Final month, the U.S. Legal professional for the Southern District of California indicted a San Diego cannabis producer for dumping hazardous waste in violation of federal regulation. The defendants are alleged to have organized for an unlicensed rubbish hauler to unlawfully dump at varied places twenty-eight 55-gallon barrels of waste ethanol utilized in risky extraction of cannabis oils, a course of that’s permitted below state and native regulation with correct licenses and permits. The defendants allegedly paid the hauler in money what amounted to about half of what it will have value to lawfully get rid of the fabric. California regulation strictly controls hazardous waste administration and disposal practices by cannabis licensees, together with producers such because the defendants right here.
Whereas the charged conduct described on this case is extraordinarily critical, essentially the most notable a part of the indictment is what’s lacking: any point out in anyway of the Managed Substances Act or different federal regulation pertaining to the illegality of defendants’ cannabis enterprise. Certainly, the indictment expressly alleges that the charged defendant “was engaged within the enterprise of extracting oils from cannabis,” and the California Division of Public Well being’s on-line license search device signifies that the enterprise appeared to have each native and state approval to conduct the extraction actions. In different phrases, regardless of the events all however stipulating to the truth that the defendant firm was engaged in federally unlawful cannabis exercise, the federal authorities determined to not cost anybody for that conduct, and as a substitute centered solely on the violation of hazardous waste legal guidelines.
Federal enforcement towards state-licensed cannabis operators has come a great distance up to now decade, from energetic enforcement to the 2013 Cole Memo to its rescission and the selective enforcement actions which have adopted—the moment case falling inside the latter class. Likewise, federal courts have continued to refine their authorized evaluation on the subject of the business cannabis trade, discovering increasingly more regularly that business contracts involving cannabis companies will probably be enforced, notably if doing so won’t drive a celebration to actively violate the Managed Substances Act.
The present case is in keeping with different federal enforcement exercise (or lack thereof) towards cannabis companies in California in latest months. Though the defendant entity apparently held state and native approvals for its cannabis manufacturing exercise, it was allegedly violating the phrases of these approvals by participating in unlawful dumping of hazardous waste and thereby jeopardizing the well being of the group. Much like the federal authorities’s group efforts with California authorities final summer season to focus on unlawful cannabis grows on public land, the present case targets alleged exercise that will be unlawful below any state’s regulation and would set off environmental issues, despite the fact that enforcement of hazardous waste legal guidelines towards cannabis operators was not a said concern of the Cole Memo.
So what does this case imply for cannabis operators on the subject of future federal enforcement exercise? Nobody can say for certain, as long as business cannabis exercise stays unlawful below federal regulation. However from previous and present observations, it appears that evidently federal enforcement sources are largely being directed in direction of cannabis exercise that implicates a number of Cole Memo priorities, and most notably actions that contain organized crime and environmental issues. It doesn’t appear that federal enforcement exercise is being or will imminently be directed in direction of business cannabis operations which can be in compliance with state and native regulation (and federal legal guidelines aside from people who prohibit cannabis), maintain legitimate permits and licenses, and are usually behaving nearly as good members of the group. And that is excellent information.