Worldwide: Cannabis Group Weekly Alert - Week Of September 10, 2019

Last Updated: September 16 2019
Article by Kathryn Ashton and Eric P. Berlin

This week:

  • US attorneys and public officials convene at a closed-door "Marijuana Summit" in Oregon.
  • An initiative to legalize medical cannabis is likely to appear on Mississippi's 2020 ballot.
  • Non-residents with qualifying medical conditions can participate in New Mexico's medical cannabis program.
  • Thailand eases restrictions on cannabis extracts with THC content of less than 0.2%.
  • The CDC and FDA are investigating reports of pulmonary illness and death resulting from vaping.
  • And more...

Federal

US attorneys and officials from the Food and Drug Administration and US Department of Agriculture attended a behind-closed-doors "Marijuana Summit" held by Oregon US Attorney Bill Williams on September 5.  In attendance was North Dakota US Attorney Drew Wrigley, who said he and other federal prosecutors discussed the development of a "cohesive federal approach and strategy" for enforcing federal cannabis laws. In 2018, Oregon US Attorney Bill Williams assured Oregon Governor Kate Brown that he would not target cannabis businesses operating legally under state law.

Civil rights groups including the ACLU, NAACP, National Education Association and National Organization for Women released a 2020 platform advocating legalizing cannabis as well as "dismantling the current paradigm of drug criminalization and replacing the current system with a regulatory approach that treats substance use as a public health issue."

A federal judge ruled that an Oregon vineyard has a plausible claim of harm caused by a neighboring cannabis cultivation operation and can proceed with a RICO lawsuit.  In response, a new court filing has been submitted by the defendants asking the judge to dismiss case on the grounds that no commercial cannabis operation existed on the subject property (as alleged by the plaintiff), and the only cannabis being cultivated was for personal medical purposes.

US Customs and Border Protection reversed the lifetime ban it had imposed on a 21-year-old Canadian woman caught crossing the Canada-US border with CBD oil.

The cannabis industry has spent approximately two million dollars this year in lobbying for legislative reform at the federal level. The top four spenders include the Cannabis Trade Federation ($483,000), Curaleaf ($400,000), Surterra ($240,000), and the National Cannabis Industry Association ($220,000).  Among other things, the lobbying efforts have included advocating for the STATES Act and the SAFE Banking Act of 2019, and meeting with lawmakers from the US Senate and House of Representatives.

The Wall Street Journal examined how airports handle people traveling with cannabis.  TSA spokeswoman Danielle Bennett stated that TSA officers cannot make arrests and are not searching for cannabis or cannabis-infused products, though "[i]n the event a substance that appears illegal is discovered during security screening, our officers will refer the matter to a law enforcement officer, who then follow their own procedures."  Regarding people possessing cannabis in a state that has legalized cannabis, Sea-Tac Airport spokesman Perry Cooper stated, "We cannot make any arrests if they don't violate state law." The Wall Street Journal found that in states that have legalized cannabis, "[s]ome airport police agencies will confiscate your purchased weed, but others allow you to leave with it."  In 2018, the TSA stated that it does not "have any regulations that address the possession or transportation of marijuana and cannabis infused products" that "under Federal law and many State laws, it's a crime to possess or transport any detectable amount of marijuana", and "[h]aving a State-issued cannabis card or other documentation indicating that the marijuana is for medical purposes doesn't exempt you from TSA's requirement to notify law enforcement."  In 2019, the TSA slightly modified such guidance stating that "[m]arijuana and certain cannabis infused products, including some Cannabidiol (CBD) cream, remain illegal under federal law except for products that contain no more than 0.3 percent THC on a dry weight basis or that are approved by FDA."

States

In California, Los Angeles regulators opened a new round of cannabis social equity licensing for the city, under which 100 retail licenses will be awarded. Additionally, an expanded effort from Code For America aims to clear a quarter of a million individuals' cannabis conviction records by the end of this year.

Illinois passed a law restricting the amount of water and electricity that can be used by cannabis growers and processors.

Massachusetts transportation officials are consulting with state cannabis regulators on whether "sponsor-a-highway" signs purchased by cannabis companies must include warnings generally required of cannabis advertisements.

Mississippi activists have submitted enough signatures to put a medical cannabis measure on the state's 2020 ballot; however, the secretary of state is still reviewing and certifying the signatures, stating that: "At this time, we do not know whether the signature requirement has been fulfilled.  We are in the process of reviewing and determining the number of signatures so as to file with the Legislature on the first day of the 2020 session in accordance with (state law)." 

A New Mexico judge has ruled that non-residents with qualifying medical conditions can participate in the state's medical cannabis program by enrolling in its medical cannabis registry.  Although earlier this year the state's medical cannabis statute was amended to remove the in-state residency requirement, the governor's office asserts such amendment was unintentional, and intends to appeal the judge's ruling.

Washington, D.C. enacted a bill protecting medical cannabis patients from workplace discrimination. It will now undergo a 30-day congressional review period before taking effect.

Hemp and CBD

Connecticut announced that regulators have licensed 82 hemp growers, two processors and 21 manufacturers under the state's new pilot program.  Currently, 294 acres of land are being used to cultivate hemp in the state.

When asked whether the NFL should permit its players to use CBD for pain management, New England Patriots quarterback Tom Brady stated, "I think they should explore it and do what's best for the players."

International

In Canada, the Superior Court of Quebec ruled that the province's criminalization of cannabis home cultivation was unconstitutional, holding that the Canadian federal government has sole authority to legislate on criminal matters.

A Myanmar legislator plans to introduce a hemp legalization bill.

South Africa's government plans to have draft hemp and cannabis regulations ready by October.  Experts estimate that the value of South Africa's cannabis industry could be more than $7.1 billion.

Thailand removed cannabis extracts with THC content of less than 0.2 percent from the nation's list of Category 5 narcotics, the possession of which can carry penalties of up to 15 years in prison and fines of up to 1.5 million baht ($49,019.61).

Uruguay's Chamber of Representatives approved a medical cannabis research bill.

Business

Health and wellness and cannabis company dosist was awarded the second spot on LinkedIn's top 50 startups list.

Medicine Man Technologies is acquiring five cannabis dispensaries operating in Colorado from Starbuds in a $31 million stock and cash deal.  Andy Williams, co-founder and chief executive officer of Medicine Man Technologies, stated, "Adding these five dispensaries to our Colorado operations will make our vertical supply strategy more efficient and help us grab additional market share through added retail capacity.  The Starbuds dispensary operations are truly top-tier in terms of brand, revenue-per-location, and profit across the cannabis retail industry."

Blockchain technology company Security Matters has submitted a patent application in the US pertaining to materials and methods used for classifying, identifying, marking and tracking seeds and plants.  Such materials and methods could assist in managing supply chains of cannabis plants and products.

Rodrigo Arcila, president of the Colombian Cannabis Industry Association (CCIA), says Colombia has an advantage as a medical cannabis producer, noting among other things, that Colombia passed laws permitting the production of medical cannabis three years ago, before many of its competitors; that Colombian cannabis products can be produced at a lower cost given the country's relatively low wages and cheap land; and that CCIA's 29 member companies have already invested more than $600 million in the building of medical cannabis facilities.

Medical and Health

The Centers for Disease Control and Prevention and the Food and Drug Administration (FDA) are investigating reports of pulmonary illness and death resulting from vaping.  The investigators have not determined whether certain devices or types of oil are to blame, though the FDA has issued warnings with regard to THC given that a subset of samples of the THC vape products used by sick patients contained vitamin E acetate. The FDA stated, "Because consumers cannot be sure whether any THC vaping products may contain vitamin E acetate, consumers are urged to avoid buying vaping products on the street, and to refrain from using THC oil or modifying/adding any substances to products purchased in stores." Unfortunately, this guidance does not address cases of pulmonary illness reported in Illinois and Wisconsin arising from nicotine vapes that do not contain THC.  New York health officials released images of cannabis vape products that they believe are connected to recent cases of severe lung injury; vitamin E acetate was found in nearly all the samples in question, and the officials believe that many of the responsible vape products are "counterfeits of recreational cannabis-containing vape products available in other states."  Currently, cases of pulmonary illness have not been tied to cannabis products compliant under state law (though a death in Oregon tied to a THC vape purchased from a licensed dispensary is currently being investigated in this regard), and warnings by health officials have primarily been with regard to THC vapes that are counterfeit, non-compliant (e.g., modified) or sold on the black market.

A review published in the Journal of Dual Diagnosis found that "cannabinoids may decrease PTSD symptomology, in particular sleep disturbances and nightmares," and concluded that "future well-controlled, randomized, double-blind clinical trials are highly warranted."  The review's lead author, Dr. Chandni Hindocha, stated: "Unfortunately, medicinal uses of cannabis have historically been difficult to study due to legal restrictions, so it could take a long time before there is enough evidence to support clinical recommendations. New approaches are needed to make the most of existing evidence in the meantime."

A study of geriatric pain and palliative patients published by Springer Medicine found that "cannabis-based drugs (here dronabinol) are an effective, low-risk treatment option that should be considered early."

A federal grant from the National Science Foundation will be provided to NYU startup Brooklyn Bioscience to develop methods to remove dangerous pesticides from cannabis.

Monitoring the Future, a federally funded national survey, found that college students' use of marijuana in 2018 was at the highest level seen in the past three-and-a-half decades."

Mahmoud ElSohly, the director of the University of Mississippi's Marijuana Project, the only legal source of cannabis under federal law, stated that he believes 8 percent THC cannabis is "extremely" potent. "Why people want to smoke or use 20 percent or 15 or 18 or any of those high amounts is just beyond me," he said. "It's not for a good reason."

Please  click here for more information on Dentons US Cannabis group.

Authored by managing associate Troy Housman.

About Dentons

Dentons is the world's first polycentric global law firm. A top 20 firm on the Acritas 2015 Global Elite Brand Index, the Firm is committed to challenging the status quo in delivering consistent and uncompromising quality and value in new and inventive ways. Driven to provide clients a competitive edge, and connected to the communities where its clients want to do business, Dentons knows that understanding local cultures is crucial to successfully completing a deal, resolving a dispute or solving a business challenge. Now the world's largest law firm, Dentons' global team builds agile, tailored solutions to meet the local, national and global needs of private and public clients of any size in more than 125 locations serving 50-plus countries. www.dentons.com.

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