Friday, February 28, 2025

Star signs and cannabis strains: March 2025 horoscopes

2025 is underway, Leafly nation! February is a month for momentum and risk, and we have the best strains, from Xeno to Chemdog, to help you hit your stride.

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Thursday, February 27, 2025

Your Cannabis Business Structure or Transaction: Planning > Doing

“An hour of planning can save ten hours of doing.” Apparently, Dale Carnegie said that. Mr. Carnegie was a 20th century influencer, who, as far as I can tell, never sold any weed. He did make a pile of money selling books and talks on how to be confident, charming, etc. That’s not my cup of tea (the “telling people” part), but I do like his quote. I would add that, as applied to legal matters, an hour of planning can save ten hours of doing, as well as undoing. Sometimes, it’s more than ten hours too.

For the past decade, I’ve taken several calls a week from individuals making a play in the cannabis industry. Some of these callers haven’t yet taken any formal steps; others are partway down the road, amid some episode with legal atmospherics; and a third group is similar to the second group, but dealing with self-inflicted wounds. We’re talking about the third group today.

In many cases, the third group is suffering because they failed to map out a course of action prior to someone doing something “material,” to use a lawyerly term. Or they mapped out a course of action without good advice. As a result, they signed something stupid, when they should not have; or they didn’t sign anything at all, when they should have. Much can go wrong without basic planning or serviceable documents. For better or worse, cleaning up those messes has kept me (and some of the litigators here) plenty busy over the years.

Most business deals are not particularly complex. If they are, you may be doing it wrong. The longer I persist as a lawyer, the more I lean on clients to keep it simple. You want agreements that are strictly necessary, not overbuilt, bespoke, and totally bombproof— or as close as you can get. Before anyone can draft them though, and before taking actions with legal ramifications, it’s critical to reduce things to writing. A roadmap can be helpful here.

A roadmap does not have to be overly long or complex. But it should be global, if that makes sense. It should hit the high notes. It should flesh out the basic structure of the cannabis enterprise, the required contributions of the players, their voting and economic rights, and any unique considerations. Often, would-be partners believe that everyone is on the same page, only to be surprised when either: a) they try to reduce their understandings to a writing, or b) something happens.

A classic example is a situation where a group of people hopes to “partner up”, and each brings disparate resources to the arrangement. One person has money; a second has connections; a third has expertise. They just start “doing things.” The person with money may sign a real estate or license purchase agreement in that person’s name, while intending that the asset become part of the business. The person with connections may register an ill-fitting corporate entity, or miss a critical deadline (easy to do). The person with expertise may just start working, in the expectation of receiving some sort of “salary.” There are so many hazards here.

I prefer working with clients at the outset of an enterprise or transaction. I know I can add value in every case, and I’d rather build a serviceable model than try to fix something— even if the fixing pays better. Yes, there is an up-front cost to working with a bona fide business lawyer or accountant who understands cannabis. Yes, there may be upfront negotiation—and even disagreements—with partners in dialing in terms. But, as Dale Carnegie also apparently said: “fear not those who argue, but those who dodge.” Once again I agree with Mr. Carnegie. Don’t dodge! You’ll pay.

See also:



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Monday, February 24, 2025

Where in the world to blaze in 2025

Berlin, Barcelona, and Bangkok—oh my!

The post Where in the world to blaze in 2025 appeared first on Leafly.



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Friday, February 21, 2025

Thursday, February 20, 2025

Red Light, Green Light for European Cannabis: Germany Goes to the Polls; Switzerland Eyes Pole Position on Cannabis Reform

Germany goes to the polls

Germany’s snap elections on February 23, 2025, have the cannabis industry watching closely. A conservative government will likely emerge, but a key question remains: will it include the far-right Alternative for Germany (AfD)? The collapse of Chancellor Olaf Scholz’s traffic-light coalition triggered this pivotal election. Polls show the Christian Democratic Union/Christian Social Union (CDU/CSU) leading with 29.1%, followed by the AfD at 21.2%.

The CDU/CSU has pledged to repeal Germany’s quasi-legalization law passed in 2024. Friedrich Merz, CDU leader and likely Germany’s next chancellor, has ruled out partnerships with the AfD or liberal parties. However, he remains open to coalitions with center-left parties like the SPD (15.5%) and Greens (13.2%). Without a majority, coalition-building will be essential to form a government. It will likely take weeks for a functioning government to emerge after Sunday’s election.

If Merz partners with center-left parties, repealing German cannabis laws would be difficult. Convincing these former traffic-light coalition members to reverse their stance on legalization seems unlikely. In this scenario, pilot programs for cannabis commerce might halt, but full repeal appears improbable. Existing laws allowing personal possession, cultivation, and medical expansion would likely remain intact.

If, however, the AfD gains significant ground or is permitted to join a coalition with the CDU/CSU, cannabis reform could face serious threats. With 38% of voters still undecided, the outcome remains uncertain. Germany’s cannabis industry anxiously awaits Sunday’s election results to see whether progressive policies endure or face rollback under new leadership.

Switzerland may take the lead in European cannabis reform

While Germany will likely pause its cannabis reforms, Switzerland continues advancing science-based proposals to liberalize cannabis. On February 14, 2025, the Social Security and Health Committee of the National Council approved a plan to legalize and regulate adult-use marijuana by a 14-9-2 vote. The proposal emphasizes public health, youth protection, and harm reduction through strict regulation. Key measures include:

  • Limited home cultivation for adults aged 18+.
  • Licensed, for-profit cultivation and manufacturing.
  • A state-controlled retail monopoly under operated under a non-profit model.
  • Advertising bans and neutral packaging without branding.
  • Non-smokable alternatives and low-THC product requirements.
  • Zero-tolerance driving laws and harsher penalties for illicit trafficking.

The proposal still has a long way to go, but it builds on pilot programs launched in 2023 that study legalization effects in specific Cantons. Early results have been promising; however, opposition from the Swiss People’s Party (SVP) could slow progress.

Why Switzerland could lead Europe in cannabis reform

Switzerland is uniquely positioned to lead Europe in adult-use cannabis reform due to its independence from EU law. Unlike Germany, Malta, Luxembourg, and the Czech Republic—EU nations are bound by EU Commission oversight— Switzerland is not. This independence eliminates risks of EU sanctions related to Switzerland’s cannabis legalization efforts.

Still, Switzerland must comply with international agreements like the Schengen Agreement governing cross-border trade/movement policies with EU countries. To likely address concerns about cannabis “leakage” into neighboring nations, Switzerland’s proposal includes strict state-controlled retail operations and limits on personal cultivation.

Compliance with the Single Convention on Narcotic Drugs

Switzerland also remains bound by the Single Convention on Narcotic Drugs (1961), which strictly regulates cannabis for medical, scientific, and industrial purposes only. Its proposed legalization framework mirrors approaches taken by Canada and Uruguay, which legalized cannabis while prioritizing public health and safety under “wider UN human rights obligations that need to be respected . . . over drug control obligations.

The Swiss plan frames legalization as an evidence-based measure to protect public health by reducing black market activity, ensuring product safety, and funding harm reduction programs. By maintaining cannabis’s classification as a narcotic while creating a tightly regulated market, Switzerland aims to balance international obligations with domestic public health priorities.

A model for pragmatic reform

Switzerland’s continued focus on advancing commonsense cannabis reforms based on science and public health sets it apart as a leader in pragmatic cannabis reform. The proposed state-controlled model eliminates profit motives, while directing revenue toward prevention programs and addiction support services. If enacted, Switzerland could become Europe’s first country to implement a fully legalized adult-use cannabis market under strict government control— a potential blueprint for other nations navigating complex legal frameworks.

As Germany hesitates amidst political uncertainty, Switzerland’s evidence-based approach may set a new standard for balancing regulation with public health priorities.



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Wednesday, February 19, 2025

Cannabis Litigation is Exploding: How to Protect YOUR Cannabis Business from Costly Lawsuits

Why So Many Cannabis Lawsuits, and How to Avoid Becoming One of Them

The cannabis industry is one of the most lawsuit-heavy sectors in the country.

Cannabis litigation is exploding. Judges are frustrated, businesses are losing money, and lawsuits that should never have been filed are clogging up the courts. If you run a cannabis business, you need to know why this is happening—and how to avoid becoming the next case on the docket.

Many cannabis businesses enter legal disputes without realizing how much time, money, and risk they are taking on. Others assume that winning in court guarantees they’ll be paid—which is often far from the truth. This blog post will not only explain why cannabis companies face so much litigation but also how you can protect your business from becoming another case in an already overburdened legal system.

The cannabis industry, while booming, remains a complex and highly regulated landscape. Navigating this sector is not for the faint of heart. Cannabis businesses face unique legal challenges that, unfortunately, often land them in court. The umber of cannabis-related lawsuits is skyrocketing. The reasons behind this surge are a mix of predictable issues and, thankfully, preventable mistakes.

If you’re running a cannabis business, this post will provide crucial insights into:

  • Why cannabis lawsuits are more common than other business disputes.
  • Why judges are growing increasingly frustrated with cannabis cases.
  • How to protect yourself with better contracts and smarter legal strategies.
  • Why many cannabis lawsuits aren’t worth bringing—even if you win.
  • And most importantly—how to keep your cannabis business out of court in the first place.

1. Why Are There So Many Cannabis Lawsuits?

Beyond general business disputes, the cannabis industry faces unique litigation risks tied to its regulated nature and specific product offerings. These risks can catch businesses off guard, leading to costly legal battles that could have been avoided with proper planning.

a. High-Risk Industry, High-Risk Deals

Many cannabis businesses operate on thin margins, often facing uncertain and ever-shifting regulations. This creates a volatile environment where disputes over money, partnerships, and contracts are commonplace. The inherent risks of the industry often lead to desperate measures and questionable deals, increasing the likelihood of litigation.

b. Bad Contracts

A significant problem is the prevalence of poorly drafted contracts. Many cannabis companies, especially in their early stages, fail to retain experienced business lawyers. This results in contracts that are vague, incomplete, unenforceable, or heavily one-sided. When disputes inevitably arise, these contracts offer no clear guidance, leaving both parties to fight it out in court. Common contract issues in the cannabis industry include vague licensing terms, unclear intellectual property ownership, and failure to address regulatory compliance.

c. Fewer Settlements, More Trials

Cannabis companies, it seems, tend to be more litigious than businesses in other industries. This may be due to the competitive nature of the market, the high stakes involved, or a combination of factors. Combine this tendency with unclear contracts and tough-minded business owners, and you have a recipe for cases that don’t settle easily, resulting in more trials than in most other industries.

d. Financial Instability

Many cannabis companies, particularly smaller operators, are struggling financially. This vulnerability makes them more likely to engage in risky deals that, when they go south, quickly turn into lawsuits. It also makes them unable to settle lawsuits.

e. Rapidly Evolving Regulations

The cannabis industry is in constant flux. New regulations are frequently introduced, and existing ones are often amended. This creates a complex legal landscape that can be difficult for businesses to navigate, increasing the risk of compliance issues and subsequent litigation.

Example 1: The Contract That Wasn’t Worth the Paper It Was Written On

One of our cannabis business lawyers recently advised a client who wanted to sue a supplier for breach of contract. The client was convinced they had a rock-solid agreement. However, upon reviewing the contract, we saw immediate red flags. The terms were vague and incomplete, lacking essential details like delivery schedules, quality standards, and payment terms. The contract was also legally weak, making it difficult to enforce in court. Worse, the contract did not specify jurisdiction, meaning a lawsuit could have been fought in multiple states, significantly increasing costs and complexity.

Instead of rushing into costly litigation, we helped our client negotiate a settlement with the supplier. This saved them tens of thousands of dollars in legal fees and prevented a protracted and likely unsuccessful legal battle. Had we been involved in drafting the contract from the start, they likely wouldn’t have faced this problem at all.

2. Why Judges Are Frustrated with Cannabis Lawsuits

Judges seem frustrated with cannabis lawsuits clogging up their dockets. One judge even told one of our cannabis litigation attorneys that cannabis companies should be using arbitration a lot more often.

This frustration stems from several factors:

a. Poorly Drafted Contracts

As mentioned earlier, many cannabis lawsuits arise from poorly written contracts. Judges are tired of seeing cases where the parties have failed to clearly define their obligations, leaving the court to effectively rewrite the agreement.

b. Frivolous Lawsuits

Some cannabis lawsuits are based on weak legal arguments or are driven by personal animosity rather than legitimate business disputes. Judges have little patience for such cases, which waste valuable court time and resources.

c. Lack of Understanding of the Industry

Some judges lack a deep understanding of the unique challenges and complexities of the cannabis industry. This can lead to rulings that are not well-tailored to the specific circumstances of the case.

Judges often express frustration with the frequency and nature of these disputes. They often view both parties as being equally at fault for entering into poorly structured agreements or failing to resolve their differences outside of court.

This means that when a cannabis case does go to trial, the ruling is sometimes less about who’s strictly “right” and more about teaching both sides a lesson: Get better legal help before disputes arise. Don’t expect the court to fix your business mistakes.

3. Why Many Cannabis Lawsuits Aren’t Worth Bringing—Even If You Win

One of the biggest mistakes we see in cannabis litigation is lawsuits that should never have been filed in the first place. Winning a lawsuit doesn’t guarantee you’ll actually see any money.

A good cannabis litigation attorney will discuss the following with you early in your case:

a. Your Likelihood of Prevailing

Do you actually have a strong case, or is it a long shot? A thorough assessment of the facts and the law is crucial.

b. Estimated Duration and Cost

How long will the litigation likely take, and what will it likely cost? No lawyer can predict this with absolute certainty, but an unwillingness to even try is usually a sign of inexperience or a lack of candor.

c. Likelihood of Collection

Your likelihood of actually collecting any judgment if you do prevail. Winning a lawsuit doesn’t mean you’ll ever see a dime. If the defendant has no money, no assets, and no insurance, your “win” may be worthless.

Example 2: The Victory That Was a Financial Loss

A cannabis company reached out to one of our cannabis litigation attorneys after they had already “won” their lawsuit. They had grown frustrated with their existing counsel and wanted us to either appeal the case or try to collect the funds the trial court had awarded them.

We explained that an appeal made no sense—they had already won. Before starting any collection efforts, we advised them to first assess whether such efforts would be worthwhile. Using publicly available cannabis sales records and additional information from proprietary databases to which we have access, we determined that collecting from the judgment debtor would be nearly impossible. The defendant company was deeply in debt and had few, if any, assets.

We charged them around $3,500 for this due diligence, after which they asked us whether this information had been available before they brought the lawsuit. Our answer? Almost certainly, yes. Their next question: Why did we sue if there was no realistic way to collect? Our answer? They probably shouldn’t have. This highlights the importance of pre-litigation due diligence.

4. How to Protect Your Cannabis Business from Lawsuits

Keeping your cannabis business out of court is the best way to protect your bottom line. Here are some key strategies:

a. Strong Contracts

Work with an experienced cannabis business lawyer to draft clear, comprehensive, and enforceable contracts. These contracts should address all key aspects of your business relationships, including payment terms, delivery schedules, quality standards, intellectual property rights, and dispute resolution mechanisms. Don’t rely on generic templates or try to save money by cutting corners on legal advice. A well-drafted contract is an investment that can save you significant time, money, and headaches down the road.

b. Smart Legal Strategies Beyond Contracts

While strong contracts are essential, they are not the only form of protection. Consider these additional strategies:

c. Alternative Dispute Resolution (ADR)

Include clauses in your contracts that require mediation or arbitration before resorting to litigation. ADR can be a faster, less expensive, and less adversarial way to resolve disputes.

d. Regulatory Compliance

Stay up-to-date on all applicable cannabis regulations and ensure your business operations are in full compliance. This will minimize the risk of legal challenges related to licensing, product testing, advertising, or other regulatory matters.

e. Intellectual Property Protection

Secure your trademarks, patents, and copyrights to protect your brand and your innovative products or processes. Strong IP protection can deter infringement and provide a solid legal foundation in case of disputes.

f. Insurance Coverage

Obtain appropriate insurance coverage to protect your business against potential liabilities, such as product liability claims or property damage.

g. Proactive Communication

Maintain open and proactive communication with your business partners, suppliers, and customers. Addressing concerns promptly and resolving issues amicably can prevent misunderstandings from escalating into full-blown disputes.

h. Due Diligence

Before entering into any significant business transaction, conduct thorough due diligence on the other party. Assess their financial stability, reputation, and track record. This can help you avoid dealing with unreliable or unscrupulous businesses.

Example 3: The Company That Avoided a Costly Lawsuit

One of our cannabis business lawyers recently worked with a distributor who was in a major dispute with a supplier over delayed shipments. The supplier was demanding payment, while our client was refusing to pay due to the significant delays.

Instead of heading straight to litigation, we leveraged the contract’s arbitration clause to force a quick and cost-effective resolution. Because we had drafted the contract ourselves, we had ensured that arbitration would be the default dispute resolution method. This saved our client months of legal headaches and hundreds of thousands of dollars in legal fees. The arbitrator was able to review the evidence and the contract quickly, issuing a decision that was fair to both parties. This example highlights the importance of not just having contracts, but having well-drafted contracts with appropriate dispute resolution mechanisms in place.

5. Understanding Specific Cannabis Litigation Risks

Beyond general business disputes, the cannabis industry faces unique litigation risks tied to its regulated nature and specific product offerings. Here are some key areas cannabis businesses should be aware of:

a. Licensing Disputes

Cannabis businesses operate under strict licensing regimes. Disputes can arise regarding the issuance, renewal, or revocation of licenses. Challenges to licensing decisions can be complex and time-consuming.

b. Product Liability Claims

Cannabis products, like any consumer goods, can be subject to product liability claims. These claims may allege defects in the product itself, improper labeling, or inadequate warnings. Given the relatively new and evolving nature of cannabis product testing and regulation, these claims can be particularly challenging.

c. Intellectual Property Infringement

With the increasing importance of branding in the cannabis market, intellectual property disputes are becoming more common. These disputes can involve trademark infringement, patent infringement, or trade secret misappropriation. Protecting your intellectual property is crucial in this competitive landscape.

d. Contractual Disputes Specific to the Industry

Beyond general contract issues, cannabis businesses often encounter disputes related to specialized contracts, such as cultivation agreements, distribution agreements, or licensing agreements for intellectual property related to strains or cultivation methods.

e. Regulatory Enforcement Actions

Cannabis businesses must comply with a complex web of federal, state, and local regulations. Violations of these regulations can lead to enforcement actions by regulatory agencies, including fines, license suspensions, or even criminal charges. These actions can be costly and disruptive, even if the business is ultimately cleared of wrongdoing.

f. Employment Law Issues

The rapid growth of the cannabis industry has led to a surge in employment. This growth, coupled with the complexities of labor law, can create fertile ground for employment-related litigation, including claims of wrongful termination, discrimination, or wage and hour violations.

6. Proactive Legal Strategies for the Cannabis Industry

To mitigate these risks and keep your cannabis business out of court, a proactive legal approach is essential. This includes:

a. Regular Contract Reviews

Don’t just file your contracts away after they’re signed. Regularly review them with your attorney to ensure they are still aligned with your business practices and current regulations.

b. Compliance Audits

Conduct regular internal audits to ensure your business operations are in full compliance with all applicable laws and regulations. This can help you identify and address potential compliance issues before they lead to legal problems.

c. Employee Training

Provide regular training to your employees on relevant laws and regulations, as well as your company’s policies and procedures. This can help prevent employment-related disputes and ensure a compliant workplace.

d. Intellectual Property Portfolio Management

Develop a comprehensive strategy for protecting your intellectual property. This includes conducting regular trademark searches, filing patent applications for innovative products or processes, and implementing robust trade secret protection measures.

e. Relationship Management

Foster strong and positive relationships with your business partners, suppliers, and customers. Open communication and a collaborative approach can help prevent misunderstandings and resolve disputes amicably.

Protect YOUR Cannabis Business 

The cannabis industry is more litigious than ever, but legal disputes don’t have to be inevitable. With the right legal strategies, risk management, and proactive planning, you can significantly reduce your exposure to costly litigation and protect your business from unnecessary legal battles.

For more than 15 years, we’ve helped cannabis companies of all sizes navigate the complex and ever-changing legal landscape. Whether you’re launching, expanding, or already dealing with a dispute, our team can help you:

  • Structure your deals properly to avoid legal pitfalls from the outset.
  • Negotiate strong, clear contracts that prevent disputes before they arise.
  • Develop and implement smart legal strategies to protect your business, including guidance on insurance coverage and risk management.
  • Effectively represent you in court when litigation is unavoidable.

Litigation Isn’t Always the Answer—Know When to Fight and When to Walk Away

Too often, businesses rush into lawsuits without evaluating whether the case is truly worth pursuing. Suing a company that can’t afford to pay is often a waste of time and money.

Before spending tens to hundreds of thousands of dollars in legal fees, it’s critical to assess your likelihood of success and, more importantly, your likelihood of actually collecting if you win. One of our experienced cannabis litigation attorneys can objectively analyze your case—before you invest valuable time and resources into a lawsuit that may not pay off.

The cannabis industry is tough, competitive, and unpredictable, but you don’t have to navigate it alone. The sooner you take proactive legal steps, the stronger and more resilient your business will be.

Schedule a consultation with one of our cannabis lawyers today to discuss how we can protect your business, brand, and bottom line. We’ll help you stay ahead of legal risks and ensure your cannabis business thrives.



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FREE Webinar March 6: Trademarking Cannabis – Cutting Through the Legal Haze

The cannabis industry is expanding nationwide, but securing trademark protection remains a complex challenge due to federal restrictions and evolving state laws. If you’re a cannabis business owner, lawyer, or entrepreneur looking to protect your brand, you won’t want to miss our upcoming webinar on cannabis and trademarks.

What You’ll Learn

Our expert panel, consisting of moderator Matt Goldberg, and presenters Fred Rocafort and Elijah Hartman, will break down key legal barriers and share practical strategies to help cannabis businesses navigate trademark law effectively.

Topics include:

Federal Trademark Law & Restrictions

  • How the Controlled Substances Act (CSA) impacts cannabis-related trademarks
  • Why the Food, Drug, and Cosmetic Act (FDCA) prevents trademarks on ingestible cannabis products
  • The latest USPTO policies on hemp-derived products under 0.3% THC

State Trademark Protections

  • How state-level trademarks can offer brand protection when federal registration isn’t an option
  • Best practices for filing state trademarks while awaiting potential federal reforms

Workarounds for Federal Trademark Protection

  • Strategies for trademarking ancillary products (rolling papers, apparel, accessories)
  • The risks of brand dilution when relying on alternative trademark strategies

Trademark Infringement & Enforcement Trends

  • How big corporations are handling cannabis trademark disputes
  • Enforcement strategies cannabis businesses can use to protect their brand identity

Future Developments & Industry Outlook

  • Will rescheduling cannabis lead to new trademark opportunities?
  • Steps to future-proof your brand in an evolving legal landscape

Who Should Attend?

✔️ Cannabis entrepreneurs & business owners
✔️ Attorneys & legal professionals specializing in intellectual property
✔️ Brand managers & marketing professionals in the cannabis industry
✔️ Anyone interested in the future of cannabis branding & trademarks

Secure Your Spot Today!

Don’t miss this opportunity to get expert insights and stay ahead of the legal curve on cannabis trademark. Register now to ensure your cannabis business is legally protected and ready for growth.

REGISTER HERE

Have questions? Feel free to reach out at firm@harris-sliwoski.com. We look forward to seeing you there!



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Tuesday, February 18, 2025

Monday, February 17, 2025

Oregon Cannabis: Are Forced Labor Peace Agreements Unconstitutional? We’re About to Find Out.

Last Wednesday, the Oregon cannabis lawsuit we’ve been waiting for finally dropped. Industry operators should tip their hats to plaintiffs Ascend Dispensary and Bubble’s Hash, and our friends at the law firm Fisher Phillips LLP, for stepping up and challenging Ballot Measure 119 in U.S. District Court.

BM 119 passed in November 2024 with 57% of the vote. It requires all OLCC licensed retailers, processors and labs to provide a signed labor peace agreement (LPA) with a bona fide labor organization, to renew or apply for an OLCC license. The requirement took effect almost immediately— we therefore urged eligible OLCC businesses to renew licenses prior to December 5th, to dodge the LPA requirement for at least another year.

I’ve been bagging on BM 119 since before the vote, when I wrote that it would probably pass and observed that “I’m surprised people aren’t talking about it more.” It did end up passing, which seemed to catch the local cannabis industry flatfooted. Fortunately for the gang, BM 119 is legally suspect and this challenge appears strong.

You don’t have to be anti-union (I’m not) to think BM 119 was poorly conceived. I previously highlighted BM 119’s Constitutional and labor law exposure, and explained how this initiative arose after a stymied legislative effort by the United Food and Commercial Workers Local 555 (“UFCW 555”). The plaintiffs’ complaint traces this history thoroughly, including how UFCW 555 brought a failed recall effort against Representative Paul Hovey for having the stones to inquire whether its proposal was unconstitutional and could be preempted.

The complaint’s specific allegations include a series of violations of the First and Fourteenth Amendments of the U.S. Constitution, including on freedom of speech, due process, equal protection and right to contract, as well as violation of the Constitution’s Supremacy Clause. So, several hooks upon which the District Court could hang its hat. The complaint left off seemingly viable state law causes of action, likely for strategic reasons beyond my expertise.

The complaint seeks both declaratory relief (“you did it wrong”) and injunctive relief (“you have to cut it out”). As to the latter, the complaint mentions that plaintiffs subsequently filed a Motion for Temporary Restraining Order, which means that the State of Oregon would have to cut it out sooner rather—that is, stop enforcing the LPA requirement. (The TRO motion hadn’t yet showed up on the docket as of close of business on Friday, when this post is being written, or I’d link it for you. Courts are closed for President’s Day; we should see it soon.)

From what I’ve gathered, OLCC isn’t particularly thrilled with having to enforce BM 119. My guess is DOJ won’t enjoy defending it. For now, it seems that a lot of cannabis licensees are submitting renewal applications without an LPA, hoping for a lawsuit like this one, and hoping the LPA requirement goes away. My information is that OLCC is processing those applications in due course: it’s worth noting that the Commission would have to follow a series of administrative steps before proposing to revoke or non-renew a license on LPA grounds, regardless.

So let’s see how it goes, now that it’s finally going. My guess is the Court will find that UFCW and Oregon voters overstepped with BM 119.

For previous posts discussing the BM 119 saga, check out the following:



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Thursday, February 13, 2025

These CBN gummies cozy up with THC for a better night’s sleep

Sheep counters everywhere can get excited about a new product from the effects-obsessive folks at Rare Cannabinoid Company, the THC+CBN Sleep Gummies.

The post These CBN gummies cozy up with THC for a better night’s sleep appeared first on Leafly.



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Australia Cannabis Laws: A Comprehensive Guide

Australia Cannabis Regulations: Federal and State Overview

Australia’s cannabis laws are complex, with federal, state, and local regulations all playing a role in determining the legal framework. Businesses looking to enter Australia’s medicinal cannabis market must understand how these jurisdictions overlap.

This article breaks down how cannabis is regulated in Australia, including federal laws, state law variations, key regulatory bodies, and Australia’s cannabis importation rules.

The Structure of Australia’s Cannabis Laws

Federal vs. State vs. Local Laws

Australia operates under a federal system, meaning cannabis laws are enforced at three levels.

Australian federal laws govern the overall legality of medicinal cannabis and control activities like cannabis importation, cultivation, and production.

Australian state and territory laws determine whether personal use, possession, and local business activities are permitted. These laws differ across Australia, leading to variations in enforcement and penalties.

Local government laws apply to business operations, zoning, and licensing, meaning cannabis-related businesses must comply with both state and local regulations.

Cannabis Laws Across Australia: Where Is It Legal?

Personal Use

Growing cannabis for personal use remains illegal in most of Australia’s states and territories, except for the Australian Capital Territory. In the Australian Capital Territory (the “ACT”), adults can possess up to 50 grams of dried cannabis and grow two plants per person, with a maximum of four per household. However, selling, supplying, or sharing cannabis remains illegal.

In all other states and territories, personal cultivation and recreational use remain criminal offenses or subject to fines.

Medicinal and Scientific Use

The cultivation, production, and supply of cannabis for medicinal and scientific purposes have been legalized under Australian federal law. Patients must meet strict criteria and obtain prescriptions from authorized medical professionals.

Each state and territory has different regulations regarding how medicinal cannabis can be accessed, with some jurisdictions making it easier than others. The Therapeutic Goods Administration oversees approvals for medicinal cannabis products, and most patients require approval through the Special Access Scheme.

The following table provides a quick reference to cannabis laws across Australian states and territories, summarizing the differences in personal use regulations and medicinal cannabis access.

 

Key Regulatory Bodies in Australia

Several Australian federal agencies regulate cannabis-related activities.

The Office of Drug Control grants licenses for the cultivation, production, and manufacture of medicinal cannabis.

The Therapeutic Goods Administration regulates medicinal cannabis products and approvals for patient use.

The Department of Agriculture, Fisheries, and Forestry manages import and export regulations, including issuing permits for plant materials.

The Australian Border Force enforces border restrictions on illicit cannabis imports and ensures compliance with legal import permits.

Businesses and individuals seeking to work with cannabis must navigate multiple layers of licensing and approvals from these regulatory agencies.

Importation and Legal Sourcing of Cannabis

Because cannabis supply is highly regulated, plants can only be sourced legally. This includes licensed Australian producers approved by the Office of Drug Control and international suppliers where cannabis cultivation is legal and in compliance with the Single Convention on Narcotic Drugs.

Importing cannabis or cannabis-derived products requires approval from multiple agencies.

The Department of Agriculture, Fisheries, and Forestry issues import permits for cannabis plants and seeds. The Therapeutic Goods Administration and Office of Drug Control must approve medicinal cannabis imports. The Australian Border Force enforces border security checks to ensure no illicit or unapproved substances enter Australia.

Obtaining an Australian Federal Medicinal Cannabis License

A federal medicinal cannabis license may authorize one or more of the following activities:

  • Importation of medicinal cannabis products or plants from international sources
  • Cultivation of cannabis for medicinal or research purposes
  • Production of cannabis-based products, including oils, tinctures, and pharmaceutical-grade extracts

These activities can be licensed separately or combined under a single license. Businesses must comply with various security, reporting, and compliance requirements to maintain their authorizations.

Why Foreign Companies Should Enter the Australian Cannabis Market Now

Based on what we have seen in other countries, we strongly recommend that foreign companies interested in Australia enter the cannabis market now rather than later. Many countries have started with limited legalization, whether only for medical use or in certain regions, and the companies that established themselves early became the market leaders when expansion occurred.

Some key examples:

  • United States – Started with state-level medical cannabis, later expanded to state-by-state recreational markets.
  • Canada – Began with strict medical-only regulations, then moved to nationwide recreational legalization.
  • Germany – Initially allowed medical cannabis only, now preparing for full legalization.
  • Thailand – Started with medical cannabis, later decriminalized wider use and business operations.
  • Uruguay – First legalized cannabis under government control, later expanded market access.
  • Mexico – Approved medical cannabis in 2017, later moved toward full legalization, though regulations remain unclear.
  • Colombia – Began with strict medical-use laws, later expanded to allow cannabis exports and a broader industry framework.

Companies that strategically entered these markets early secured a decisive competitive advantage by acquiring in-depth regulatory experience, establishing dominant brand recognition, cultivating crucial strategic partnerships, developing robust infrastructure, and gaining invaluable first-mover status, positioning them for sustained success as legalization expanded.

We are already seeing Australia following a similar trajectory, and companies that enter early will gain a competitive edge as the Australian cannabis market expands beyond medical use.

The Future of Cannabis in Australia

Australia’s cannabis regulations are constantly evolving, reflecting shifting public opinion and growing recognition of the potential benefits of cannabis, particularly for medicinal purposes. Several trends are shaping the future of cannabis in Australia:

Potential Decriminalization

While nationwide legalization for recreational use is not currently on the agenda, there are increasing discussions and pilot programs exploring decriminalization models in various states and territories. These models often focus on diverting individuals caught with small amounts of cannabis to health and education programs rather than criminal charges. The ACT’s existing model serves as a case study for other jurisdictions considering similar approaches.

Expanded Medicinal Access

Efforts are underway to streamline the process for patients to access medicinal cannabis. This includes exploring options like allowing pharmacies to dispense certain medicinal cannabis products, increasing the number of authorized prescribers, and expanding the range of qualifying conditions. Research into the efficacy of cannabis for various medical conditions is also ongoing, which could lead to further expansion of its medicinal applications.

Focus on Product Quality and Safety

As the medicinal cannabis industry grows, there is a strong emphasis on ensuring product quality, safety, and consistency. Regulatory bodies are working to establish stricter standards for cultivation, manufacturing, and testing of medicinal cannabis products. This will help build trust among patients and healthcare professionals and could accelerate expansion beyond medical use.

Growing Industry and Economic Opportunities

The cannabis industry is poised for significant growth in Australia, creating new business opportunities in cultivation, manufacturing, distribution, and research. This growth is attracting investment and fostering innovation in the sector.

Public Discourse and Education

Open public discussions about cannabis are becoming more common, helping to reduce stigma and promote informed decision-making. Educational initiatives are also playing an increasingly important role in providing accurate information about cannabis and its potential benefits.



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New Mexico’s Cannabis Legislation: Key Bills to Watch

The New Mexico legislature is considering several bills that address the state’s cannabis industry. With a two-month session held only every other year, there is an opportunity for meaningful changes aimed at strengthening the industry. Among the many bills under consideration, four stand out for their potential impact– both for industry and for consumers seeking high-quality, regulated cannabis products.

HB 10 – Cannabis Enforcement and Oversight

HB 10 is a bipartisan bill, supported by Governor Michelle Lujan Grisham. It addresses a key challenge: the inability of the Cannabis Control Division (CCD) to effectively manage the growing number of operators in New Mexico who are in violation of the Cannabis Act.

This bill proposes the creation of an Enforcement Bureau within the CCD, granting it powers to investigate and act on suspected violations. Key powers include:

  • Conducting lawful searches of cannabis facilities;
  • Upon issuance of a warrant, taking control of a premises where cannabis is located;
  • Taking cannabis samples for testing;
  • Confiscating suspected adulterated, dangerous, misbranded, or violative products;
  • Destroying products pursuant to applicable law;
  • Issuing a recall order for certain cannabis products; and
  • Arresting violators.

Licensees facing enforcement actions would have 10 days to request an administrative hearing. If found in violation, the CCD would have the authority to impose penalties, including:

  • License suspension or revocation
  • Fines up to $10,000 per violation
  • Additional disciplinary actions as authorized by the Cannabis Act

HB 10 passed the House Commerce and Economic Development Committee. It is now under consideration by the House Judiciary Committee, before going to a full floor vote. If passed, it would take effect on July 1, 2025.

HB 112 – Strengthening Cannabis Licensure

HB 112 amends the Cannabis Act by increasing criminal background check requirements on applicants. Under the bill, both state and federal criminal background checks will be required for CCD applicants. (Currently, only a state report is required.) This bill also mandates that the CCD receive and maintain these background reports. HB 112 is currently under review by the House Commerce & Economic Development Committee.

HB 346 – Regulation of Hemp Products and Synthetic Cannabinoids

HB 346 amends the state’s hemp laws to address a regulatory chasm concerning finished hemp products. Among the amendments, the bill would:

  • Expand the definition of “Hemp Finished Products” to include products intended for human ingestion, absorption, or inhalation;
  • Define and ban “Semi-Synthetic” and “Synthetic Cannabinoids” in Hemp Finished Products; and
  • Create the definition, and require regulation, of “Hemp Retailer”.

This bill requires the Department of Environment and the Environmental Improvement Board to establish rules for the manufacturing and retail sale of hemp products, including requirements for labeling, licensing, and recordkeeping. Additionally, hemp products will be subject to state food laws.

HB 346 is currently with the House Commerce & Economic Development Committee for review.

SB 89 – Repealing Cannabis Tax Increases

SB 89 takes a simple but important step: it repeals the incremental tax increases laid out in the Cannabis Act. Tax increases are set to start after July 1, 2025. The bill would keep the cannabis excise tax at its current rate of 12%, rather than gradually raising it over the next five years:

  • 13% after July 1, 2025
  • 14% after July 1, 2026
  • 15% after July 1, 2027
  • 16% after July 1, 2028
  • 17% after July 1, 2029
  • 18% after July 1, 2030

The bill is currently in the Senate Tax, Business, and Transportation Committee for review.

Conclusion

While HB 112 and SB 89 focus on administrative changes, HB 10 and HB 346 have the potential to significantly reshape enforcement and regulation in both New Mexico’s marijuana and hemp industries. If these bills pass, operators in both sectors will need to revisit their operating procedures to ensure full compliance with New Mexico’s cannabis laws.

As a licensed New Mexico attorney with years of experience in the cannabis and hemp industries, I am available for free consultations to help operators navigate these changes. If you’re a current New Mexico operator or interested in entering the industry, feel free to reach out.



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Wednesday, February 12, 2025

Tuesday, February 11, 2025

Ventura Hall of Flowers is March 19–20—is your business ready?

Cannabis industry insiders are set to converge this March 19th-20th for the 2025 Hall of Flowers industry-only trade show. The iconic event brings all the movers and shakers of the cannabis industry together in one place.

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Monday, February 10, 2025

New weed shops of America: Miami’s first, New Mexico’s biggest, and Puerto Rico’s Cush

Including New Mexico's biggest medical shop.

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Australia Cannabis Laws: A Comprehensive Guide

Australia Cannabis Regulations: Federal and State Overview

Australia’s cannabis laws are complex, with federal, state, and local regulations all playing a role in determining the legal framework. Businesses looking to enter Australia’s medicinal cannabis market must understand how these jurisdictions overlap.

This article breaks down how cannabis is regulated in Australia, including federal laws, state law variations, key regulatory bodies, and Australia’s cannabis importation rules.

The Structure of Australia’s Cannabis Laws

Federal vs. State vs. Local Laws

Australia operates under a federal system, meaning cannabis laws are enforced at three levels.

Australian federal laws govern the overall legality of medicinal cannabis and control activities like cannabis importation, cultivation, and production.

Australian state and territory laws determine whether personal use, possession, and local business activities are permitted. These laws differ across Australia, leading to variations in enforcement and penalties.

Local government laws apply to business operations, zoning, and licensing, meaning cannabis-related businesses must comply with both state and local regulations.

Cannabis Laws Across Australia: Where Is It Legal?

Personal Use

Growing cannabis for personal use remains illegal in most of Australia’s states and territories, except for the Australian Capital Territory. In the Australian Capital Territory (the “ACT”), adults can possess up to 50 grams of dried cannabis and grow two plants per person, with a maximum of four per household. However, selling, supplying, or sharing cannabis remains illegal.

In all other states and territories, personal cultivation and recreational use remain criminal offenses or subject to fines.

Medicinal and Scientific Use

The cultivation, production, and supply of cannabis for medicinal and scientific purposes have been legalized under Australian federal law. Patients must meet strict criteria and obtain prescriptions from authorized medical professionals.

Each state and territory has different regulations regarding how medicinal cannabis can be accessed, with some jurisdictions making it easier than others. The Therapeutic Goods Administration oversees approvals for medicinal cannabis products, and most patients require approval through the Special Access Scheme.

The following table provides a quick reference to cannabis laws across Australian states and territories, summarizing the differences in personal use regulations and medicinal cannabis access.

State/Territory Personal Use (Possession/Cultivation) Medicinal Cannabis Access Notes
ACT Legal (up to 50g, 2 plants per person, 4 per household) Legal with prescription Selling/supplying remains illegal
NSW Illegal Legal with prescription Strict qualifying conditions
VIC Illegal Legal with prescription Specific access schemes apply
QLD Illegal Legal with prescription Limited authorized prescribers
SA Illegal Legal with prescription Some product availability varies
WA Illegal Legal with prescription Patient registry maintained
TAS Illegal Legal with prescription Telehealth consultations allowed
NT Illegal Legal with prescription Police discretion for minor offenses

Key Regulatory Bodies in Australia

Several Australian federal agencies regulate cannabis-related activities.

The Office of Drug Control grants licenses for the cultivation, production, and manufacture of medicinal cannabis.

The Therapeutic Goods Administration regulates medicinal cannabis products and approvals for patient use.

The Department of Agriculture, Fisheries, and Forestry manages import and export regulations, including issuing permits for plant materials.

The Australian Border Force enforces border restrictions on illicit cannabis imports and ensures compliance with legal import permits.

Businesses and individuals seeking to work with cannabis must navigate multiple layers of licensing and approvals from these regulatory agencies.

Importation and Legal Sourcing of Cannabis

Because cannabis supply is highly regulated, plants can only be sourced legally. This includes licensed Australian producers approved by the Office of Drug Control and international suppliers where cannabis cultivation is legal and in compliance with the Single Convention on Narcotic Drugs.

Importing Cannabis into Australia

Importing cannabis or cannabis-derived products requires approval from multiple agencies.

The Department of Agriculture, Fisheries, and Forestry issues import permits for cannabis plants and seeds. The Therapeutic Goods Administration and Office of Drug Control must approve medicinal cannabis imports. The Australian Border Force enforces border security checks to ensure no illicit or unapproved substances enter Australia.

Obtaining an Australian Federal Medicinal Cannabis License

A federal medicinal cannabis license may authorize one or more of the following activities:

  • Importation of medicinal cannabis products or plants from international sources
  • Cultivation of cannabis for medicinal or research purposes
  • Production of cannabis-based products, including oils, tinctures, and pharmaceutical-grade extracts

These activities can be licensed separately or combined under a single license. Businesses must comply with various security, reporting, and compliance requirements to maintain their authorizations.

Why Foreign Companies Should Enter the Australian Cannabis Market Now

Based on what we have seen in other countries, we strongly recommend that foreign companies interested in Australia enter the cannabis market now rather than later. Many countries have started with limited legalization, whether only for medical use or in certain regions, and the companies that established themselves early became the market leaders when expansion occurred.

Some key examples:

  • United States – Started with state-level medical cannabis, later expanded to state-by-state recreational markets.
  • Canada – Began with strict medical-only regulations, then moved to nationwide recreational legalization.
  • Germany – Initially allowed medical cannabis only, now preparing for full legalization.
  • Thailand – Started with medical cannabis, later decriminalized wider use and business operations.
  • Uruguay – First legalized cannabis under government control, later expanded market access.
  • Mexico – Approved medical cannabis in 2017, later moved toward full legalization, though regulations remain unclear.
  • Colombia – Began with strict medical-use laws, later expanded to allow cannabis exports and a broader industry framework.

Companies that strategically entered these markets early secured a decisive competitive advantage by acquiring in-depth regulatory experience, establishing dominant brand recognition, cultivating crucial strategic partnerships, developing robust infrastructure, and gaining invaluable first-mover status, positioning them for sustained success as legalization expanded.

We are already seeing Australia following a similar trajectory, and companies that enter early will gain a competitive edge as the Australian cannabis market expands beyond medical use.

The Future of Cannabis in Australia

Australia’s cannabis regulations are constantly evolving, reflecting shifting public opinion and growing recognition of the potential benefits of cannabis, particularly for medicinal purposes. Several trends are shaping the future of cannabis in Australia:

Potential Decriminalization

While nationwide legalization for recreational use is not currently on the agenda, there are increasing discussions and pilot programs exploring decriminalization models in various states and territories. These models often focus on diverting individuals caught with small amounts of cannabis to health and education programs rather than criminal charges. The ACT’s existing model serves as a case study for other jurisdictions considering similar approaches.

Expanded Medicinal Access

Efforts are underway to streamline the process for patients to access medicinal cannabis. This includes exploring options like allowing pharmacies to dispense certain medicinal cannabis products, increasing the number of authorized prescribers, and expanding the range of qualifying conditions. Research into the efficacy of cannabis for various medical conditions is also ongoing, which could lead to further expansion of its medicinal applications.

Focus on Product Quality and Safety

As the medicinal cannabis industry grows, there is a strong emphasis on ensuring product quality, safety, and consistency. Regulatory bodies are working to establish stricter standards for cultivation, manufacturing, and testing of medicinal cannabis products. This will help build trust among patients and healthcare professionals and could accelerate expansion beyond medical use.

Growing Industry and Economic Opportunities

The cannabis industry is poised for significant growth in Australia, creating new business opportunities in cultivation, manufacturing, distribution, and research. This growth is attracting investment and fostering innovation in the sector.

Public Discourse and Education

Open public discussions about cannabis are becoming more common, helping to reduce stigma and promote informed decision-making. Educational initiatives are also playing an increasingly important role in providing accurate information about cannabis and its potential benefits.

Conclusion

Ready to unlock the potential of the Australian cannabis market? Schedule a free consultation today by clicking here. Let’s discuss how I can help you achieve your business goals.



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Best cannabis and hemp lubes

THC and CBD-infused lubricants can be a game-changer.

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Thursday, February 6, 2025

Oregon Cannabis Oversupply in 2025

There is too much weed in Oregon. There is not enough weed in Oregon.

Allow me to explain. On February 1, the OLCC released its 2025 legislative report on local, regulated marijuana supply. We get these reports every two years, as required by ORS 475C.529. They tend to be downers. And this one could be the worst one yet.

The report came in as expected; which is to say, both supply and demand are trending badly for Oregon operators. Specifically:

“[t]he retail median price-per-gram of usable marijuana is at the lowest point the market has seen since legalization. The low price can be attributable to oversupply.”

Prices aren’t just low. They have never been lower. The report confirms the conclusions in my State of the State post from December 19, 2024, where I highlighted a static number of OLCC licensees, a static enforcement environment (inside and outside the OLCC system), and Oregon’s largest fall harvest, ever. I predicted downward pricing pressure. I could go on and on about all these things, but I don’t mean to bore you, and we’d like some encouraging words.

I have another way to think about the report. Oregon is not producing too much cannabis. We have stellar terroir, delicious appellations and virtuosic growers. The problem ‘round here is we cannot export it. We can’t send our record harvest to non-agricultural states, and places where cannabis can only be grown in buildings. Here are some reasons:

  1. Federal law.

Here is some color on that:

  1. Congress never gets it done. The best we got was a bill out of the House in 2022.
  2. The executive branch’s proposed rulemaking may move marijuana to Schedule III. Maybe. But this would not allow interstate sales.
  3. The leggiest lawsuit challenging the federal Controlled Substances Act wouldn’t allow for interstate commerce, even if they win.
  4. The export bill Oregon passed in 2019 never “goes live”, due to the state of federal law and policy.
  5. Oregon’s legislative efforts around the edges on interstate transfer of seeds and such have puttered out.

Early local thinkers like the Craft Cannabis Association (RIP) and Adam Smith were ahead of their time. Oversupply in the OLCC market has been around since the Oregon program started. Advocates pushing for interstate sales and federal legalization are making the only practical argument.

In the last few years, local industry seems to have gone away from this. You’ll hear complaints that we cannot sell cannabis to other states, even while industry litigates against the prevailing testing standards in other states. In that sense, Oregon is not well positioned for when the floodgates open.

I do hope the floodgates open. That is the only thing that could put an appreciable dent in oversupply, even if the fires return in the fall of 2025; even if the OLCC starts talking tough again; and even if we get some tax relief through federal rescheduling. As the report concludes:

“The Oregon recreational marijuana market . . . is continually disadvantaged by the marketplace being limited to Oregon. Year after year, supply has outpaced demand.

Until the federal government creates pathways to interstate commerce, the Oregon recreational marijuana market will be characterized by variations on the same theme: a competitive marketplace that features low prices for consumers but low margins for businesses. As we enter 2025, it remains to be seen how narrow the margins will be and how well the Oregon cannabis industry can operate within them.”

I would add to this the fact that with record-high output and record-low pricing, Oregon growers will be incentivized to sell cannabis out the back door or leave the OLCC program altogether. Options there include the intoxicating hemp market or simply assuming the risks of growing unlicensed weed and selling interstate.

The bottom line is it’s difficult to make any money growing cannabis in Oregon if you do not own the land. And it’s a shame we have too much weed in Oregon for Oregon, but not for other states.

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Tuesday, February 4, 2025

Leafly’s top 7 bongs of 2025

Find the best bongs of 2025. Leafly reviewed popular bongs and chose what we think are the top picks for different needs and budgets.

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Why Don’t More U.S. Investors Look Abroad for Marijuana Investment?

With ongoing tensions between U.S. state and federal marijuana laws, U.S. marijuana investments present significant legal and logistical challenges. This is especially true for investors with ties to federally regulated businesses. While some investors have accepted the risks of U.S. marijuana, others are waiting for major federal reforms. But what if there was a way to invest in marijuana without the looming threat of federal enforcement?

International marijuana operators might offer just that opportunity. Marijuana remains a Schedule I controlled substance within the U.S. (See Thoughts on the Terrible Pageant of Marijuana Rescheduling) Even if marijuana is moved into Schedule III, it will still be illegal to buy and sell interstate without a DEA license, and state markets won’t fundamentally change. This opens the door for investment and operational partnerships in legal marijuana markets abroad — without many of the risks associated with U.S. marijuana operators.

Some U.S. Code provisions relevant to investing in international marijuana markets

21 USC § 841(a)

Makes it illegal to manufacture, distribute, or possess with intent to distribute a controlled substance within the U.S.

21 USC § 959

Extends the reach of the Controlled Substances Act (CSA), criminalizing the intent to import a Schedule I substance into the U.S. This explicit reference to unlawful importation shows that Congress anticipated extraterritorial application of the CSA for certain sections (e.g. § 959) and not others (e.g. § 841(a)).

18 USC § 1956

Criminalizes monetary transactions involving proceeds from “specified unlawful activity”, including violations of the CSA. Unless a foreign investment or operational partnership resulted in the import of marijuana into the U.S., it would not rise to the level of a “specified unlawful activity.”

21 USC §§ 846; 18 USC 371; & 18 USC 2

Both conspiracy and aiding and abetting confer extraterritorial jurisdiction to the same extent as the underlying offense. Therefore, unless the foreign investment resulted in marijuana being imported into the U.S., such investment would not trigger these violations.

Key judicial interpretations on investing in international marijuana markets

The CSA does not speak specifically to foreign investment into an operation that would otherwise be illegal in the U.S. As such, we must look to judicial precedent.

The Supreme Court has emphasized that unless Congress speaks to the extraterritorial application of a law, then it does not generally apply to foreign activities. The relevant issue here centers on whether the foreign activity is intended to, or could reasonably be expected to, result in a violation on U.S. soil. For example, investing in a foreign operator that intends to illegally export marijuana into the U.S., would trigger a CSA violation. However, investing in a foreign operator that intends only to manufacture and sell marijuana outside of the U.S., would not trigger a CSA violation (ensuring robust SOPs and internal oversight policies is also critical).

The leading case on this topic is United States v. Lopez­Vanegas, which relied on Supreme Court precedent on extraterritorial application of U.S. law. The Eleventh Circuit held that where “the object of the conspiracy was to possess controlled substances outside the United States with the intent to distribute outside the United States” the CSA does not apply to those foreign activities. The Court noted that it did not matter whether the alleged conspirators planned some of the operations from within the U.S. The key to a CSA violation centered around whether the conspirators intended to possess or distribute a controlled substance inside the U.S.

Courts in the First Circuit, Fifth Circuit, D.C. Circuit, and the Eastern and Northern District (States v. Daniels, 2010 WL 2557506 (N.D. Cal. June 21, 2010)) have either cited Lopez-Vanegas or reached similar conclusions in cases with both similar and differing circumstances.

What does this mean for international marijuana investment?

These judicial interpretations show that investing in or providing operational support to legal foreign marijuana operators does not pose a risk of violating U.S. law— provided that the investment does not involve importing marijuana into the U.S. While some U.S. banks may remain cautious, these concerns can often be alleviated with a well-supported legal memorandum or opinion.

If you or your team are interested in exploring opportunities to support legal marijuana operations abroad (e.g. Canada, Germany, Thailand, Colombia, Portugal, etc.), please reach out for a free consultation.

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Alto Dispensary is a family affair in Tribeca

Meet the tight-knit Queens family that turned their dad's 1990s cannabis arrest into a legal dispensary license.

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Monday, February 3, 2025

These states sold more than $1 billion in weed in 2024

At least 11 states racked up medical and adult-use cannabis sales over $1 billion in 2024.

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Saturday, February 1, 2025

Best strains in Michigan: weed trends February 2025 – Melonade and Cherry Runtz on the rise

Michigan’s cannabis market is buzzing with excitement as we enter February 2025. Whether you’re searching for the best weed in Michigan or looking for the best strains in Michigan to enhance your experience, the state’s cannabis landscape is constantly evolving. If you’re on the hunt for the best strains in Michigan, our updated guide has […]

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California Cannabis Highlights: Must-Try Picks for February 2025

California’s cannabis scene is thriving this February 2025, and we’re here to spotlight the best weed brands in California. Whether you’re into top-shelf flower, flavorful edibles, or potent concentrates, we’ve scoured the shelves to bring you the hottest picks right now. In particular, these four brands are setting the standard for quality and keeping California’s […]

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