Lp,s are doomed!
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Recalls are a drag.
IF CANNABIS IS LEGAL, WHY THE POLICE RAIDS?
CALEB MCMILLANSEPTEMBER 17, 2022
If cannabis in Canada is legal, why are there still police raids?
Suppose, for instance, you travel back to the 1990s, and you say in the future, cannabis is legal, but police still get funding and make raids on “illegal grow-ops,” you might scratch your head.
If cannabis is legal, how are there still police raids? How are people still growing illegally?
How can the Ontario police make an $8.5 million discovery of 10,000 plants and 113 kilograms of dried flower? Why wasn’t this massive enterprise legal?
A Brief History of Cannabis in Canada
If Cannabis is Legal, Why the Police Raids?
If cannabis in Canada is legal, why are there still police raids? The answer is that not all cannabis is legal. As I correctly predicted, Justin Trudeau never intended to legalize cannabis.
Justin is a shill. A wokester who deserves prison. His plan was to corporatize it.
In late 2012, the former Harper government announced an overhaul of the medical system. Patients wouldn’t be able to grow for themselves anymore. They were going to have to go through a corporate LP system.
Patients sued, won, and now even recreational consumers can grow (unless you’re in Quebec or Manitoba).
All Justin Trudeau did was change the laws so these large-scale medical cannabis producers could sell to the general public. Although not directly. First, they must go through an inefficient and ineffective government wholesale distribution centre.
The only way to grow and sell cannabis or industrial hemp is by receiving approval from Health Canada.
You can imagine the situation if the nation produced food like this. Ontario police raiding local farmers’ markets’ over “illicit” tomatoes.
If Cannabis is Legal, Why the Police Raids?
Recently, the Durhan Regional Police Service’s Drug Enforcement Unit found a massive “grow-op” out on highway 7. As mentioned, an estimated $8.5 million worth of goods and capital were present.
Earlier this month, police charged two senior citizens in Caledon for operating an “illicit” cannabis farm and making concentrates. With over 16.5 kilograms of cannabis oil and 500 plants, police estimated the street value was shy of $5 million.
This past summer, Ontario police raided two greenhouse sites and discovered 45,000 plants, estimated at $61 million.
Ontario police charged three people in May after raiding a farm near Renfrew and finding 7,600 cannabis plants.
In March, another 7,600 plants were seized by the police out in Essex County, near Leamington, Ontario.
And that’s just this year. In one province. And that’s not even all of them, just the large ones.
What’s going on here? If cannabis is legal, why aren’t these people getting proper licences?
The Problem with Cannabis in Canada
Canada excessively regulates its cannabis industry.
From Health Canada’s onerous regulations, asinine licensing processes, federal excise taxes, and provincial wholesalers to the general incompetence of every level of government.
If you want your country or state to legalize cannabis, look to more liberal regimes like Colorado. Canada is not an example for the world to follow.
As part of Justin Trudeau’s pledge for legal cannabis, there was the caveat that he’d make it harder for organized crime to operate.
Now, the people involved in Ontario‘s recent cannabis raids may be pieces of trash. They could have been cutting corners, spraying plants with pesticides, and making solvents unsafely.
But it’s also possible their only crime is producing a plant that government excessively regulates.
Ontario doesn’t have a problem with alcohol bootleggers. There is no black market in craft beer. That’s because the regulations allow anyone to enter the business.
With some start-up capital and ambition, you can make it as a craft brewer in Ontario.
You can’t say the same for craft cannabis.
If Cannabis is Legal, Why the Police Raids?
Cannabis is not legal. It’s been corporatized. Health Canada wouldn’t be the gatekeeper for production licensing if it were legal. Police wouldn’t be raiding peaceful farmers.
In a genuine free market, we wouldn’t even need licensing. Insomuch that accreditation is important, consumers will pay the premiums if that’s something they value.
In the meantime, Justin Trudeau has fulfilled his promise to “legalize, restrict, and regulate” cannabis.
For someone who admires China’s “basic dictatorship,” it’s clear cannabis legalization was going to mean all within the state, nothing outside the state, and nothing against the state.
Justin’s Liberals were clear from the beginning. Police were going to get more funding and powers to fight “the black market.”
Cannabis is legal in Canada, so why the police raids? Because cannabis is not legal. It’s stamped with a barcode and sits under fluorescent lighting, hiding behind opaque child-resistant plastic containers.
Cannabis prohibition is still alive and well in Canada.
Good old dear friend Tommy
Tommy Chong's stash
Photo: David Wylie/the oz.
Tommy's Craft is pictured with the classic film Cheech and Chong's Up in Smoke playing in the background.
By David Wylie
Unlike some other celebrities, Tommy Chong didn’t rush into putting his name on just any weed.
It wasn’t that the star stoner of Cheech and Chong wasn’t offered the chance, says his nephew Josh Wong, who’s president of RGB Cannabis.
Various products by Tommy’s Craft
Ever wonder what Tommy Chong would smoke?
We tried a selection of four Tommy’s Craft products purchased for us out of Alberta.
A variety of flavour and look, they were all impressive.
Pink Mandarin
As the name suggests, you’re greeted with a citrus scent off the top. The bud was really nicely trimmed though a little dry.
There were a few good size buds with some scraggly bits that all together came in right on weight.
The smoke experience was pleasant, giving a little mouth tickle and burning with white ash.
With a THC level of 21.5% with 2.13% terpenes (Myrcene, Caryopyllene, and Linalool), it provided an active high.
Grape Galena (Pre-rolls)
It would have been great to see the Grape Galena in flower format; however, apparently this cultivar grows in small buds so it’s milled and made into pre-rolls.
These short, stubby joints are all rolled consistently.
They have a nice grape smell, though not nearly as dank as Organnicraft’s Platinum Grapes.
It clocks in at 22.1% THC with 2.79% terpenes (beta-Caryophellene, Limonene, alpha-Humulene).
The joints burned evenly with white ash around the outside but light grey in the middle.
The high hit fast and hard.
About an inch from the cardboard filter, these started to taste off – not ideal with such short joints.
Cherry ’47
Bred from AK 47 and Purple Punch strains, Cherry ’47 has a delightfully fruity smell that brightened up the room.
A good deep sniff provided notes of chocolate and cherry as well.
Though packaged nearly a year ago the buds were tight and beautiful.
It burned white.
The high is creative and functional.
It has 21% THC, with 2.81% Terpenes (beta-Caryophyllene, D-Limonene, beta-Myrcene).
Bassdrop Crescendo
This one really packs a punch on the nose with a pungent gassy scent that leans into the cheese.
It’s the heaviest THC hitter of the bunch at 22.7%, but a lightweight in terpenes with only 2.12% (beta-Myrcene, beta-Caryophyllene, alpha-Humulene.)
Overall thoughts
All four Tommy’s Craft products are flavourful and unique. Yet they still seem to have an undertone of cheese that’s even more pronounced on dry pulls.
Home / Retail
Cannabis wholesale chaos didn’t ‘meaningfully impact’ Canada’s market – or did it?
author profile pictureBy Matt Lamers, International Editor
September 15, 2022 -
Image of Canadian indoor-grown cannabis
Crippling service disruptions at two of Canada’s biggest government-run cannabis wholesalers in August do not appear to have meaningfully impacted the broader market, interim data for the month suggests.
Nationwide cannabis retail sales in August rose an estimated 16% year-over-year, according to data from analytics firm Hifyre.
The data was cited in a research note by Toronto-based BMO Capital Markets analyst Tamy Chen, who wrote that August’s estimated sales were in line with BMO’s outlook.
“It does not appear that industry sales in August were meaningfully impacted by the cyberattack on Ontario’s cannabis distributor or the labor strike at B.C.’s liquor board distribution center,” according to Chen’s note.
However, some industry insiders say the evident top-line growth doesn’t paint a full picture of potential sales had there been no disruptions.
Nor does it account for consumers who returned – some permanently – to the illicit market or stores that could close for good in the coming months because of unreliable wholesalers.
In British Columbia, dozens of regulated cannabis stores were forced to close their doors in mid-August after workers at the province’s monopoly distributor went on strike, leaving many stores with too little inventory. Operations didn’t resume until Aug. 31.
Also that month, Ontario’s provincial monopoly wholesaler suspended all deliveries to retailers after a cyberattack struck the parent company that operates its distribution center. Full deliveries didn’t resume until weeks later.
The two provinces account for more than half the legal cannabis sales in Canada.
A spokesperson for the Ontario Cannabis Store said the wholesaler is in the process of understanding the impacts that the service disruption might have caused.
“We are committed to improving our capabilities and processes to better meet the needs of retailers, licensed producers, and consumers,” Daffyd Roderick, the OCS’ senior director of communications, said in a statement provided to MJBizDaily.
“Over the past year, OCS completed a thorough vendor management review, hired additional staff to support vendor management, and provided training for existing staff on vendor oversight. This supports our growth, continuous improvement, and goal of enabling a vibrant marketplace.”
The OCS’ counterpart in British Columbia, the Liquor Distribution Branch (LDB), said it has not started to study the full impacts of the closure of its distribution center, including job losses and lost revenue to the province and stores.
An LDB spokesperson told MJBizDaily that the organization’s “focus has been on expediting the resumption of services,” which has included running overtime shifts at the distribution centre and working with carriers and industry partners to allocate more resources to deliver orders.
“We are aware of the impacts the service disruption has had on wholesale customers and will continue to take steps to return to normal service levels as soon as possible,” the spokesperson said.
Illicit market wins again
Jaclynn Pehota, executive director of Association of Canadian Cannabis Retailers (ACCRES), estimated that about 50 stores in British Columbia closed or curtailed hours because of the wholesale backlog, affecting about 400 jobs.
She suggested that, had the strike lasted two more days, almost three-quarters of the province’s privately owned stores could have closed their doors.
“We were 48 hours away from the vast majority of legal weed in B.C. shutting down,” she told MJBizDaily in a phone interview.
British Columbia operates a dual system in which 441 privately owned regulated stores compete against almost three dozen government-owned ones. Illicit sellers also remain prolific in the province.
Pehota said it might not be clear for months how many consumers the legal industry lost to the illicit market.
“How do you quantify that impact?” she asked about lost future sales.
“This is a sector, especially in British Columbia, that is competing desperately for market share (with the illicit market), and we just bled who knows how many consumers back,” Pehota said.
“There are people who have never bought illicit cannabis before. They were 18 in 2017, and cannabis has always been legal for them.
“This is the first time they’re saying, ‘Wait a minute, you mean if I can’t get vapes in the legal system, I can go and buy them from some guy online at 75% discount with no i.d.?’”
August usually a ‘banger month’
August is typically one of the best sales months of the year for cannabis stores, making it the worst month for a wholesale system failure.
In 2019, cannabis sales increased more than 18% from July to August.
In August 2020, they grew 6%. Last year, the monthly raise from July was 4%.
Pehota said some ACCRES members were on track for their best month ever for August, but now they’re looking at “a sizable budget hole” because they ran out of their most popular products.
“The premise that August was on track to be a banger month (before the job action) is a sound one, because I’ve heard over and over again that ‘this would have been the best month ever if this hadn’t happened’,” she said.
Janeen Davis, vice president of sales at Joint Venture Craft Cannabis, based in Salmon Arm, British Columbia, said the business was expecting August “to be a monster month.”
She said the impact on smaller businesses won’t be truly felt for some time, possibly even into the winter when those businesses typically have to get by with lower seasonal revenue.
“I don’t think we’re going to see the impact from the loss of revenue right now. I think we’re going to see them with small craft producers and independent retailers come December/January,” Davis said.
The wholesale logjam in Ontario and B.C. “may have only lasted a couple weeks, but in our highest velocity sales month of the year, the flow to our operations is going to hurt, because we’re all running so lean during the winter months.”
“The loss of revenue in August is tremendous,” she added.
Staff retention could also end up costing more for stores that were forced to close.
“Another knockdown effect could be higher-priced staff,” Pehota said.
“What’s the cost of acquiring new staff these days? It’s huge. Those folks didn’t wait around for the retailers to reopen. They went and got new jobs.”
‘Everyone else suffers’
Michaela Freedman, an international marijuana business consultant and founder of Toronto-based MF Cannabis Consulting, said federally licensed producers and provincially regulated stores are at the mercy of the Ontario Cannabis Store.
“When the OCS fails to do its job, everyone else suffers,” she said.
“Producers are sitting on packaged product that can’t be resold, and retailers are forced to lay off workers just to stay afloat.
“In an industry where consumer loyalty is so difficult to maintain, interruptions like this can be a death sentence.”
Freedman suggested Ontario – the largest cannabis market in Canada by sales – would be better off with decentralized wholesalers.
“Adopting the Saskatchewan model (of privately owned businesses) is not feasible for a province with more than 1,300 stores,” she said, “because it would make independent retailers more vulnerable to price compression and lead to even more logistical errors.”
We will win this one also...
Ho no!!!! Martha is at it again...
Home / Legal
Wyld CBD parent accuses Martha Stewart CBD of copyright infringement
By Kate Robertson
September 15, 2022
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(This story has been updated with Canopy Growth saying it was declining comment.)
Oregon-based Northwest Natural Goods alleges in a lawsuit that Canopy Growth Corp.’s Martha Stewart CBD product line intentionally copied Northwest’s Wyld CBD brand packaging and marketing designs.
The copyright-infringement complaint, first reported by Law360, alleges that Northwest Natural Goods and a former strategic investment subsidiary of Canada-based Canopy Growth, Canopy Rivers, were in business discussions regarding the Wyld CBD line of products between July and November of 2019.
As part of those discussions, the Sept. 9 complaint alleges, Canopy Rivers was provided a Wyld CBD business plan, including “trade dress” and copyrighted materials for the brand’s blackberry, lemon and raspberry CBD gummies. Trade dress typically shows the look of a product or its packaging.
One year after Wyld terminated the talks, according to the complaint, Canopy launched its own CBD product line in partnership with Martha Stewart Living Omnimedia, which is based in New York and owned by Marquee Brands.
“Prior to distributing the Martha Stewart CBD products, defendants knew of Wyld’s trade dress and, on information and belief, intentionally copied that trade dress to trade off of Wyld’s goodwill and reputation,” the complaint alleges.
Each brand’s products are available nationwide.
According to the complaint, some stores that carry both brands place them side by side, causing consumer confusion.
The complaint also noted that in February 2022, Vitamin Shoppe declined to carry the Wyld brand because it was too similar to Martha Stewart CBD gummies and would “create cannibalization within (the store’s) assortment” of products.
Northwest Natural Goods is seeking compensation, “compensatory damages in an amount to be determined at trial, attorneys’ fees, costs and disbursements.”
“As a successful and growing American midsize business with an expanding customer base, we are committed to protecting our brand integrity and the high-quality products our customers have come to trust,” Wyld founder and CEO Aaron Morris said in a statement emailed to MJBizDaily.
“Our unique brand identity is critical to Wyld’s growing reputation, and we are taking this action to ensure that our customers are not deceived and that we remain positioned for future growth.”
A Canopy Growth spokesperson declined to comment on an active litigation.
Martha Stewart Living Omnimedia did not immediately respond to an MJBizDaily request for comment.
Growers to close lights in their grows while football stadiums lit the sky.
CA Department of Cannabis Control
@CAcannabisdept
Please help conserve energy and help decrease the strain on our power grid by remembering to:
? Turn off lights or any major sources of power
? Begin using a backup generator, if available Now is the time to rally, California!
This is GREAT NEWS!!!
https://huffman.house.gov/imo/media/doc/HUFFCA_059_xml.pdf
A bill filed in the U.S. House of Representatives on Wednesday would allow small marijuana cultivators and producers to sell directly to customers, which could give them a boost when competing against larger companies.
Rep. Jared Huffman, a California Democrat, is leading the legislation, titled the Small and Homestead Producers (SHIP) Act.
Will Canada follow?
They have their work cut out but...
Alabama Is Jailing Pregnant Marijuana Users —
And Not Letting Them Post Bail
Maria Loreto
September 15, 2022
Marijuana LegislationNews
Alabama Is Jailing Pregnant Marijuana Users
Photo by Camylla Battani via Unsplash
Alabama is keeping pregnant women in custody if they’re suspected of consuming marijuana. This problem will only get worse following the overturn of Roe v. Wade.
A pregnant woman in Alabama was kept in jail for three months after officials learned that she had smoked weed — and she’s not the only one.
On May 25, 23-year-old Ashley Banks was was pulled over for a routine traffic stop when officers noticed a small amount of marijuana in her car. When she admitted that she had smoked weed two days earlier, the same day she found out she was pregnant, they threw her in jail without a trial.
According to The Guardian, there’s a law in Alabama that allows for this strange occurrence to take place. Unlike the majority of drug offenses where people have the option to post bail and leave, pregnant women are instead taken into state custody for the fetus’s protection.
Cannabis Use In Pregnancy Linked With Issues In Childhood
Photo by freestocks via Unsplash
Banks’ case is particularly egregious; at first, officers wanted her to be interned in a drug rehabilitation program. Upon examining her, workers at the center turned her away, believing that she was a casual marijuana user and thus not likely to reap the benefits of their service. This resulted in her three-month stint in jail.
RELATED: Alabama, How Could You? Senate Approves Forcing Women To Take Pregnancy Test To Obtain Weed
Banks’ pregnancy worsened while imprisoned. Having a family history of miscarriages and difficult pregnancies, Banks was often bleeding in jail and didn’t have any medical attention. She was forced to sleep in a cell where there were often too many women, resulting in her sleeping on the floor on one occasion. She isn’t the only one. According to National Advocates for Pregnant Women (NAPW), Etowah county in Alabama has jailed 150 pregnant women in recent years, 12 of whom remain in jail.
RELATED: Cancer Patients Should Just Buy Marijuana On The Streets, Says Alabama Senator
The Guardian argues that these decisions reinforce how the pro-life movement views women as less valuable than the fetuses they carry. “The movement claims to see embryos and fetuses as persons, and in practice they speak as if these “persons” are not women’s equals, but their superiors: the fetus is conceived of as more important than the woman, more worthy, less tainted by those things that make a pregnant woman so unappealing,” reads the article.
While Alabama is particularly harsh in its imprisonment rates and treatment of pregnant women, this problem will only continue to increase in the face Roe v. Wade being overturned. And while it might be harmful for pregnant women to consume marijuana, there is a big difference between consuming weed and consuming other drugs, something that federal law doesn’t take into account.
The Supreme Court of Canada will rule on whether Quebec‘s ban on growing cannabis for personal use is constitutional.
Janick Murray-Hall v. Attorney General of Quebec will be heard on Thursday, September 15.
Quebec’s Cannabis Growing Ban
Supreme Court of Canada to Rule on Quebec Cannabis Ban
How did Quebec end up the odd-duck out with their home-growing cannabis ban?
In 2018, the federal government legalized recreational cannabis. In the federal Cannabis Act, the government stipulated that people can grow up to four plants per household.
And then, provinces and territories have their sphere of influence, like regulating the retail cannabis sector.
In Quebec, however, the provincial government enacted a law banning people from owning and growing cannabis plants for personal use.
Violators could face up to $750 in fines.
Janick Murray-Hall, wasn’t having it. He called the Quebec law unconstitutional and sued the government.
Lower Courts Rule on Quebec Cannabis Ban
So how have Quebec’s lower courts ruled?
Murray-Hall argues that growing cannabis plants are under the federal government’s jurisdiction. For example, you are charged under federal criminal law if caught growing more than four plants.
Ergo, Quebec does not have the authority to ban home growing. According to section 91(27) of Canada’s Constitution, these matters belong to Ottawa.
With that said, says Murray-Hall, Quebec’s ban should have no force or effect because federal law overrules provincial law. Quebec’s cannabis ban is ultra vires to the federal Cannabis Act.
Quebec’s Superior Court judge agreed and declared the Quebec ban unconstitutional. But then, the Attorney General of Quebec appealed the decision.
Quebec’s Court of Appeal disagreed, and they ruled the ban was constitutional because it is a matter of provincial jurisdiction.
This time, the judge pointed to sections of the Canadian Constitution. Section 92(13) says provinces can make property and civil rights laws. And section 92(16) permits the provincial government to make laws of a local nature.
So, the Court of Appeal interpreted the Constitution to mean that Quebec can ban growing cannabis plants for personal use.
Supreme Court of Canada to Rule
The Supreme Court of Canada will decide whether Quebec’s ban on growing cannabis plants for personal use is constitutional.
The case is worth paying attention to for any precedents that the case may set. If the Supreme Court rules with Quebec, it may inspire British Columbia‘s leadership to become bolder against Ottawa’s encroachment into BC Bud territory.
Overall, it’ll settle the question of whether federal cannabis laws can overrule incompatible provincial ones.
Matt Lamers ??
@matt_lamers
13-09-2022
A delegation from Germany is visiting Canada in the coming days to scope out how our legal system is going here. 1 takeaway may be: Canada clearly over regulated the sector, which helped make the public health policy a success, but private sector profits are nearly nonexistent ??
Steve Rolles ????
@SteveTransform
Replying to
@matt_lamers
That's an odd conclusion. Couldn't you equally well argue that they *under regulated* - let a small number of mega corps run riot - creating oligopolies & a doomed speculative bubble?
Establishing a more diverse equitable mkt structure would have avoided much of this.
Matt Lamers ??
@matt_lamers
·
19h
Replying to
@SteveTransform
Sorry, no. No one in Canada thinks this industry is under regulated. That's crazy. "Establishing a more diverse equitable mkt structure" is what I've been writing about for 5 years.
Steve Rolles ????
@SteveTransform
Replying to
@matt_lamers
I rate your analysis - I just don't follow the logic here. Doesn't the corporate meltdown suggest a huge regulatory failure?
6:23 PM · Sep 13, 2022
·Twitter for Android
Yes and no. I don't think it was a public policy goal for the Canadian gov't to prevent oligopolies.
I view the corporate meltdown as the result of very poor business decisions mostly, and irrational investors.
https://www.bundestag.de/resource/blob/909524/0331f5fd3ccd14c6758c234f561ed879/WD-2-057-22-pdf-data.pdf
Note: the Bundestag document is only availabe in German - but Google translate does a decent (but not perfect) on it.
Similarly - there are only a French and Spanish versions of our 'Strategies for reform' briefing at this point.
3/
TransformDrugPolicy
@TransformDrugs
·
Sep 13
For a more comprehensive analysis of UN and drug reform and international law issues - see the resources from TNI
@DrugLawReform
here; https://tni.org/en/topic/un-drug-control
and from
@IDPCnet
's searchable archive here: https://idpc.net/publications
4/4
Ho well...
Canada’s Cannabis Act review won’t launch until after Queen’s funeral
author profile pictureBy Matt Lamers, International Editor
September 14, 2022
to Bonno SHARE
The Canadian government is delaying the launch of the mandatory review of the country’s 2018 recreational cannabis law because of the death of Queen Elizabeth II, sources told MJBizDaily.
Queen Elizabeth II, who was Canada’s monarch, died Sept. 8 at Balmoral Castle in Scotland.
The review had been expected to begin Wednesday in a joint announcement by Jean-Yves Duclos, Canada’s health minister, and Carolyn Bennett, minister of mental health and addictions, according to the sources, who requested anonymity because they don’t have permission to speak on the matter.
The launch is now expected to happen after the late monarch’s Sept. 19 funeral.
The ministers are expected to begin an 18-month review of Prime Minister Trudeau’s historic legislation.
After the review is completed, a report will be submitted to parliament.
The review was supposed to start by October 2021, three years after Canada legalized recreational cannabis.
Health Canada has not provided MJBizDaily with a timeline for when the review would begin, nor would Canada’s health department confirm the launch or postponement of the review.
Replying to MJBizDaily queries, a Health Canada spokesperson said that “the government is committed to putting into place a credible, evidence-driven process for the legislative review, which will assess the progress made towards achieving the objectives of the Cannabis Act.”
“Preparations are underway for the launch of the legislative review,” the spokesperson said.
The Canadian government has taken that stance for almost a year.
“As set out in the legislation, the legislative review must study the impact of the Act on public health,” the spokesperson said.
“In particular, it must look at the impact on the health and consumption habits of young persons with respect to cannabis use; the impact of cannabis on Indigenous persons and communities; and the impact of the cultivation of cannabis plants in a dwelling-house.”
Health Canada’s response does not suggest the review will consider meaningful reforms requested by the industry.
Canadian industry players previously told MJBizDaily they hope to use the review to address issues such as:
Cannabis excise taxes.
Edibles potency limits.
Government regulatory fees.
Marketing and advertising restrictions.
Canada’s largest cannabis producers have lost upward of 16 billion Canadian dollars ($12.3 billion), largely because of business decisions such as massive overproduction, leading to mass destruction of cannabis.
Since 2018, almost 900 million grams (roughly 900 tons) of unpackaged dried cannabis has been destroyed by licensed producers because of overproduction and quality issues – a weight approximately equal to 650 Toyota Prius cars.
In June, the Canadian federal government updated its Forward Regulatory Plan through 2024, which lays out several regulatory changes for the cannabis industry that “Health Canada aims to propose or finalize in the next 2 years.”
Those details had previously been announced.
Previously announced changes to cannabis beverage possession limits will not be ready before this fall, according to Health Canada.
The Canadian industry had been hoping to capitalize on those alterations this summer.
More police b.s.
It,s as if they have to traffic humans to grow weed now?
We live in a capitalist society!
Good workers are not difficult to find.
Photo: Max Fleischmann/Unsplash
DCC: SAN BERNARDINO SHERIFF CANNABIS CLAIMS UNSUBSTANTIATED
JIMI DEVINESEPTEMBER 14, 2022
The California Department of Cannabis Control is disputing a statistic used by the San Bernardino County Sheriff’s Department on NBC Nightly News.
The Sept. 7 edition of the NBC broadcast features a report on human trafficking in the cannabis industry. Before the report came the first surprise for cannabis industry pros, when Lester Holt even prefaced the it with the claim of a new trend from law enforcement.
That trend? Victims of human trafficking were growing cannabis that ended up on the shelves of permitted California dispensaries. Cut to NBC’s crew on a ride along with the sheriff in the Mojave Desert on a raid. The property features a spread of greenhouses and a voiceover with claims of illegal marijuana being grown with illegal methods per the sheriff.
Next, the package cuts to the officer in charge of the raid, Lieutenant Marc Bracco. The sheriff takes multiple people into custody with Bracco noting those cultivators themselves might be the victims of human trafficking. The Mandarin-speaking cultivation team tells the crew they all left restaurant jobs after finding the gig on a website, suggesting at least some degree of autonomy and freedom. But then they note they haven’t been paid yet, this can be typical in underground operations with everyone getting cashed out after the harvest.
After a tour of the housing conditions, the camera cuts back to Bracco noting, “This product will end up in a dispensary.”
He’s asked if he means a legal dispensary, to which he replies, both legal and illegal. That’s followed up with him being asked to clarify if consumers can walk into a dispensary and find products grown by victims of human trafficking.
“Yes,” Bracco replies. “If you look at the number of legalized grow locations for the state, there’s not enough of those to funnel product for the legal dispensaries. So over 70% to 80% of marijuana at your dispensary is illegally cultivated.”
We asked the Department of Cannabis Control for its take on the comments from Bracco.
“No information from our licensing, compliance, or enforcement divisions corroborate these claims. Unsubstantiated claims destroy public confidence in the legal cannabis market and do a disservice to the thousands of businesses working to follow the law. Our enforcement division works closely with federal, state and local partners, including the San Bernardino Sheriff’s Office, and will continue to provide coordinated resources and support to aid in their efforts to combat the illegal market,” the state told L.A. Weekly.
Most experts in the industry agree the exact opposite of what the sheriff claimed is happening. The marketplace is so flooded with legal product, it has crashed the market price of marijuana. Many farmers chose not to plant this year because it would not be worth their time. This flood of products on the recreational market is the main point of financial strife for the legacy communities that backboned California’s market for decades. It is undeniable that there hasn’t been a true drought since 2019 and there is a ton of pot left over annually.
While interstate and international commerce eventually will change the game, right now California definitely has too much of its own legal weed.
Is illegally grown cannabis appearing on dispensary shelves a big issue? Highly doubtful. Legal marijuana is much more likely to get backdoored to marketplaces like Illinois and New York, where it’s worth three times its value in California. Furthermore, the idea that it would be grown using illegal methods in a desert greenhouse, and then pass the checks and balances of California’s recreational market is baffling.
This isn’t to dismiss the idea that there are people in bad situations working in cannabis cultivation in California, but that product making it to the legal market is unlikely when it’s worth more with fewer hurdles in many places right now.
We asked the San Bernardino County Sheriff’s Department for some background on Bracco’s after our initial press time they replied they stand by the information provided, as a result of thousands of investigations, years of professional experience, education, and training.
Sadly, some politicians have different (agenda) vues.
Old John Bonehead is one of (too) many...
John Boozman
@Boozman4AR
US Senate candidate, AR
Arkansans should know legalizing recreational marijuana isn’t the “win-win” its supporters promise. Learn more about the negative consequences for minors, safety, and more at http://safeandsecurecommunities.com, and join me in voting NO on Issue 4 this November.
Will you join him?
The Consequences of Recreational Marijuana
Studies prove the societal costs of legalized drugs far outweigh the revenue marijuana sales bring. Let’s keep Arkansas safe from this fate!
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19-997 (L)
United States v. Green
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
August Term, 2021
(Argued: December 7, 2021 Decided: August 31, 2022)
Docket Nos. 19-997 (Lead), 19-1027 (Con)
UNITED STATES OF AMERICA,
Appellee,
v.
MICHAEL AMALFI, JR., CHRISTOPHER ALVINO, PETER WILK, MICHAEL MARCIANO,
Defendants,
ALEXANDER GREEN, CHARLES GREEN,
Defendants-Appellants.
Before: SACK, BIANCO, Circuit Judges, and UNDERHILL, District Judge.
*
Defendants-appellants Alexander and Charles Green were charged in the
United States District Court for the Western District of New York with, inter alia,
conspiracy to possess with intent to distribute 100 kilograms or more of
marijuana, in violation of 21 U.S.C. §§ 841(a)(1), (b)(1)(B) and 846. The Green
Brothers filed a joint motion to dismiss the narcotics conspiracy count on the
grounds that the classification of marijuana under Schedule I of the Controlled
Substances Act violates their Fifth Amendment due process and equal protection
rights. They argued that marijuana's scheduling has no rational basis because it
does not meet the statutory criteria for inclusion on Schedule I. The district court
(Wolford, J.) denied their motion to dismiss, concluding that they incorrectly
sought to tether the rational basis inquiry to the statutory criteria. We agree with
* Chief Judge Stefan R. Underhill, United States District Court for the District of
Connecticut, sitting by designation.
19-997 (L)
United States v. Green
2
the district court that the Act's scheduling criteria are largely irrelevant to our
constitutional review because the rational basis test asks only whether Congress
could have any conceivable basis for including marijuana on the strictest schedule.
Because there are other plausible considerations that could have motivated
Congress's scheduling of marijuana, we conclude that its classification does not
violate the Green Brothers' due process or equal protection rights. We therefore
AFFIRM the order and judgment of the district court.
WILLIAM EASTON, Easton Thompson
Kasperek Shiffrin LLP, Rochester, N.Y., for
Defendant-Appellant Charles Green;
JEFFREY LICHTMAN (Jeffrey Einhorn, on the
brief), Law Offices of Jeffrey Lichtman, New
York, N.Y., for Defendant-Appellant
Alexander Green;
SEAN C. ELDRIDGE, Assistant United States
Attorney, for James P. Kennedy, Jr., United
States Attorney for the Western District of
New York, Rochester, N.Y., for Appellee.
SACK, Circuit Judge:
To decide this appeal, we must determine the proper scope of rational
basis review when analyzing equal protection and due process challenges to the
scheduling of a controlled substance under the Controlled Substances Act
("CSA"), 21 U.S.C. § 801. Defendants-appellants Alexander and Charles Green
(the "Green Brothers") urge us to limit the breadth of our constitutional analysis
to the CSA's scheduling criteria; that is, they argue that the inclusion of
19-997 (L)
United States v. Green
3
marijuana on Schedule I—the CSA schedule with the strictest controls—violates
the equal protection and due process guarantees of the Fifth Amendment
because there is no rational basis on which to conclude that marijuana fulfills the
statutory requirements for placement on that schedule. In particular, the CSA
requires that a substance have no accepted medical use to be listed on Schedule I,
and the Green Brothers argue that marijuana's scheduling is irrational because of
the abundant evidence that marijuana has legitimate medical uses. They ask us
to strike down marijuana's Schedule I classification as unconstitutional and,
upon that basis, dismiss the narcotics conspiracy counts against them.
We decline to do so. The statutory criteria in the CSA are substantially
irrelevant to our review of the Green Brothers' constitutional claims. The rational
basis test requires us to ask whether there is any conceivable basis to support
Congress's decision at issue (here, to include marijuana on the strictest CSA
schedule). Thus, even if there are accepted medical uses of marijuana such that it
would not satisfy the listing criteria for a Schedule I substance under the CSA,
that fact would not be sufficient to render marijuana's scheduling
unconstitutional. Because there are plausible considerations that could have
motivated Congress to place marijuana on Schedule I, we conclude that
19-997 (L)
United States v. Green
4
marijuana's scheduling does not violate the Green Brothers' due process or equal
protection rights. Accordingly, we affirm the decision of the United States
District Court for the Western District of New York (Wolford, J.) denying their
motion to dismiss the charges against them for conspiracy to possess with intent
to distribute 100 kilograms or more of marijuana, in violation of 21 U.S.C.
§§ 841(a)(1), (b)(1)(B) and 846.
BACKGROUND
Over a four-year period, the Green Brothers were engaged in a marijuana
distribution scheme. Alexander Green obtained hundreds of kilograms of
marijuana from California which he shipped to his brother, Charles Green, in
New York State. The Green Brothers set prices for sale and, with the aid of coconspirators, distributed and sold the marijuana in the Rochester, New York
area. On March 27, 2014, a Western District of New York grand jury returned a
two-count indictment against the Green Brothers charging them with conspiracy
to possess with intent to distribute 100 kilograms or more of marijuana, in
violation of 21 U.S.C. §§ 841(a)(1), (b)(1)(B) and 846, and conspiracy to commit
money laundering, in violation of 18 U.S.C. § 1956(h).
The Green Brothers filed a joint motion to dismiss the narcotics conspiracy
19-997 (L)
United States v. Green
5
count based on their argument that the CSA's classification of marijuana as a
Schedule I controlled substance violates their due process and equal protection
rights. They argued that marijuana's scheduling has no rational basis because it
does not meet the statutory criteria for Schedule I classification; that is, the CSA
requires that a substance have no currently accepted medical use in treatment in
the United States to fall under Schedule I, see 21 U.S.C. § 812(b)(1), and marijuana
does have accepted medical uses.1 The Green Brothers made clear that they "do
not request" a reclassification of marijuana under a different Schedule; they
"simply request the Court strike the offending statutory classification as
unconstitutional" and leave the issue of reclassification "to the legislative branch."
Factual Allegations and Legal Authorities in Supp. of Def.'s Mots., App'x 40, ¶ 17
(Apr. 10, 2015). In their motion to dismiss, the Green Brothers requested an
evidentiary hearing to present evidence of marijuana's medical uses and build
upon expert declarations submitted by two professors.
On June 27, 2016, after briefing and oral argument, Magistrate Judge
1 The Green Brothers also argued that marijuana failed to meet the two other
statutory requirements for Schedule I classification because, they assert, it does
not have a "high potential for abuse" and there is not "a lack of accepted safety
for use of the drug . . . under medical supervision." 21 U.S.C. § 812(b)(1).
19-997 (L)
United States v. Green
6
Jonathan Feldman issued a Report and Recommendation recommending that no
evidentiary hearing be conducted and that the Green Brothers' motion to dismiss
Count 1 be denied. United States v. Green, No. 14-CR-6038, 2016 WL 11483508
(W.D.N.Y. June 27, 2016) (Report and Recommendation). On December 7, 2016,
the United States District Court for the Western District of New York issued a
decision and order adopting the Magistrate Judge's Report and Recommendation
and denying the Green Brothers' motion to dismiss. United States v. Green, 222 F.
Supp. 3d 267, 269 (W.D.N.Y. 2016).
As an initial matter, the district court tentatively rejected the government's
argument that the court lacked jurisdiction over the Green Brothers' challenge to
marijuana's scheduling because CSA scheduling is an administrative
determination that is only subject to review in a circuit court. Id. at 272-73. The
district court concluded that it had jurisdiction to hear a "proper constitutional
challenge" to marijuana's scheduling. Id. at 272. However, it was "not convinced
that Defendants' argument constitutes a proper constitutional challenge" because
"[w]hen Defendants' argument is dissected, it essentially becomes an attack on
the scheduling of marijuana based on the criteria set forth in the statute," which
is "an argument that really should be asserted in a petition filed with the
19-997 (L)
United States v. Green
7
Attorney General." Id. at 273. Nevertheless, the court identified binding
precedent that “stands for the proposition that a defendant may challenge the
scheduling of marijuana through a constitutional attack brought in the district
court," even though the court “question[ed] the soundness of [that] decision[] as
applied to the circumstances present here.” Id. at 274 (citing United States v.
Kiffer, 477 F.2d 349 (2d Cir. 1973)).
The district court also questioned whether the Green Brothers properly
raised an equal protection claim. The court "ha[d] trouble reconciling how the
classification of a drug, in and of itself, could implicate an individual's equal
protection rights" because "[d]rugs do not have constitutional rights—people
do." Id. Even so, the court continued its inquiry because (1) the Green Brothers
also asserted a due process claim, which is more inclusive yet leads to a similar
analysis, and (2) other courts have allowed defendants to launch equal protection
challenges based on classifications of things (rather than people). Id. at 274-75.
Applying rational basis review,2 the court held that the Schedule I
2 The district court agreed with the Magistrate Judge's decision to apply rational
basis review. Id. at 275. The Magistrate Judge applied the lowest tier of scrutiny
because (1) there is no fundamental right to use, sell, or possess marijuana
without facing incarceration and (2) the Green Brothers' racial classification
arguments—that marijuana's scheduling was racially motivated and imposes an
19-997 (L)
United States v. Green
8
classification of marijuana did not violate the Green Brothers' due process and
equal protection rights. Although the court agreed with the defendants that
"marijuana is . . . currently being used for medical purposes," it concluded that
the Green Brothers misidentified the key question in the case. Id. at 275. They
"focus their argument on the claim that it is not rational for Congress or the DEA
to continue to conclude that there is no acceptable medical use for marijuana,"
but "[r]ational basis review asks not whether it is reasonable to conclude that the
specific criteria in the statute have been met, but, rather, whether there is any
conceivable basis that might support the classification." Id. at 277. Because
"there are numerous conceivable public health and safety grounds" for placing
marijuana on Schedule I, the court concluded that there is a rational basis and
declined to dismiss the count. Id. at 279.3
outsized burden on people of color—failed because they could not establish that
Congress acted with invidious discriminatory purpose. Green, 2016 WL
11483508, at *3-*4, report and recommendation adopted, 222 F. Supp. 3d 267
(W.D.N.Y. 2016).
3 In the alternative, the district court concluded that the Green Brothers' claims
would fail even if it were to adopt their formulation of rational basis review, and
it decided that "[a]ny hearing on this issue is unnecessary." Id. at 280. "Whether
the medical purposes for which marijuana is being used is 'accepted' continues to
be debated. . . . Since the question is at least debatable, a court would err if it
were to substitute its judgment for that of the legislature." Id. (internal quotation
19-997 (L)
United States v. Green
9
On October 3, 2018, the Green Brothers pled guilty to a two-count
Superseding Information that charged them with a marijuana distribution
conspiracy and conspiracy to commit money laundering. The district court
sentenced Alexander Green to 48 months' imprisonment on each count, to be
served concurrently, and Charles Green to 27 months' imprisonment on each
count, also to be served concurrently. The Green Brothers reserved the right to
appeal the denial of their motion to dismiss the marijuana conspiracy count,
which they now do.
DISCUSSION
I. Standard of Review
We review de novo the denial of a motion to dismiss an indictment. United
States v. Smilowitz, 974 F.3d 155, 158 (2d Cir. 2020), cert. denied, 141 S. Ct. 2570
(2021).
II. Controlled Substances Act and Marijuana's Scheduling
The CSA—which Congress enacted as part of the broader Comprehensive
Drug Abuse Prevention and Control Act of 1970—places controlled substances
marks omitted). We take no position regarding this conclusion because it is not
necessary to resolve this appeal.
19-997 (L)
United States v. Green
10
into five schedules based on three factors: "[1] their accepted medical uses, [2] the
potential for abuse, and [3] their psychological and physical effects on the body."
Gonzales v. Raich, 545 U.S. 1, 13 (2005). The schedule on which a drug is placed
determines the strictness of manufacturing, distribution, and use controls. Id. at
14. To fall under Schedule I—the strictest schedule—a controlled substance must
have (1) "a high potential for abuse," (2) "no currently accepted medical use in
treatment in the United States,” and (3) "a lack of accepted safety for use of the
drug or other substance under medical supervision.” 21 U.S.C. § 812(b)(1).
When Congress first enacted the CSA, it placed marijuana on Schedule I,
relying on the recommendation of the Assistant Secretary of the Department of
Health, Education, and Welfare that marijuana be strictly controlled until
pending studies were completed. Raich, 545 U.S. at 14. Yet Congress's initial
scheduling of marijuana has never changed. As a result of Congress's
determination, "the manufacture, distribution, or possession of marijuana
became a criminal offense, with the sole exception being use of the drug as part
of a Food and Drug Administration preapproved research study." Id. If
marijuana were demoted to a lower schedule, individuals would be able to
obtain it for personal medical use with a valid prescription. See 21 U.S.C.
19-997 (L)
United States v. Green
11
§ 829(a)-(c).
The CSA prescribes a process for reclassifying controlled substances. The
Attorney General has the power—now delegated to the Drug Enforcement
Administration ("DEA")—to reclassify a drug, subject to certain limitations. 21
U.S.C. § 811(a); 28 C.F.R. § 0.100(b). Those seeking to challenge the government's
scheduling of a controlled substance can file an administrative petition and, if
necessary, obtain review of an adverse determination in a federal circuit court.
See 21 U.S.C. § 877. As we have explained, "[t]he question [of] whether a
substance belongs in one schedule rather than another clearly calls for fine
distinctions, but the statutory procedure at least offers the means for producing a
thorough factual record upon which to base an informed judgment." Kiffer, 477
F.2d at 357. "[T]he very existence of the statutory scheme indicates that, in
dealing with this aspect of the 'drug' problem, Congress intended flexibility and
receptivity to the latest scientific information to be the hallmarks of its approach."
Id.
There have been several attempts to reclassify marijuana through the
CSA's administrative process. See Green, 222 F. Supp. 3d at 272 (identifying at
least six instances). But "[d]espite considerable efforts to reschedule marijuana, it
19-997 (L)
United States v. Green
12
remains a Schedule I drug." Raich, 545 U.S. at 15.
III. Analysis
A. Threshold Issues
Before deciding the merits of the Green Brothers' motion to dismiss, we
address three threshold issues: (1) whether they bring a proper constitutional
challenge, which can be adjudicated by the district court, or a statutory claim,
which must be brought as an administrative petition; (2) whether, despite raising
constitutional defenses, they were nevertheless required to exhaust
administrative avenues for relief; and (3) whether they failed to show that their
injury could be redressed by the relief they seek.
1. The district court had jurisdiction to hear the Green Brothers'
constitutional defense.
First, we conclude that the district court had jurisdiction over the Green
Brothers' constitutional defenses irrespective of whether their proposed analysis
mirrors that of an administrative petition. The district court expressed doubt
that it had such jurisdiction because it "question[ed] whether Defendants have
attempted to disguise as a constitutional claim an argument that really should be
asserted in a petition filed with the [DEA]." Green, 222 F. Supp. 3d at 273. The
CSA establishes a process for seeking reconsideration of a controlled substance's
19-997 (L)
United States v. Green
13
scheduling based on the CSA's statutory factors, and that process requires
individuals to file an administrative petition, the denial of which is directly
reviewable in the courts of appeals. See 21 U.S.C. §§ 811(a), 877. The district
court expressed concern that, "[a]lthough Defendants attempt to avoid that
statutory scheme by couching their challenge in constitutional language, it seems
as though they are really challenging the administrative determination not to
reclassify." Green, 222 F. Supp. 3d at 273.
We appreciate the district court's concerns, but we think that there is a
meaningful difference between seeking review of the denial of an administrative
petition (over which the district court does not have jurisdiction) and an asserted
constitutional defense, however mistaken (over which it does). Although, as
discussed below, the Green Brothers misconstrued the proper constitutional
question by urging us to restrict our rational basis review to statutory criteria,
they nonetheless raised a constitutional defense.4 We need not accept the
4 In concluding that the Green Brothers raised a constitutional defense, we
consider it worth noting that the Green Brothers did not ask the court to
reschedule marijuana outside of Schedule I, which would have "call[ed] for fine
distinctions" that are best left to administrative agencies. Kiffer, 477 F.2d at 357.
Rather, they appropriately "request[ed] the Court strike the offending statutory
classification as unconstitutional"—i.e., deschedule marijuana—and leave any reclassification efforts "to the legislative branch" or DEA. App'x 40.
19-997 (L)
United States v. Green
14
defendants' formulation of the constitutional analysis to exercise jurisdiction over
their claims.
2. The Green Brothers were not required to exhaust administrative
avenues for relief prior to mounting a constitutional defense.
The government expressed skepticism as to whether the Green Brothers
can raise their constitutional defense without first exhausting available
administrative remedies. Administrative exhaustion is a doctrine that "holds
that federal courts should refrain from adjudicating a controversy if the party
bringing suit might obtain adequate relief through a proceeding before an
administrative agency." Washington v. Barr, 925 F.3d 109, 116 (2d Cir. 2019).
Although the district court ultimately concluded that it was bound to excuse the
Green Brothers' failure to exhaust based on our decision in United States v. Kiffer,
supra, it "question[ed] the soundness" of that precedent. Green, 222 F. Supp. 3d at
274. We see no issue with the rule identified in Kiffer, and we reaffirm that no
such exhaustion is required.
In Kiffer, we entertained a similar constitutional challenge to marijuana's
scheduling. The government argued that the criminal defendants should "be
estopped from attacking . . . the constitutionality" of marijuana's scheduling until
19-997 (L)
United States v. Green
15
they had fully exhausted the CSA's administrative remedies. Kiffer, 477 F.2d at
351. “We put to one side the obvious rejoinder that the administrative agency. . .
does not have the power to declare the Act unconstitutional," because the
"administrative remedy would have obtained for appellants the very relief they
s[ought]" through their constitutional claim. Id. We nevertheless identified an
additional "two reasons" for not requiring administrative exhaustion. Id. First,
we explained that there was "some doubt" whether an administrative remedy
even existed in 1973 because, at that time, the relevant official had taken the
position that he could not consider petitions to reclassify marijuana. See id. The
Green district court correctly noted that this reason is largely irrelevant today,
because that official's position was ultimately rejected by the courts. See Green,
222 F. Supp. 3d at 274.
However, the second reason we identified for excusing non-exhaustion in
Kiffer remains valid: "[E]ven assuming the existence of a viable administrative
remedy, application of the exhaustion doctrine to criminal cases is generally not
favored because of 'the severe burden' it imposes on defendants." Kiffer, 477 F.2d
at 352 (quoting McKart v. United States, 395 U.S. 185, 197 (1969)); see also Moore v.
City of E. Cleveland, 431 U.S. 494, 497 n.5 (1977) ("[R]equiring exhaustion of
19-997 (L)
United States v. Green
16
administrative remedies . . . is wholly inappropriate where the party is a criminal
defendant . . . asserting constitutional invalidity of the statute under which she is
being prosecuted."); Washington, 925 F.3d at 119-20 (requiring exhaustion in civil
suit challenging marijuana's scheduling but distinguishing Kiffer's waiver of
exhaustion because it involved a constitutional defense raised by criminal
defendants). As we recently observed, "[t]he exhaustion requirement under the
CSA is . . . prudential, not jurisdictional. It is not mandated by the statute.
Rather, it is a judicially-created administrative rule, applied by courts in their
discretion." Washington, 925 F.3d at 119. "[J]udge-made exhaustion doctrines,
even if flatly stated at first, remain amenable to judge-made exceptions." Ross v.
Blake, 578 U.S. 632, 639 (2016).
We see no reason to disturb the exception we recognized in Kiffer for
criminal defendants disputing the constitutional validity of a controlled
substance's scheduling. We therefore conclude that criminal defendants need
not exhaust the CSA's administrative process for reclassifying a controlled
substance prior to raising a constitutional defense seeking to deschedule that
substance.
3. The Green Brothers would benefit from the relief they seek.
The government argues that "the classification of marijuana as a Schedule I
19-997 (L)
United States v. Green
17
drug . . . had no effect on the Green Brothers' actual or potential punishment"
because the penalty ranges for marijuana offenses are now tied to "the amount of
marijuana involved, not its classification as a Schedule I controlled substance."
Appellee's Br. at 13. Therefore, the government argues, the Green Brothers
would have faced the same penalties whether marijuana was on Schedule I or
reclassified to another schedule.5 We disagree that the Green Brothers would not
benefit from the relief they seek.
Although the government correctly notes that sentencing for marijuana
offenses is currently based on weight,6 the remedy for the unconstitutional
scheduling of marijuana, if the Green Brothers' defense were to prevail, would
likely be the removal of marijuana entirely from any schedule. Unless and until
the government rescheduled marijuana, it would cease to be a "controlled
substance." Thus, the distribution of marijuana would no longer be the
5 The government frames this as an argument that the "Green Brothers cannot
make the threshold showing that the classification of marijuana as a Schedule I
drug deprives them of a constitutionally protected liberty interest," but
recognizes that other courts have treated this as an argument that a defendant
lacks "standing" to challenge marijuana's classification. Appellee's Br. at 13-15.
6 See, e.g., 21 U.S.C. § 841(b)(1)(A)(vii) (imposing minimum of 10 years and
maximum of life for offenses involving 1000 kilograms or more of marijuana); id.
§ 841(b)(1)(B)(vii) (imposing minimum of 5 years and maximum of 40 years for
offenses involving 100 kilograms or more of marijuana).
19-997 (L)
United States v. Green
18
"distribut[ion] . . . [of] a controlled substance" in violation of 21 U.S.C. § 841(a)(1),
and, therefore, would not be punishable by the weight-based penalties in Section
841(b). There is, of course, a difference between the 40-year maximum the Green
Brothers faced and the lack of penalty they would face if marijuana were
descheduled. Thus, the Green Brothers have shown that their injury could be
redressed, at least in theory, by the relief they seek.
B. Constitutional Analysis
Moving on to the constitutional questions posed by the Green Brothers, we
conclude, for substantially the reasons proffered by the district court, that that
the Green Brothers' due process and equal protection claims fail.
The Fifth Amendment includes an explicit Due Process Clause and an
implicit equal protection guarantee that is "precisely the same as . . . equal
protection claims under the Fourteenth Amendment." Sessions v. MoralesSantana, 137 S. Ct. 1678, 1686 n.1 (2017) (quoting Weinberger v. Wiesenfeld, 420 U.S.
636, 638 n.2 (1975)). Since, in the context of this appeal, the due process and
equal protection claims are essentially identical, we analyze them together. See
Chapman v. United States, 500 U.S. 453, 464-65 (1991) (explaining that, in the
context of due process claims based on a "right to be free from deprivations of
19-997 (L)
United States v. Green
19
liberty as a result of arbitrary sentences" caused by arbitrary statutory
classifications, "an argument based on equal protection essentially duplicates an
argument based on due process").7 For either type of claim, when a challenged
statute does not implicate suspect or quasi-suspect classifications or burden
fundamental rights, we apply rational basis review, which demands only that the
classification be rationally related to a legitimate governmental interest. See
Heller v. Doe, 509 U.S. 312, 320 (1993); Molinari v. Bloomberg, 564 F.3d 587, 606 (2d
Cir. 2009). The Green Brothers raise no arguments on appeal to support
applying a stricter form of scrutiny, and we conclude that rational basis review
7 The district court questioned whether the defendants had properly articulated
an equal protection claim, noting that "[d]rugs do not have constitutional
rights—people do." Green, 222 F. Supp. 3d at 274. Although the concept of equal
protection claims based on arbitrary classifications of things (rather than unequal
treatment of people) is undoubtedly puzzling, the Supreme Court clearly permits
such claims. See, e.g., Minnesota v. Clover Leaf Creamery Co., 449 U.S. 456, 461-63
(1981) (permitting equal protection challenge to legislative classification
differentially treating "plastic and nonplastic nonreturnable milk containers");
United States v. Carolene Prods. Co., 304 U.S. 144, 153-54 (1938) ("[W]e recognize
that the constitutionality of a statute, valid on its face, may be assailed by proof
of facts tending to show that the statute as applied to a particular article is
without support in reason because the article, although within the prohibited
class, is so different from others of the class as to be without the reason for the
prohibition.").
19-997 (L)
United States v. Green
20
applies to their claims.8
The key question on appeal is how to properly frame our rational basis
analysis. The Green Brothers argue that whether there is a rational basis for
including marijuana on Schedule I requires an inquiry into whether it is rational
for the government to conclude that marijuana meets each of the statutory
criteria for that schedule. In particular, they assert that it is irrational to conclude
that marijuana has no accepted medical uses. We conclude—as the district court
did—that the Green Brothers are asking us to improperly tether the
constitutional question to statutory factors. See Green, 222 F. Supp. 3d at 277
("Rational basis review asks not whether it is reasonable to conclude that the
specific criteria in the statute have been met, but, rather, whether there is any
conceivable basis that might support the classification.").
8 Although the Green Brothers include a footnote assuring us that they have not
"abandon[ed] a claim that stricter scrutiny applies," Appellants' Br. at 20 n.8, they
make no effort to rebut the district court's conclusions that (1) the scheduling of
marijuana implicates no fundamental right, see Green, 2016 WL 11483508, at *3
(Magistrate Judge's report and recommendation) (quoting Kiffer, 477 F.2d at 352-
53 ("[T]here is no colorable claim of a fundamental constitutional right to sell
marihuana . . . .")), and (2) they failed to show that marijuana's inclusion on
Schedule I was motivated by discriminatory intent toward a suspect class, see id.
at *4; Green, 222 F. Supp. 3d at 275 (agreeing with "the reasons articulated in the
Report and Recommendation" for applying rational basis review).
19-997 (L)
United States v. Green
21
We reject their reasoning because, on rational basis review, "it is entirely
irrelevant for constitutional purposes whether the conceived reason for the
challenged distinction actually motivated the legislature." F.C.C. v. Beach
Commc'ns, Inc., 508 U.S. 307, 315 (1993). Indeed, "a legislative choice" to make a
particular classification "may be based on rational speculation unsupported by
evidence or empirical data." Id. Therefore, "[o]n rational-basis review, a
classification in a statute . . . comes to us bearing a strong presumption of
validity." Id. at 314. It is not enough for "those attacking the rationality of the
legislative classification" to argue that Congress's stated reasons do not support
the decision it made; rather, challengers "have the burden to negative every
conceivable basis which might support it." Id. (emphasis added) (internal
quotation marks and citation omitted). The rational basis test is thus an
extremely deferential standard. It precludes second-guessing Congress's
"wisdom, fairness, or logic of legislative choices." Heller, 509 U.S. at 319 (quoting
Beach Commc'ns, Inc., 508 U.S. at 313). Accordingly, if a classification's rationality
is "at least debatable," we must refrain from questioning Congress's judgment.
Clover Leaf Creamery Co., 449 U.S. at 464 (internal quotation marks omitted).
Thus, even if marijuana's classification would not survive an
19-997 (L)
United States v. Green
22
administrative petition for rescheduling because it fails to meet the statute's
enumerated criteria, it is not unconstitutional unless there is no conceivable basis
for placing marijuana on the strictest schedule. The Green Brothers convincingly
argue that it is irrational for the government to maintain that marijuana has no
accepted medical use, and we agree with the district court that—if this were an
appeal from an agency's denial of a petition to reschedule marijuana—it would
therefore be difficult for us to conclude otherwise. See Green, 222 F. Supp. 3d at
275. But that is not enough to establish their equal protection and due process
defenses. As we have explained, they "must do more than show that the
legislature's stated assumptions are irrational—[they] must discredit any
conceivable basis which could be advanced to support the challenged provision,
regardless of whether that basis has a foundation in the record, or actually
motivated the legislature." Beatie v. City of New York, 123 F.3d 707, 713 (2d Cir.
1997) (internal citations omitted and emphasis in original). As the district court
recognized, "there are numerous conceivable public health and safety grounds
that could justify Congress's and the DEA's continued regulation of marijuana as
a Schedule I controlled substance." Green, 222 F. Supp. 3d at 279. More
specifically, as the district court explained:
19-997 (L)
United States v. Green
23
One need only review the DEA's most recent denial of a petition to
reschedule to recognize the continuing public health and safety issues
associated with marijuana use—it "induces various psychoactive
effects that can lead to behavioral impairment"; it can result in a
"decrease in IQ and general neuropsychological performance" for
those who commence using it as adolescents; it may result in adverse
impacts on children who were subjected to prenatal marijuana
exposure; it "is the most commonly used illicit drug among
Americans aged 12 years and older"; and its use can cause recurrent
problems related to family, school, and work, including repeated
absences at work and neglect of family obligations.
Id. (quoting Denial of Petition to Initiate Proceedings to Reschedule Marijuana,
81 Fed. Reg. 53,767, 53,770, 53,774-75, 53,783-74 (Aug. 12, 2016)). And "[w]here
there are plausible reasons for Congress' action, our inquiry is at an end." Beach
Commc'ns, Inc., 508 U.S. 307, 313-14 (internal quotation marks omitted).9
For these reasons, we conclude that the district court properly rejected the
Green Brothers' equal protection and due process defenses.
9 We also reject the Green Brothers' argument that they are entitled to a hearing
to force the government to produce evidence of a rational basis for marijuana's
scheduling. Because the burden is on the Green Brothers "to negative every
conceivable basis" for placing marijuana on the strictest schedule, there is also no
need for the government to produce evidence to support the classification. Beach
Commc'ns, Inc., 508 U.S. at 315 (internal quotation marks omitted); see Heller, 509
U.S. at 320 (explaining that, on rational basis review, the government "has no
obligation to produce evidence to sustain the rationality of a statutory
classification").
19-997 (L)
United States v. Green
24
CONCLUSION
We have considered the Green Brothers' remaining arguments on appeal
and conclude that they are without merit. For the reasons explained above, we
AFFIRM the order and judgment of the district court.
SMART MOVE!!!
Small Marijuana Growers Could Sell Directly To Consumers Across State Lines Under New Congressional BillPublished 3 hours ago on September 14, 2022By Kyle Jaeger
To Bonno Share
A pair of congressmen filed a bill on Wednesday that’s intended to help small marijuana growers compete against large corporations when cannabis is federally legalized, proposing to give them the ability to ship and sell products directly to consumers within and across state lines.
Rep. Jared Huffman (D-CA) is leading the legislation—titled the “Small and Homestead Independent Producers (SHIP) Act”—alongside Rep. Earl Blumenauer (D-OR).
As Congress continues to work toward ending cannabis prohibition, there have been concerns that smaller businesses will struggle to compete against the handful of multi-state operators that have the resources and infrastructure to quickly expand, threatening to further consolidate the market when the federal floodgates finally open.
The SHIP Act is designed to minimize that risk and maximize opportunities for those smaller farmers and producers.
“It is a daunting business environment that they’re facing. Markets are consolidating,” Huffman told Marijuana Moment in a phone interview ahead of the bill’s introduction. “We want to make sure that the smaller operations have a chance to compete and succeed.”
Direct-to-consumer models have historically benefitted small farmers in traditional agriculture markets, allowing them to bring their products to market without going through third-party distributors or retailers that would require additional spending.
The SHIP Act would extend that marketing opportunity to the cannabis sector, but only after marijuana is federally descheduled. Huffman said that getting a policy ready for that “inevitability” is an important step “to provide some regulatory certainty and assurances for folks that want to be able to do business out of state.”
The text of the legislation states that a “small cultivator of marijuana and a small manufacturer of a marijuana product may ship and sell marijuana or a marijuana product to an individual located in that State or another State in which possession of marijuana or the marijuana product is lawful by that individual, using the Postal Service or any private or commercial interstate carrier.”
Small cultivators are defined as those who grow up to one acre of “mature flowering marijuana canopy” for outdoor cultivation, up to 22,000 square feet of cannabis canopy using greenhouses or up to 5,000 square feet for indoor cultivation.
For manufacturers, they would meet the definition of a small operation if they produce “a manufactured marijuana product, including a salve, “tincture, edible, or concentrate, with a gross annual revenue of less than $5,000,000, inclusive of all marijuana product manufactured by that person.”
Canada business leaders note ‘lost opportunity’ for cannabis in Trudeau-Scholz meeting
author profile pictureBy Matt Lamers, International Editor
September 12, 2022
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Image of Canadian Prime Minister Justin Trudeau and German Chancellor Olaf Scholz greeting two other Canadian officials
Prime Minister Justin Trudeau and other Canadian officials, left, greet German Chancellor Olaf Scholz, right. (Photo by Adam Scotti)
Olaf Scholz’s recent trip to Canada is raising eyebrows among Canadian business executives over what wasn’t discussed during talks between the German chancellor and his Canadian counterpart, Prime Minister Justin Trudeau.
Cannabis and mainstream business leaders said Canada missed an opportunity last week to highlight its regulated cannabis industry and promote international trade when Scholz visited the only large country in the world to have legalized marijuana.
Germany announced its intention earlier last year to regulate the distribution and sale of recreational cannabis and, this summer, kicked off the preparatory phase. A draft law is expected to be published this year.
Industry officials said the circumstances created a unique opportunity for the Canadian prime minister to back the multibillion-dollar industry, which has struggled to tap into international markets.
But a spokesperson for the Office of the Prime Minister confirmed cannabis was not discussed between the German leader and Trudeau during Scholz’s trip last week.
“It didn’t come up? Shocking. It’s shocking,” George Smitherman, CEO of the Cannabis Council of Canada, which represents dozens of businesses, said in an interview with MJBizDaily.
“Canada has a chance to align with Germany, and we’re not advancing that? That’s crazy,” added Smitherman, a former deputy premier for Ontario who also was the province’s energy and infrastructure minister.
Smitherman said opportunity abounds between Canadian and German cannabis businesses.
Germany is suffering through an energy crisis because of the war in Ukraine, and cannabis cultivation can be incredibly energy intensive, he said.
That, plus the fact that Canada already has more cannabis cultivation capacity than it will ever need, puts Canada in a position to ramp exports.
Canada has so much excess cannabis, it has destroyed more than 1 billion grams since 2018, and inventories are still overflowing. (That cannabis is thought to mostly be unsellable, but the production capacity remains in place.)
“You might have thought that the combination of these two, the symmetry if you will, the rationale for having Canada and Germany collaborating could be an extension of the energy cooperation,” Smitherman said.
“I’m a former energy minister. I was looking at it from that standpoint.”
Canada is already Germany’s top supplier of medical cannabis, and business leaders say that could easily be expanded.
Canada’s Chamber of Commerce said the country missed an opportunity to promote the legal sector internationally.
“As the first G-7 economy to legalize recreational cannabis, Canada has a narrow first-mover advantage and should promote the legal sector internationally,” the business group said in a statement to MJBizDaily.
“Although cannabis was not on the agenda for German Chancellor Scholz’s short visit to Canada earlier this month, the Canadian Chamber’s National Cannabis Working Group believes Canada should actively work towards securing future meetings with countries like Germany to share industry best practices and to facilitate business opportunities, including the export of medicinal cannabis.”
Canada is top supplier
Canada was the top supplier of medical cannabis flower and extracts to Germany last year, according to data provided by Germany’s Federal Institute for Drugs and Medical Devices (BfarM).
In 2021, Germany imported 6,493 kilograms (14,315 pounds) of cannabis from Canada, or 31% of its medical and scientific marijuana imports.
Denmark was the next closest, with 3,726 kilograms, or 18% of the total amount imported.
Business leaders estimate the opportunity to be in the hundreds of millions of dollars.
Germany is expected to overtake Canada as the largest federally regulated medical marijuana market in the world in 2022.
Economic driver
Despite massive losses at a small number of producers, cannabis has been a driver of economic growth in Canada.
The industry has added roughly 43.5 billion Canadian dollars ($37 billion) to the country’s economy and sustained 151,000 jobs since legalization in 2018, according to a report by accounting firm Deloitte.
Industry leaders have said the Canadian government could be doing more to help struggling cannabis producers make inroads into foreign markets.
“That the (Prime Minister’s Office) confirmed that is really kind of a smoking gun for just how leadership attention and interest in Ottawa has diminished over their own prized initiative,” Smitherman said of the absence of cannabis as a topic in the Scholz-Trudeau discussions.
“If I was prime minister, and I was meeting with the German Chancellor, I might actually be saying, ‘You know, chancellor, us two leading G7 nations, the legalizers of cannabis, we have a chance to be the foundation for countries in favor of a $100 billion industry that’s emerging, what can we do strategically to align that? For instance, could Canada offer Germany supply arrangements?'”
Smitherman said the federal government’s “neglectful leadership model” is being replicated in several provinces and “is an extraordinary threat to the public health goals and to the livelihoods of many Canadians.”
‘Incredible lost opportunity’
Nathan Mison, CEO of Alberta-based Diplomat Consulting, called Scholz’s visit an “incredible lost opportunity.”
He said a majority of Canadians want the cannabis sector to be promoted as an economic opportunity, citing data from Ontario-headquartered pollster Abacus Data.
Mison, co-chair of the National Cannabis Working Group for the Canadian Chamber of Commerce, believes the federal government should treat the cannabis industry like it does mining.
“When we’re looking for positive opportunities for our cannabis sector, what an incredible opportunity to treat cannabis sector regulation the same way we exported Canadian mining rules around the world,” he said.
Mison said 55 countries are weighing cannabis regulation, and it’s in Canada’s best economic interest to be involved in that process, where possible.
“We should be looking to trade opportunities for Canadian businesses to understand how to operate in emerging jurisdictions.”
GLOBAL CANNABIS SALES WILL GROW TO $57B BUT DEPEND ON NEW MARKETS
TRAVIS CESARONESEPTEMBER 13, 2022
As prohibition lifts an ugly grasp on cannabis, the new market prospers. BDSA is an analytics firm that tracks the industry through an enormous point-of-sale network. A recent report by the firm suggests global cannabis sales will grow to $57 Billion by 2026.
This author spoke with the Founder and CEO but also Andy Seeger who serves as one of the BDSA’s Director of Analytics. Seeger gave insight into the US cannabis market’s current era.
We’re now in an innovation 2.0 wave based on price. And that’s at both ends. We’re seeing bulk where full ounces are dominating the market in Colorado, even though it’s an ounce daily purchase limit. All the way down to Illinois, where they’re selling a 0.3 G chillum for $12 — that’s a $36 gram.
Whether it’s one gram cartridges taking over vapes because the price got so low — or sample and trial in Illinois because the price is so high — price realization is driving a lot of the innovation, accessibility, and trends in the market right now.
Andy Seeger
Quality as global cannabis sales grow
BDSA expects Illinois to reach $2B in total cannabis sales in 2022, a 14% increase from last year. Following their most recent report, this author discussed the growing market with BDSA’s founder and CEO, Roy Bingham. During a price reduction, though, quality can be partially maintained through product diversification.
I think there is a difference if you’re talking about flower versus vaporizer products — possibly. But certainly if you’re talking about edibles.
There’s a lot of competition in the mature market. And there is an excess supply in some situations. So the price is a byproduct of that, isn’t it, as the price has been going down for the last year in the mature markets.
Roy Bingham
Product appreciation is found in the right lane
Brand reputation and consistency are vital for more processed Consumer Packaged Good [CPG] markets such edibles and vapes, according to Bingham. Whereas the quality of dried flower, while less laborious to produce, is more multifaceted.
Now, I don’t know that there is necessarily a trade-off between price and quality in cannabis — perhaps not. When you’re talking about relatively processed products like vaporizers and edibles, I am not sure if there is very much difference to be determined. Except, maybe, a lack of innovation if prices are low. There is less incentive for companies to come up with the next new thing or the next new technique.
But when you’re talking about flower, I guess there’s a possibility that cutting corners in various grow stages might lead to a lower quality product.
Bingham
On the consumer side, Seeger noted that top-tier products are conversely becoming more affordable on the market.
Infused pre-rolls offer a higher value proposition than regular prerolls that are now comparable to very cheap flower everywhere else. We’re seeing those [infused pre-rolls] take off with additives of keif or wax.
We’re seeing rosin being pushed into edibles and cartridges at accessible prices, or higher-order cannabinoids now utilized in lower-order formats. So the quality is there. But the price is just affecting quality, and now consumers expect it.
Seeger
Mapping the state-to-state roll-out
BDSA released their report this morning highlighting new market strengths contrasting flat mature states. Do you see advantages or disadvantages to the slow state-by-state rollout compared to immediate federal legalization?
I think, historically, there have been some advantages to a state-by-state rollout. Some companies were able to build a very solid base in their own state before facing the challenges of logistics and other challenges of trying to expand very rapidly over large distances.
We’re probably at the point where federal legislation would benefit the consumer the most and probably many of the large and well-established companies. And, of course, it’s not just a benefit from the point of view of being able to grow and distribute cannabis products. It’s also a benefit from access to banking and financial services and other services that are not readily available to the industry because of federal legislation.
Bingham
Lessons for upcoming markets
The cannabis market currently still under values accountants. And Bingham noted a major issue with taxation. But he instead warned nations preparing for cannabis legalization, such as Germany and Mexico, of potential supply shortages.
Even if you go far enough back to the medical-use market, there was a supply problem at the beginning. And that could last anywhere from a few months to several years.
It’s difficult to anticipate the level of demand and build a supply chain capable of coping and flexing without taking outrageous risks and bets as a business. And then I think the other thing we see is usually there is a category of product format.
You basically sell out of your flower each time before you actually get far enough down the pipe to start to produce those alternative products.
Bingham
Producers can keep sales strong as global cannabis grows with products, quality, and brand strength.
Balancing oversupply
BDSA’s report discusses Oregon and Washington’s moratorium to slow the oversupply problem. Bingham called their oversupply a different problem that occurred six or seven years later.
And, of course, it’s associated a lot to do with the legal status of the market and the extent to which there is an illicit market. And also what’s happened to prices as well — so you can end up in a situation of massive oversupply.
Bingham
Advantages and shortfalls of a federal bill
National legalization would alter the course of the entire market. While that bill could take until at least 2026 to come into force, it might lead to a short-term fallout amidst great potential.
You have growth and processing facilities established in every state. They would be needless if you could transport your product across state borders. And then you’ve got a lot of suboptimal operations in terms of scale.
Bingham
BDSA’s Founder and CEO remarked on the classic cannabis industry trend. That is, licensed producers with deep pockets and a lack of grow know-how frequently enter the competitive market with a trajectory half-a-country-wide.
Corporate LPs perpetually attempt to encompass smaller competition. Yet, the Globe’s cannabis market has room to grow — from 30$ billion in 2021 to 57$ billion by 2026.
[The industry) will have its rapid growth years and more challenging years — like this year for the mature markets. But we will see its overall growth outstrip any other food and most other CPG category.
Roy Bingham
The cannabis industry hosts new markets with unusually prosperous values. In contrast, sales flatline after maturation. New markets are, therefore, projected to support global cannabis sales growing until 2026.
TRAVIS CESARONE
Travis resides in British Columbia with a strong personal enthusiasm for cannabis and sciences. He spends equal amounts of time conversing amongst various cannabis communities as he does dwelling in research papers. A strong passion for scanning and reviewing various social, political and
Germany move to legalise cannabis slows over fears of clash with EU laws
New ‘degree of caution’ in coalition government over promises of breakthrough before end of this year
People demonstrating last month in Berlin, with a placard calling on the governing coalition’s three parties to fulfil their pledges on legalising the drug. Photograph: Carsten Koall/Getty Images
Philip Oltermann in Berlin
@philipoltermann to Bonno
Mon 12 Sep 2022 14.57 BST
Legal hurdles are slowing down German plans to allow the controlled distribution of cannabis among adults, with fears that a badly crafted law to legalise the drug could be thrown out by the European court of justice.
In a coalition agreement signed last November, the three-party government led by the chancellor, Olaf Scholz, stated its intention to make it legal to sell cannabis to adults for recreational purposes.
The pledge has been reiterated by the Green party and the liberal Free Democratic party in particular, with the justice minister, Marco Buschmann, expressing optimism in May that a law could be passed by next spring and “the first legal joint” sold in Germany in 2023.
Since then, however, the government has become noticeably quieter on promises of a draft law in the autumn. On Monday, a legal analysis by the German parliament’s research service leaked to the news portal RedaktionsNetzwerk Deutschland warned that a move to legalise cannabis would contravene European regulations in more ways than one.
While the expert opinion was commissioned by the conservative Christian Democratic Union, which opposes steps to further legalisation, some of the increased alertness around the subject is shared in government circles.
“There is a degree of caution about promises of a breakthrough before the end of the year,” said one official familiar with the matter. “The complexity of all is starting to sink in, and there’s a sharper awareness of the risks involved. We don’t want another autobahn toll debacle.”
Angela Merkel’s fourth term as chancellor saw a humiliating U-turn on plans to introduce a German road toll that would disproportionately affect foreign-registered cars, after it was ruled in violation of anti-discrimination law by the European court of justice.
In the initial debate around legalising cannabis in Germany, the main obstacle identified was the UN 1961 single convention on narcotic drugs, whose obligations Canada and Uruguay ignored when they took steps to legalise the drug.
Now, however, Berlin increasingly sees the convention as the smaller challenge as the binding nature of various European laws has come into focus. A Council of the European Union framework decision from 2004, for example, requires member states to ensure that the sale of drugs including cannabis are “punishable by effective, proportionate and dissuasive criminal penalties”.
The Schengen agreement also obliges signees to curtail the illegal export, sale and supply of “narcotic drugs and psychotropic substances, including cannabis”.
While the German government remains on track to pass a law within the current parliamentary term to allow the distribution of cannabis, sources said, it is also watching the latest plans in Luxembourg as a way to legalise the drug with minimal risk of infringing European laws.
The government in Luxembourg this summer proposed a law that would legalise recreational use of cannabis in private but continue to ban the use of the drug in public.
The Netherlands, while widely associated with legal weed-smoking, only tolerates the consumption of cannabis and technically still criminalises the growth and sale of the drug to coffee shops.
Legalization will have to wait.
Rosen Law Firm will win and expose the caper!
TIMBER. How low will Turdray go?
Considering what the grow is, i,d call it a doomed scenario.
It,s all in the grow!
*****18 million per year HEXO pays Tilray !!!
To grow bunk.
ENOUGH SAID !
Lol...
What are those problem John?
“European countries that have a much bigger problem with illegal cannabis use, like France, are watching very closely what Germany is doing at the moment.”
I see only one problem...
Stop arresting folks for growing weed and ruining their lives.
Inside Europe’s largest cannabis manufacturing facility
Somai Pharmaceuticals' 3,800m² facility has been built to satisfy Europe’s growing appetite for the herb
Bonno IN BARCELONA 12 SEPTEMBER 2022
Walking around Europe’s largest cannabis manufacturing facility, it quickly becomes obvious that I’m in the hands of a veteran. Even though we’re surrounded by millions of euros’ worth of state-of-the-art machinery, Somai Pharmaceuticals’ founder and CEO Michael Sassano is more concerned with the tiny scuffs he’s noticing on the walls and floor than the impressive technology.
“It’s a little rough,” he says, dropping down to his knees to examine the easy-clean epoxy surface. Sassano has spotted a tiny dimple in some of the sealant connecting two panels. It’s almost indiscernible to the untrained eye but, now, building his 16th cannabis manufacturing facility, he’s hyper-aware of anything that might slow the operation down later along the line.
“It’s the details that’ll sink you, brother,” he says, in a drawling American accent.
“A bit of roughness like that: run a machine over it a few hundred times, that’s going to be a full-on scratch — a breeding ground for bacteria. Once that happens, you’ll have to shut the whole operation down while you fix it.”
This high level of attention to detail is understandable, given the stakes. Hundreds of startups are seeking to get their noses out in front in the European medical cannabis market which is expected to grow from $4.96bn in 2022 to $13.4bn in 2027.
Sassano says that the majority of these startups are in cannabis cultivation, and they’ll become natural clients for Somai. His company turns the raw cannabis plant into medical products like sprays, drops, vape liquids, softgels and transdermal patches (“a doctor would rather not prescribe you a joint to smoke,” he explains).
Even though the manufacturing line, located 30 minutes outside of Lisbon, isn’t fully operational on the day of my visit, we’re still required to suit up in antibacterial smocks, shoes and hairnets. When you’re making medical products to the highest certification, keeping contamination out of the production is priority number one.
“We’re glorified cleaners,” Sassano jokes. But his dry humour doesn’t cover for the impressiveness of the technical operation. Built within a pretty standard-looking warehouse from the outside, Somai’s production line is a U-shaped procession of airlocked and pressurised chambers, each housing its own piece of specialised equipment.
After the raw “biomass” (the cannabis buds) enters the warehouse, it’s first cleaned. Somai’s managing director Anton Nakhodkin is visibly stressed describing this unsanitary part of the process.
“It is extremely dusty,” he frets.
After the biomass is cleaned and weighed, we’re onto the serious machinery.
To be turned into medical products, the cannabis buds must first be turned into an oil.
This is where the cryo-ethanol extractor comes in. The machine takes in cleaned biomass and runs it through a process using ethanol chilled to minus 40C, to extract crude oil from the plant material.
The cryo-ethanol extractor
A specialised, blast-proof camera that’s needed due to use of flammable ethanol in the extraction process
Once this cannabis oil has been obtained, it has to be purified. It’s wheeled next door to meet the distillation machine (Sassano’s favourite toy in the facility). Here, dark crude oil at a purity of roughly 55% THC (the primary psychoactive ingredient in cannabis) is turned into a clear distillate with a THC purity which can range from 80-95%.
Next, the distillate is taken to meet the formulation room — the place where it’s turned into one of the 42 different products, including sprays and oils, that Somai intends to roll out.
Different products
“42 is extremely aggressive,” says Sassano. “That’s about 32 more than the nearest guy.”
Much of this product differentiation comes in the different mixes and concentrations of THC and CBD (another psychoactive compound in cannabis which is believed to reduce anxiety among other benefits) that Somai produces.
This balance changes the intensity and general effect of the medical product, while another factor, homogenisation, influences how quickly edible products are absorbed into the body’s system.
Somai’s product roadmap
Sassano says that these differences can all make meaningful differences to the way a patient responds to medicinal cannabis, adding that taste will be another differentiation in Somai’s product line.
“There is no reason that your medicines should taste like crap,” he says.
After being formulated, the cannabis derivatives are then taken off to be bottled and packaged. Before sending out for distributors, all of Somai’s products are quality controlled on-site to ensure they match up to the highest GMP medical certification for cannabis. The certification ensures that medical products are consistent, high-quality and don’t degrade more quickly than stated.
Quality control happening on-site at the Somai facility
The need
These 42 products will give doctors a wide range of options for treating different conditions in different people. In Europe, Sassano says, the average age of patients using medical cannabis is around the 50-55 mark — clearly showing that the drug isn’t only valued by hippies at music festivals, as the stigma suggests.
“The number one category of indication [currently being treated with cannabis] is pain,” Sassano explains. “Then you’ve got conditions like epilepsy, sclerosis and arthritis.”
While doctors can prescribe these cannabis products as a medicine today, the treatments are not yet approved through the clinical trial process. What this means is that a doctor can only say “this might help your arthritis” rather than “we are clinically certain this will help your arthritis”.
As well as producing medical products that can be prescribed, the company is also launching clinical trials to develop approved cannabis-based drugs for chronic pain and arthritis.
Sassano says that there are currently 200k insured patients in Germany using cannabis treatments, while less developed markets like the UK have around 17k patients, with that number “going rapidly up” every year.
The startup market
Sassano says that demand for cannabis in Europe is about to explode, with Germany looking set to legalise the drug completely in the coming years — a move that he says will supercharge European rollbacks of regulations.
“You have the real kindling of a brush fire going on right now,” he says. “If Germany goes, I imagine Portugal will be almost instantaneous.”
This, he says, is being accompanied by a general swathe of relaxation around medical cannabis regulations in countries like France, Spain and Switzerland.
Startups aren’t naive to what could be a massive increase in the size of Europe’s cannabis market in the coming years. Sassano says that there are currently hundreds of founders around Europe applying for growing licences to meet this demand.
“They all want to work with us,” he says. “We give them that end-to-end solution, and allow them to diversify their product so they don’t just have to sell the [cannabis] flower. What we make is a higher margin product.”
Somai has capacity to expand its manufacturing operation within the warehouse, as demand increases
Manufacturing startups like Somai are in competition with big hitters from Canada, where the medical cannabis market is much more mature. But Sassano says that due to market woes back home, Canadian companies’ “capital is distracted”, with none of them having anywhere near as much manufacturing capacity in Europe as Somai. Besides, Canadian companies are known for their poor quality products.
Why Portugal?
Before launching the company in 2020, Sassano was CEO of US cannabis company Solaris Farms. He’s clearly relishing the chance to bring that expertise to Europe, where the market is younger and the competition less fierce.
“We come from the US market where we’re in a much more competitive place. We’re used to much lower price targets, so we can easily achieve a much more profitable experience here,” he says.
As the biggest manufacturing facility on the continent, and a first mover, Sassano says that Somai will be generating €7m in sales in 2023, with that figure doubling in 2024 and climbing to €35m in 2025. He says that profitability should be achievable for the company by the end of next year.
Somai’s manufacturing facility, half an hour outside of Lisbon
The company’s already raised €22m in funding from a mix of private equity funds, family offices and angel investors, and Sassano says that he’ll be looking for banking partnerships to fund things like clinical trials and product registrations in different markets.
Portugal, the Somai founder says, is a perfect place to launch a cannabis business. That’s partly due to regulators who genuinely want the industry to succeed and partly due to a large pool of highly skilled and relatively inexpensive talent who work hard.
“I’ve got a brilliant team,” he says. “They work hard, they really care. And you know what? I really care as well and it show in the product we sell.”
We have been waiting long enough…
We will pass go and collect!
This Ponzi will crash!!
LPs can’t make a living selling grams to newbs.
Money is in bulk.
No… Bunk won’ cut it.
Germany did not like Tilray,s bogus comments...
They better know "Tilray way of doing shady biz" now..
Bad start!
Where is Martha?
MONOPOLY WHOLESALERS LIMITING YOUR CHOICE
CALEB MCMILLANSEPTEMBER 9, 2022
After a turbulent month of cyberattacks, strikes, and product shortages, government monopoly wholesalers are getting back to what they do best: limiting your choice as a cannabis consumer.
As Canadian cannabis law bans celebrity endorsements, you won’t find the latest product from Hexo Corp in Quebec or Alberta.
The “Tyson 2.0” is in partnership with boxing legend Mike Tyson.
Canadian cannabis law prevents celebrity endorsements. But, you’d be hard-pressed to find any promotion or endorsement on this product.
American versions of “Mike Bites” features a hilarious package with an ear on the cover. Of course, this refers to when Tyson bit off part of Evander Holyfield’s ear during the 1997 World Boxing Association heavyweight championship.
The Canadian products, called “Tyson 2.0,” are plain-packaged like every other cannabis product.
However, packaging may have been beside the point. The Quebec wholesaler didn’t want the organization “to be associated with this image.”
They might have been referring to Mike Tyson’s 1992 rape conviction or his general reputation as a crazy person.
The Alberta Gaming, Liquor & Cannabis (AGLC) referred to the promotion of cannabis products through celebrity endorsements as their raison d’état.
Not the First Time: Governments Love Limiting Your Choice
Canopy Growth has tried a few times to lighten up Canada’s no fun allowed cannabis regime. Each time, Health Canada squashed the initiatives, limiting your choice as a consumer.
Twice, Canopy tried to work with rappers. The first time it was a partnership with Snoop Dog to produce “Leafs by Snoop.” The product still made it to Canada. Canopy just had to remove any reference to Snoop Dogg’s name.
Last year, Canopy ended a partnership with Drake. As well they had to cancel a deal with movie actor Seth Rogan.
Don’t blame Health Canada, they’ll say. The real problem is the strict marketing rules in the Cannabis Act. And while that’s true, interpretations and enforcement (however petty) are always left to the bureaucracy.
When enforcing the Cannabis Act, can we trust Health Canada?
Consider who funds Health Canada.
Taxpayers, right? It’s a federal bureaucracy, so you’d think Canadian taxpayers would be funding it. Makes sense. Who else would be giving them money?
What about large pharmaceutical companies? And to the tune of 90%?
Health Canada charges manufacturers for new drugs on the market. These user fees account for 50% of Health Canada’s operating costs.
But since October 2017, this has steadily increased to cover 90% of Health Canada’s costs.
Isn’t there a conflict of interest here? Our health care bureaucracy receives most of its funding from pharmaceutical companies. They are also tasked with regulating a non-patented, natural herb. One that replaces a good chunk of pharmaceutical drugs.
Monopoly Wholesalers Limiting Your Choice
Now, I’m not against this in principle. The problem comes from having monopoly powers.
Health Canada receives 90% of its funding from pharmaceutical companies, then tells us their mRNA vaccines are safe. At the same time, cannabis causes heart attacks and psychosis and is addictive.
The problem is their monopoly status as federal health care regulators, like provincial wholesalers of cannabis.
Of course, if a private distributor doesn’t want to carry Tyson 2.0 because they don’t like Mike Tyson, that’s their prerogative. It’s limiting your choice, but when you have other options…
But when a taxpayer-funded monopoly makes that decision, they’re interjecting their personal values where they don’t belong.
Hence the moral superiority of private enterprise. Where risking your capital requires you to put some thought into your decisions.
Imagine a Canada where consumers and entrepreneurs make choices based on their own risk assessments.
Where the government does the basic tasks of any liberal state: keep out of the daily affairs of the public.
Where individual autonomy and personal responsibility overrule concerns about “public health and safety.”
You won’t find that today. Not in a country run by bureaucrats too scared to allow a private store to sell Mike Bites to willing customers.
Growing lots of Bunk[
b]In 2021, Canadian cannabis producers DESTROYED 60-times more cannabis than they exported to Germany, the biggest medical market outside North America.
(This is cannabis that was legally produced, but was ultimately unsellable)
Top cannabis exporters to ???? (2021)
1—Canada (6,493 kg)
2—Denmark (3,726 kg)
3—Netherlands (3,724 kg)
4—Portugal (2,413 kg)
5—Australia (1,566 kg)
6—Uruguay (848 kg)
...
10.—Colombia (149 kg)
11.—Lesotho (137 kg)
Source: Federal Institute for Drugs & Medical Devices
Why weed companies can't make any money
High taxes, siloed state markets, poor quality and lack of access to capital make it very difficult to turn a profit.
Employees are seen working at a facility that produces cannabis for medical purposes.
The industry has been trying without much success for years to jettison some of the onerous policies that make it so difficult to make money selling weed. | Fernando Vergara/AP Photo
By PAUL DEMKO
10-09-2022 07:00 AM EDT
It’s not easy selling weed.
The legal marijuana business is booming — revenues are projected to hit $32 billion this year, more than double what sales were just three years ago. They’re projected to double again in the next six years, propelled by the launch of big new recreational weed markets in New York, New Jersey and Virginia.
But that hasn’t prevented most weed companies from continuing to hemorrhage red ink nearly a decade after Colorado and Washington became the first states to establish legal markets for anyone at least 21 years old. An analysis by POLITICO of financial filings from two dozen of the largest publicly traded U.S. operators shows that they collectively lost more than $550 million in the first six months of this year on revenues of nearly $4.5 billion.
“It all stems from federal illegality,” said Anita Famili, who heads the cannabis and CBD industry group at Manatt, a law firm and consultancy. “The cost of doing business for weed companies is just much higher than any other business.”
Pro-medical marijuana advocates speak in front of the Nebraska State Capitol.
THE FIFTY
Where cannabis legalization efforts stand across the country
BY MONA ZHANG AND PAUL DEMKO
Arguably the biggest barrier to making money is the sky-high taxes weed companies pay because they’re treated like illegal narcotics traffickers under the federal tax code. The goods also cannot cross state lines, and that lack of interstate commerce means companies must build separate farms, factories and stores in each state where they do business and navigate a rapidly evolving patchwork of state regulations. Finally, raising capital is extremely expensive due to a dearth of financing options, an issue both Republicans and Democrats in Congress recognize but have yet to address.
“If you’re able to generate cash flow with all of these headwinds, when these headwinds start to be removed it’s going to be an incredibly, incredibly good business model,” said Jen Drake, co-chief operating officer of Ayr Wellness, which has retail and cultivation operations in eight states, including Florida, New Jersey and Pennsylvania.
Another factor exacerbating the current financial malaise: Companies spent heavily last year to expand capacity due to misguided optimism about the prospects for loosening federal marijuana restrictions after Democrats won control of Congress and the White House. That’s led to a glut of product and plunging prices in many of the largest state markets like California, Colorado, Michigan and Massachusetts. Those struggles are being compounded by inflation and an illicit marijuana market that remains robust in many states.
“You have more capacity coming into a marketplace with less spending power from the consumer base,” said Charlie Bachtell, CEO of Cresco Labs, one of the country’s largest cannabis companies with more than $800 million in revenues last year. “It’s a lesson in Economics 101 of supply and demand.”
The end result is that weed companies are in a deep financial funk. Capital raises are down more than 60 percent compared to 2021, according to Viridian Capital Advisors, a financial analysis firm that tracks the cannabis industry. The AdvisorShares Pure US Cannabis ETF — a popular gauge of the industry — is down roughly 50 percent since the start of the year, despite a recent uptick, compared to a less than 20 percent dip for the broader S&P 500.
“If you’re too exposed in a market where wholesale pricing pressures is a severe headwind, those companies suffered in the quarter,” said Morgan Paxhia, co-founder of Poseidon Asset Management, which has been investing in cannabis companies since 2014. “There are plenty of companies that will end up going by the wayside.”
Failed lawsuits and lobbying efforts
The industry has been trying without much success for years to jettison some of the onerous policies that make it so difficult to make money selling weed.
Companies have not found success in lawsuits they’ve filed to invalidate Section 280E of the federal tax code. That section was enacted by Congress in the early 80s in response to outrage over a tax court ruling that a cocaine dealer was entitled to deduct his operating expenses. The upshot is that cannabis companies can’t write off any business expenses, including salaries and benefits, and end up paying tax rates that can eclipse 70 percent. Cresco Labs, for example, estimates that it paid an additional $80 million in taxes last year due to 280E.
“Weed companies really suffer from a double whammy when it comes to federal taxes,” said Manatt’s Famili. “One might wonder if there’s a disincentive for the feds to legalize cannabis in that regard.”
Similarly, the cannabis industry and its allies have been pushing Congress for years to pass legislation that would make it easier for weed companies to access some of the simplest banking tools, like loans, and raise capital. Those restrictions mean firms in the sector must typically pay far higher interest rates than those in other industries.
The SAFE Banking Act initially passed the House in September 2019 with strong bipartisan support, and has since cleared the chamber six more times as either a standalone bill or as part of a broader legislative package.
But it’s never gone anywhere in the Senate. That’s in large part because Democrats have portrayed it as a handout to big business and insisted that it be paired with additional proposals designed to help people who were disproportionately harmed by criminal marijuana enforcement. The latest discussions on Capitol Hill have been around a potential “SAFE-plus” package, which would pair criminal justice provisions with the banking bill in hopes of mollifying liberals without alienating too many Republicans.
“The idiots in Washington are causing the problem,” said Matt Hawkins, founder and managing partner of Entourage Effect Capital, which has been investing in cannabis companies since 2014. “They need to understand that in order for this industry to grow and thrive that has to be passed.”
A demonstrator waves a flag with marijuana leaves on it during a protest outside of the White House.
Even if something akin to federal legalization were to happen, the industry is split on whether they want state borders to vanish when it comes to cannabis production and sales. | Jose Luis Magana/AP Photo
The lack of interstate commerce is a thornier problem that few industry watchers expect to go away anytime soon because it would require a big change in federal marijuana policy that looks unlikely in the near future.
But even if something akin to federal legalization were to happen, the industry is split on whether they want state borders to vanish when it comes to cannabis production and sales. A company that has invested millions of dollars to build indoor grow operations in Massachusetts, for example, is unlikely to relish the prospect of competing against California cultivators that can grow outdoors at a much lower cost.
“One of the hardest things about doing business in a business that’s federally illegal is the difficulty of dealing with the state-by-state regulations,” said Drake, of Ayr Wellness. “If I could wave my magic wand and make one thing easier and smoother, it would be the state-by-state regulatory process.”
Playing the long game
Despite the current financial woes besetting the cannabis industry, most close market watchers remain giddily optimistic about the future. That’s because more and more states continue to embrace legal sales, with five states potentially holding referendums in November on whether to legalize marijuana use for anyone 21 or older. In addition, they see some form of federal legalization as inevitable at some point down the road, considering that just over two-thirds of Americans consistently back that stance in polling.
“It’s really not if; it’s a matter of when,” Famili said. “The industry is not just going to close shop and walk away.”
That means many of the biggest companies are still making significant investments in hopes of reaping huge profits when barriers like high taxes and lack of access to capital eventually disappear.
“Realistically, it’s still a bit too early in the game to be to be expecting anybody to be really making money, because all of these guys are still in investment phase,” said Jon Decourcey, director of equity research at Viridian Capital Advisors. “It should be expected that it would be taking time to [have] those investments bear fruit in terms of actual profits.”
Cresco Labs’ Bachtell argues that anyone who expected to make a quick buck in a heavily regulated, rapidly changing, emerging market with unique legal barriers was naive. Instead, he views it as a long-term bet on the financial potential of what’s likely to one day be a $100 billion-plus market.
“We thrive in this environment where you’re sort of making the plane while flying it,” Bachtell said.
One third of Toronto's cannabis stores are expected to close within the next year
If you feel like there are too many cannabis dispensaries in Toronto, you're certainly not alone, but it looks like the long-foretold industry shakedown appears to finally be taking place, to the alarm of those in the industry but the joy of some residents and other business owners.
Especially in the wake of mass closures of stores and restaurants over lockdown, it has seemed like pot shops have been popping up in vacant storefronts left, right and centre across the city, oftentimes taking over neighbourhood blocks.
But, the closures of these outlets have already begun, with experts predicting far more in the coming months.
According to recent numbers obtained by the Star, store sales are in decline, the number of new store openings has drastically slowed in pace, and more and more licenses to legally open pot shops (issued by the Alcohol and Gaming Commission of Ontario) are being cancelled — a completely new phenomenon in the GTA as of September 2021.
There is also the fact that many brands are consolidating, with bigger players buying out the little guys as the industry grapples with over-saturation.
t's something experts have been expecting for some time, with analysts at major banks reporting last fall that Ontario as a whole was in for a huge drop in industry sales, store shutdowns and a "loss of economic viability."
Even at that time, in November 2021, legal marijuana sales in Canada were already down 33 per cent from two years earlier, with more than 1,200 retailers operating in Ontario alone, a large proportion of them (about a third) in Toronto.
While some brands have remained successful due to their unique aesthetic, retail experience and approach, the sheer number of licensed dealers has meant lower sales per location as the customer base fails to keep pace with the industry footprint, which is still growing, albeit at a far less voracious pace this year than last.
It's led stakeholders to make some unfortunate predictions for the industry; one Canadian cannabis brand's CEO forecasts somewhere around 1,000 of Canada's 3,200 or so cannabis stores will close this year, which would likely disproportionately impact larger markets in large urban centres like Toronto.
Along with all of the factors working against these companies, members of the community have also been pushing back against openings in their area, with even Mayor John Tory saying at one point that he would be on board with more stringent approval rules in certain circumstances.
Toronto City Council also unanimously passed a motion 10 months ago to support a bill that would amend the Cannabis Licence Act and change the approval process for cannabis retailers, bringing more power to municipalities to have a say in such shops in their cities, which would likely mean fewer new ones opening in an already slowing market.
German cannabis imports growing as Canada’s leading share wanes
author profile pictureBonno
Sept 12-09-2022
Chart showing total medical and scientific cannabis imports to Germany
Germany imported a record amount of cannabis for medical sales and scientific use in the first half of this year, putting the European Union’s biggest market on pace to match or possibly surpass 2021’s total.
The data paints a picture of a medical market that is growing consistently, though not at the blistering pace some analysts had forecast amid the cannabis stock market mania of 2018-20.
Separate data also shows Canada’s role as the country’s top supplier has waned as competition to supply the prized, if still small, German market intensifies.
Cannabis companies in Denmark, the Netherlands and Portugal also supply the German market.
Imports of dried flower and extracts through the first six months of 2022 equaled 10,487 kilograms (11.6 tons), which is 6.1% higher than the first half of last year, when 9,840 kilograms were imported, according to the data from the Federal Institute for Drugs and Medical Devices (BfArM).
Dried cannabis is accounted for as a weight in kilograms, while extracts weight is calculated as the amount of dried flower used for the production of the imported extracts.
In all of 2021, Germany imported 20,589 kilograms of cannabis for medical and scientific purposes, a substantial increase over its 13,346 kilograms in 2020.
Germany imported roughly 8,057 kilograms of cannabis in 2019.
Experts say an unknown quantity of the imported product is reexported to other Europe Union countries, so the import figure should not be used to measure Germany’s market size.
Chart showing which countries German medical and scientific marijuana was imported from.
Canada being challenged
Canada remained Germany’s top supplier in 2021, separate German government data shows.
Last year, Canadian licensed producers shipped 6,493 kilograms of medical cannabis flower and extracts to Germany, accounting for approximately one-third of the country’s imports.
However, that percentage is falling.
Canada has accounted for upward of 38% of all of Germany’s medical cannabis imports since 2017, according to a report by Der Spiegel newspaper, citing government data.
The data suggests that although Canada maintains its leadership position as the No. 1 exporter to Germany, it’s being increasingly challenged by other countries, Alfredo Pascual, vice president of investment analysis at Seed Innovations, told Bonno.
After Canada, the top suppliers to Germany in 2021 were Denmark (3,726 kilograms, or 18.1%), Netherlands (3,724 kilograms, or 18%) and Portugal (2,413 kilograms, or 11.7%).
Another reason for Canada’s diminishing role in Germany’s import mix might stem from some Canadian companies shifting production from their facilities to Europe.
Edmonton, Alberta-based Aurora Cannabis had been supplying the German market primarily from Canada.
But the receipt of European Union-Good Manufacturing Practice (GMP) certification for its Aurora Nordic facility in Denmark on Sept. 11, 2020, allowed the company “to transition the supply of product destined for the EU markets from Canadian facilities to Nordic,” according to a regulatory filing.
A spokesperson confirmed that the majority of Aurora’s marijuana in Germany is now imported from Denmark.
Aurora shipped medical cannabis from Denmark to Germany for the first time in early 2021.
Aurora also holds one of the three licenses for medical cannabis production in Germany, and its EU-GMP-certified facility there, called Aurora Leuna, opened in July, meaning a limited amount of German demand will be met by Aurora’s facility there.
“With our experienced team, Aurora is well-positioned for future growth in the German market, and to capture opportunities in recreational markets in Europe, pending legalization,” the Aurora spokesperson said.
Axel Gille, president of Aurora Europe, said the company is a leading supplier of in Germany, “with the No. 2 position in medical flower sales and two of the top three bestselling dried-flower products.”
Growth impressive, not exponential
Businesses eyeing the German import market are warned against buying into any forecasts of exponential growth.
The German government data shows that imports dropped meaningfully in the final quarter in three of the past five years.
“While that may sound disappointing to those who were expecting unstoppable exponential growth, it’s still impressive to see that a market that started with less than two metric tons of imports in 2017 grew to over 20 tons imported in 2021,” Pascual said.
Pablo Zuanic, an analyst with New York-based investment banking firm Cantor Fitzgerald, estimates the German medical market will reach 300 million euros ($301 million) by the end of this year.
However, Germany does not publish reliable figures on legal cannabis sales, unlike Canada, leaving analysts and researchers to piece together bits of data.
The analyst also noted that past predictions have been well off the mark, citing a 2018 report by London-based Prohibition Partners that had projected a 1 billion-euro ($1.1 billion) medical market in Germany by 2020 and a forecast by Colorado-based BDS Analytics of an 800 million-euro market by 2022.
Zuanic’s report noted the German market “remains rather undeveloped” and has room for growth.
“What is the outlook for the German medical market? We think the out-of-pocket segment may migrate to the rec market, while the reimbursed (from health insurance) segment could continue to grow despite rec legalization,” according to the report.
Zuanic calculated Germany’s medical flower market to be running at 13 tons annually at an average price of 13 euros per gram overall, or 16 euros per gram for the reimbursed segment and 10 euros per gram for the out-of-pocket segment.
The extracts segment is estimated to be worth 80 million euros; the dronabinol segment is flat to declining, at 20 million euros.
Germany’s plan to legalize recreational cannabis is expected to have an unknown impact on the medical market.
Zuanic’s report asks: “Are we putting too much attention on Germany, a market that we estimate has, at best, 300 million euros in medical cannabis sales at present?”
The answer, according to the report, “will come down to the structure of the future German rec cannabis market, which will determine its size and profitability.”
Home / Finance / Stocks
Canadian marijuana stocks dumped by world’s largest sovereign fund
Bonno
September 12, 2022
Norway’s sovereign wealth fund is excluding several Canadian companies because they produce recreational marijuana, which remains illegal in the Nordic country.
Fund manager Norges Bank Investment Management announced this week that Aurora Cannabis, Canopy Growth Corp, Cronos Group and Tilray Brands – all based in Canada – will be excluded from the world’s largest sovereign wealth fund, the Government Pension Fund Global (GPFG).
Canada is the only large country to have legalized adult-use cannabis, but Germany has pledged to follow suit and Uruguay regulated the drug in 2014.
The GPFG’s Council on Ethics recommended the Canadian companies be excluded from investment by the fund “due to production of cannabis for recreational use.”
The move by Norges Bank is the latest blow to the Canadian companies, which have seen their stock prices fall drastically in recent years as losses stretch into the billions of dollars.
Stock losses in the past 12 months total:
78% for Aurora, which trades as ACB on the Toronto Stock Exchange and Nasdaq.
77% for Canopy, which trades as WEED on the TSE and CGC on Nasdaq.
73% for Tilray, which trades as TLRY on the Nasdaq and TSE.
48% for Cronos, which trades as CRON on the TSE and Nasdaq.
Norges bank also excluded tobacco producers and companies that “contribute to severe environmental damage.”
The fund has more than $1 trillion in assets.
Cannabis producer Tilray news release ‘not correct,’ German lawmaker says
author profile picture Bonno International Editor
September 10, 2022 - Updated September 10, 2022
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German government officials are questioning the veracity of some key facts in a recent news release by cannabis producer Tilray Brands, telling MJBizDaily their meeting with Tilray representatives was “a one-time conversation” and “not part of the preparatory phase” of marijuana legalization.
Tilray, headquartered in New York, said in a news release dated Sept. 6 it held a “policy roundtable” with German officials on adult-use cannabis legalization, including:
Burkhard Blienert, commissioner on narcotic drugs at the Federal Ministry of Health.
Kristine Lütke, member of the Bundestag and drug policy spokesperson.
Carlos Kasper, Bundestag member and part of the Finance Committee.
Martina Stamm-Fibich, Bundestag member and part of the Health Committee.
“With this event, Tilray reaffirms its leading role as a trusted partner to government regulators and contributes to German legalization efforts by sharing its long-standing expertise and experience in cannabis research, product quality and safety, supply management, patient and consumer protection, and cannabis education,” the company’s release noted.
However, Lütke’s chief of staff said the Bundestag member did not participate.
Bonno had asked the German officials to confirm the date of the “policy roundtable,” as mentioned in the Tilray news release.
“We (would) like to inform you that there is no roundtable with Tilray and the federal government commissioner for addiction and drug issues,” Blienert’s spokesperson said.
The spokesperson said the meeting was “a one-time conversation with several political representatives” on Sept. 6.
The news release also said Blienert “presented the plan for adult-use cannabis legalization.”
However, rather than presenting the “plan” for legalization, the German government spokesperson said they “only outlined the schedule that has already been published several times. Tilray has deleted the press release yesterday.”
Tilray did not immediately reply to queries from Bonno and the news release does not appear to have been corrected or retracted.
Asked if the officials were downplaying the meeting, Blienert’s spokesperson said: “The content of the press release is just not correct. We are not downplaying the meeting, because there is no cooperation and there will be none either with Tilray. On no level to be clear.”
The title of Tilray’s news release saying the company held the meeting “to Kick-Off Draft Legislation” also seems to have caught the eye of German officials.
Blienert’s spokesperson said the meeting “was not part of the ‘preparatory phase’” of legalization.
“The focus of the federal government in the plans for the controlled dispensing of cannabis to adults lies on expected positive health effects of the population,” the spokesperson said.
Germany launched the preparatory phase of cannabis legislation earlier this summer.
Public hearings were already held to cover topics such as health and consumer protection, criminal liability, control measures and licensing.
More than 200 leading experts shared their expertise on addiction medicine, addiction help, law, business and industry associations as well as representatives of Germany’s states, municipalities, federal ministries and other federal authorities.
A draft bill is expected later this year.
The focus of the legalization is expected to be safety and the protection of youth from negative health effects, according to Germany’s health minister.
Tilray’s shares trade as TLRY on the Nasdaq and Toronto Stock Exchange.
I,m part of that and we have waited long enough...
except Quebec
While business around the world shuttered as COVID-19 spread, the cannabis industry was deemed "essential" in nearly 30 states and stood to gain from the pandemic.
But more than two years later, amid rising inflation and fears of a recession, North American cannabis companies are cutting hundreds of jobs, closing retail outlets and cultivation facilities or shuttering altogether.
The cannabis industry mirrors mainstream companies that experienced similar demand and now are struggling to rightsize their businesses, High Time correspondent Bonno writes.
The cannabis industry layoffs and retrenchment have affected plant-touching companies large and small as well as tech businesses such as Akerna of Colorado and Dutchie of Oregon.
Scaling bunk weed did not help.
While business around the world shuttered as COVID-19 spread, the cannabis industry was deemed "essential" in nearly 30 states and stood to gain from the pandemic.
But more than two years later, amid rising inflation and fears of a recession, North American cannabis companies are cutting hundreds of jobs, closing retail outlets and cultivation facilities or shuttering altogether.
The cannabis industry mirrors mainstream companies that experienced similar demand and now are struggling to rightsize their businesses, High Times correspondent Bonno writes.
The cannabis industry layoffs and retrenchment have affected plant-touching companies large and small as well as tech businesses such as Akerna of Colorado and Dutchie of Oregon.
You are wrong again.
Canada did not legalized cannabis.
No prison for pot.
No chopper hovering low tring to bust four quebec canna plants.
It was designed to fail by ex-police chief Bill Blair.
Stock market caper.
Cannabis has no business selling for dollars per gram.
Chronically elderly sick folks cannot afford these daily prohibition prices.
Legalized cannabis should cost no more than tomatoes.
In the mean time, i and many others are overgrowing this government.
Croptober is turning purple...
Red Hot.