Week in Review: MPP chief bows out, Ohio’s dispensary application glut & MassRoots’ internal war

Rob Kampia steps down as executive director of the Marijuana Policy Project, Ohio is inundated with MMJ dispensary applications, and MassRoots and its ousted CEO do battle.

Here’s a closer look at some notable developments in the marijuana industry over the past week.

Changing of the guard

Marijuana Policy Project’s announcement that Rob Kampia will be moving from executive director into a more supporting role with the organization is another sign that 2017 likely will be the year a new generation of cannabis legalization activists take the baton from those who began the modern movement.

Earlier this year, Ethan Nadelmann announced his retirement as executive director of the Drug Policy Alliance.

“This is certainly going to be seen as the year where the guard changed,” said Kris Krane, managing partner of Boston-based 4Front Ventures. “If you had to look at who were the two most influential people in the movement over the last 20 years, it’s probably Rob and Ethan.”

While Krane said he wasn’t surprised to hear Kampia is relinquishing his leadership position at MPP, he also wasn’t expecting it.

But, Krane added, it’s worth noting the changing dynamics between the burgeoning cannabis industry and the activist-driven legalization movement.

“Twenty-two years ago, we hadn’t won anything. We didn’t even have any medical marijuana laws on the books, and now we have a massive industry,” Krane said.

“And Ethan has talked publicly about his struggles with how do you effectively fundraise with the industry, how close should these organizations be getting to the industry? These are very valid questions, and I think Rob had similar sort of issues.”

Kampia was much more willing “to play give-and-take” with business interests than was Nadelmann, Krane noted, and that was one of the things that made him such an effective fundraiser for legalization campaigns.

But that trait also helped build Kampia’s reputation as being hard to work with, Krane added.

That held true especially where state-level activists were concerned, Krane said, because such advocates often don’t want to make concessions on policy to for-profit companies that may be willing to fund campaigns depending on how proposed laws are written.

“At this point, to give these organizations an opportunity to bring in folks who can view these questions with a fresh set of eyes is, I think, not necessarily a bad thing,” Krane said.

What the changing of the guard means for the future of the legalization movement, however, very much remains to be seen.

Ohio’s flood of applications

It looks as if Ohio regulators will have their hands full with nearly 400 dispensary applications to process.

But will that be too many for them to handle and cause a delay in the market’s rollout?

“I would say no,” said Bret Kravitz, a Columbus-based attorney with Green Thumb Industries, an MMJ company.

“Based on the number of applications that were submitted for dispensary licenses in Pennsylvania,” he added, “I don’t think it’s a surprise that we saw as much competition in Ohio.”

Pennsylvania received more than 500 applications for cultivation and dispensary licenses but seems well on track to meet its deadlines.

“I would like to think (Ohio’s) regulators anticipated the number of applications,” Kravitz said. “At this point in the game in the industry, this is what everybody anticipates on a state-by-state basis.”

He added that he has “100%” faith the regulators will get the job done – and on time.

“They took enough time to go through the regulations and do their due diligence and travel to different states to understand what’s going on,” Kravitz said.

Dietrich in deep?

Most marijuana industry observers likely are wondering what’s next in the MassRoots drama.

After ousting Isaac Dietrich as CEO, the company filed a lawsuit against Dietrich, who then filed legal paperwork calling for a new shareholder vote that could lead to the ouster of the board members who fired him.

Details of the situation are sparse, but MassRoots’ civil suit charges that Dietrich stole more than $250,000 in company funds.

What’s important is what it all could lead to, said David Axelrod, a former Securities and Exchange Commission attorney who’s now a partner at Philadelphia-based Ballard Spahr.

If MassRoots officials are “serious” about the charge, he said, “there’s a good chance they’ve contacted the local (district attorney’s) office or the local police, and so there’s a decent chance that there’s going to be a criminal investigation of some type.”

Though Axelrod said “there’s not a lot of specifics about the theft in the lawsuit,” he called the theft allegations against Dietrich a “pretty straightforward situation of embezzlement, not that dissimilar from small companies where corporate officers have a lot of control.”

“But if this is something where the FBI gets involved,” Axelrod added, Dietrich “could be looking at a prison sentence.”

The situation also could change if Dietrich is successful in retaking control of MassRoots with a new shareholder vote and is able to dodge the lawsuit.

But if law enforcement has begun an investigation into Dietrich’s alleged malfeasance, the boat may have sailed on his opportunity to get out of such a legal scrape without some major legal wrangling.

John Schroyer can be reached at [email protected]

Bart Schaneman can be reached at [email protected]

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