Just days after California began selling legal recreational pot, U.S. Attorney General Jeff Sessions unleashed federal prosecutors to more aggressively enforce federal marijuana laws. What does the announcement mean for the cannabis legalization movement?
Rescinding the Cole Memorandum
Marijuana has long been illegal under federal law. But since 1996, when California passed the first law allowing the use of medical marijuana, a growing number of states have legalized and regulated the sale and possession of medical and recreational pot. The Cole Memorandum, issued in 2013 by the Department of Justice (DOJ) under the Obama administration, instructed federal prosecutors not to go after legalized pot, thus allowing sales to flourish in those marijuana-friendly states.
On January 4, 2018, Sessions rescinded the Cole Memorandum, which he says undermined the “rule of law” and the DOJ’s obligation to enforce the federal statutes that prohibit the possession and sale of marijuana. In his directive, Session’s wrote, “Today’s memo on federal marijuana enforcement simply directs all US attorneys to use previously established prosecutorial principles that provide them all the necessary tools to disrupt criminal organizations, tackle the growing drug crisis, and thwart violent crime across our country.”
“The Cole Memorandum was an unofficial internal policy in the Department of Justice; it was never binding law,” says renowned cannabis attorney Allison Margolin of Margolin and Lawrence. “It provided limited protections to those who followed the provisions in it under the Obama administration.” Such provisions included not selling to minors and not crossing state lines with cannabis products.
What it means for states that have legalized marijuana
“I believe the intention of [Sessions’] statement is to scare,” says Serge Chistov, financial partner of Honest Marijuana Company, who’s waiting to see if there’s any real actions in the states where pot is legal. “It will be very interesting to observe if he has anything specific to say to California regulations or regulatory bodies or if he is truly going after legalization whole war,” Chistov adds. “I think the bark is bigger than the bite.”
Tanya Hoke, managing director of Galen Diligence, a company that provides investigative due diligence of legalized pot businesses, sounds a more cautious note, saying there’s a lot that we still don’t know. “If, as some expect, enforcement decisions are left up to individual U.S. attorneys, then we may see a lot of variation in federal enforcement from state to state,” she says. “If they haven’t already, smart investors and operators in the industry should figure out which U.S. attorneys cover their jurisdiction and what their stance is on legal cannabis.”
“I don’t think it will immediately impact [legalized marijuana] dispensaries,” says Chistov, who doubts that the DOJ has the manpower to do so and that it won’t find willing partners among state authorities and regulatory bodies.
Nor does Chistov think Sessions’ announcement will affect the use of marijuana. “The fact is, we are legalizing something that people have been using for hundreds of years legally or illegally,” he says. “We are now just trying to reroute the paths of revenues so they stay away from the black market and instead go to the right parties, which are government regulators.”
Which is what makes Sessions’ motives even more confusing. “The money is used to benefits school districts, roads, and employment,” says Chistov. “Would he prefer the money go back to the cartels? That’s something he needs to think about.”