The Agriculture Improvement Act of 2018 (“2018 Farm Bill”) legalized hemp by removing the crop and its derivatives from the definition of marijuana under the Controlled Substances Act (“CSA”) and by providing a detailed framework for the cultivation of hemp. The 2018 Farm Bill gives the US Department of Agriculture (“USDA”) regulatory authority over hemp cultivation at the federal level. In turn, states have the option to maintain primary regulatory authority over the crop cultivated within their borders by submitting a plan to the USDA. This federal and state interplay has resulted in many legislative and regulatory changes at the state level. Indeed, most states have introduced (and adopted) bills that would authorize the commercial production of hemp within their borders. A smaller but growing number of states also regulate the sale of products derived from hemp. In light of these legislative changes, we are presenting a 50-state series analyzing how each jurisdiction treats hemp-derived cannabidiol (“Hemp-CBD”). Each Sunday we will summarize a new state in alphabetical order. So far, we have covered Alabama and Alaska. This week we turn to Arizona. The Arizona Department of Agriculture (“AZDA”) oversees the state’s hemp program. The hemp program began in May 2018 when Senate Bill 108 was signed into law, which opened up hemp processing in the summer of 2019. It took the state a year so that it could develop the regulations and licensing program. As of now, the state’s opening up for license applications. Arizona’s hemp laws and regulations can be found here and here respectively. Under Arizona law, growers (and nurseries), processors, harvesters, and transporters are required to obtain AZDA licenses, which AZDA publishes applications for here. The regulations also require researchers to obtain licensure. Notably, the AZDA doesn’t regulate retailers, which I’ll discuss some more below. Like in any other state with regulated hemp, there are fees, compliance rules, and penalties for non-compliance. But the level of regulation is not even close to what we see for cannabis/marijuana in many other states. It’s important to consider that the 2018 Farm Bill hasn’t yet been fully implemented, meaning for the time being, the 2014 Farm Bill is still in play. Even though the 2014 Farm Bill doesn’t expressly allow for commercial activity, a number of states have broadly interpreted it to permit commercial activity. Arizona is allowing commercial activity for licensees of the AZDA—in addition to allowing research as noted above—but it doesn’t appear to have taken the position that commercial sales are authorized under the 2014 Farm Bill like other states. What this means is that under federal law, and until the 2018 Farm Bill is fully implemented, the state of the laws is murky. One of the areas in which the law is murky is the sale of hemp products. There is currently no retail license type, and the hemp regulations state that it’s prohibited to “Offer for sale, trade, transfer possession of, gift, or otherwise relinquish possession of industrial hemp plants, plant parts, or hemp seed that is capable of germination to an unauthorized person”. However, a different section of the regulations states that processors can “sell, distribute, transfer, or gift any products processed from harvested hemp that are not” unauthorized. Read together, these sections only seem to bar the resale of plant parts and not all “Hemp products”, which are defined as “all products made from industrial hemp, including cloth, cordage, fiber, fuel, grain, paint, paper, construction materials, plastics and by-products derived from sterile hemp seed or hemp seed oil. Hemp products excludes any product made to be ingested except food made from sterile hemp seed or hemp seed oil.” While there aren’t specific retail license types, the state may be okay with limited sales of hemp products. In terms of what those hemp products are, the AZDA itself doesn’t regulate the production of products made from hemp according to the following statement from these FAQs on its website:
In other words, the AZDA doesn’t have oversight over certain products, but that’s not to say that other authorities don’t. Another important nuance of the regulations is that they state that “No unauthorized person shall . . . transport, import or process industrial hemp”. It’s not yet clear what the effect of this provision will be on interstate shipments of hemp or hemp products. The 2018 Farm Bill states that individual states can’t block shipments through their borders, but (a) that law hasn’t taken effect yet, and (b) Arizona is free to stop shipments of out-of-state hemp into Arizona. So in the end, the state may just be closing off its borders to out-of-state products. There are not a great deal of restrictions on personal use. The AZDA notes in the FAQ that people aren’t allowed to grow hemp for personal use. When it comes to marijuana, the state has a medical marijuana program which is subject to much different regulations. Arizona’s hemp laws are still in their infancy. That’s all likely to change as the federal government implements the 2018 Farm Bill and the FDA (hopefully) comes out with CBD regulations. Stay tuned to the Canna Law Blog for any further developments with Arizona CBD and hemp laws. [Read More ...] George Scorsis Liberty Health Sciences Originally posted on Hemp-CBD Across State Lines: Arizona via George Scorsis Medical Marijuana News
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Every Saturday, at least for a while, we plan to run a series of blog posts that take a close look at each of the Democratic Party candidates for President in 2020. We will examine each candidate’s historic approach to marijuana law and policy, and also canvas each politician’s current stances on marijuana. Today, we start with Joe Biden, the former vice president and U.S. senator from Delaware. As of today’s post, Biden may still be the current party front-runner, and is certainly near the top of the heap. Overall Grade: D Stance on marijuana: Biden wants to decriminalize marijuana use and automatically expunge prior criminal records showing marijuana possession convictions. He is, however, far from an advocate for cannabis legalization. Biden’s campaign website nowhere even addresses his beliefs on cannabis. Instead, it makes a vague statement about criminal justice reform that nowhere mentions the War on Drugs or marijuana:
His failure to mention the War on Drugs or marijuana on his website despite using “criminal justice reform” as a policy point is presumably because he zealously supported the War on Drugs, as described below. If Biden truly believes “Nobody should be in jail for smoking marijuana,” as he told voters this past March, he owes an explanation for why he previously supported the arrest and incarceration of countless Americans for weed. History with marijuana legislation: Biden’s failure to mention marijuana on his website is probably intentional. Over the course of his political career, Biden has expressed his disdain for marijuana, with both his rhetoric and his legislation. The former vice president is described as an architect of the War on Drugs by Michael Collins, the director of national affairs at Drug Policy Action. As a senator, Biden was largely responsible for creating the “drug czar” in 1982, a cabinet position that would go on to form the Office of National Drug Control Policy and increase enforcement of anti-drug laws. Biden consistently pushed for stepping up enforcement of draconian drug policies, even criticizing then-President George H.W. Bush for being too soft on drugs. As vice president, Biden’s position on marijuana seemed more subdued as major drug policy changes were enacted under the Obama administration, including the Cole memo which made it easier for states to legalize marijuana. However, the Obama administration deflected all attempts to reschedule marijuana, leaving it classified as a Schedule I drug, the same schedule as heroin. As the Democratic Party’s platform increasingly becomes pro-legalization, Biden continues to oppose the legalization of marijuana, even for medical use:
Biden gets one thing right: we do need more research surrounding pain management. However, his refusal to acknowledge the viability of cannabis as a possible treatment exposes his basic misunderstanding of both marijuana and the drugs currently used to manage pain. Though extensive research is necessary to determine the efficacy of marijuana for specific maladies, there is little doubt that it has tremendous potential for reducing the U.S.’s ongoing opioid epidemic, among other things. Considering the existing scientific evidence, Biden’s perspective that marijuana is somehow “inhumane,” and thus not to even be considered as a treatment for pain, is simply illogical. His opinion stems more from prejudice against cannabis (and the people who use it) than from science. Conclusion: Biden receives an “D” grade for his views on cannabis because he both fails to recognize or acknowledge its medicinal uses and because he is the only prominent Democratic Party presidential candidate who does not support cannabis legalization. The only thing Biden has going for him is a stated desire for criminal justice reform, which saves him from a failing grade. [Read More ...] Originally posted on Grading the Democratic Presidential Candidates on Marijuana: Joe Biden via George Scorsis Medical Marijuana News A bipartisan group of U.S. senators introduced a federal bill to bolster marijuana and CBD research, a move that could encourage more doctors to recommend medical cannabis and expand legalization efforts. The bill also would amend the definition of marijuana in the federal Controlled Substances Act to exclude the synthetic equivalent of hemp-derived CBD that Bipartisan lawmakers offer congressional bill to promote cannabis, CBD research is a post from: Marijuana Business Daily: Financial, Legal & Cannabusiness news for cannabis entrepreneurs [Read More ...] Originally posted on Bipartisan lawmakers offer congressional bill to promote cannabis, CBD research via George Scorsis Medical Marijuana News Marijuana businesses hoping to see the end of onerous 280E tax provisions were dealt a setback by the nation’s highest court. The U.S. Supreme Court declined to review a petition brought by a Colorado medical cannabis dispensary challenging the authority of the Internal Revenue Service. Alpenglow Botanicals, based in Breckenridge, argued in its petition to the US Supreme Court declines to hear 280E marijuana tax case is a post from: Marijuana Business Daily: Financial, Legal & Cannabusiness news for cannabis entrepreneurs [Read More ...] Originally posted on US Supreme Court declines to hear 280E marijuana tax case via George Scorsis Medical Marijuana News Marijuana was the most widely used drug around the world in 2017, with an estimated 188 million consumers that year, according to a new report from the United Nations. The 2019 World Drug Report provides an overview of the international supply and demand of cannabis, as well as other drugs. The data also underlines the Cannabis the most widely used drug globally, UN World Drug Report says is a post from: Marijuana Business Daily: Financial, Legal & Cannabusiness news for cannabis entrepreneurs [Read More ...] Originally posted on Cannabis the most widely used drug globally, UN World Drug Report says via George Scorsis Medical Marijuana News Surterra Wellness, an Atlanta-based medical cannabis company, closed a $100 million share offering whose net proceeds will be used to fund acquisitions and capital expenditure. The company also said it is taking on two new directors to help with corporate strategy: Ed Brown, former president and CEO of The Patron Spirits Co. Brown was a participant Cannabis company Surterra closes $100 million funding, adds executives is a post from: Marijuana Business Daily: Financial, Legal & Cannabusiness news for cannabis entrepreneurs [Read More ...] Originally posted on Cannabis company Surterra closes $100 million funding, adds executives via George Scorsis Medical Marijuana News Social media challenges continue for cannabis firms sometimes costing thousands in lost investment6/27/2019 After what seemed to be a brief hiatus, social media giants are once again suspending – and outright deleting – the accounts of marijuana companies. Some industry officials say this is a result of spiteful competitors flagging posts and reporting pages to the platforms’ moderators, costing businesses thousands of dollars in lost time and labor when Social media challenges continue for cannabis firms – sometimes costing thousands in lost investment is a post from: Marijuana Business Daily: Financial, Legal & Cannabusiness news for cannabis entrepreneurs [Read More ...] Originally posted on Social media challenges continue for cannabis firms – sometimes costing thousands in lost investment via George Scorsis Medical Marijuana News Oregon Hemp-CBD Litigation: Another Tale on the Importance of Due Diligence Before Contracting6/27/2019 Most of the hemp litigation we’ve written about has concerned a hemp purchaser suing a hemp farmer. This week concerns a $2.5 million lawsuit recently filed in Oregon wherein a hemp farmer sued a CBD processor. The plaintiff, JNV Farms, alleges that in the fall of 2018 it entered into a manufacturing agreement with one of the defendants, C&N Ag LLC (“C&N”), by which JNV Farms was to provide industrial hemp to C&N who was to process the hemp into CBD Isolate and market and sell the finished product. The complaint alleges that profits were to be split 50/50. According to the complaint, JNV Farms provided the defendants 13,800 lbs of biomass in December 2018. The defendants represented they were testing and preparing to process the material. After JNV Farms made repeated inquiries, defendants became less communicative then eventually refused to respond at all, and refused to meet with JNV Farms or permit inspection of the hemp or finished product. JNV Farms claimed the defendants (i) neglected or refused to complete the work contemplated by the contract, (ii) failed to return the industrial hemp, (iii) failed and refused to compensate JNV Farms for the hemp, and (iv) failed to provide JNV Farms any of the CBD Isolate or the share of revenue from its sale. JNV Farms alleged claims for breach of contract, breach of the covenant of good faith and fair dealing, unjust enrichment, conversion, and fraud. Finally – and not insignificantly – the complaint seeks to pierce the corporate veil and to hold the two owners of C&N, defendants Mock and Eastburn, personally responsible for the liabilities of C&N. This claim, perhaps more than the others, may strike fear into the defendants. As every business owner knows (or should know) a key purpose of incorporation is to shield company assets from being used to satisfy company obligations. The goal of a veil-piercing claim is to reach past the corporate shield and into the pockets of owners or investors. Piercing the corporate veil is difficult. As it should be. But the complaint appears to allege facts sufficient to withstand a motion to dismiss. Notably the complaint alleges that when Mock and Eastburn negotiated the contract, and as of the date it was executed, that C&N was not yet in existence because no paperwork had yet been filed with the Oregon Secretary of State. This fact, if true, is not necessarily dispositive. (Indeed, if there was no corporation there is no need to pierce the corporate veil). But no one entering million-dollar contracts (Mock and Eastburn) ought to do so without having completed the necessary steps to form an entity. On the flip side, JNV Farms likely could have done a better job protecting its investment and the lawsuit may, as it often does, come down to whether the defendants have any recoverable assets. Time will tell. For more on the recent wave of Oregon hemp litigation, check out the following:
[Read More ...] Originally posted on Oregon Hemp-CBD Litigation: Another Tale on the Importance of Due Diligence Before Contracting via George Scorsis Medical Marijuana News New Hampshire Gov. Chris Sununu vetoed legislation that would have opened the state’s heavily regulated medical marijuana industry to for-profit MMJ businesses, dealing a setback to cannabis entrepreneurs who might have been interested in launching a moneymaking operation there. The bill would have allowed MMJ licensees, called Alternative Treatment Centers (ATCs), to operate either as New Hampshire governor vetoes bill opening state to for-profit cannabis firms is a post from: Marijuana Business Daily: Financial, Legal & Cannabusiness news for cannabis entrepreneurs [Read More ...] Originally posted on New Hampshire governor vetoes bill opening state to for-profit cannabis firms via George Scorsis Medical Marijuana News ************************ Check out our website: https://midasletter.com ************************ SUBSCRIBE to our YouTube: http://bit.ly/MidasLetterYoutube SUBSCRIBE to our 2nd YouTube Channel - Midas Letter Clips: https://bit.ly/2rtQzgy SUBSCRIBE to our Newsletter: http://bit.ly/MidasLetterNewsletter Download Our Podcast on iTunes: http://bit.ly/MidasLetterPodcast ************************ Follow Us on Twitter: http://bit.ly/MidasLetterTwitter Like Us on Instagram: http://bit.ly/MidasLetterInsta Like Us on Facebook: http://bit.ly/MidasLetterFacebook ************************ #WeedStocks #MidasLetter Originally posted on Cannabis News June 27 2019 - Curaleaf, The Green Organic Dutchman, MediPharm, Green Growth via George Scorsis Medical Marijuana News |
George Scorsis
Mr. George Scorsis has more than 15 years of experience leading companies in highly regulated industries to rapid growth, including alcohol, energy drinks and, most recently, medical cannabis. ArchivesCategories |