Tag Archives: rohrabacher-blumenauer amendment

Cannabis Trading on Major U.S. Stock Exchange

Seth Goldberg
Seth A. Goldberg

Another breakthrough for the cannabis space occurred on Tuesday, February 27, 2018, when Toronto-based Cronos Group Inc. began trading on the Nasdaq Stock Market. (MJN:CN). This marks the first listing of a company focused purely on cannabis on a major U.S. stock exchange.  The listing of Cronos comes within two months of the memorandum issued by Attorney General Sessions that rescinded the federal government’s previous guidance regarding enforcement of state-lawful cannabis activities under the Cole Memorandum.  That earlier guidance is credited with providing the cannabis space with a window of opportunity for the warp-speed growth the space has seen in recent years.  The Sessions memo was intended to slow the growth of the cannabis space, especially with respect to the capital markets.  The Nasdaq listing of Cronos suggests that 2018 could be another strong year for cannabis-related investments; 2017 was believed to have resulted in approximately $2 billion in cannabis-related investments in the U.S.

Patricia Heer

Rohrabacher-Blumenauer Protections Extended Through Stopgap

On January 22, 2018, Congress came to an agreement on a resolution that continues funding the government, including the Department of Justice, through February 8, 2018.  The funding resolution leaves in place protections for state medical marijuana programs from prosecutions by the Department of Justice by restricting its funding.  The protections are found in legislation now sponsored by Reps. Dana Rohrabacher and Earl Blumenauer (formerly by Sam Farr instead of Blumenauer) that became law as part of the omnibus spending bill (and are known as the Rohrabacher- Farr Amendment, or the Rohrabacher-Blumenauer Amendment). 

The Amendment provides that  none of the funds made available to the Department of Justice in the Appropriations Act may be used to prevent states from implementing their own laws that authorize the use, distribution, possession, or cultivation of medical marijuana.  In light of recent steps taken by the administration to rescind the Cole Memo and review the FinCEN guidelines that have put the cannabis industry on alert, cannabis businesses can find some comfort, albeit temporary, in Congress’ continuing limitation on the funding extended for the Department of Justice.

Rohrabacher-Blumenauer Amendment On Hold; FinCen Guidance Reviewed; and Cole Memo Rescinded

On Thursday, the House had passed a continuing resolution to the Appropriations Act which would have kept the government funded through February 16, 2018.  That resolution kept in tact the protections for state medical marijuana programs from prosecutions by the Department of Justice, by restricting its funding. The Senate, however, would not agree to the resolution (because it included protections for young immigrants from importation) and the government has shutdown as of midnight on Friday. 

The protection for medical marijuana operators that is typically included in the government’s budget, known as the Rohrabacher-Blumenauer amendment (f/k/a Rohrabacher – Farr Amendment), provides that none of the funds made available to the Department of Justice in the Appropriations Act may be used to prevent states from implementing their own laws that authorize the use, distribution, possession, or cultivation of medical marijuana. 

This provision had been contained in the appropriations act (Consolidated Appropriations Act, 2017, PL 115-31, Division B section 537), which funded the Department of Justice and other government departments through September 30, 2017.  The provision was carried over through the appropriations act (Appropriations Act 2018, PL 115-56, Division D, section 101(a)(2)) that funded the Department through December 8, 2017, and was thereafter extended by Congress through two continuing resolutions through January 19, 2018.  With the failure to pass a resolution to continue funding the Justice Department, the limitations on that funding, including those provided by the Rohrabacher Amendment, have no effect (since no funds have currently been approved to begin with). 

This may raise more questions in the marijuana industry given Attorney General Jeff Session’s rescission of the Cole Memorandum on January 4th.  The Cole Memorandum had provided guidance to federal prosecutors not to enforce federal marijuana laws against those marijuana businesses that were compliant with state law where the federal priorities were not implicated.  Based on that rescission, the U.S. Treasury Department, on January 17th,  stated that it is reviewing the FinCen guidance for financial institutions that provide services to marijuana businesses. Continue reading Rohrabacher-Blumenauer Amendment On Hold; FinCen Guidance Reviewed; and Cole Memo Rescinded

Adult-Use Marijuana Bill Introduced in New Jersey

Seth Goldberg
Seth A. Goldberg

With the election of Phil Murphy as New Jersey Governor in 2017, the possibility of New Jersey becoming one of the next states to pass recreational marijuana legislation became very real, as this was among the issues key to Murphy’s campaign.

On Tuesday, January 9, 2018, less than one week after AG Sessions issued guidance to all US Attorneys rescinding Obama-era policies deprioritizing the federal prosecution of state-lawful cannabis-related activities, that possibility became more of a likelihood, as New Jersey Sen. Nicholas Scutari introduced Senate Bill 830, which would allow for the cultivation, sale and use of marijuana for recreational purposes in New Jersey by those 21 and older.

The legislation proposes adults would be permitted to possess up to 1 ounce of marijuana, 16 ounces of marijuana-infused products in solids, 72 ounces in liquid form, 7 grams of concentrate and up to six immature plants, and establishes a sales tax on marijuana that would rise incrementally from 7 percent to 25 percent over five years.

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.