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url: hMPp://www.denverpost.com/news/marijuana/ci_23520365/many-owners-states-pot-businesses-dont-have-marijuana
Many CO pot business owners don't have mj backgrounds
One is a former oil man. Another was the president of a company that produced baby sleep positioners.
There's a boutique real estate developer of an Aspen hotel and a 32-year-old former commercial banker who opened her own consulting company.
The names of some of Colorado's biggest marijuana moguls are not well known outside the industry or in some cases, even inside it. Some like it that way, preferring a low profile in a risky business.
The names of some of Colorado's biggest marijuana moguls are not well known outside the industry or in some cases, even inside it. Some like it that way, preferring a low profile in a risky business.
One thing those on the list share is a wealth of management experience in fields unrelated to marijuana, showing that making it in the legal pot industry today is as much about business acumen as it is about growing good weed.
"You will find that the successful ones are professionals," said Chris Walsh, editor of Medical Marijuana Business Daily, an industry trade publication.
"They'll wear a suit to a meeting. They understand their company's books and finances. ... These guys picked up pretty quickly that you've got to be professional in this."
Through information obtained in public-records requests to state regulators, The Denver Post has been able for the first time to identify several of the leading medical-marijuana business owners in Colorado. Because of new laws that give preference to owners of medical-marijuana dispensaries, these owners are well positioned to jump into the state's newly legalized recreational marijuana market.
Put another way: If Colorado's groundbreaking new laws on marijuana create pot barons, they could very well be these folks.
Most of the larger dispensary owners are guarding their business plans for post-Amendment 64 Colorado or waiting to see what kind of rules municipalities adopt governing recreational pot shops.
"We have been discussing it since the morning after 64 passed," said Brooke Gehring, a member of a group that owns four dispensaries, some of which once teetered on the brink of collapse. "We see it as an opportunity for another new market that's opening up, and we're going to have the real estate, strategy and systems in place to continue to be an industry leader."
The list of owners provided to The Post comes with significant limitations.
One quarter of the state's roughly 500 medical-marijuana dispensaries don't have a state license but are instead operating under a pending license application. Colorado Medical Marijuana Enforcement Division officials, saying those applications are not public records, will not provide the names of the dispensaries' owners.
One quarter of the state's roughly 500 medical-marijuana dispensaries don't have a state license but are instead operating under a pending license application. Colorado Medical Marijuana Enforcement Division officials, saying those applications are not public records, will not provide the names of the dispensaries' owners.
The list also fails to differentiate between current owners and previous owners who may have since sold their interests. The state says its computer database cannot make the distinction. The only way for the state to check who currently owns a dispensary is to look at the scanned copy of the documents the dispensary owner filed when applying for a license.
The Medical Marijuana Enforcement Division, though, recently lost some of those documents because of a computer-hardware failure. The state has not said how many records were lost but cited the computer problem in telling The Post that certain records requested could not be produced.
For four of the five largest dispensary ownership groups, The Post verified active ownership of the businesses through records and interviews. Records indicate the other owner, 42-year-old Shawn Phillips, has a stake in six dispensaries in Denver, Wheat Ridge and Central City. Phillips declined to be interviewed for this story.
The owner of another large dispensary group, Joseph Max Cohen, also declined an interview request. The records provided to The Post list Cohen as the sole owner of five dispensaries under the banner of The Clinic. The website of The Clinic also lists a sixth store that is "temporarily closed, reopening soon."
While The Clinic at times stakes out high-profile positions in the industry for instance, by sponsoring a charity golf tournament to benefit multiple sclerosis research or entering its products in competitions a representative for the company said it has decided not to attract any more attention to itself through the news media.
Many of Colorado's major marijuana players prefer to keep out of the limelight. Some fear publicity could draw scrutiny from federal law enforcement officials who view dispensary owners as drug traffickers.
Taken together, the records' limitations and the cultural secrecy mean the ownership of Colorado's medical-marijuana industry remains very much shrouded in haze. But the list of owners still offers valuable insight into the makeup of the medical-marijuana industry and provides hints of what the recreational industry could look like.
For instance, a number of owners and ownership groups have begun assembling formidable chains of dispensaries.
The list provided to The Post contains 585 names. Of those, 112 people are listed as owning more than one dispensary. Twelve people are listed as owning at least four, although some of those people are members of overlapping ownership groups.
The owner on the list with a stake in the most dispensaries seven is John Lord, 52, a New Zealand native who formerly was president of Denver-based Basic Comfort Inc., a manufacturer of baby sleep positioners and other products. Another company purchased Basic Comfort in 2008 for $6.5 million, according to a filing with the Securities and Exchange Commission.
At the time, Basic Comfort operated a manufacturing and distribution center in Denver and generated about $10 million in sales in 2007, according to an announcement of the transaction.
In branching into the marijuana business, Lord teamed with Benjamin Burkhardt, 39, in a company called Beyond Broadway LLC.
Lord and Burkhardt share a stake in six dispensaries in Denver, Colorado Springs, Lakewood, Garden City and Boulder, some of which operate under the LivWell name, records show. Lord has an ownership stake in another dispensary independent of Burkhardt.
Before moving to Colorado, Burkhardt was arrested on drug charges in Los Angeles County in 2009, court records show. In a plea deal, Burk-hardt was convicted on one felony charge and received a suspended sentence.
The charge was reduced to a misdemeanor in June 2011 after he completed his probation, records show.
Burkhardt said in an interview he was arrested for growing 35 plants in his home for a medical-marijuana collective. California laws governing marijuana are confusing, he said, and his case involved "the gray area of the law and politics of California."
Law enforcement officials in California have been far more aggressive in pursuing nonprofit marijuana collectives and growers than their counterparts in Colorado, where the business is tightly regulated.
In Colorado, convicted drug felons are prohibited, with some exceptions, from owning medical-marijuana companies.
Burkhardt said he provided his criminal record to the Medical Marijuana Enforcement Division when he applied for his license in the summer of 2011 after the felony was wiped off the books.