22 years and over the course of four presidential administrations, the federal government has taken a general posture of restraint as states have promulgated medical and then recreational cannabis programs. There are ... read more
    Source: Canna Law Blog – OregonPublished on 2018-04-24
  • Industrial Hemp: Oregon and Interstate Sales
    So it goes with Oregon hemp. In the past six to twelve months, we have seen an extraordinary increase in businesses and individuals interested in growing and processing industrial hemp. This is especially true in Oregon, where Department of Agriculture (ODA) grower and handler registrations are fast, cheap and easy to acquire. In many cases, these registrants are cultivating and processing hemp in order to create cannabidiol (CBD) based products. The products can be sold state-wide without limitation, including into the Oregon Liquor Control Commission (OLCC) adult use marijuana market via hemp-endorsed OLCC processors. Other entrepreneurs, in Oregon and elsewhere, are extracting CBD for sale interstate. This is a legally nebulous area at the federal level, although interstate sales are not prohibited under Oregon law. With CBD isolate changing hands at upwards of $4,500 per kilo, however, and given the proliferation of CBD products making their way into big box retail, many businesses and individuals feel the risk is worth taking. Perhaps for this reason, we have been getting numerous weekly inquiries as to the viability of CBD sales interstate, especially as of late. From a state rules perspective, Oregon has taken significant steps in the past several months in building out its industrial hemp regime. We wrote about the recent OLCC rules promulgated in December, which allowed for ODA hemp registrants to sell into the OLCC market; and more recently we wrote about House Bill 4089, which tied up a number of loose ends related to the tracking of those sales. The upshot of all of this is that we now have unprecedented interplay between the OLCC and ODA markets. And as the OLCC hustles to write rules implementing HB 4089, there is a fair bit of confusion about what is actually allowed. One question that keeps coming up is whether an OLCC processor applicant may process ODA hemp (under both ODA and OLCC rules) while waiting to receive its license from OLCC. According to our reading of the rules, recently confirmed to us by OLCC, the answer is “yes.” Much in the way that marijuana growers used to attempt to “squeeze in” a medical marijuana crop pending their OLCC inspection and licensure, ODA hemp processors can float their operations by processing industrial hemp while in line with OLCC. Note that this is allowed even for ODA processors that are not seeking a hemp endorsement in their OLCC processor applications. Of course, ODA, local fire marshals and other state or local actors may place limitations on hemp processing operations, or ... read more
    Source: Canna Law Blog – OregonPublished on 2018-04-20
 
  • Oregon Marijuana, the Feds and the Williams Memo
    Seems like a good approach. Once upon a time, the cannabis industry had something called the Ogden Memorandum. That was back in 2009, prior to any state legalizing cannabis for recreational use. The Ogden Memo gave prosecutorial guidelines to U.S. Attorneys in medical marijuana states. Many people read the Ogden Memo too cavalierly for the feds’ liking (to wit, over 1,000 new Colorado dispensaries opened that year), and Eric Holder’s office attempted to cool industry expectations with the first Cole Memo in 2011. A few years later, after Colorado and Washington legalized adult use cannabis, we got the second Cole Memo and its famous eight federal enforcement priorities to help guide state lawmaking. The second Cole Memo, which everyone just called the “Cole Memo”, lasted an astonishing 4.5 years until Jeff Sessions rescinded that guidance in early 2017, with a memo of his own. The Sessions Memo effectively reset everything to a primitive ground zero, lecturing that “marijuana is a dangerous drug and marijuana activity is a serious crime.” Aside from disrupting longstanding federal policy framework on cannabis, the Sessions Memo directed federal prosecutors “to weigh all relevant considerations” in bringing prosecutions for violations of the federal Controlled Substances Act. As of last week, one such prosecutor gave explicit indications as to what relevant considerations will take priority in his district. That U.S. Attorney was Billy Williams of the District of Oregon. So now we now have the Williams Memo. The Williams Memo is a thoughtful if somewhat awkward document. In the classic posture, it reserves prosecutorial discretion and promises nothing to anyone. Instead, it explains that lawyers in Mr. Williams’ office will primarily focus on five enforcement priorities when deciding whether to enforce the draconian federal laws against cannabis operators. Those priorities are: Overproduction and interstate trafficking; Protecting Oregon’s children; Violence, firearms, or other public safety threats; Organized crime – including tax evasion and money laundering; and Protecting natural lands, natural resources, and Oregon’s environment. The one that has state compliant operators a little worried is “overproduction,” given that the Oregon legislature has not capped marijuana licenses and does not require verticality in licensees. When I say “a little worried” I mean very little: So far, of the large number of Oregon cannabis and cannabis-adjacent clients my firm represents, I’ve heard from exactly zero of them with concerns over the Williams Memo. The only people I’ve heard from are reporters. Still, the Williams Memo is important because it could serve as a template for U.S. attorneys in other states, ... read more
    Source: Canna Law Blog – OregonPublished on 2018-05-22
  • The Business of Marijuana in Oregon: Join us June 7th!
    On June 7, our own Vince Sliwoski will chair an all-day continuing legal education (CLE) event called The Business of Marijuana in Oregon, along with Jesse Sweet, a lawyer and senior policy analyst at the Oregon Liquor Control Commission (OLCC). This will be Vince’s fourth year presenting at the event and his third year as chair. The roster of speakers lined up for this CLE is better than any year to date, and everyone, including non-lawyers, would be well served to attend. For a full event description, including topics, speakers and registration links, click here. Looking back over the past four years, it is amazing to see how much things have changed in Oregon cannabis. At this point, the OLCC’s recreational marijuana program is fully built out, with over 3,400 applicants now on file with the state. We are proud to call many of these Oregon producers, processors, wholesalers and retailers our clients, alongside the many investors and ancillary service providers we represent. Sometimes, it is said that pioneers get slaughtered and settlers get rich. Now that the Oregon regulatory groundwork has stabilized, we have begun to see a second wave of entrepreneurs and investors move in on the local industry. Many of these new entrants bring skills, capital and experience from other regulated markets, while others are new to the space. Over the next year or so, we expect to see a fair amount of market consolidation throughout the Oregon cannabis industry. (See our most recent observations on the “state of the State” here). Oregon attorneys and business owners alike need to be familiar with the unique regulatory concepts and industry dynamics that will be discussed on June 7, in order to best serve the Oregon cannabis industry. These concepts include state laws and administrative rules, developments in the highly dynamic federal sphere, and practical approaches to working with and in the cannabis industry. Attendees will hear from regulators, bankers, CPAs, and, of course, lawyers aplenty. We hope you will join us on June 7 for an eight-hour survey of Oregon cannabis that is both broad and deep. And if you are a Harris Bricken client or a friend of the firm, please click here to request a promotional discount code, which can be applied to either the webcast, or to in-person attendance. See you soon. ... read more
    Source: Canna Law Blog – OregonPublished on 2018-05-20
  • Dreaming of an Oregon-California Cannabis Exchange
    Yesterday, we received a call from Congressman Earl Blumenauer’s office here in Portland, Oregon. The purpose of the call was to discuss an idea to deal with the oversupply of marijuana in the state sanctioned Oregon market. Specifically, the idea was to explore the possibility of an interstate compact with California, where Oregon would sell its excess cannabis to the Golden State, much like Oregon has sold its excess renewable energy over the years. Unfortunately, we don’t think it’s a great idea. Could a west coast cannabis exchange really work? We have been writing about the oversupply issue for a while (see here and here). Recently, oversupply has also begun to receive a surge in media coverage (see here, here and here). To be sure, we have a ton of clients who have been affected by depressed cannabis prices lately: These clients include not just farms but processors and retailers who are struggling to move product and cover costs, let alone turn profits. This predictably has resulted in fair bit of industry consolidation as of late, and we have been buying and selling cannabis businesses nonstop for a while now. Various approaches have been suggested to deal with the oversupply issue in the regulated Oregon market. These approaches include having the state legislature cap the issuance of licenses, like Washington, or having the Oregon Liquor Control Commission (OLCC) curtail maximum allowed canopy sizes. To date, neither approach has gained any traction. Instead, policy makers are simply watching the market attempt to sort itself out, which means watching a significant number of operators fail, while others are swept up by out-of-state and even international investment. So why don’t we think an interstate compact with California is a great idea? There are a few different reasons. The first is that California has plenty of cannabis in its own right: It just needs to recalibrate regulations that are currently seen as too restrictive to allow most small and mid-sized operators to enter the regulated market. The second reason is that California’s adult use program is too new: The state will almost certainly wish to keep and grow its own legal cannabis, rather than import product from Oregon while a black market thrives. But the biggest reason of all may be that an interstate compact, while exotic, is legally and politically hazardous. For 22 years and over the course of four presidential administrations, the federal government has taken a general posture of restraint as states have promulgated medical and then recreational cannabis programs. There are ... read more
    Source: Canna Law Blog – OregonPublished on 2018-04-24
  • Industrial Hemp: Oregon and Interstate Sales
    So it goes with Oregon hemp. In the past six to twelve months, we have seen an extraordinary increase in businesses and individuals interested in growing and processing industrial hemp. This is especially true in Oregon, where Department of Agriculture (ODA) grower and handler registrations are fast, cheap and easy to acquire. In many cases, these registrants are cultivating and processing hemp in order to create cannabidiol (CBD) based products. The products can be sold state-wide without limitation, including into the Oregon Liquor Control Commission (OLCC) adult use marijuana market via hemp-endorsed OLCC processors. Other entrepreneurs, in Oregon and elsewhere, are extracting CBD for sale interstate. This is a legally nebulous area at the federal level, although interstate sales are not prohibited under Oregon law. With CBD isolate changing hands at upwards of $4,500 per kilo, however, and given the proliferation of CBD products making their way into big box retail, many businesses and individuals feel the risk is worth taking. Perhaps for this reason, we have been getting numerous weekly inquiries as to the viability of CBD sales interstate, especially as of late. From a state rules perspective, Oregon has taken significant steps in the past several months in building out its industrial hemp regime. We wrote about the recent OLCC rules promulgated in December, which allowed for ODA hemp registrants to sell into the OLCC market; and more recently we wrote about House Bill 4089, which tied up a number of loose ends related to the tracking of those sales. The upshot of all of this is that we now have unprecedented interplay between the OLCC and ODA markets. And as the OLCC hustles to write rules implementing HB 4089, there is a fair bit of confusion about what is actually allowed. One question that keeps coming up is whether an OLCC processor applicant may process ODA hemp (under both ODA and OLCC rules) while waiting to receive its license from OLCC. According to our reading of the rules, recently confirmed to us by OLCC, the answer is “yes.” Much in the way that marijuana growers used to attempt to “squeeze in” a medical marijuana crop pending their OLCC inspection and licensure, ODA hemp processors can float their operations by processing industrial hemp while in line with OLCC. Note that this is allowed even for ODA processors that are not seeking a hemp endorsement in their OLCC processor applications. Of course, ODA, local fire marshals and other state or local actors may place limitations on hemp processing operations, or ... read more
    Source: Canna Law Blog – OregonPublished on 2018-04-20