Bumpy Road Ahead for Medical Cannabis in Fresno

By Michael “Bud” Green

An intense struggle over the right to grow, distribute and sell marijuana in Fresno is under way. This article brings readers up to speed on the debate and legal implications that you need to know about.

The assignment seems straightforward enough: Write an article summing up the medical cannabis scene in Fresno. The diehard journalist starts a mental checklist of sources and court cases, then gives up. Dry facts don’t tell the full story.

Long story short, if you’re a Prop 215 patient in Fresno who counts on dispensaries for safe access, things are not looking good. Dispensaries in Fresno County are operating on borrowed time, with a county ban that takes effect in March and the ever-present threat of federal raids.

That threat isn’t theoretical. Five dispensaries were raided in June, and the Drug Enforcement Administration (DEA) followed up by taking down Buds 4 Life’s two locations in October. It’s unknown whether Mark Bagdasarian and his son, Ryan, were fully compliant with California law, but that’s irrelevant in federal cases where medical cannabis doesn’t exist as a criminal defense. The pair were featured on a list of federal enforcement actions announced at an Oct. 7 press conference in Sacramento. “They had installed an ATM in one store, and one of the defendants told investigators they were making $30,000 to $50,000 per day selling marijuana,” wrote Ben Wagner, U.S. Attorney for California’s Eastern District.

Beyond the feds, Fresno County Sheriff Margaret Mims says there’s no such thing as a legal dispensary under state law. No attempt to sort the good apples from the bad ones; the strategy is to zone them all out of existence. In so doing, the sheriff and the Board of Supervisors (with the exception of Susan Anderson) have belatedly followed the lead of hundreds of cities and counties around the state, albeit with a certain Fresno flair that defies polite description.

The Board of Supervisors also passed a Draconian cultivation ordinance to replace the cultivation ban they can’t enforce now, all the while proclaiming their compassion for patients—but only if those patients are dying or sick enough to pass the supervisors’ moral muster. If you want respect, in other words, you’d better fluff up the pillows on your deathbed. Everyone else is just a stoner in their eyes, even qualified patients and caregivers who follow state law to the letter.

Informed debate? Forget about it. Yet questions abound: Why is California being targeted by the feds while Colorado’s more regulated dispensaries are untouched? How can U.S. Attorney Eric Holder tell Congress that his 2009 directive to limit federal enforcement in medical cannabis states still applies when it’s open season in California, Washington and Montana? Where is the state legislature, state Attorney General Kamala Harris and her predecessor, Gov. Jerry Brown? Inquiring minds want to know how it came to this, 15 years and counting after the passage of the Compassionate Use Act.

I wish I had answers to those questions and more, but I don’t. All I know for sure is that it’s a historic time in our social, medical and legal understanding of cannabis. That, and it’s going to be a chilly winter in Fresno for collective-dispensary operators who are brave enough and/or foolish enough to provide Prop 215 patients with safe access to medical cannabis.

In closing, some hard facts sprinkled ever-so-lightly with conjecture and editorial comments. Read the hyperlinked version at fresnocannabis.org/dispensaries.

Are Collectives and Dispensaries the Same?
No, but the terms are often used interchangeably. The Medical Marijuana Program Act (SB 420) authorizes patients and caregivers to “associate within the State of California in order collectively or cooperatively to cultivate marijuana for medical purposes.” As a set of 2008 guidelines issued by the office of then-Attorney General Jerry Brown points out, “A collective is not a statutory entity, but as a practical matter it might have to organize as some form of business to carry out its activities.”

Legally, a collective is a group of qualified Prop 215 patients, nothing more or less. When those groups decide to distribute medical cannabis among their respective members through a storefront or delivery service, that business is often called a dispensary. Most local ordinances in California ban or restrict all types of patient collectives, not just those that operate dispensaries.

Are Dispensaries Legal under Federal Law?
The simple answer is “no,” and for simple-minded people that ends the discussion: Federal law trumps state law, right? That’s the central issue in a test case involving Anaheim’s dispensary ban, which is based on federal law. The City of Fresno’s 2006 dispensary ban draws on the same concept, and Sacramento County supervisors also applied it in their dispensary ban.

But the Fourth District Court of Appeals rejected the federal preemption argument in 2010. The second appeal of that case is under way, but in the meantime, the Anaheim ruling has the force of law: “California’s decision in the (Compassionate Use Act) and the (Medical Marijuana Program Act) to decriminalize for purposes of state law certain conduct related to medical marijuana does nothing to ‘override’ or attempt to override federal law, which remains in force.” The more recent Riverside ruling concurs: “We agree that under Qualified federal preemption of state medical marijuana law is not a valid basis for upholding Riverside’s zoning ordinance banning (medical marijuana dispensaries).”

This is the “bud” from a Bubba Kush marijuana plant, which federal law says is illegal, California state law permits it if used for medical purposes, but city and county ordinances are trying to regulate it almost out of existence.

Interestingly, people rarely question whether federal law trumps the state’s medical cannabis laws themselves—there is no case law that declares Prop 215 is invalid, or the Legislature’s 2003 follow-up, SB 420, or even last year’s SB 1449, making simple possession of non-medical cannabis an infraction instead of a misdemeanor. The U.S. Supreme Court found that medical cannabis dispensaries were illegal under the Controlled Substances Act in 2005—but it did not overturn Prop 215 or SB 420.

If the legal issues are confusing, consider how federal law is enforced. This July, Deputy U.S. Attorney General James Cole issued a memorandum that attempted to clarify federal policy with regard to enforcement in the 16 U.S. states where medical marijuana is legal or decriminalized. According to Americans for Safe Access (ASA), Cole’s memo threatened enforcement actions against “persons who are in the business of cultivating, selling or distributing marijuana, and those who knowingly facilitate such activities,” including local and state officials. The memo further underscored that “state laws or local ordinances are not a defense to civil or criminal enforcement of federal law.”

As the ASA and other advocacy groups have pointed out, the Cole memo appeared to be a retreat from President Barack Obama’s pledge that he was “not going to be using Justice Department resources to try to circumvent state laws” regarding medical cannabis. It also backtracked from a 2009 memo issued by Deputy Attorney General David Ogden, which stated that federal resources should not be used for “individuals whose actions are in clear and unambiguous compliance with existing state laws providing for the medical use of marijuana.” U.S. Attorney General Holder testified before Congress in December that the Ogden policy still applies, even though dispensaries in California and other states are being targeted in a new wave of federal raids.

U.S. Attorneys have sent letters threatening public officials from at least 10 states with criminal prosecution if they implement laws regulating the production and distribution of medical marijuana, according to the ASA. In California, the U.S. Attorneys’ Office has not only sent warnings to elected officials but also to landlords who rent property to dispensaries. The Cole memo appears to give wide discretion to prosecute dispensaries and large-scale growers, while also placing landlords and government officials and/or employees into the realm of potential targets.

Complicating matters further, the Second District Court of Appeals in Los Angeles said in an October ruling that a Long Beach ordinance permitting dispensaries violated federal law. “The city’s ordinance…goes beyond decriminalization into authorization,” reads the ruling, which has been appealed to the California Supreme Court. Since then, Sacramento stopped processing dispensary permits under that city’s ordinance, and Eureka reversed course by passing a dispensary moratorium. Chico and Redding both repealed their regulatory ordinances, citing federal warnings.

On Oct. 27, the ASA filed suit against U.S. Attorney General Holder and Melinda Haag, the U.S. Attorney for California’s Northern District. The lawsuit accuses the federal government of seeking to “coerce and commandeer” California’s police and regulatory powers over medical cannabis, in violation of the 10th Amendment to the U.S. Constitution. Federal lawsuits filed by dispensary operators around the state are also pending, though a judge denied their request for an injunction to stop future raids.

Are Dispensaries Legal under California Law?

Rick Morse, owner of the Medmar medical marijuana dispensary in the Tower District, was an early victim of Fresno’s crackdown. See: http://fresnoalliance.com/wordpress/?p=4170

It depends on who you ask. Sheriff Mims first supported a dispensary ban more than a year ago in an appearance before the county supervisors, a stance she has repeated consistently since then. “I do not believe that the Medical Marijuana (Program) Act or Prop 215 legally allow[s] for dispensaries or storefronts as they currently exist,” she said in December 2010.

Yet then-Attorney General Brown’s office released a set of guidelines in 2008 that supports the idea of legal, collective cultivation by Prop 215 patients. “Neither Proposition 215, nor the MMP, conflict with the CSA (federal Controlled Substances Act) because, in adopting these laws, California did not ‘legalize’ medical marijuana, but instead exercised the state’s reserved powers to not punish certain marijuana offenses under state law when a physician has recommended its use to treat a serious medical condition.”

The Attorney General’s guidelines don’t have the force of law, nor do they say that medical cannabis is even legal. Prop 215 and SB 420 didn’t legalize anything, including storefront dispensaries or large-scale grow sites. Prop 215 provides patients with an affirmative defense should they be arrested on suspicion of violating state laws prohibiting marijuana cultivation, transportation, distribution and sales. SB 420 created “get out of jail free” ID cards, but many patients fear being in a statewide database, even one designed to help them avoid arrest. Both laws are silent on how and when patients can exchange cannabis, whether through a storefront dispensary or other nonprofit business.

The state Attorney General’s office is working on an update of its guidelines that says dispensaries may (or may not) operate legally under state law. The legal status of dispensaries could change more substantially if voters pass one or more cannabis reform measures in the 2012 statewide election.

Are Dispensaries Legal under Local Ordinances?
Dispensaries are not permitted throughout Fresno County (effective March 9, 2012) and most if not all of its cities. Violations can result in criminal and/or civil liability, depending on the specific language of the ordinance.

Fresno County’s ordinance bans dispensaries and so strictly limits cultivation that it amounts to a de facto ban. Even so, collective operators have for now abandoned efforts to pass a ballot measure that would replace the ordinance passed in August. Attorney Bill McPike, a medical cannabis patient, cited the Long Beach ruling when he filed suit against the county in October; more litigation seems likely.

In November, the Fourth District Court of Appeal upheld Riverside’s dispensary ban. Although Anaheim’s ban is still under appeal, Riverside shows the likely outcome: Local governments have broad land-use authority that can be applied to cultivation and dispensaries—but only in the absence of state law that occupies the whole field of medical cannabis regulation.

In December, a statewide coalition of advocates including the ASA and the California Cannabis Association submitted a ballot measure that would preempt most local medical cannabis regulations and establish a state panel to oversee cultivation, distribution and sales. Should that initiative or one or more legalization measures qualify for the November 2012 ballot, debate will focus on whether statewide regulation of cannabis is preferable to local ordinances and bans. The feds don’t get to vote, but they’ll likely try to influence state voters, just like they did with Prop 19 in 2010.

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Bud Green is the online persona for Michael S. Green, a Fresno native who tracks cannabis stories at CalPotNews.com. He hopes to form an association of medical cannabis patients in 2012; visit www.FresnoCannabis.org for details.