Feds Try To Undermine California’s Legal Marijuana Industry Vía Selective Prosecution of Advertising


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Sep 19, 2009
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Mariposa County CA
From LA Weekly
Feds Try To Undermine California’s Legal Marijuana Industry Vía Selective Prosecution of Advertising Companies

Richard Cowan April 27, 2020
Although California’s Proposition 64, the “Control, Regulate and Tax Adult Use of Marijuana Act” which legalized the sale of recreational marijuana, won by an overwhelming victory four years ago (Yes 7,979,041 = 57.13% vs No 5,987,020 = 42.87%) it was — and still is — opposed by law enforcement in rural areas, some urban localities, and — of course — by the Feds.

Also, there has been great confusion and controversy over how to implement it by licensing retail sales. As is almost always the case, the drafting of the lengthy text involved many compromises with the state’s numerous “stakeholders” — AKA “special interests.”

One of the most troublesome provisions allowed “local options” so supposedly “conservative” rural areas could continue to ban retail locations (but not medical dispensaries or deliveries). The result is that there are parts of the state where marijuana users may have to drive an hour or more to buy cannabis, which is a real burden for many low-income people, and a nuisance for everyone. (And also very bad public policy.)

The other big problem is more complicated. Licensing procedures are always going to be contentious, especially in a state like California where regulation is considered “progressive,” and more regulation is even more progressive. And if businesses object … Well, filthy capitalists!

In the real world, California already had a well-established semi-legal market with numerous “medical marijuana dispensaries,” especially in urban areas, where the “black market” is simply a fact of life. And surprise, surprise, these people found it too difficult or simply too onerous to get licenses.

Of course, those who did get licenses then had a vested interest in suppressing retailers that didn’t, and thus didn’t have to comply with state laws or pay the special marijuana taxes. Perfectly understandable, except consumers don’t like paying taxes to governments that haven’t done much for them lately, to put it politely.

For almost 20 years there has been advertising for medical marijuana dispensaries. There used to be thick pulp paper magazines that had almost no articles, but an amazing number of ads for medical marijuana dispensaries and doctors who would examine you for what ails you, and issue you a “recommendation” for medical marijuana. Everyone was winking so much, they looked like they needed an ophthalmologist.

Can anyone these days be a patriot without being a cynic? “Truth, Justice and the American Way”? Pause for tears and laughter.

Of course, Prop. 64 was supposed to solve these problems, but as time went by and the retail licensing process neared its theoretical completion it became clear that a large number of long established retailers were unwilling or unable to get licenses.

And then it gets weird. The state saw that some unlicensed retailers were still advertising, but instead of just shutting them down, it complained to the websites and publications that they should stop carrying the ads for these allegedly unlicensed shops. Of course, the ads all had the locations and contact info for these allegedly unlicensed stores. All the police had to do was look at the ads and then go to those addresses and close down any place that couldn’t produce a license. Bingo.

After that there would almost certainly be another unlicensed store opened up serving the same area. If they advertised they would be at heightened risk of being raided, but if they didn’t advertise they would be harder for the police to find. Dealers’ dilemma or police problems?

Meanwhile, back in the real world, the licensed stores are delighted to have less competition and are loving it. They don’t need to advertise or compete on price because they have far less (legal) competition.

As a consequence of having most of the state’s population geographically far from legal retailers and far too few licensed retailers in urban areas, black market dealers still have 70% of the marijuana business. T’was a great victory.

Now, when the politicians and police screw up, what do they do? Look for scapegoats, of course.

So, last September, the U.S. Attorney’s office in Eastern California sent subpoenas to various publications and websites, including WeedMaps, the leading marijuana advertising sight.

Were they complying with California’s laws? If not, the Feds might prosecute them, even though the Federal laws do not recognize the states’ laws.

And were they “facilitating” the violation of Federal marijuana prohibition? Even though the Feds are not going to prosecute the actual retailers, they might prosecute someone for “facilitating” what the actual retailers were actually doing.

Ain’t through yet. Now guess what …

It turns out that both Yelp and Google are still carrying ads for all the retailers, including the unlicensed stores, and they were not subpoenaed! Why?

It is obvious that the real objective of the Federal investigation is simply to make marijuana legalization fail and to perpetuate the War on Us.

Richard Cowan is a former NORML National Director and co-founder of Blue Ribbon Hemp for Seniors


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