Just as entrepreneurs getting into the retail pot industry need a good lawyer, some of those lawyers might be wise to consult an attorney of their own.
Lawyers in the burgeoning business are entering a legal gray zone where the drug is permitted for some purpose in most states but illegal under federal law — in the same controlled substances category as heroin. Missteps could lead to prosecution for conspiracy, money laundering or aiding and abetting drug dealers.
“Any lawyer that goes into this should be aware that a literal reading of federal law permits such a prosecution,” said Sam Kamin, a University of Denver marijuana policy law professor, whose research five years ago found lawyers more susceptible to being disbarred than criminally charged for cannabis-related work. “It probably makes sense for a lawyer to at least talk to a legal ethicist or get an opinion from a legal ethicist.”
Attorney General Jeff Sessions recently reiterated his opposition to legal weed, and a congressional amendment prohibiting federal prosecutors from targeting medical marijuana is due to expire at the end of the year.
Sessions has not said if he will reverse a longstanding Justice Department policy not to interfere with purveyors complying with state laws but to focus prosecutions on trafficking, sales to minors, cartels and gangs in the business, violence or gun use in cultivation or distribution, and pot grown on public land.
Despite a few instances of lawyers being prosecuted in federal and state court — including a pending San Diego County case — more attorneys are jumping into cannabis law. Legal needs range from financing to permits, real estate, water law, intellectual property, contracts and banking.
With California allowing recreational pot retail sales Jan. 1, interested investors are reaching out to attorneys like Mitch Kulick to find out how to safely finance the potentially lucrative industry.
Kulick, a New York lawyer who offers his expertise in many states, recently gave his typical scare spiel to a real estate magnate about the possible legal consequences, and said he could only help mitigate risk so much.
“At a certain point, you have to realize this is against the law. There’s no insurance policy to take away the risk,” Kulick said he told the man. “If I was already a billionaire, I might not be taking the risk.”
Kulick, who once worked as a lawyer for the Securities and Exchange Commission and a major international firm, had to do a similar risk analysis and soul searching before deciding to commit to the higher cause, so to speak.
There has been a tipping point for many lawyers setting up boutique pot law firms and jumping from old-school law firms as demand for their services trumps fear of legal repercussions and the stoner stigma fades as more states legalize marijuana use.
Attorney Chris Davis, who grew up in Berkeley around friends and family who use the drug, found people operating in the shadows who wanted to go legit when he returned to California from New York two years ago.
“So many people were asking how to go legal and how to worry less,” said Davis, executive director of the National Cannabis Bar Association, which has about 300 members in the U.S. and Canada and is growing rapidly. “It became impossible to turn people away.”