Shakedown From Feds Imperils Medicinal Marijuana

DEA Allegedly Tells Landlords to Evict Pot Club Tenants - Or Else

Then there's medical marijuana, which is being sold in a haze of legality (the state's cool with it, the feds aren't) at numerous shops around Santa Barbara. Grow rooms (such as the one pictured above) are taking root in many neighborhoods, and the city is finally starting to put regulations down on the books about this curative cannabis. Will everything remain groovy in 2008? That's up to the feds.
Paul Wellman

Not too long ago, critics were likening the medical marijuana movement in Santa Barbara to the cannabis culture equivalent of the Wild West: more dispensaries than Starbucks, no city oversight, and law enforcement without a clear mandate. Things have changed quickly, however, with the city stepping in earlier this spring to craft an ordinance outlining the dos and don’ts of dispensary operation. Now, just last week, the federal government’s Drug Enforcement Agency (DEA) and Department of Justice (DOJ) paid a visit to Santa Barbara and threatened the people who rent their properties to California-approved cannabis clubs with hefty fines, property seizure, and criminal charges for violation of federal law.

According to local attorney Joe Allen, who sat in on at least one of the several meetings between federal officials and landowners on August 5 and 6 at the Santa Barbara District Attorney’s office, “In very clear terms, they said this is the last warning: The government is going to shut all of these clubs down and the government is going to prosecute anyone involved.”

The visits, which Santa Barbara District Attorney Christie Stanley coyly refused to confirm or deny, leave in their wake a questionable future for the eight or so medical marijuana shops that operate in Santa Barbara and the thousands of patients who visit them each week to seek relief from a wide variety of conditions. In the opinion of Allen, who is considered a go-to guy within the state for the hazy landscape of medical marijuana law, the heat turned up by the DEA this week has worked so well that he suspects “virtually every cannabis operator” will receive or has already received an eviction letter from his or her landlord.

Adding to the fallout is the city’s aforementioned cannabis ordinance, which essentially voids business permits for any clubs that suspend operations for 30 days. It is feasible that most operators will not be able to reopen even if they succeed in the uphill battle of finding a landlord willing to rent to them.

Josh Braun, (left) owner of Hortipharm Caregivers, says he will close the doors to his State St. dispensary by September
Paul Wellman (file)

One of those who has already received his eviction order is Josh Braun. His dispensary, the third locally when it opened in 2005, had been operating on the 3500 block of State Street, nestled among restaurants, a coffee shop, and a gardening store. But after his landlord’s lawyers met with federal authorities last week, his days of operating Hortipharm Caregivers are numbered. His doors will close by September. “I’ve got 20 employees with salary and health benefits-most of them with families-who are going to be out of work in a crappy economy,” explained Braun recently before adding with marked frustration, “And for what? Because the feds don’t want to respect the people of California? “

Braun’s landlord, John Friese, said the eviction didn’t result from bad behavior on Hortipharm’s part but from the threat of property seizure and thousands in fines. “I was basically being told by the DOJ : that I better get them out and get them out in a hurry or else.”

Adding insult to injury, Santa Barbara Bank & Trust called Braun the day after the meeting last week to inform him that his accounts with the bank, or at least those associated with Hortipharm, would have to be terminated because of his line of work. “For years, it wasn’t a problem but now, all of a sudden, the same day the feds come to talk to my landlord, it is,” scoffed Braun. According to him, at least one other dispensary in town received similar word from Bank of America last week.

The United States Attorney General’s office did not return calls for this story. The DEA office referred calls to the Attorney General.


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