Business
Michigan Cannabis Regulator Plans Crackdown on Illicit Products
“If there’s anybody cutting corners or cheating, we want to expose that,” says the Michigan agency director.
The top cannabis regulator in Michigan said Tuesday that the state is planning to “expose” businesses operating in the legal marijuana market that have engaged in illicit practices and sold illegal products.
The Detroit News reported that Brian Hanna, the acting director of the Michigan Cannabis Regulatory Agency, told assembled media that “the agency is planning actions that will expose bad actors and serve as a warning to other regulated businesses.”
“If there’s anybody cutting corners or cheating, we want to expose that and take a strong enforcement approach on that,” Hanna told reporters, as quoted by the Detroit News.
The publication reported that some of the issues the regulatory agency intends to address are “proper tagging and registering of marijuana products in the statewide system and proper maintenance of required cameras — both requirements that, if abandoned, allow for a proliferation of illegal weed in regulated facilities and snarl state efforts to identify it.”
Hanna, who took over as acting director of the agency in September following the resignation of Andrew Brisbo in August, told reporters on Tuesday that “his focus over the first 90 days as acting director is to engage stakeholders to better understand what’s working in the industry and what isn’t, and to crack down on illicit cannabis products in the market, including marijunana that is grown and processed in other states,” according to the Detroit News. He also said that the “the department is hiring six new regulatory agents, two inspectors, two analysts and a laboratory specialist, is planning more unannounced inspections and is taking a second look at the department’s current operating procedures as it emerges from the pandemic, when the agency had pulled back much of its field staff.”
Michigan voters legalized recreational cannabis use when they approved a ballot measure in 2018. Adult-use marijuana sales began in late 2019.
Earlier this year, the state consolidated the regulatory bodies overseeing the the processing and distribution of cannabis there, which resulted in the newly created Cannabis Regulatory Agency.
Prior to the restructuring, hemp was regulated by the Michigan Department of Agriculture and Rural Development (MDARD), while the Marijuana Regulatory Agency handled cannabis.
Now, the Cannabis Regulatory Agency oversees both.
“Consolidating multiple government functions into the newly named Cannabis Regulatory Agency will help us continue growing our economy and creating jobs,” Michigan Gov. Gretchen Whitmer said in announcing the changes in February. “And to be blunt-safe, legal cannabis entrepreneurship, farming and consumption helps us put Michiganders first by directing the large windfall of tax revenue from this new industry to make bigger, bolder investments in local schools, roads, and first responders.”
Earlier this month, the Cannabis Regulatory Agency issued a 30-day suspension of a marijuana retailer in Detroit, after it conducted “an unannounced compliance visit at the licensed provisioning center and observed multiple bags, backpacks, and duffle bags of suspected marijuana products that did not have the tracking identification numbers assigned by the statewide monitoring system (METRC) attached.”
After advising the retailer to “not to sell or destroy the untagged products until the investigation was completed and until guidance was given,” regulators returned “to the provisioning center facility and inquired about the untagged marijuana products,” only to discover that the remaining untagged products had been destroyed.
“The Cannabis Regulatory Agency has a legal responsibility to protect the health, safety, and welfare of the public,” said agency spokesman David Harns. “Our licensees must follow all of the rules and laws that govern the cannabis industry. Untagged marijuana products and the inability to provide video footage is simply unacceptable.”
Source: https://hightimes.com/news/michigan-cannabis-regulator-plans-crackdown-on-illicit-products/
New Mexico regulators fined a cannabis operator nearly $300,000 and revoked its license after the company allegedly created fake reports in the state’s traceability software.
The New Mexico Cannabis Control Division (CCD) accused marijuana manufacturer and retailer Golden Roots of 11 violations, according to Albuquerque Business First.
Golden Roots operates the The Cannabis Revolution Dispensary.
The majority of the violations are related to the Albuquerque company’s improper use of BioTrack, which has been New Mexico’s track-and-trace vendor since 2015.
The CCD alleges Golden Roots reported marijuana production only two months after it had received its vertically integrated license, according to Albuquerque Business First.
Because cannabis takes longer than two months to be cultivated, the CCD was suspicious of the report.
After inspecting the company’s premises, the CCD alleged Golden Roots reported cultivation, transportation and sales in BioTrack but wasn’t able to provide officers who inspected the site evidence that the operator was cultivating cannabis.
In April, the CCD revoked Golden Roots’ license and issued a $10,000 fine, according to the news outlet.
The company requested a hearing, which the regulator scheduled for Sept. 1.
At the hearing, the CCD testified that the company’s dried-cannabis weights in BioTrack were suspicious because they didn’t seem to accurately reflect how much weight marijuana loses as it dries.
Company employees also poorly accounted for why they were making adjustments in the system of up to 24 pounds of cannabis, making comments such as “bad” or “mistake” in the software, Albuquerque Business First reported.
Golden Roots was fined $298,972.05 – the amount regulators allege the company made selling products that weren’t properly accounted for in BioTrack.
The CCD has been cracking down on cannabis operators accused of selling products procured from out-of-state or not grown legally:
- Regulators alleged in August that Albuquerque dispensary Sawmill Sweet Leaf sold out-of-state products and didn’t have a license for extraction.
- Paradise Exotics Distro lost its license in July after regulators alleged the company sold products made in California.
Golden Roots was the first alleged rulebreaker in New Mexico to be asked to pay a large fine.
Source: https://mjbizdaily.com/new-mexico-cannabis-operator-fined-loses-license-for-alleged-biotrack-fraud/
Four marijuana companies, including a multistate operator, have filed a lawsuit against U.S. Attorney General Merrick Garland in which they allege the federal MJ prohibition under the Controlled Substances Act is no longer constitutional.
According to the complaint, filed Thursday in U.S. District Court in Massachusetts, retailer Canna Provisions, Treevit delivery service CEO Gyasi Sellers, cultivator Wiseacre Farm and MSO Verano Holdings Corp. are all harmed by “the federal government’s unconstitutional ban on cultivating, manufacturing, distributing, or possessing intrastate marijuana.”
Verano is headquartered in Chicago but has operations in Massachusetts; the other three operators are based in Massachusetts.
The lawsuit seeks a ruling that the “Controlled Substances Act is unconstitutional as applied to the intrastate cultivation, manufacture, possession, and distribution of marijuana pursuant to state law.”
The companies want the case to go before the U.S. Supreme Court.
They hired prominent law firm Boies Schiller Flexner to represent them.
The New York-based firm’s principal is David Boies, whose former clients include Microsoft, former presidential candidate Al Gore and Elizabeth Holmes’ disgraced startup Theranos.
Similar challenges to the federal Controlled Substances Act (CSA) have failed.
One such challenge led to a landmark Supreme Court decision in 2005.
In Gonzalez vs. Raich, the highest court in the United States ruled in a 6-3 decision that the commerce clause of the U.S. Constitution gave Congress the power to outlaw marijuana federally, even though state laws allow the cultivation and sale of cannabis.
In the 18 years since that ruling, 23 states and the District of Columbia have legalized adult-use marijuana and the federal government has allowed a multibillion-dollar cannabis industry to thrive.
Since both Congress and the U.S. Department of Justice, currently headed by Garland, have declined to intervene in state-licensed marijuana markets, the key facts that led to the Supreme Court’s 2005 ruling “no longer apply,” Boies said in a statement Thursday.
“The Supreme Court has since made clear that the federal government lacks the authority to regulate purely intrastate commerce,” Boies said.
“Moreover, the facts on which those precedents are based are no longer true.”
Verano President Darren Weiss said in a statement the company is “prepared to bring this case all the way to the Supreme Court in order to align federal law with how Congress has acted for years.”
While the Biden administration’s push to reschedule marijuana would help solve marijuana operators’ federal tax woes, neither rescheduling nor modest Congressional reforms such as the SAFER Banking Act “solve the fundamental issue,” Weiss added.
“The application of the CSA to lawful state-run cannabis business is an unconstitutional overreach on state sovereignty that has led to decades of harm, failed businesses, lost jobs, and unsafe working conditions.”
Alabama regulators are targeting Dec. 1 to award the first batch of medical cannabis business licenses after the agency’s first two attempts were scrapped because of scoring errors and litigation.
The first licenses will be awarded to individual cultivators, delivery providers, processors, dispensaries and state testing labs, according to the Alabama Medical Cannabis Commission (AMCC).
Then, on Dec. 12, the AMCC will award licenses for vertically integrated operations, a designation set primarily for multistate operators.
Licenses are expected to be handed out 28 days after they have been awarded, so MMJ production could begin in early January, according to the Alabama Daily News.
That means MMJ products could be available for patients around early March, an AMCC spokesperson told the media outlet.
Regulators initially awarded 21 business licenses in June, only to void them after applicants alleged inconsistencies with how the applications were scored.
Then, in August, the state awarded 24 different licenses – 19 went to June recipients – only to reverse themselves again and scratch those licenses after spurned applicants filed lawsuits.
A state judge dismissed a lawsuit filed by Chicago-based MSO Verano Holdings Corp., but another lawsuit is pending.
Source: https://mjbizdaily.com/alabama-plans-to-award-medical-cannabis-licenses-dec-1/
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