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FDA says marijuana has a legitimate medicinal purpose
As a Schedule 1 drug, marijuana is currently in the same category as some of the hardest drugs, like heroin and LSD.
The FDA released a report saying that marijuana does have a legitimate use for medical purposes and recommended the US Drug Enforcement Agency to change its classification from Schedule 1 to Schedule 3. “The definition of a schedule 1 drug says it has no health benefits to it, and, so, obviously, there’s been plenty of research that has documented the multitudes of ways that cannabis can be helpful,” said Dr. David Berger with Wholistic ReLeaf.
Marijuana
By: Anthony HillPosted at 5:43 AM, Mar 21, 2024 and last updated 7:13 PM, Mar 21, 2024
TAMPA, Fla. — The FDA released a report saying that marijuana does have a legitimate use for medical purposes and recommended the US Drug Enforcement Agency change its classification from Schedule 1 to Schedule 3.
“The definition of a schedule 1 drug says it has no health benefits to it, and, so, obviously, there’s been plenty of research that has documented the multitudes of ways that cannabis can be helpful,” said Dr. David Berger with Wholistic ReLeaf.
Recent Stories from abcactionnews.com
Though not all in the medical community agree, many people swear by the medicinal effects of marijuana to help treat symptoms of cancer, anxiety, PTSD and epilepsy.
“It’s no longer appropriate to say that there’s no medical benefit when there are hundreds if not thousands of medical studies that show the opposite,” explained Dr. Berger.
As a Schedule 1 drug, marijuana is in the same category as some of the hardest drugs like heroin and LSD, which means it’s classified as being more dangerous than fentanyl and methamphetamine.
“What happens after this is the federal government has more decisions to make as to what they’re going to do next,” said Dr. Berger.
CDEL MM did the same today, making market.
CDEL bought the 9m dumped at open today at BID of .0003, and then placed the 9M on the ASK for .0004, looking to make the spread profit.
Easy $900 for one trade.
That is what MM do, they make a market
They BUY at the Bid and SELL on the ASK, that is what you are seeing.
Very, very little actual trading going on.
+ 65% in One Hour, LOL. Now 80% Gain!!!
These Cannabis stocks can gain 100% in 2 minutes while it took 2 years to lose 80%!!!
Last run for PVSP was over 1400% gain!!
Stock today is worth .02 just on current share structure!!
It will Run Big Time just a matter of when, and you better have bought your ticket and not chase it!!!
Don't you just love a nice SHORT Squeeze, +46% LOL
Cannabis sector is ready for HUGE rebound. Schumer says expects Safe Banking approval by election!
MindMed’s stock jumps 24% after FDA grants breakthrough designation
MindMed’s stock jumps 24% after FDA grants breakthrough designation to LSD therapy for a form of anxiety
By Ciara LinnaneFollow
Biotech also issues new shares and reports positive data from Phase 2b trial
Mind Medicine Inc.’s stock jumped 24% early Thursday, after the biotech company said the Food and Drug Administration has granted breakthrough designation for its MM120 LSD-based treatment for generalized anxiety disorder.
Published: March 7, 2024 at 8:26 a.m. ET
Board of Dopes, LOL
Seriously Mr. Free shares that has to be your dumbest post ever!
Do you even do any research, any at all? I didn't think so, just blab, blab, blab.
The Cannabis wholesale market has seen a price drop of over 50% in the past few years, and you are not happy that Artizen has been able to maintain revenues by cutting expenses, improving operations etc, etc.
They have done a great job in managing the business in difficult times of oversupply and declining prices.
Key Highlights
Gross Profit for the year ending November 30, 2023 totaled $4,890,763 on $15.8 million in revenues, compared to gross profits of $2,724,601 during the same period in 2022.
Gross Margins improved from 17% to 31%, a 182% increase. The improved gross margin reflects increases in production yields and gains in production efficiencies.
Revenues of $15.8 million equal 2022 revenues, achieved in a market that continues to battle over supply and price compression.
Operating Loss for the year ending November 30, 2023 totaled ($460,037), compared to an operating loss of $2,422,916 during the same period in 2022.
Cashflow for the year ending November 30, 2023 totaled $409,507, compared to negative cashflow of ($798,033) during the same period in 2022.
Income Tax liabilities increased due to a materially improved Gross Profit. Under 280e tax treatment, the Company is being taxed on Gross Profit as compared to non-cannabis businesses being taxed on Net Income.
“We continued to increase yields and margins in a market that is still challenged by oversupply and price compression.” said German Burtscher, Pervasip’s President and Chief Executive Officer.
Debt Holders $15m, becomes Equity Holders!!!
Debt Holders are getting 15% of Artizen spin off and will become Equity Holders. That 15% is coming from Founders 85%, PVSP holder keep their entire 15%, no dilution.
Gross Profit $4,890,763 on $15.8 million in revenues
Reports 2023 Revenues of $15.8 Million from Artizen Corporation
SEATTLE, WA, Feb. 29, 2024 (GLOBE NEWSWIRE) -- Pervasip Corp. (OTCPK: PVSP) (“Pervasip” or the “Company”), a developer of companies and technologies in high value emerging markets, today announced the filing of its unaudited financial statements for its fiscal years ended November 30, 2023.
Key Highlights
Gross Profit for the year ending November 30, 2023 totaled $4,890,763 on $15.8 million in revenues, compared to gross profits of $2,724,601 during the same period in 2022.
Gross Margins improved from 17% to 31%, a 182% increase. The improved gross margin reflects increases in production yields and gains in production efficiencies.
Revenues of $15.8 million equal 2022 revenues, achieved in a market that continues to battle over supply and price compression.
Operating Loss for the year ending November 30, 2023 totaled ($460,037), compared to an operating loss of $2,422,916 during the same period in 2022.
Cashflow for the year ending November 30, 2023 totaled $409,507, compared to negative cashflow of ($798,033) during the same period in 2022.
Income Tax liabilities increased due to a materially improved Gross Profit. Under 280e tax treatment, the Company is being taxed on Gross Profit as compared to non-cannabis businesses being taxed on Net Income.
“We continued to increase yields and margins in a market that is still challenged by oversupply and price compression.” said German Burtscher, Pervasip’s President and Chief Executive Officer.
Since the successful completion of its comprehensive financial audit for fiscal years ending November 30, 2022 and 2021, the Company has entered into debt restructuring efforts for one of its operating companies in preparation for the spin out of its cannabis assets and efforts to further reduce its real estate footprint in Washington State.
Audited 2023 financials are expected to be completed by end of April 2024.
Great article PA Governor push to Legalize Cannabis
Pennsylvania Governor Says Lawmakers ‘Don’t Even Have A Choice’ But To Legalize Marijuana As Other States Move Ahead
Published 19 hours ago on February 12, 2024By Kyle Jaeger
Pennsylvania’s governor says he thinks officials in the state “don’t even have a choice anymore” on legalizing marijuana, and he feels there’s bipartisan momentum that lawmakers should leverage to get the job done.
With neighboring states such as Ohio enacting legalization in recent years, Pennsylvania Gov. Josh Shapiro (D) said last week that “this really comes down to an issue now of competitiveness,” as the state is currently “losing out on 250 million bucks a year in revenue that could go to anything from economic development, education, you name it.”
“The reality is, as long as we have safeguards in place to make sure our children aren’t getting their hands on it—it’s just like, we don’t want our kids out drinking, right?” he said. “And a lot of that is going to be a burden on parents and schools and others to make sure we educate on that. Then I think this is something we’ve got to compete on.”
States That Legalized Marijuana See Massive Reduction in Tobacco Use
“I actually think we don’t even have a choice anymore given the way in which this is moving so quickly across our region and across the country,” Shapiro told WILK News Radio, adding that he’s personally “evolved on” the issue and wants a legal cannabis market “focused on lifting up Pennsylvania businesses in the process—not these big national conglomerates—and we’re empowering people in local communities to it that I think some good can come from it.”
The governor made the comments days after unveiling a budget proposal that calls for marijuana legalization to be enacted this year, with sales beginning as early as next January.
Cannabis reform has stalled in the Pennsylvania legislature over recent sessions, but Shapiro said he sees a path forward this year.
“You’ve got some of the legislature who just—you know, it cracks me up they’re like kneejerk against everything I’m for, but that’s like their politics,” he said. “But I think what you’re beginning to see is, from the thoughtful folks out there, some bipartisan support emerged and you’ve got Democrats and Republicans sponsoring bills to legalize it.”
“It’s obviously wildly popular across the country and certainly in polling regionally and in the states. So if someone’s going to be against it, I think they’re going to have to justify that to their constituents as well,” he said. “There does seem to be an emerging bipartisan consensus that we’ve got to compete on this issue, and we’ll see if we can get it done. We’re going to work hard.”
In a separate interview with KDKA News Radio that the governor’s office also promoted last week, Shapiro noted that his office estimates that Pennsylvania could bring in $250 million in tax revenue annually from cannabis sales.
“The reality is we are leaving all that money on the table. We are falling behind other states,” he said. “I think it’s another story of us not being as competitive as we need to be, and I think its time has come.”
“It’s time to shut down the black market. It’s time to take the strain off of cops. It’s time to be competitive. And this is a way to do that,” the governor said. “We can’t let Ohio and the other states around us keep eating our lunch on this or any other issue. As I’ve said many times, I’m competitive as hell and this is one of those areas. We’ve got to compete it.”
A staffer in Shapiro’s office similarly remarked on the need to legalize marijuana after Ohio voters approved the reform at the ballot last November.
Also last week, Pennsylvania lawmakers convened another hearing on marijuana legalization issues—focusing on the industry perspective, with multiple stakeholders from cannabis growing, dispensing and testing businesses, as well as clinical registrants, testifying.
“From the outset, my personal goals for adult-use has been to put health and safety of our constituents first and to allow for equitable and meaningful opportunities, particularly for those harmed by the war on drugs,” Rep. Dan Frankel (D), chair of the full Health Committee who previously sponsored cannabis legalization legislation, said at the beginning of last week’s hearing
NITE on BID for 38 Million, 10k on ASK, LOL
MM are trying to get more cheap shares, BID is stacking with 103 Million, ASK only 5 Million
CDEL on BID for 32 Million, on ASK 5 Million
GTSM on BID for 18 Million, on ASK 1 Million
ETRF on BID for 16 Million, on ASK 85K
INTL on BID for 25 Million, on ASK 10k
Jettison over 80% of Debt, with No Dilution!!!!
This restructuring demonstrates Pervasip's commitment to strengthening its financial position and streamlining
operations. It plans to jettison over 80% of its debt by engineering a spinoff into a new cannabis-focused entity,
without diluting the public shareholders. The current management team is giving up ownership interest in the
spinout pubco to create more value for the public shareholder and reduce debt-to-equity ratios, thereby
fortifying its balance sheet and improving overall financial health.
Your Word, LOL, LOL, LOL, LOL, LOL
Now that was funny, needed a good laugh!!!
You can't Buy on Record Date and get Artizen shares!
Don't think you can just wait until the Record Date to Buy. If you do you will not receive the Artizen Shares distribution.
To be eligible for the Artizen Distribution, you will need to buy the stocks before the ex-dividend date, which generally is two days before the record date.
Also, remember it takes T+2 days to get registered and updated, so keep those as buffer days and do not just wait for the last date to buy the stocks.
$PVSP In answer to those pesky RS rumors! NO!
Series K shareholders have agreed to a restructuring and spin-off and Pervasip has announced the plans in its March 2, 2023 press release.
1. Spin out all cannabis assets into a standalone entity and uplist to OTCQB, preserve 15% of all stock for float (= current fully diluted %), AND all debt dilution NOT carried by current float but converted K shareholders! Thank you!
2. The remaining Pervasip as a second standalone will see a REDUCTION of KShares from 85% to 20%. NO RS!
No Reverse Split, LOL Dopes
Pervasip Corp
@PervasipC
·
16s
$PVSP In answer to those pesky RS rumors! NO!
Series K shareholders have agreed to a restructuring and spin-off and Pervasip has announced the plans in its March 2, 2023 press release.
1. Spin out all cannabis assets into a standalone entity and uplist to OTCQB, preserve 15% of…
Show more
What an ignorant dope, LOL
Sad really, big mouth idiot, lazy cyber bully, LOL
What Is a Reverse Stock Split?
A reverse stock split is a measure taken by a public company to reduce its number of outstanding shares in the market. Existing shares are consolidated into fewer shares. This results in a higher stock price for the stock shares but has no immediate effect on the total value of the stock to the investor or the market capitalization of the stock.
For example, if a stock is trading at 50 cents on the market, and the company declares a two-for-one reverse stock split, an investor who owned 100 shares worth 50 cents would own 50 shares worth $1 each.
KEY TAKEAWAYS
A company performs a reverse stock split to boost its stock price by decreasing the number of shares outstanding.
A reverse stock split has no immediate effect on the company's value, as its market capitalization remains the same after it’s executed. However, it often leads to a drop in the stock's market price as investors see it as a sign of financial weakness.
This path is usually pursued to prevent a stock from being delisted or to improve a company's image and visibility.
You will never have enough information, only more questions, LOL
If you are that worried about investing, why in the world are you playing with micro penny pink stocks?
Seriously what gives with you?
A reverse split is nothing more than someone giving you a hundred dollar bill for 100 one dollar bills.
The problem markets have with some companies that do R/S is why they are doing R/S. Usually they are all ready very weak, with declining revenues and profits, along with share price, and are doing the r/s to meet listing requirements to stay on a particular exchange.
Doing R/S to uplist on the OTC while revenue and probits are increasing along with share price is really a non issue except for the few dumb shorties that cannot tell the difference.
PVSP will NEVER reverse split, Reverse Merger Yes
PVSP shareholders are going to own 80% of the company after the Spin Off, vs the current 15%.
The 20% remainder will be held by the original Artizen founders, and they will use those for any future CD's that maybe needed.
Great deal for current PVSP shareholders, the Artizen founders are being more than fair to PVSP shareholders.
Remember they have spent 10's of Millions building Artizen business since 2013, when it was a private company.
IMO, PVSP will do a reverse merger once again with a profitable private company that wants to go public and there are many out there.
It is so funny watching those clowns chase every tic, LOL
Seriously, who cares if it drifts around, it is what it is short term. They act like investors are going to jump off a bridge if it tics lower.
If it tics back lower, just means investors will continue loading the boat for a few more weeks or months, but I don't think so.
2024 is going to be a BIG, BIG year for shareholders!!!
Very Healthy Consolidation going on now.
We have to build a new higher base and the only way to do that is to let the daytrader get off the train and replace them will longer term investory that don't need sell before the weekend, LOL
Beer money trading.
It took 2 yrs from 1 cent to .0002, will take a few months to get back up!
MM are using algorithms to trade, and getting 75% and holding it a day is not likely, and that is their job really so let it trade up and down, the only thing that matters is that we get to our destination, not how many stop we hit along the way.
Future is what I am look for, 1 to 2 years out will look very different.
"PVSP shareholders will own 85% vs the current 15%"
“While Pervasip common shareholders of record at the spin-out closing date will collectively receive 15% of Artizen’s common shares in addition to keeping their existing Pervasip common shares, Pervasip’s Series K preferred stock will be restructured immediately after completing the Artizen spin-out to reduce the applicable conversion rights from 85% of Pervasip’s fully diluted issued and outstanding stock to 20%.
Importantly, that 20% then will also absorb the full impact of all other Pervasip convertible equity and debt securities. As a result, in addition to receiving 15% of Artizen in the spin-out transaction, Pervasip’s common shareholders will collectively hold 80% of Pervasip’s fully diluted shares immediately after the spin-out transaction instead of the current 15%.”
We will not be in the "triples" much longer!!!
Just impossible, the stock will be moving into PENNY LAND sooner than you think!
200 Million plus traded in 30 minutes!!!!
It is not dumping, it is MM covering shorted ASK
Much of the ASK is MM offering Short shares, they sell them and cover later at lower price, perfectly normal.
You have to own PVSP shares to get Artizen Spin Off shares
The Record date will be established any time now that the audit is completed.
New Artizen will only have 15m shares in the Trade Float!
Going to be fun with such a low number of shares available to trade, No Debt, Audited Financials, New Listing on OTCQB, and Profitable!!
Founders are exchanging 15% of their shares for the debt!!!
They controlled 85% of the new company shares, and they will have 70% and PVSP shareholders 15% will not be effected!!!!
Artizen will have NO DEBT !!
No dilution, total outstanding shares will be the same 100M,
Pervasip Announces Restructuring and Spin-Out
Press Release | 02/01/2024
SEATTLE, WA, Feb. 01, 2024 (GLOBE NEWSWIRE) -- Pervasip Corp. (OTCPK: PVSP) (“Pervasip” or the “Company”), a developer of companies and technologies in high value emerging markets, is pleased to announce the restructuring of its cannabis operations to convert about $15,000,000 in debt into 15% of a newly formed subsidiary. The restructuring is a prelude to the Company’s previously announced plan to spin that new subsidiary out into a standalone public entity on the OTCQB market.
The Company has completed its final audited financials, which have been instrumental in guiding this decision. A key aspect of this restructuring involves converting over 80% of the company's debt into equity in the new cannabis-focused entity. This move is designed to streamline operations and strengthen Pervasip's financial footing.
It's important to note that the impact of the subsidiary debt-equity conversion and the corresponding dilution at the subsidiary level will not impact the subsidiary common shares reserved for current Pervasip common shareholders in the subsidiary spin out. Thus, the subsidiary spin-out will still involve the 15,000,000 subsidiary common shares reserved for the Pervasip common shareholders as announced in 2023, 15,000,000 subsidiary common shares reserved for the newly restructured subsidiary debt, and the remaining 70,000,000 subsidiary common shares for holders of Pervasip’s Series K Preferred Stock. In addition to this restructuring, Pervasip is embarking on a strategic transition away from non-productive assets, focusing exclusively on higher-margin branded product sales in all of its operating markets. This shift is expected to enhance profitability and efficiency, aligning with the Company’s long-term growth objectives.
The goal through these changes is to position Pervasip in a way that allows the market to assess the Company’s performance based on profitability. We aim to establish benchmarks for stock performance valuations using metrics such as EV/Sales and EV/EBIDTA. Furthermore, this restructuring is anticipated to significantly reduce the company's debt-to-equity ratios, thereby strengthening our balance sheet and overall financial health.
"We are excited about this new phase in Pervasip's journey. Restructuring our operations and focusing on high-margin, branded product sales will not only streamline our business but also enhance shareholder value," said German Burtscher, CEO/President of Pervasip. "The long-announced spin-out of our cannabis assets marks a pivotal step in our strategy to become a more focused, profitable company. We believe these changes will positively reflect in our stock performance and overall market valuation."
This strategic restructuring represents a new chapter for Pervasip, positioning it for sustainable growth and profitability. The company is committed to transparency and will continue to provide updates as we progress through this transformative phase.
Converting over 80% of debt into Equity in new Artizen!!!
The founders are covering this, PVSP shareholder getting full 15% shares.
Moving to OTCQB, bye, bye to the PINKS
PVSP restructure, $15M debt into 15% of newly formed subsidiary!!!!
Spin Off of Artizen coming soon!!!
Public Company Accounting Oversight Board: PCAOB
Interesting read on PCAOB function and practices.
The PCAOB is a nonprofit corporation established by Congress to oversee the audits of public companies in order to protect investors and further the public interest in the preparation of informative, accurate, and independent audit reports.
The PCAOB is responsible for setting auditing standards for public companies.
https://pcaobus.org/oversight/inspections/inspection-procedures
Democrats urge Biden administration to deschedule marijuana
12 Senate Democrats, including Majority Leader Chuck Schumer, urged the DEA in a letter to remove marijuana from the Controlled Substances Act altogether.
Jan. 30, 2024, 6:00 AM EST
By Julie Tsirkin
WASHINGTON — Senate Democrats are putting new pressure on the Biden administration to ease federal restrictions on marijuana in a new letter to the Drug Enforcement Administration on Tuesday as it considers rescheduling cannabis after it was federally classified more than five decades ago.
The Department of Health and Human Services formally recommended in August that the DEA move the drug from Schedule I to Schedule III of the Controlled Substances Act, or CSA, prompting a monthslong review, which continues.
The letter, from 12 senators led by Elizabeth Warren, D-Mass., and John Fetterman, D-Pa., and signed by Majority Leader Chuck Schumer, D-N.Y., goes further.
“The case for removing marijuana from Schedule I is overwhelming. The DEA should do so by removing cannabis from the CSA altogether, rather than simply placing it in a lower schedule,” the senators wrote in the letter, first obtained by NBC News.
Rescheduling the drug or removing it entirely would have significant implications for the marijuana industry and for cannabis users, some of whom consume it for medical purposes.
Since 1971, cannabis has been under Schedule I, the highest classification of the CSA, along with drugs like heroin and LSD, which the government formally considers to have high potential for abuse and no accepted medical use.
Even so, 40 states and Washington, D.C., have legalized some form of cannabis, for either recreational or medical use, leaving consumers and business owners to operate in a patchwork of changing laws across the country.
The DEA told lawmakers this month that despite the historic recommendation by the Department of Health and Human Services over the summer, it “has the final authority to schedule, reschedule, or deschedule a drug under the Controlled Substances Act” based on scientific and medical evaluation.
The White House had hoped to make a rescheduling announcement close to the one-year mark since President Joe Biden ordered the DEA to review HHS’ recommendation in October 2022 and to use it as a campaign issue at the ballot box in November, according to five sources with knowledge of the situation.
Senate Democrats argued in Tuesday’s letter that the Biden administration should “promptly” remove the drug from Schedule I before it ultimately deschedules it.
“The Biden Administration has a window of opportunity to deschedule marijuana that has not existed in decades and should reach the right conclusion — consistent with the clear scientific and public health rationale for removing marijuana from Schedule I, and with the imperative to relieve the burden of current federal marijuana policy on ordinary people and small businesses,” they wrote.
In addition to Warren, Fetterman and Schumer, the letter was signed by Sens. Cory Booker, D-N.J., and Ron Wyden, D-Ore., who both worked with Schumer to put forward a comprehensive marijuana reform proposal that would end federal prohibition and decriminalize cannabis, legislation that has not gained the necessary support across the aisle.
A similar piece of legislation that would have legalized marijuana nationwide passed in the Democratic-controlled House in 2022, largely along party lines.
Another bill, known as the SAFE Banking Act, would make it easier for financial institutions to offer banking services to cannabis companies in states where the drug is legal and there is bipartisan support for getting the legislation across the finish line. After the bill passed through committee in the fall, Schumer said passing it through the Senate would be a top legislative priority, but a vote has not yet been scheduled.
Meanwhile, Biden has used executive authority to pardon thousands of people convicted of use and simple possession of marijuana, most recently in December.
A national poll commissioned by the Coalition for Cannabis Scheduling Reform, released in December, found that an overwhelming majority of 18- to 25-year-old likely voters — 65% — expressed support for Biden’s efforts to reschedule cannabis, another sign that the issue could help him politically in a tough re-election bid.
Seventy percent of Americans support federal marijuana legalization, the highest percentage ever, according to a recent Gallup poll.
Consolidating move, little backing and filling, going HIGHER
Nothing goes straight up, we have to let the traders make their trade and replace them with investors that are looking for better price. Going to be a lot of this type action on the way to multi pennies, so it really doesn't what the short term trading does on the way up!! LOL
Nearly every trade is a MM double count, LOL
With $17m revenue company was valued at less than $800k, Impossible!
Anyone with half a brain knows that a company that generates revenue of over $17M with 60% margins and is EBITDA positive has to be worth at least X time revenue. Most are at 2 to 6 times revenue, but even at 1 X $17m the stock should have been valued at nearly 20 times it's recent price.
We are going much, much higher in 2024 just watch, better yet get a ticket early!!!
You have to own PVSP to get Artizen shares Spin Off
If you own 1% of PVSP shares, you will receive 1% of Artizen Cannabis shares, plus keep ALL of your PVSP shares!!!!
Stock is worth 3 to 5 cents, $17m in revenue
PVSP is already EBITDA positive, generating $17m in revenue, just expanded operations into Oregon.
You have to own PVSP to get shares in NEW Aritizen spin off, plus you get to keep ALL your PVSP shares.
PVSP will be renamed after Reverse Merger with a NEW company to be announced after Spin Off.
Both companies will be leaving PINK sheets for the OTC, moving on up!!!
Annual Report due next month Feb 28
Biden DOJ Tells Federal Court Not To ‘Disrupt’ Marijuana Rescheduling Decision By Allowing Industry Lawsuit To Proceed
Published 15 hours ago on January 23, 2024By Kyle Jaeger
The Justice Department has asked a federal court to dismiss a cannabis industry lawsuit that seeks to block the enforcement of marijuana prohibition against state-legal activity—in part, it says, because the court should not get ahead of a possible cannabis rescheduling decision that’s being considered.
In a document filed with the U.S. District Court for the District of Massachusetts, Western Division, on Tuesday, lawyers for Attorney General Merrick Garland said that Congress “rationally set up an administrative process for rescheduling drugs.”
“Pursuant to that mechanism, the DEA is currently considering” a recommendation from the U.S. Department of Health and Human Services (HHS) “to reschedule marijuana” under the Controlled Substances Act (CSA).
States That Legalized Marijuana See Massive Reduction in Tobacco Use
“It is not for the courts to disrupt or get ahead of that administrative process,” DOJ said.
Overall, DOJ also said that marijuana businesses who brought the case lack standing to pursue the challenge because they cannot claim direct injury since they haven’t been federally prosecuted under the policy of prohibition. The filing also notes that a long-standing congressional rider has been in place for a decade, barring the department from using federal funds to interfere in state-legal medical cannabis laws.
“Plaintiffs do not dispute that as enacted, the CSA rationally served legitimate government purposes. Yet they argue that the CSA has been rendered irrational because Congress has chosen to allow federal territories to enact marijuana legalization laws and has prohibited the Department of Justice on spending funds to prevent implementation of state medical marijuana laws…while the Department of Justice has allegedly exercised prosecutorial discretion to decline to prosecute conduct that complies with state marijuana laws under certain circumstances.”
“Yet as explained above, these actions and inactions serve the rational purpose of facilitating state and local experimentation with marijuana laws while focusing federal law enforcement resources on conduct that most significantly affects federal interests,” it says.
The government also asserts that precedent set in a 2005 Supreme Court ruling negates plaintiffs’ argument that the U.S. Constitution’s Commerce Clause renders bans on interstate marijuana commerce unlawful.
The case is a “transparent entreaty to overrule” that precedent, known as Raich, DOJ said.
“Federal regulation of intrastate marijuana activities is constitutional because such activities “substantially affect interstate commerce,'” the department argued. “Plaintiffs get no further by claiming that the CSA violates their right to substantive due process. Courts have consistently, and correctly, held that no fundamental right exists to distribute, possess, or use marijuana. Therefore, the CSA is subject only to deferential rational basis review, which it easily survives.”
“To raise a pre-enforcement challenge to a law, a plaintiff must show a substantial risk of future enforcement. Here, Plaintiffs allege the opposite, that the government’s policy is not to prosecute conduct that complies with state marijuana laws. Neither Plaintiffs’ contention that they are harmed by other federal laws and policies whose constitutionality is not challenged here, nor Plaintiffs’ allegations that some third parties have independently chosen not to transact with them, suffice to provide Plaintiffs with standing to challenge the CSA.”
The motion to dismiss additionally says that plaintiffs “fail to allege facts showing that the risk of prosecution is substantial.”
“In fact, Plaintiffs’ allegations negate the existence of such a substantial risk,” it says. “Yet even if this Court were sympathetic to Plaintiffs’ arguments that [Gonzales v. Raich] holding should no longer be good law, stare decisis commands that this Court adhere to Raich unless and until it is overruled by the Supreme Court
“Moreover, Plaintiffs allege that the Department of Justice has implemented a policy of prosecutorial discretion that guides federal law enforcement to focus enforcement resources ‘on persons or organizations whose conduct interferes’ with important federal interests such as curtailing violence and gang activity, and otherwise to rely largely on ‘enforcement of state law by state and local law enforcement and regulatory bodies’ to ‘address[] marijuana-related activity.'”
The filing adds that a policy of prosecutorial discretion for federal marijuana cases such as under the Obama-era Cole memo that was rescinded under the Trump administration is a “surely rational” approach.
In the overarching lawsuit, plaintiffs claim that perpetuating prohibition in state markets is unconstitutional, creating undue public safety risks while precluding licensed marijuana businesses from accessing critical financial services and tax deductions that are available to other industries.
Reacting to the DOJ filing on Tuesday, the plaintiffs said in a statement that they “look forward to demonstrating their standing before the Federal District Court in Springfield, Massachusetts.”
“Plaintiffs have been injured by the federal government’s ban on cultivating, manufacturing, and distributing intrastate marijuana. Plaintiffs brought this suit to stop the enforcement of that unconstitutional ban and protect themselves and others similarly situated from further injury,” they said. “The facts in the complaint distinguish this case from Gonzales v. Raich, the 2005 Supreme Court decision on which the government continues to rely.”
The government filing comes about a month after the Justice Department and plaintiffs—a coalition of marijuana businesses represented by an influential law firm—jointly agreed to request a deadline extension for the filing of initial briefs.
The suit against the federal government is being led by multi-state operator Verano Holdings Corp. and the Massachusetts-based cannabis businesses Canna Provisions and Wiseacre Farm, along with Treevit CEO Gyasi Sellers.
On Monday, DOJ sought permission to submit the new 25-page of memorandum that exceeds the general 20-page limit allotted under the rules.
The law firms Boies Schiller Flexner and Lesser, Newman, Aleo & Nasser LLP are representing the plaintiffs. David Boies, chairman of the former firm, has a long list of prior clients that includes the Justice Department, former Vice President Al Gore and the plaintiffs in a case that led to the invalidation of California’s ban on same-sex marriage, among others.
The lawsuit alleges that while Congress originally banned marijuana through the Controlled Substances Act (CSA) in an attempt to eradicate interstate commerce, ostensibly giving the government a basis to enforce prohibition at the state level, lawmakers and the executive branch have since “abandoned”