US Court of Appeals backs bankruptcy filing by landlord of WA marijuana grow

Just Released! Get realistic market forecasts, state-by-state insights and benchmarks with the new 2024 MJBiz Factbook member program, now with quarterly updates. Make informed decisions.

The U.S. Court of Appeals for the Ninth Circuit rejected a request by the Department of Justice to dismiss a bankruptcy filing for a Washington state landlord who rented property to a state-licensed cannabis cultivator.

The DOJ’s U.S. Trustee Program, which is responsible for overseeing the administration of bankruptcy cases, argued that landlord Michael Cook could not file a Chapter 11 repayment plan because he received money from a marijuana business, the Wall Street Journal reported.

The trustee noted that cannabis remains federally illegal.

The appeals court, however, affirmed Cook’s filing in a ruling that could provide some guidance about how companies that serve the marijuana industry might navigate the bankruptcy process, the Journal noted.

This bankruptcy case and an earlier one involving an Oregon woman who worked for a cannabis staffing agency reflect some of the larger questions swirling around the DOJ’s overall policies as they apply to individuals whose income is connected to the cannabis space.

To read more about the ruling, click here.