Tag Archives: David N. Feldman

David Feldman

Study: Cannabis Improves Cancer Patients’ Condition

An Israeli peer-reviewed study, just published in the European Journal of Internal Medicine, reports that pain and nausea of cancer patients can be lessened through the use of medical cannabis. The study included thousands of cancer patients using medical cannabis between 2015 and 2017. Over 95% of the patients reported an improvement in their condition after using cannabis. The conclusion of the study: “Cannabis as a palliative treatment for cancer patients seems to be well tolerated, effective and safe option to help patients cope with the malignancy related symptoms.”

As we know, the US Government continues to defend the status of cannabis as a Schedule I drug, deemed as dangerous as heroin and LSD. Their previous claims suggested that no research shows that cannabis is safe or has medical benefit. At the same time, the Government severely limits the amount of research on cannabis that can be conducted in the US. According to the DEA website, Schedule I drugs are “drugs with no currently accepted medical use and a high potential for abuse.” This study, with others also underway, appear to now counter the belief that cannabis has no accepted medical use.

With the recent dismissal of a constitutional challenge to the Controlled Substances Act as it relates to cannabis (which may be appealed), more eyes are turning to Congress and the various bills pending to deschedule cannabis at the federal level.

David Feldman

Court Dismisses Suit Challenging Controlled Substances Act

A potentially groundbreaking federal lawsuit brought last summer was dismissed by New York judge Alvin Hellerstein today. The case, brought by five plaintiffs including two children, two veterans and former NFL player Marvin Washington, all of whom use state legal medical cannabis, claimed that the Controlled Substances Act is unconstitutional as it relates to the plant.

The judge ruled that the plaintiffs should have first complied with administrative processes by filing a petition with the Drug Enforcement Administration, and that the case was not appropriate to bring to court. He was sympathetic to the plaintiffs, however, noting that “this decision should not be understood as a factual finding that marijuana lacks any medical use in the United States, for the authority to make that determination is vested in the administrative process.”

He did, however, rule that it was “not irrational” that the Government deemed cannabis dangerous enough to be listed as a Schedule I drug, as it did for heroin and LSD. Statements by former Nixon Administration officials in the 1990s that they knew they were lying about the drugs at the time of the CSA were not considered dispositive, since Congress passed the law.

News reports indicate that the plaintiffs’ attorneys, Mike Hiller, Joe Bondy and Lauren Rudick, may appeal the decision or ask the judge to reconsider. They claim that the petition process would be futile and that there is substantial evidence that the US government has taken actions supporting the notion that there is medical benefit to cannabis.

David Feldman

Vermont Legalizes Adult Use of Cannabis

Vermont’s Republican Governor, Phil Scott, reluctantly signed legislation today fully legalizing the adult use of cannabis in the Green Mountain State. This makes Vermont the ninth state (plus the District of Columbia) to have fully legalized cannabis. It is the third northeast state to legalize, along with Maine and Massachusetts.

The Governor had vetoed a previous bill but apparently had his issues addressed in the newly passed legislation. Commercial and private sales of cannabis will not be allowed, but individuals will be permitted to possess up to an ounce of cannabis and grow two mature plants in their home. Public use is not permitted, and no taxes will be collected by the state. Penalties for possession of larger amounts also will be adjusted.

Vermont’s action also represents the first state to legalize cannabis through legislation rather than voter referendum. It is expected that New Jersey soon will do the same under new Gov. Phil Murphy. Several other states are considering a similar path.

David Feldman

New York to Study Full Cannabis Legalization

In his annual budget address yesterday, NY Democratic Governor Andrew Cuomo announced his plan to form a task force to study possible legalization of the adult use of cannabis in the Empire State. Currently the state permits the sale of cannabis only for medical reasons.

Less than a year ago, Cuomo referred to cannabis as a gateway drug and was widely perceived not to be supportive of legalization. Observers believe, however, that politics may be forcing his hand. Neighboring New Jersey’s new Governor Murphy has announced his intention to legalize adult use of cannabis there. In addition, a potential Republican opponent to Cuomo’s reelection this year has announced his support of legalization in New York.

Currently, while cannabis remains illegal under US federal law, eight states and the District of Columbia have legalized adult use. More states are expected to approve legal sales later this year in the November elections. Others, like New Jersey, are considering legalization through legislation as opposed to voter referendum. As we know, California’s adult use program was launched to great fanfare on January 1 of this year.

New York, with nearly 20 million people, is the fourth largest US state. This creates the potential for a significant market for legal cannabis sales, state tax and tourism revenues and job creation. Legalization could be particularly helpful for New York’s struggling upstate region, which has not seen major job growth in the current economic recovery.

Forming a task force is a long way from legalization and the opening of cannabis stores in Times Square. Cuomo will center the proposed study within the NY Department of Health, which currently oversees the medical marijuana program. He is asking that the task force look at the economic and health impact of legalization.

Cannabis Banking Guidance Unclear After Sessions Action

On January 4, US Attorney General Jeff Sessions rescinded all prior advisory memos on prosecutorial priorities relating to cannabis, including the 2014 Cole Memo which many relied on in entering the space. One consequence of rescinding the Cole Memo is its effect on US Treasury Department guidelines for banks and financial institutions that seek to take cannabis customers. Those 2014 guidelines, issued by the Treasury’s Financial Crimes Enforcement Network (FinCEN), outline processes and filings to be undertaken when a cannabis customer is signed up. The main focus of the process is on due diligence the bank must do on the proposed customer, including ongoing monitoring while the company is a customer. The guidelines also require filing of a “suspicious activity report” (SAR) with FinCEN for each such potential customer.

The banking guidelines focus heavily on the now-rescinded Cole Memo, which suggested the low prioritization of enforcement against people complying with state cannabis laws. The Memo contained a list of exceptions, and if one of the exceptions was present, then enforcement could be pursued. The exceptions included things like providing cannabis to minors, the involvement of organized crime or firearms, and the like. The FinCEN guidelines require a bank to conduct an analysis of whether the potential customer is complying with the Cole Memo priorities. Indeed the type of SAR that the bank must file varies depending on whether or not the potential customer appears to be in compliance with the Cole Memo.

story in Politico quoted a FinCEN spokesman who was asked if they are looking to bring their policies into line with the Justice Department. He said, “FinCEN works closely with law enforcement and the financial sector to combat illicit finance and provide relevant information that allows law enforcement to pursue their priorities. We will continue to work with DOJ and other stakeholders on this issue.” It does appear that confusion and uncertainty on this issue will continue until FinCEN provides further clarification or interpretive guidance. In the meantime, this might mean that some financial institutions will stop servicing cannabis customers and others that were considering it may suspend their efforts.

This post was the combined effort of David Feldman and Neeraj Kumar.

David Feldman

Flash: Sessions Rescinds Cole Memo

US Attorney General Jeff Sessions today rescinded all prior advisory memoranda regarding enforcement priorities in connection with alleged cannabis crimes. This includes the key so-called Cole Memo issued in 2014. That memo advised US attorneys not to prioritize pursuing criminal cases against those complying with state legal cannabis laws as long as certain concerns (such as the involvement of organized crime or distribution to minors) were not present.

In his memo issued today, Sessions indicates that no special guidance is needed in the cannabis space and that general guidelines applicable to all potential prosecutions apply. These guidelines include, according to the memo, “federal law enforcement priorities set by the Attorney General, the seriousness of the crime, the deterrent effect of criminal prosecution, and the cumulative impact of particular crimes on the community.”

In justifying his action, Sessions lists federal statutes making cannabis illegal, indicating his belief that those statutes “reflect Congress’ determination that marijuana is a dangerous drug and that marijuana activity is a serious crime.”

Sessions has been hinting at taking some action regarding the Cole Memo for a while. There was talk that he might replace it with another cannabis memo, maybe a bit tougher, but this memo seems to suggest that will not happen. A federal law known as the Rohrabacher-Blumenauer amendment still prohibits spending federal dollars on enforcement against those complying with state medical cannabis laws. That law will expire with the current budget bill in a few weeks, and it is not clear that it will be retained in the new federal budget. Stay tuned.

David Feldman

Cannabis Shows Promise in Treating Psychosis

Several weeks ago, scientists at King’s College London announced exciting preliminary study results involving mental illness and CBD derived from cannabis. The trial involved 88 patients diagnosed as psychotic, meaning they experience hallucinations, paranoia and anxiety. The study found that patients administered CBD saw lower levels of psychotic symptoms than those given just a placebo.

CBD, or cannabidiol, is separate from the psychoactive aspect of cannabis known as THC. Thus, the patients were provided a fully non-psychoactive form of cannabis, the same as is used to treat ailments such as chronic pain or seizures, even in children.

The study results were published in the American Journal of Psychiatry. As reported in the VOA News, one of the trial leaders, Philip McGuire, said, “The study indicated that CBD may be effective in psychosis: patients treated with CBD showed a significant reduction in symptoms, and their treating psychiatrists rated them as having improved overall.” McGuire also noted very few side effects to use of CBD.

A slow but steady drumbeat of study results is beginning to prove what many in the medical community have believed for a number of years:  while we still don’t quite know why, CBD and cannabis may indeed provide safe and effective treatment or cure for many illnesses and diseases facing mankind today.

David Feldman

Which States Will Legalize Cannabis in 2018?

As we get ready to stick a fork in 2017, the speculation has begun as to which US states might consider legalizing full adult use of cannabis next year. Many are betting on these five: Arizona, Florida, Michigan, Missouri and Nebraska. And of course New Jersey is expected to legalize adult use under new Governor-elect Phil Murphy. Certainly an interesting mix! Some don’t even have legal medical cannabis yet and would try to do both at the same time. Of these one would think Arizona, NJ and Florida, particular tourist destinations already, could really benefit from legalization.

Why does this matter? For several reasons. First, the steamroller that is the state legalization and growing public acceptance of adult use of cannabis is clearly strengthening. Second, knowing which states may be next creates business opportunities. For example, real estate speculators can buy up locations that might be useful for growing, processing or selling cannabis. In the absence of federal trademark registration being available, seeking state trademarks on potential brands in these upcoming locations also could be beneficial. Others like technology providers are working to ensure that states’ regulatory schemes are designed to accommodate their products.

We will learn shortly whether the Rohrabacher-Blumenauer amendment, preventing the spending of federal enforcement dollars against state legal medical cannabis businesses, will survive in the next budget bill. Some are challenging its renewal, but a strong bi-partisan effort to retain it has been building as well. As more states look to legalize cannabis, one hopes that the Feds will continue their prior mostly hands off approach from a regulatory perspective, despite the recent threatening tone of the Attorney General Jeff Sessions.

David Feldman

Sessions Hints at Broader Cannabis Enforcement

According to The Fresh Toast, US Attorney General Jeff Sessions is now hinting at expanding enforcement of federal cannabis laws. The report indicates that, at a news conference this past Wednesday, Sessions said they are looking “very hard right now” at possible changes to the Cole Memo. That 2013 memo adopted a policy to de-emphasize enforcement activities against those complying with state cannabis laws, with certain exceptions. He added, “We’ll be working our way through to a rational policy. But I don’t want to suggest in any way that this department believes that marijuana is harmless and people should not avoid it.”

Sessions has used various methods to seek to interfere with state legal cannabis. He is attempting to stop the renewal of the Rohrabacher-Blumenauer amendment to the annual budget bill. That amendment prohibits the spending of federal money to bring enforcement action against those complying with state medical cannabis laws. It is not clear whether the amendment, passed annually since 2014, will survive the current budget battle. The existing continuing resolution expires in several weeks along with the current budget.

The Attorney General has also put governors in adult use states on notice to ensure they are working hard to enforce their local laws, implying he might come in if they do not, something permitted by the Cole Memo. That said, Sessions’ boss, the President, has said he is “100%” in favor of medical cannabis and believes adult use should be up to the states. Therefore it seems Sessions would not be acting at Trump’s direction if he were to do something dramatic. Watch this space.

David Feldman

Sessions Reconfirms Status of Cole Memo

The entire cannabis industry descended on Las Vegas this week for the MJBiz conference where over 18,000 professionals gathered. While we were there, US Attorney General Jeff Sessions made some news during a Congressional grilling focused more on his involvement with Russian players.

Many have worried that Sessions intends to change or eliminate the Cole Memo. Issued in 2013, in this memo Obama’s Attorney General declared, essentially, that the US will not put any priority on enforcing federal cannabis laws against those legally complying with state laws. Certain exceptions were included, such as keeping cannabis away from children and keeping organized crime out of the business.

Many in the industry felt a bit of relief when Sessions said to Congress this past Tuesday, “Our policy is the same really, fundamentally, as the Holder-Lynch [ie Obama] policy, which is that the federal law remains in effect and a state can legalize marijuana for its law enforcement purposes, but it still remains illegal with regard to federal purposes.”

Sessions made some more news as well. For the first time, he agreed that cannabis is not as dangerous as heroin, even though both are listed as Schedule I drugs, i.e. deemed the most dangerous of all. He had previously called cannabis “only slightly less awful” than heroin.

In addition, he acknowledged that “we are bound” by the Rohrabacher-Blumenauer amendment, a statutory mandate. This amendment, renewed annually since 2014, prevents the use of federal funds to go after those complying with state medical marijuana laws.  There had been some question after the most recent amendment thanks to a confusing statement issued by President Trump. Some interpreted the statement as potentially suggesting Trump views the amendment as not constitutional. Sessions has been attempting to convince Congress not to renew the amendment in the current budget.