Cannabis industry risk could rise sharply with change in federal position

Attorney General Jeff Sessions on Jan. 4 issued a memo to all U.S. attorneys suggesting that they resume enforcement of federal law that defines cannabis as a dangerous drug and cannabis activity as serious crime.

The memo refers to the 1970 Controlled Substances Act, where cannabis is classified as a drug in the same category as heroin.

“In deciding which marijuana activities to prosecute under these laws with the Department’s finite resources, prosecutors should follow the well established principles that govern all federal prosecutors,” Sessions said. Those principles include weighing the seriousness of a crime, deterrent effect of prosecution and the cumulative impact of crimes on a community.

Of particular note, Sessions said, “previous nationwide guidance specific to marijuana enforcement is unnecessary and is rescinded, effective immediately.”

That statement includes rescission of the Cole Memo, issued in 2013 and long regarded as providing a safe haven by cannabis entrepreneurs. That memo guided U.S. attorneys that “the federal government has traditionally relied on state and local law enforcement agencies to address marijuana activity through enforcement of their own narcotics laws.” Federal agencies have “not historically devoted resources to prosecuting individuals whose conduct is limited to possession of small amounts of marijuana for personal use on private property.”

That guidance is gone, effective today.

James Dunn covers technology, biotech, law, the food industry, and banking and finance. Reach him at: james.dunn@busjrnl.com or 707-521-4257