Q&A With Henry Wykowski, Lead Attorney for Harborside Health Center in Forfeiture Case
The federal government has waged an all-out war against medical marijuana in California over the past two years. US attorneys in the state have shuttered hundreds of MMJ centers – from San Diego to Los Angeles to San Francisco – using a simple yet highly effective strategy: Threaten to seize the property if the dispensaries don’t close down.
In most cases, all it takes is a letter to the landlord to force a cannabis center out of business. Dispensary owners typically don’t have the financial resources to fight an eviction under such circumstances, while most landlords don’t have the desire to stand up to the government on behalf of their tenants.
That all changed when the feds took on the biggest fish in the water: Oakland-based Harborside Health Center.
Regarded as a model dispensary for the entire industry – and ranking as one of the largest MMJ centers in the country with more than $20 million in annual revenues – Harborside didn’t succumb to demands that it close down. Instead, it took the battle to court. Harborside has since put together an impressive string of legal victories, the latest – and biggest – of which came earlier this week, when a judge ruled that the dispensary’s landlords can’t force the operation to close while its forfeiture case plays out.
The man behind these wins: Henry Wykowski, Harborside’s lead attorney. Wykowski – regarded as one of the top MMJ business and tax attorneys in the country – is at the forefront of a battle that will have lasting, significant impacts on the cannabis industry, one way or another.
Medical Marijuana Business Daily spoke to Wykowski about the importance of the judge’s recent decision, how it could affect the entire MMJ industry and what’s next in the forfeiture case.
Following are excerpts of that discussion:
On the most important aspects of the decision for Harborside…
The biggest one is that they are allowed to remain open while the forfeiture case is pending. If they weren’t allowed to stay open, Harborside wouldn’t have had the financial resources to defend against the forfeiture.
On what would’ve happened if the judge ruled the other way…
I think it would’ve been very difficult for Harborside to continue to defend itself had they been forced to close, based on what it’s going to cost to go forward. It would’ve been a very unfortunate decision because it also would have emboldened US attorneys to use this tactic to close other dispensaries. You could reasonably argue that what’s at stake here is the future of the industry, because if the federal government can take down Harborside, it can take down anybody.
On how this week’s ruling could ripple across the industry…
Beyond Harborside, the significance of the ruling is phenomenal. Essentially, we have a United States district court that has declined to shut down a medical cannabis dispensary while a forfeiture case against it is pending. Think about that for a minute: This is a federal judge who didn’t close a dispensary, even though marijuana is illegal federally.
On whether the decision will benefit other dispensaries facing federal forfeiture threats…
That’s hard to answer simply. The facts of each case vary, so I don’t think you could say with legal certainty that they’re never going to close down dispensaries during forfeiture proceedings. But in cases similar to Harborside, we could get the same results. Also, as I said before we now have a federal court that has declined to close a medical cannabis dispensary. Once one does it, that makes it easier for another sympathetic judge to do it.
On what it means for the government’s crackdown…
I think that this is going to make the Department of Justice much more cautious about pursuing forfeiture actions and maybe even cause them to abandon that tactic. They’re no longer winning, because they took on Harborside.
Basically, forfeiture was a big strategy for the government, and they have been very successful by sending out letters to landlords. The reason Harborside is even here is because everyone in front of us that was challenged rolled over. Reasonably speaking, this is the first time a dispensary fought back against landlord evictions and forfeitures. (Harborside Executive Director) Steve DeAngelo is not running away. He is not afraid. He is going to stand up and fight. My philosophy is that if you believe in what you’re doing it’s better to go down fighting than give in. And we’re going to go all the way.
On the top arguments Harborside made as to why it should be allowed to stay open during the forfeiture case…
The first argument we raised was that individuals – or in this case the landlords – do not have a standing under the Controlled Substances Act to stop Harborside from operating. The judge agreed, saying the only party that had the opportunity to do this was the federal government.
Also, the statute of limitations says that if you are aware of certain conduct and do not take action to stop it, after five years you are barred from taking the action. Harborside has been open and operating openly since 2006. It would be incredulous for the federal government to say that for over five years they didn’t know what Harborside was doing.
On the mood after the decision was announced…
The cannabis community was very happy, and the government wasn’t so happy. We went out and had a nice lunch and talked about it. We’re pleased, but I also see this as just another battle in the war.
On what’s next…
Based on the current ruling, the judge will set a case management conference, which I suspect will happen in February, and we will all meet to discuss how the case will proceed. We’ll likely agree on a discovery schedule and agree on dates for motions, and it’s possible that the judge would also set a trial date at that time. I estimate that we’re not looking at a trial until the end of this year or sometime next year. It could be a drawn-out case, but I don’t think the trial will last beyond a month.
On whether cannabis legalization in Colorado and Washington could influence the outcome of the forfeiture case…
It did not in any way change the federal law. But I think that the federal government is concerned that this type of information in the hands of jurors could affect the decision.
On the possibility of a settlement…
Harborside has made it known any number of times that we would love to sit down and discuss a negotiated resolution but (US Attorney Melinda Haag) has not yet responded. We remain open at any time to talk with them, either one on one or with a judge or a neutral mediator or any other reasonable person.
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