Executive branch lobbying is going to become a more visible issue over the next few months as the state sets up the system of licensed medical marijuana dispensaries.
There will be two stages. Stage one, rule making. Stage two, competition for licenses.
Here’s a basic description from a story in Pacific Business News a couple of months back, based on an interview with one interested contender.
The Hawaii state Department of Health must finalize rules by January, licensees will be announced in April, and they’ll be authorized to open dispensaries just three months later in July. He is gathering a team of experts including a lawyer, potential growers, a doctor consultant, and a lobbyist to prepare as well as he can before the application form is made public in January.
The existing lobbyist law (
Chapter 97 HRS
) requires paid lobbyists attempting to influence the content of those rules to register with the State Ethics Commission and disclose their activities as long as they meet some minimal thresholds in time or money spent lobbying.
But here’s the thing. Current law does not appear to cover any attempts to influence the granting of licenses, which is likely to involve pretty intense competition. Tracking the insider influences, and deterring unethical or illegal influences, at the licensing stage will be considerably harder as a result.
And there’s another wrinkle that was recently called to my attention. The person quoted by PBN is assembling a team that includes a lawyer and other professionals.
Well, I’m told that Hawaii lawyers have been advised against getting involved in the marijuana issue because while the licenses are being issued under state law, marijuana is still illegal under federal law. And the standards of the Hawaii courts prohibit attorneys from being involved in illegal activities. It’s a huge gray area subject to lots of interpretation.
Perhaps some of the lawyers or lobbyists out there might be able to update us on the current interpretations of Hawaii’s rules for lawyers that impact this issue.
The Washington State Bar Association recently issued an opinion summarizing the status of the issue of conflicts between state legalization and federal prohibitions. Here’s an excerpt:
• The Washington Governor and Attorney General have testified about the care that will be taken to implement I-502 in a way that will not conflict with federal priorities. See, e.g., Written Testimony of Washington Governor Jay Inslee and Washington Attorney General Bob Ferguson (Sep. 10, 2013), available at http://www.governor.wa.gov/sites/default/files/documents/testimony_20130910.pdf. In addition, one of the principal reasons for the adoption of the CPPA was to provide additional state-level regulation that was not present under prior Washington medical marijuana law. [n.5]
• The federal government has issued several public statements over the years to the effect that, while reserving ultimate federal authority, it does not wish to impede retail sales of medical or recreational marijuana pursuant to a state regulatory system unless the sales implicate other federal concerns such as money-laundering, sales to minors, sales outside of the state regulatory system and the like. See, e.g., Memorandum from David W. Ogden, Deputy Attorney General, to Selected United States Attorneys, re Investigations and Prosecutions in States Authorizing the Medical Use of Marijuana (Oct. 19, 2009), available at http://www.justice.gov/sites/default/files/opa/legacy/2009/10/19/medical-marijuana.pdf (underlining in original); Memorandum from James M. Cole, Deputy Attorney General, to United States Attorneys, re Guidance Regarding the Ogden Memo in Jurisdictions Seeking to Authorize Marijuana for Medical Use (June 29, 2011) (underlining in original), available at http://www.justice.gov/oip/docs/dag-guidance-2011-for-medical-marijuana-use.pdf; Memorandum from James M. Cole, Deputy Attorney General, to All United States Attorneys, re Guidance Regarding Marijuana Enforcement (Aug. 29, 2013), available at http://www.justice.gov/iso/opa/resources/3052013829132756857467.pdf (underlining in original) (“Cole Memorandum”).
And a presentation by the Washington State’s chief disciplinary counsel at a 2014 American Bar Association conference collected a number of references, and is a good review for those seeking more details (“The Changing Marijuana Landscape and What that Means for the Legal Community”).
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My understanding is that since the federal law does not allow for the sale of marijuana, banks are not allowed to knowingly accept money from licensees. Is anyone familiar with how the money is handled in other states?
In a more rational world, an attorney would be authorized to unambiguously declare to and advise a client that MJ remains illegal under federal law and that any legal services provided pertain solely to ensuring full compliance with state law and are in no way meant to advocate or facilitate any violation of federal law.
Of course, in an even MORE rational world …
“Any fool can make a rule, and any fool will mind it.”
– Henry David Thoreau
@Voice of Reason – In an even MORE rational world, Congress would have descheduled marijuana, already.
Doesn’t this strike anyone as a bit of gambling? While the winds are favorable for federal marijuana legalization, there’s no intrinsic reason to believe that it’s going to happen. It could be next year, it could be ten years from now. All it takes is one “tough on crime” administration and *everyone* who participated in this experiment could wind up in the crosshairs of a DEA investigation.
Lawyers have weird rules, and this is far from the only one. Another common one is lawyers are forbidden from advising clients about how to best apply for medicaid government health benefits, though some attorneys are pushing the envelope lately with “estate planning”.
Until recently, lawyers could not even advertise. Now, there are “non-attorney spokesmen” hawking the spec services for national ambulance chasing network affiliates. But please don’t tell sick grandma how she can preserve her assets better for her grandkids.
Natalie, I understand that marijuana is a cash business in other states (including employees being paid in cash), and that in response, a security industry has evolved to provide secure transportation and storage of all that cash.
Hmmmm. Honolulu has had some experience with groups offering “security” services for other cash businesses, like gambling operations.
Natalie, I understand that marijuana is a cash business in other states, including employees being paid in cash, and that in response, an industry has evolved to provide secure transportation and storage of all that cash.
Lawyers have the same problem banks do. Marijuana is still a Schedule I controlled substance under the federal Controlled Substance Act, which means holding, selling, using it, etc., or helping someone do any of those things, is without question a federal crime. This is regardless of state law, including Hawaii’s law.
While the Dept. of Justice has issued criteria suggesting it does not intend to pursue activity falling within a state law’s safe harbor, it does not rule out changing its mind. DOJ’s most current public position is here: http://www.justice.gov/iso/opa/resources/3052013829132756857467.pdf
In particular, read all the disclaimers/reservation of rights on page 4. And if a Republican wins the Presidency, the risk of the DOJ changing course increases dramatically.
My large Honolulu law firm, like almost all other large firms nationwide, is afraid to touch this work, even though (i) philosophically we believe Hawaii’s law is a very good policy we would like to support; and (ii) the pure business aspect of this industry is significant. This is “good work” in both the philosophical and business sense of the phrase, but we won’t do it because it jeopardizes our license to practice law.
The only lawyers willing to do this are solo attorneys, or small groups of attorneys, who decide that they are willing to run the risk of federal prosecution (which is likely low, at least for now) and loss of their license.
There is literally nothing Hawaii can do at the state level to change this. It’s a federal question.
Thanks zzzzzz and Legal Beagle. I think this is going to get very nasty.
Legal Beagle, I wound think that other lawyers possibly willing to work on this might include:
-Lawyers licensed to practice, but who aren’t actively practicing, and don’t rely on their licenses for their livelihoods.
-Lawyers nearing retirement.
-Lawyers who are not currently licensed, but might get licensed to work on this.
-Lawyers planning career changes.
IOW, lawyers for whom losing their licenses would not be disastrous.
Would there be any financial risk to lawyers working on this beyond loss of license?
“-Lawyers planning career changes.”
zzzzzz’s list of candidates is funny, considering former Mayor and Prosecutor Peter Carlisle and former AG David Louie are two of the lawyers now speaking out on this.