Rightsmile, Inc. (RIGH)

[Burn Notice88]

$RIGHt, Notes on updated finanacials. This explanation was clearly outlined Saturday morning surrounding the political climate affecting RIGH's release of financials. Many may have missed it, here it is again in combined form:

Major challenge facing RIGH from Apr 2012 to Dec 2013. Los Angeles voted this year to crack down on medical dispensaries - haven't the public's intentions been abused?

"The feds are going to sort of lay off Colorado and Washington insofar as priority enforcement areas. The Treasury [Department] still has to come down on whether to allow banking [to participate]. Right now it's a purely cash business. You can't go in with your debit card and buy, and the store can't have a bank account. With any luck, the banking regulators will issue something that tells banks, OK, you can open an account for these [businesses]." - Patt Morrison, Pots Go-To Guy

$RIGH
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One more Major challenge facing RIGH from Apr 2012 to Dec 2013. Banks Turn Away Stacks Of Cash From Legal Pot. Federal Laws Trip Booming Business.

"A lot of business owners are operating on a cash-only basis, and you can imagine the security issues with that," said Mike Elliott, executive director of the Medical Marijuana Industry Group, an industry advocacy organization based in Denver.

"For every business with an account, I've heard 20 stories from people who have said, 'We had a bank account, and I don't know why, but they kicked us out,'" said Mr. Elliott. "We're talking about a checking account here. So you don't have to show up at the Colorado Department of Revenue and pay your taxes in cash."

"Banks have been told they should not be handling these accounts, so they're more than nervous," said Don Childears, president and CEO of the Colorado Bankers Association. "You really need a federal statute. But politically, I don't think members of Congress in either party want to be perceived as being soft on drugs."
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Still another Major challenge facing RIGH from Apr 2012 to Dec 2013. The piggy-bank approach to marijuana sales also creates problems for state and local agencies charged with collecting taxes. "I don't know how you regulate or tax and industry where you can't follow the money," said Don Childears, president and CEO of the Colorado Bankers Association.

The issue of taxation does not just impact Colorado, but California and every state in the union. Pot is new, and the fed doesn't know what to do with it.

$RIGH
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Now do you understand the bigger picture with RIGH? A lot of little issues like how transactions can be handled (cash only), taxation and federally-regulated banks not willing to do business with MJ companies.

$RIGH

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The power struggle still goes on in California. Fresno County Supervisors Ban Growing Of Medical Marijuana. "Over objections of medical marijuana users, the Fresno County Board of Supervisors on Tuesday banned all marijuana cultivation in the county's unincorporated areas starting in February.

The ban includes fines of $1,000 per plant.

The 5-0 vote by supervisors also adds a fine of $100 per plant for each day plants remain after the initial discovery. Violations of the public nuisance ordinance would spark misdemeanor financial penalties." - Marc Benjamin, Media Awareness

How does this impact RIGH? Think! Clearly explains why updates haven't been coming our way. Companies like RIGH have to be careful as the law changes in California daily...

All that is about to change though...
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SANTA ROSA EASES RULES ON MEDICAL POT

Santa Rosa relaxed its restrictions on medical marijuana dispensaries Tuesday, eliminating rules that advocates said were outdated and limited patients' ability to obtain their cannabis locally.

The changes, which included elimination of patient caps, expansion of hours of operation, and allowing dispensaries to sell pipes and other devices used to ingest marijuana, were approved by the council unanimously.

"Times sure do change," said Councilman Ernesto Olivares, a retired police lieutenant. "I couldn't imagine back in 1979 when I started working for the Santa Rosa Police Department that I'd be here voting for this, to be honest with you. But here we are."

Advocates of the changes extolled the virtues of marijuana as a medicine and noted that the 500-patient cap on dispensaries forced some people to travel outside the city to refill their stashes."
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As America shifts, we can see signs RIGH and California are shifting with MJ legalization, as well.

Legal pot supported by California majority for first time, Field Poll shows
By Josh Richman

Posted: 12/10/2013 06:00:00 AM PST

"For the first time in 44 years, a clear majority of California voters favors legalizing marijuana, a new Field Poll found.And where there's smoke, there might soon be fire: A specific legalization ballot initiative now seeking signatures to get on next November's ballot also has majority support, the poll found."Debating about whether to legalize now is pointless, because we're going to," said Mark A.R. Kleiman, a UCLA professor and drug policy expert. "The smart debate is about how we'll do it."California voters narrowly rejected a legalization measure in 2010, and Washington and Colorado voters approved theirs -- the nation's first -- in 2012. Kleiman said he actually is surprised the Field Poll number isn't higher, in light of Gallup's report in October that 58 percent of Americans favor legalization -- the first-ever national majority support.

It has been a long climb. Only 13 percent of Californians favored legalization when the Field Poll started asking about marijuana in 1969 amid the tumult of Woodstock, Stonewall and Apollo 11. In 1983, as Nancy Reagan told America to "just say no," 30 percent of California voters said yes. In 2010, the poll found 50 percent in favor, yet that year's Proposition 19 legalization measure fell short with 46.5 percent of the vote. Now support for {California} legalization stands at 55 percent, according to the latest poll. Eight percent say anyone should be able to buy it, and 47 percent support legalizing it with age and other controls like those for alcohol."
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The bleeding heart story that has everyone walking on eggshells in California...

Think it has been easy for RIGH to operate in California the past 18 months? As mentioned, the political landscape is changing, but just as recently as December a well-known, and respected California businessman will be serving 5 years in prison for operating a legal pot business. And we...worry about the little things, like filing business papers, or larger things like communicating with shareholders and filing financials. Prison folks! For making money legally in California...


By Michael Fitzgerald, MAP Inc.
December 15, 2013

FEDS ON MEDICAL POT: HAZY AT BEST

"Next in line for the dustbin of history: federal marijuana law, as applied to the case of Stockton's Matthew Davies.

On Friday, a federal judge sentenced Davies, "a working man, a married father of two young children, with no criminal record" to five years in prison, a plea agreement.

His crime: growing and selling medical marijuana in Stockton and Sacramento.

"My entire family has already been scarred by this," Davies wrote prosecutors. "It will be the ultimate struggle to keep our family together."

Of course, all defendants sing the victim song. Nobody forced Davies into the legally treacherous chasm between state and federal marijuana law.

But, prosecutors say, Davies ran seven pot dispensaries, some illegal even under state law, and two grow warehouses, one immense and sophisticated, all to make a killing, not to dispense medical cannabis to sufferers as envisioned by state law.

( Davies opened an eighth dispensary in Manteca. City officials closed it down within days. )

"Davies entered the marijuana business to make money, not to treat seriously ill patients," U.S. Attorney Benjamin B. Wagner wrote to Davies' attorney.

Toward that end, Davies disguised for-profit dispensaries as non-profits; sometimes concealed his participation; and laundered money, Wagner said.

His operation was so big and sketchy that the sentencing judge balked at the lenient plea deal, Wagner said.

Lenient? Davies also forfeits $100,000. On top of that, he said he spent $250,000 on legal fees.

That's a travesty, said his attorney, Elliot R. Peters.

So Davies made money, asked Peters. Is that criminal?

"They've always said the problem with what Matt did, he approached it like a business," Peters said. "Like it would have been better if he'd been selling it out of the back of a Volkswagen bus with a 9mm under his seat."

In fact, Davies ran the sort of shop Uncle Sam should appreciate, Peters said. One that beats cartels.

Back to square one. Davies broke federal law by growing and selling pot. But who got hurt and how? Where is the harm to society?

An Aug. 29 memo from Deputy Attorney General James M. Cole outlines the sort of dispensary violations worthy of federal prosecution. They are:

Selling marijuana to minors; funding criminal enterprises, gangs or cartels; moving pot to states that outlaw it; providing cover for illegal drug sales or other crime; using violence or firearms in grow operations; conducing to "drugged driving;" or growing marijuana on public lands.

Davies' operation did none of the above, said Peters.

"I think the criminality is just a bureaucratic mentality of 'Here's a statute, he violated the statute, it carries a mandatory minimum, we'll enforce the law without thinking very hard about it,' " Peters said.

Furthermore, the Cole memo says if states legalize marijuana, and impose tight regulations, the feds should save their resources and leave enforcement to the states.

Some believe the feds went rogue in Davies' case.

Wagner responded that Davies' case was largely a done deal by the time that memo came out.

Second, while California legalized medical pot, its enforcement is anything but tight. It is a "free-for-all." Uncle Sam must patrol for chaos, Wagner said.

"Without an effective state regulatory system, there's no way of insuring that marijuana businesses will not engage in conduct that does implicate federal law enforcement," Wagner said.

Isn't that "guilty until proven innocent?"

"He violated the Controlled Substances Act, which is my job to enforce," Wagner said.

Uncle Sam didn't go looking for Davies, Wagner added. The pot operation came to light when Stockton police responded to a burglary at the grow warehouse. Davies fell in Uncle Sam's lap.

The Davies case is a painful example of the crazy disconnect between state and federal marijuana laws. Congress ought to hear the will of the people and change federal law.

Until it does, leaders such as state Attorney General Kamala Harris ought to stand up for the people of California and laws protecting medical marijuana. Those laws are the future.

"I don't disagree that these are changing times," Wagner said. "We're trying to balance federal priorities and the changing facts on the ground. That is not easy in cases like this."

Understood. Yet the fact remains that Davies must spend at least 41/2 years in prison after pleading guilty to 10 counts of dubious federal laws against growing, possession and distribution of a substance less harmful than margarine.

"My kids will be lucky to see me two times a month for four hours at a time for the next five years," Davies wrote."
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