Category Archives: General

Why Social Justice Matters in the Cannabis Debate

David FeldmanThe centuries of enslaving people of color and the overwhelming racism against and systemic mistreatment of Mexicans and other Hispanics in this country were and in many respects to this day remain horrid and indefensible. This has been no more apparent than in the U.S. “War on Drugs.” We can recount at length the original criminalization of cannabis in the 1930s and again in 1970 as almost purely racist, political and economic. It was a way, among other things, to lock up Mexicans and blacks and stop their efforts to hurt opposition candidates or take jobs away from “real” Americans. Leaders from those times have all but, and in some cases directly, admitted as much.

To read the full text of this column by Duane Morris partner David Feldman, please visit the HoneySuckle website.

NJ Adult Use Bill – Two Steps Closer to a March 25th Vote – Brad A. Molotsky, Esq.

According to late night reporting from NJ Biz – Dan Munoz, who has been all over this topic, committees in both the NJ Assembly & Senate approved a measure that would legalize adult-use recreational marijuana, setting the proposals for a showdown full-floor vote in 7 days from now on March 25.

Senate Bill 2703 passed by a 6-4 vote with one abstention in the Senate Judiciary Committee Monday evening while its counterpart, Assembly Bill 4497, passed by a 6-1 vote with two abstentions at the Assembly Appropriations Committee.

Both measures would allow for anyone over 21 years of age to possess up to an ounce of marijuana.

The product would be taxed at $42 an ounce and the industry would be regulated by a five-person Cannabis Regulatory Commission, which will function similarly to how the Casino Control Commission operated following the legalization of gambling in the 1970s.

The approval of both measures followed hours of closed-door meetings as lawmakers hammered out last-minute changes to the legislation, including a dramatically increased expungement process for people with marijuana-related convictions.

Stay tuned for a detailed analysis as the final bill is published. – Brad

NJ Adult Use Cannabis Bill Fast Tracked for March 25th Vote

Gov. Phil Murphy and legislative leaders reached agreement on key provisions to legalize marijuana for adult recreational use, including how to tax and regulate it, and expunging past low-level marijuana offenses for certain users as a step toward social reform per reporting from Dan Munoz.

Per a press release issued by key Assembly Senate and the Governor’s office, we should expect to see the introduction of a cannabis bill within days.
Under the terms of the agreement:

• Adult-use marijuana would be subject to an excise tax of $42 per ounce, which will be imposed when marijuana is cultivated.

• Municipalities that are home to a cultivator or manufacturer would receive the revenue from a 2 percent tax on the product within their jurisdiction.

• Municipalities that are home to a wholesaler would receive the revenue from a 1 percent tax on the product within their jurisdiction.

• Municipalities that are home to a retailer would receive the revenue from a 3 percent tax on the product within their jurisdiction.

To start to address social equity concerns, the revised legislation will likely provide an expedited expungement process for individuals convicted of low-level marijuana offenses, and a separate expungement process that would automatically prevent certain marijuana offenses from being taken into account in particular areas such as education, housing and occupational licensing.

Additionally, there are a number of provisions that aim to ensure broad-based participation for women owned and minority owned businesses, low and middle-income individuals, and disadvantaged communities.

Under the proposed legislation, adult-use marijuana would be governed by a Cannabis Regulatory Commission, composed of 5 members—three appointed directly by the Governor to serve terms of at least 4 years, and 2 appointed by the Governor upon the recommendations of the speaker and Senate president.

The commission would be tasked with promulgating all regulations to govern the industry and overseeing applications for licensing of adult-use marijuana dispensaries.

-Brad A. Molotsky, Esq.

With Gottlieb Leaving FDA, Uncertainty Over CBD and Hemp Regulation Remains

David Feldman, a Duane Morris partner and team lead of the firm’s Cannabis Industry Group, was quoted in the Corporate Counsel article, “With Gottlieb Leaving FDA, Uncertainty Over CBD and Hemp Regulation Remains.”

“There is tremendous confusion in the marketplace right now concerning what is and isn’t legal in hemp and CBD,” Feldman said. “We are comfortable as to knowing what we know is true. There is a lot of uncertainty as to what operators can and can’t do.”

Feldman said he is telling clients that there will be a path for legal hemp and legal CBD products, but that path does not yet exist. He said there is a process in place already for companies seeking approval for drugs with CBD in them, however there is still a question of what the approval process will be for food and beverages containing CBD.

To read the full article, visit the Corporate Counsel website (subscription required).

Is March the 4:20 for Adult Use Marijuana in NJ?

Is March the 4:20 for NJ recreational, adult use marijuana? Brad A. Molotsky

According to Senate President Stephen Sweeney, with budget hearings and discussions beginning to ramp up in Trenton, March 2019 is likely the last best time to act on a New Jersey marijuana-legalization bill.
In order for the Bill to move forward, Senator Sweeney confirmed his view that a vote needs to be held this month (i.e., March) in order to hold an election on a measure legalizing, regulating and taxing marijuana for adult-use.

Why March – According to the Senator, April would be a difficult month because of budget hearings and religious holidays. Then May is the actual budget discussion and focus on passage of the budget.

That in and of itself is problematic, according to Dan Munoz at NJBiz, given that lawmakers might view negotiations on the budget and marijuana-legalization through a tit-for-tat, transactional lens.

As for whether we could see a vote this summer or during a lame duck session of the Legislature, Senator Sweeney said he “doesn’t want to wait that long.” And whether lawmakers might put the questions before voters as a ballot referendum has essentially been a non-starter according to Munoz.

A tentative agreement between the Governor and the legislative leaders calls for a $42 an ounce tax on marijuana and for a 5-member Cannabis Regulatory Commission to oversee the new industry. Per the momentary agreement, Governor Murphy would be able to select 3 of the 5 Commission members.

Per Munoz, Governor Murphy was initially pushing for legalization within his first 100 days of office. The proposed 2020 budget, unveiled Tuesday by Governor Murphy, includes $60 million of tax revenue under the assumption that marijuana is made legal by January 2020.

The 2020 budget also anticipates spending $21 Million to create the necessary regulatory apparatus for legalized cannabis and thereafter has a placeholder for a $12 Million a year spend for cannabis operations and enforcement.

Could be an interesting March in Trenton – stay tuned!

No Hemp Transport Through Idaho

A recent decision by a Federal Magistrate Judge for the United States District Court for the District of Idaho upheld the seizure of an industrial hemp shipment in January after the enactment of the 2018 Farm Bill.

On January 24, 2019, Big Sky, a Colorado-based company, shipped industrial hemp from Oregon thorough Idaho on its way to Colorado. The hemp was seized in Idaho and the driver arrested for illegal transportation of marijuana. The crime carries a 5 year mandatory sentence. Big Sky sued for a temporary restraining order to release the hemp under the 2018 Farm Bill. The Court found that because no plan from the State of Oregon had been approved by the Department of Agriculture, the seized hemp was not produced in accordance the 2018 Farm Bill. The Court held that at this point time, without USDA approval of a state hemp plan, the Interstate Commerce Clause provisions of the Farm Bill do not apply.  A Temporary Restraining Order was denied on 2/2 and the Preliminary Injunction was denied on 2/20. Big Sky Scientific LLC v. Idaho State Police et al., No. 1:19-cv-00040-REB (D. Idaho, February 2, 2019). The case is on expedited appeal to the Ninth Circuit. Opening brief is due 3/20.

This decision is contrary to the intent, if not the letter, of the Farm Bill. It creates confusion about the what is permissible now, prior to USDA regs and approval of state plans.

Is Cannabis Media Coverage Fair and Balanced?

With many billions of dollars of business and tax revenue and many jobs at stake, as well as an emerging national debate about legalization, the U.S. cannabis industry has received quite a bit of media coverage. This has been especially true since Colorado and Washington were the first U.S. states to legalize cannabis adult use in 2012, and has morphed into a crescendo of content since California fully legalized in January 2018. And yes, in many cases, in today’s super-competitive world of selling words, at times it seems more about the punny headlines than the substance underneath.

To read the full text of this column by Duane Morris partner David Feldman, please visit the Green Entrepreneur website.

Seth Goldberg

Cannabusiness: The Marijuana Industry on Sirius XM

A two-hour special program, “Cannabusiness: The Marijuana Industry,” will be broadcast on Sirius XM’s Business Radio, Channel 132. Duane Morris partner Seth Goldberg will be interviewed on the program. The program will be re-broadcast at the following times:

Tuesday, February 26 from 2 to 4 pm ET
Tuesday, February 26 from 8 to 10 pm ET
Wednesday, February 27 from 1 to 3 pm ET
Thursday, February 28 from 2 to 4 pm ET
Friday, March 1 from 5 to 7 pm ET
Saturday, March 2 at Midnight and then again from 7 to 9 pm ET
Sunday, March 3 at 8 am ET and then again from 6 to 8 pm ET

Listen to the program on the Business Radio podcast site.

New Jersey – One step closer to Adult Use, Recreational Marijuana Legalization

Earlier this week, Governor Murphy, Senate President Stephen Sweeney, D-3rd District, and Assembly Speaker Craig Coughlin, D-19th District, reached a tentative agreement on key pieces of adult use marijuana legislation, overcoming one of the key sticking points of how to tax the product sales, reaching a collective consensus of a $42 an ounce tax.

According to a recent Monmouth University Poll, 6 in 10 New Jersey adults support legalizing recreational marijuana. The February poll interviewed 604 New Jersey adults between Feb. 8 and 10, found that 62% of respondents favored legalizing small amounts of marijuana for personal use, compared to 32% of adults who said no to the prospect of legal marijuana in New Jersey.

68% of respondents said it would support the state economy, while 40% of respondents who support legal cannabis said it would boost tax revenue for New Jersey.
From an age perspective, 81% of millennials (i.e., ages 18 to 34), support legalizing marijuana, compared to 74% of adults ages 35 to 54, and 67% of adults 55 and older.

One of the other bones of contention that was overcome involved who will control the oversight commission. The current agreement would create a 5-member Cannabis Regulatory Commission to oversee the state’s marijuana industry, and Governor Murphy would be able to appoint 3 of the members without requiring Senate approval.

A earlier New Jersey marijuana legalization bill that was advanced by Assembly and Senate commitees in the fall of 2018 included a 12% sales tax. Under the Monday compromise, adult use marijuana purchasers will pay the same tax rate no matter what amount they purchased – meaning, $42 for an ounce, $21 for a half-ounce, $10.50 for a quarter-ounce or $5.25 for an eighth-ounce.

The Senate Budget and Appropriations Committee vote was 7-4 in favor, while the Assembly Appropriations Committee voted 7-3 to advance the bill. If legislation is moved, the “Marijuana Legalization Act” would allow users 21 years old and up to possess up to an ounce of marijuana.

EU Parliament Vote Supports Medical Cannabis

The Parliament of the European Union is calling for a formal EU policy for the manufacture and use of medical cannabis and targeted funding for scientific research.

A number of EU states have legalised the use of certain forms of cannabis or cannabinoids for medical purposes and others are in the process of debating similar changes to their legislation.

However, the rules on which products are allowed and their permitted usage varies widely from state to state and at present no EU country authorises the smoking or home-growing of cannabis for medical purposes.  Continue reading EU Parliament Vote Supports Medical Cannabis