Cannabis Industry Daily News

Florida bank that welcomed medical marijuana firms now closing accounts

Orlando-based First Green Bank – which earlier this year opened accounts for six of Florida’s seven medical marijuana producers and openly agreed to provide them with financial services – said it is shuttering the accounts.

Advertisement

The Miami Herald reported the move reflects a pending acquisition of First Green Bank by a bigger financial institution that doesn’t want to do business with marijuana businesses.

The newspaper also reported that First Green Bank appears to have found another financial institution to provide the same type of services and that medical cannabis patients wouldn’t notice an interruption in securing medicine.

“There will be no interruption or change in operations as far as patients and members are concerned,” Jake Bergmann, CEO of Surterra Holdings, a medicinal marijuana operator and First Green client, told the Herald.

First Green Bank had worked for months to convince Florida regulators it was fit to work with marijuana companies, and said it had “a rock-solid kill switch” that could close all MMJ-related accounts in 24 hours if federal regulators give the order.

Though many banks do work quietly with cannabis-related companies, few advertise a willingness to take on marijuana clients.

Ohio medical cannabis cultivation licensees vie for processing permits

Ohio regulators announced that 104 applicants have applied for 40 available medical marijuana processor licenses.

Advertisement

The Cleveland Plain Dealer reported that at least 22 of those applicants are businesses that have already secured cultivation licenses.

Here’s what you need to know:

  • Ohio’s medical marijuana program allows for companies to be vertically integrated and possess retail, cultivation and processing licenses.
  • Processors will be allowed to produce cannabis oil, tinctures, edibles, patches and flower for vaping. Ohio law prohibits smoking cannabis flower.
  • The deadline for the program to be fully functional is Sept. 8, 2018.
  • Ohio’s MMJ application process recently came under scrutiny after it was revealed one of the application judges had a felony drug conviction and another had ties to the license winner.

Privateer adds marijuana edibles company The Goodship to its portfolio

By Bart Schaneman , Editor

Privateer Holdings has added an edibles company to its portfolio of marijuana businesses, marking the Seattle company’s first foray into the infused products sector.

According to a news release, The Goodship, a Seattle-based marijuana edibles company, said it had agreed to join Privateer’s “family of brands.” Terms of the acquisition weren’t disclosed.

Advertisement

The news release said the two companies plan to develop new products and expand the availability of The Goodship’s brands across North America – including Canada, which is preparing to launch adult-use sales next summer.

“When regulations allow, yes we intend to bring The Goodship to Canada,” Privateer spokesman Zack Hutson told Marijuana Business Daily in an email.

Here’s what you need to know:

  • Seattle-based Privateer Holdings also owns cannabis website Leafly, major Canadian licensed medical marijuana producer Tilray and Marley Natural, a California-based cannabis brand created in partnership with the family of reggae musician Bob Marley.
  • The Goodship sells cannabis-infused chocolate bars, cookies, brownies and other products.
  • The acquisition comes after Privateer announced in November that it would lay off some of its workforce. That followed job cuts of 15 Leafly employees a few weeks prior.
  • Privateer has raised more than $150 million – including $122 million in 2016 alone – to invest in a portfolio of cannabis brands.
  • The company now has more than 500 employees in seven U.S. states and seven countries.

Cannabis company MJardin raises $20 million to bankroll acquisitions

Denver-based MJardin Group said Wednesday it secured $20 million in equity financing, a hefty sum it plans to use for additional strategic acquisitions in the marijuana industry.

Advertisement

MJardin – which manages dozens of cultivation facilities for cannabis companies – said in a news release it had closed on a private placement financing of equity and convertible senior secured debentures.

Here’s what you need to know:

  • Earlier this month, MJardin struck a strategic partnership with a Canadian company that provides alternative financing options – Bridge Finance – to create an “infrastructure fund” for acquisitions. As a result of Wednesday’s announcement, MJardin said it is now “fully financed for its near-term growth initiatives.”
  • MJardin recently set its sight on Canada’s marijuana market, buying a “major” equity stake in a fledgling producer of medical marijuana in Ontario. Terms of that deal weren’t disclosed, but it underscored how U.S. cannabis companies are positioning themselves for next year’s launch of recreational sales in Canada.
  • In the latest funding, KES 7 Capital – a Toronto-based merchant bank – acted as placement agent.
  • MJardin also provides consulting services in cannabis cultivation and processing.
  • In addition to Colorado, the company has an office in Toronto.

Nevada recreational marijuana sales set record in October, hitting nearly $38M

Nevada’s young recreational marijuana market remains red hot, showing few signs of slowing since launching in July.

Advertisement

Sales of recreational marijuana accelerated in October, hitting a record $37.9 million – up notably from the $27.7 million recorded in September, the Las Vegas Review-Journal reported.

Under Nevada’s “early start” program, licensed medical marijuana dispensaries were allowed to begin selling adult-use cannabis in July while regulators worked through the recreational licensing process.

The initial pace of sales exceeded early totals in other adult-use markets. In July and August alone dispensaries rang up $60 million in sales.

According to the Review-Journal, rec and medical sales generated $5.8 million in tax revenue for state coffers in October. That was about $1 million more than in August, which marked the state’s previous largest tax haul.

“We are pretty on target with projections, maybe a little over,” Nevada Department of Taxation spokeswoman Stephanie Klapstein told the Review-Journal.

Big labor sees growth potential in California cannabis workers

Unions have caught a whiff of a rare opportunity to organize a whole new set of workers as recreational marijuana becomes legal in California.

The United Farm Workers, Teamsters and United Food and Commercial Workers are looking to unionize the tens of thousands of potential workers involved in the legal marijuana game, from planters to rollers to sellers. The move could provide a boost to organized labor’s lagging membership — if infighting doesn’t get in the way.

Advertisement

The United Farm Workers, co-founded by iconic labor leader Cesar Chavez, says organizing an industry rooted in agriculture is a natural fit, and growers could label their products with the union’s logo as a marketing strategy.

“If you’re a cannabis worker, the UFW wants to talk with you,” national vice president Armando Elenes said.

But United Food and Commercial Workers, which represents grocery store employees, meat packers and retail workers, registered its intent to organize cannabis workers across the country.

“We would hope they respect our jurisdiction,” UFCW spokesman Jeff Ferro said.

Teamsters organizer Kristin Heidelbach said there’s no need for unions to battle each other. There will be plenty of workers needing representation as small cannabis businesses run by “happy stoner” types give way to large pharmaceutical corporations, she said.

– Associated Press

Rob Kampia no longer affiliated with Marijuana Policy Project

(This story has been updated from an earlier version.)

The founder of Marijuana Policy Project, Rob Kampia, has parted ways with the pro-legalization group.

Advertisement

“I can confirm that Rob has separated from MPP and is no longer on the board,” MPP spokesman Morgan Fox wrote in an email.

Marijuana Moment first reported the news. The website said Kampia departed from the MPP board over the weekend and was no longer employed by the advocacy organization he co-founded in 1995.

The exit comes soon after past allegations of sexual misconduct involving Kampia resurfaced in Washington DC’s City Paper – although Kampia denies such charges came up with MPP board members in the latest turn of events.

Kampia told Marijuana Moment he is launching a for-profit consulting business, Marijuana Leadership Campaign (MLC).

The firm “will focus almost exclusively on changing U.S. laws,” Kampia said, adding that he had lined up $500,000 in seed money from donors and investors.

His latest move comes after Kampia said last month he was bowing out as MPP’s executive director. Instead, he would become director of strategic development and continue to serve on the boards of directors for both MPP and the MPP Foundation.

Kampia’s exit comes amid heightened attention surrounding sexual misconduct and abuse, with several notable personalities in politics, the media and entertainment losing their jobs.

According to Marijuana Moment, Kampia’s departure comes as a major newspaper is preparing an article about previously unreported allegations targeting Kampia.

A memo Kampia gave the website “appears to lay out the case that Kampia’s departure from MPP has nothing to do with any old or new allegations of sexual misconduct,” Marijuana Moment reported.

Kampia said the topic didn’t come up with MPP board members.

“We didn’t even talk about the s-word at all,” Kampia told Marijuana Moment, referring to sex.

Cannabis churches on the rise in California as alternative to dispensaries

Small-scale churches that specialize in marijuana are becoming increasingly common across California, creating yet more competition for retailers that want to operate as for-profit ventures instead of tax-exempt religious institutions.

Churches that have integrated cannabis use with worship ceremonies have cropped up in Oakland, Roseville, Modesto and San Diego, Orange and Los Angeles counties, California Healthline reported.

So far, “a few have been shut down by law enforcement,” according to Healthline.

Advertisement

But many are still operating openly, and California has a lengthy history of marijuana enthusiasts finding loopholes in the law to fit new models of trafficking and consumption, and law enforcement officials like San Jose’s city attorney are taking action against what he calls “illegal dispensaries,” Healthline reported.

Such churches are also likely contributing to a general downturn in dispensary sales that has hit a number of retailers across California, as price-conscious consumers search out the cheapest possible options for purchasing marijuana.

Many such consumers used to rely on dispensaries, but in recent years many have turned to quasi-legal delivery services or other outlets such as MJ churches, which often sell cannabis in a “gift shop” or give it away in exchange for donations.

Break-in at Alaska marijuana operation, $150k of product stolen

A marijuana business in Anchorage had a large amount of freshly packaged cannabis stolen, police said, highlighting the ongoing danger robberies can present for plant-touching companies.

The owner of Danish Gardens – a licensed grower, product manufacturer and retailer – arrived at his store to find the glass employee entrance smashed in, with a small amount of blood left behind, KTVA-TV reported.

The burglars got away with about $150,000 worth of ready-to-buy marijuana.

Dozens of surveillance cameras, required for marijuana firms under state law, recorded the burglary.

Business owner Dane Wyrick said video shows the suspects going straight to the product without looking at anything else.

Wrick said he is concerned that online plans for his business played a factor in the burglary. The plans show his building’s room inventories and camera placements. They also list his home address.

He said he asked industry regulators to take the plans offline.

“We feel that’s extremely wrong — that the State of Alaska and the Municipality of Anchorage, no matter what regulations they’re working under, are jeopardizing our personal safeties and business,” Wyrick said.

Danish Gardens and other Alaska marijuana businesses have raised the online-documents issue through their attorneys, but have been “stonewalled” in response, Wyrick said.

Requests for comment to municipal planning officials and Erika McConnell, director of the state Alcohol and Marijuana Control Office, weren’t immediately answered.

Wyrick said a $10,000 reward is being offered for information leading to arrests.

-Associated Press

Los Angeles won’t meet Jan. 1 deadline to start recreational marijuana sales

Los Angeles’ recreational marijuana businesses won’t be allowed to open Jan. 1 when legal adult-use sales launch in California.

L.A. marijuana regulators said Friday they won’t begin accepting applications to sell legal recreational cannabis until Jan. 3 and it could take weeks before those businesses are properly licensed with the city and state.

Advertisement

“Come Jan. 1 in the city of Los Angeles, there are no legal, adult-use sales,” said Cat Packer, who heads the city’s Department of Cannabis Regulation.

“We are starting a process. This is something that is not going to happen overnight.”

The launch of legal rec MJ sales was widely anticipated in Los Angeles, which arguably will be the largest market in the world when it’s online.

In March, 80% of the city’s voters endorsed a measure that set in motion creation of the new adult-use marketplace.

But the city struggled for months to get rules in place to license businesses for legal sales, and they agreed to guidelines only earlier this month.

– Associated Press

Massachusetts marijuana regulators sign off on industry draft rules

Massachusetts is a step closer to a legalized recreational marijuana industry.

Advertisement

The Cannabis Control Commission has approved a wide-ranging set of draft regulations, though the regulations are not final.

The rules will be subject to public hearings over the next few months, and some revisions are possible before the business licensing process begins.

Facing a July 1 deadline for the launch of adult-use sales, the commission has been wrestling with such questions as:

  • When and how to allow cannabis consumption in social-use clubs.
  • How to promote diversity, especially residents of minority neighborhoods who were targeted by the war on drugs.
  • Marijuana research facilities.
  • Home delivery, including a proposal that delivery drivers must obtain positive ID and proof a buyer is 21 or older. The recipient also would have to sign for any delivery.
  • A special license for facilities that would cultivate and purchase marijuana but wouldn’t sell it.

Jim Borghesani – a spokesman for the Yes On 4 campaign that passed Massachusetts’ rec cannabis law – said the group is generally supportive of the draft regulations.

However, he said the group has “a few minor changes we’d like to see, including removing the requirement for delivery recipients to provide signatures and the requirement for license applicants to hold mandated public hearings.”

– Associated Press

Federal medical cannabis protections extended once more

By John Schroyer , Senior Reporter

The only federal law that protects medical marijuana businesses from U.S. Attorney General Jeff Sessions’ Department of Justice has once again been extended for a short period.

The Rohrabacher-Blumenauer Amendment – which prohibits the DOJ from using federal funds to interfere with state MMJ programs but must be renewed annually – has been given its sixth lease on life by Congress under a stopgap budget deal passed Thursday.

The bill not only avoided a federal government shutdown, it extended the amendment until at least Jan. 19, when Congress must pass either another stopgap budget fix or an entirely new federal spending bill.

Advertisement

“Patients around the country who rely on medical marijuana for treatment – and the businesses that serve them – now have some measure of certainty,” U.S. Rep. Earl Blumenauer, D-Oregon, said in a news release.

“Our fight, however, continues to maintain these important protections in the next funding bill passed by Congress.”

This is the sixth time that Congress has passed what’s known as a continuing resolution, basically keeping the previous federal budget in place instead of hammering out a new one.

It’s a necessary step to keep the federal government funded and running over the holidays. The amendment – previously known as Rohrabacher-Farr – was first approved by Congress in 2014.

The ultimate fate of the law remains uncertain, since the House Rules Committee earlier this year prevented amendments like Rohrabacher-Blumenauer from being added on the floor during a full vote of the House; instead, they must be made at the committee level.

The Senate Appropriations Committee in response attached the Rohrabacher-Blumenauer Amendment to a spending bill that passed the full upper chamber. However, a resolution between the House and Senate budgets was never reached, making the discrepancy a moot point.

Some industry observers doubt Sessions will crack down on the MJ industry, even if Rohrabacher-Blumenauer doesn’t survive past January. But Sessions did ask Congress to kill the amendment earlier this year.

If Sessions had made prosecuting cannabis companies a top priority, he could have gone after recreational marijuana businesses at any point in 2017. Unlike MMJ businesses – adult-use companies are not protected by the amendment.