Marijuana Matters

Education & Experience: Understanding the Operations

By David C. Kotler, Esq.
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I often write about the legal side of and opinions about the cannabis industry. Much of what I write about is culled from anecdotal experiences within either my personal practice or observations in regard to the industry. I recently had a trip to Portland, Oregon to spend time learning and understanding a little bit about a particular client’s operations so that I could provide counsel to that particular client, where permissible. For me, it was an important part of the education, which I stress and serve as the basis for this article.

With education comes understanding. What I see in the cannabis industry is often those who are critical of the use of cannabis, either recreationally or medically, seem to demonstrate some lack of understanding. In Florida, as the “No on Amendment 2″ commercials and videos roll out, I see much information that clearly comes from a lack of understanding or potentially a willful desire to distort the truth.

I share the following, less as a means to correct those distortions, but more as an opportunity to educate one who may be reading this and who may not have the same experience, which I just had the opportunity to receive. My time in Oregon was spent predominately in Portland and Salem as this is where the particular client has locations that I was able to view and experience.

My observation from a zoning perspective was that there was not a dispensary on every corner and that at times I had to be patient before seeing a dispensary during our drive. Of note in regard to the dispensaries that I did see was often the use of “cannabis” or “marijuana” in the name or associated with signage at the dispensaries, in addition to a green cross. However, there were many that did not take as visible an approach. I recall seeing, pursuant to the rules of the Oregon Program, windows covered so that one cannot see in. From time to time there were billboards advertising dispensaries. What I noticed most was in part, the clean presentation of the particular client I was seeing versus what was presented on the outside of many dispensaries we passed. This may be highlighted in part based on viewing dispensaries through what one might consider an East Coast lens. There are others that might argue that this perspective, particularly in emerging markets, is much different than that which has been developed over time in the West Coast markets, many of which have now gone recreational.

Overall, like anything, what I saw ranged the gamut from unprofessional and a little unsightly to professional and clean looking, which generally fit into the surrounding neighborhood. In particular, my client’s dispensary in Salem was in a retail shopping center along with a Little Caesars, Aaron’s Rentals, a nail salon, and other normal and expected retailers. Unless you poked your head inside the door, it would not be readily apparent that it was a dispensary.

My experience with the types and looks of the dispensaries running the gamut was mirrored by a particularly unique experience I had in viewing customers/patients. What was clear from a very limited time of viewing who it is that goes into a dispensary in Oregon was that it was impossible to pigeonhole the types of patients and ailments or, in the recreational setting, who the end user might be. On the Saturday morning of my visit, while viewing operations in Salem, I was approached and began to speak with an older gentleman with a long straggly gray beard who appeared to be in his late 60’s to early 70’s. During the course of our conversation he let me know that he is looking forward to taking it easy, and that he was a veteran. He had two friends with him and it looked like they were going to enjoy some time relaxing together, but he was also able to tell me that it was assistive to him at times when his anxiety got the best of him. His purchases were economical, and it was apparent that he and his friends were of limited socio-economic means; however, his purchases were notably and significantly cheaper for use than potentially alcohol if, in fact, he was not medicating and using with his friends recreationally.

Within minutes after the gentleman left, the exact opposite walked in the store. Candidly, I was mildly surprised by whom I held the door for to walk in as I was leaving. For a moment I was transported from Salem, Oregon to any town in central New Jersey or main street USA. Decked out in what could have been Lily Pulitzer or other preppy outfit were two soccer moms. They had stepped out of the newest model of a particular German automobile manufacturer. Unfortunately, I did not have the opportunity to engage with the soccer moms in discussion, but it was clear through their knowledge of the layout and interaction with the employee behind the counter that this was not their first trip to this particular location.

So what does the foregoing illustrate? For me it illustrates the development of perspective through education. It is that perspective that I hope to bring to the advice and counsel of clients. Perhaps I can use the knowledge to be assistive in making recommendations on regulatory issues, if consulted on them, helping to explain to politicians and bureaucrats or zoning and planning officials what might or might not be important in their considerations when dealing with a client. My observations should ultimately help me assist in educating others as to what the business and operation of cannabis related businesses might actually entail and look like. It is absolutely necessary, irrespective of one’s role in the cannabis industry, whether it be on the real estate side, insurance brokerage, providing legal or consulting advice (especially as individuals transition from those areas of practice in non-cannabis related spaces) that one take the time to understand the industry and its practice from the inside out. Only then can one be an effective resource to a cannabis related business wherein once the layers of the onion are peeled back, there is actually substance and information.

Marijuana Matters

Patent Options Available for Breeding Cannabis

By David C. Kotler, Esq.
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Patent No.: 909554. Date of patent: August 4, 2015. Years from now, historians and academics may look back on this patent number and date as a watershed mark in the evolution of legal cannabis. Feel free to read the 147 pages of the patent documents but, in short, it “leads to many innovations, provides compositions and methods for breeding, production, processing and use of specialty cannabis.” It was the first time that the U.S. Patent Office (USPTO) had issued a patent for a plant containing significant amounts of THC. One USPTO spokesman recently discussed with a journalist that “there are no special statutory requirements or restrictions applied to marijuana plants.” The following is a broad, and I mean really broad, overview of the options available to protect intellectual property within the cannabis species and strain realm.

Generally speaking, to be patent eligible, an invention must be useful, it must be new, it cannot be obvious and it must be described in a manner so that people of skill in the relevant specialty can understand what the invention is, make it and use it without engaging in undue experimentation. In terms of cannabis, essentially the breeder must have created a new and non-obvious strain over what already exists that is useful such as being highly resistant to molds or having a specific concentration of CBD.

Breeders potentially have a number of options available to them, despite the common belief otherwise. In the U.S. there are five types of intellectual property protection that breeders can obtain for new plant varieties or their use of clones:

One may seek protection for seeds and tubers, known as Plant Variety Protection. A tuber is essentially a swelled root that forms a storage organ. The Plant Variety Protection Office provides this protection. To apply for Plant Variety Protection, the applicant submits information to show that the variety is new, distinct, uniform and stable.

For asexually propagated plants except for tubers, a Plant Patent may be sought. These are sought through the USPTO. This is relatively inexpensive compared with a Utility Patent covering the genetics.

Trade secrets are often used to protect inventions that will not be commercially available or cannot be reverse engineered. For example, if a new strain is invented but is only commercially available in its final form, trade secret protection may be the best form. The most important thing to remember is that a company must follow a strict set of requirements to keep the trade secret confidential.

The last patent type protection could be through a Utility Patent. A Utility Patent can be issued for any type of plant showing its utility. These are issued by the USPTO. Seeking and obtaining a Utility Patent is expensive and complex.

In addition to Patent Protection, breeders may seek Contractual Agreements restricting the use of the clones (i.e. a material use agreement). The parameters that a breeder wishes to craft can essentially be crafted into the language of any type of agreement that is drafted to memorialize the relationship and terms between the parties.

A few broad-stroke items to keep in mind with regard to patents particularly relative to the patenting of cannabis strains and the like: First, is the passage of the America Invents Act which among other changes allowed for the U.S. to transition from a First-to-Invent patent system to a system where priority is given to the first inventor to file a patent application. Second, there are the potential bars based on different types of prior use.

Any discussion about the foregoing topic should necessarily include the question: Is it really good for the cannabis industry and its evolution? The dialogue moves out of one steeped in tradition, lure of trips through mountain passages, and potentially patient benefit or in search of higher quality and into connotations of business law and big businesses sweeping in to take over. It is an expensive process. It may be inevitable. In the meantime, protect yourself as best you can and as you see fit.

Marijuana Matters

Let’s Talk CBD

By David C. Kotler, Esq.
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Let’s talk about cannabidiol, CBD, a non-psychoactive component of cannabis. Let’s not talk about CBD from the whole plant. This is a conversation about the proliferation of hemp-based CBD marketed everywhere from gas stations to specialty health and wellness stores. Heck, “its legal in all 50 states”, right?

On the Federal Level, pursuant to Title 21 USC 802 Section (16) The term “marijuana” means all parts of the plant cannabis sativa L., whether growing or not; the seeds thereof; the resin extracted from any part of such plant; and every compound, manufacture, salt, derivative, mixture, or preparation of such plant, its seeds or resin. The term does not include the mature stalks of such plant, fiber produced from such stalks, oil or cake made from the seeds of such plant, any other compound, manufacture, salt, derivative, mixture, or preparation of such mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of such plant which is incapable of germination.

Proponents of the position that hemp-derived CBD is legal point to the lack of a specific definition under the above description (often asserting that their oil is not processed from the flower) and the Ninth Circuit’s opinion in Hemp Indus. Ass’n v DEA, 333 F.3d 1082 (9th Cir. 2003). They buttress their belief by citing the DEA’s clarification of hemp in the Federal Register released in October 2001 and the 2013 Farm Bills’ adoption of the following definition of industrial hemp (adopted from plant scientists research in the 70’s: “The term ‘industrial hemp’ means the plant, cannabis sativa L. and any part of such plant, whether growing or not, with a delta-9 tetrahydrocannabinol H. R. 2642—265 concentration of not more than 0.3 percent on a dry weight basis.” Much of the foregoing has been extended to even support opinions that hemp-derived CBD from domestic sources under the 2013 Farm Bill is legal for distribution nationwide.

Opponents of the hemp-derived CBD is legal argument (putting aside the issues with imported hemp and contaminants, etc.) point to the exception in the definition of “marijuana” i.e. to actually get a workable form of CBD from hemp, the preparation of the stalk puts you into the resin category which is excepted from the terms that are specifically not included in “marijuana.” In regard to HIA v. DEA cited above, opponents posit that the court decision, never mentions CBD, and the HIA maintain that this ruling did not legalize CBD.

In February 2015 and again in February 2016 the FDA issued warning letters to CBD companies. The overall context of the letters dealt with mislabeling and improper claims in addition to the most recent round of letters addressing CBD products’ exclusion from the dietary supplement definition under the FD&C act and how that is affected by CBD’s consideration as a new drug in one or more new drug applications. What has not been addressed or asserted by the FDA is the legal status of CBD under the Controlled Substances Act.

Although I have seen many commentators and attorneys opine on the legality as the case may be of hemp-derived CBD and its ability to be shipped to and sold in all 50 states (often with a caveat that readers should consult them for further advice), I have never seen the issue addressed from a practitioner that deals with the United States Patent and Trademark Office. I am not that practitioner. However, I do represent a company that has recently made application. I, not being a trademark attorney, but being sensitive to the federal government’s position collectively on CBD, found the examiner’s questions in her Office Action Letter surrounding CBD to be quite interesting. They were as follows:

  1. Do applicant’s identified goods contain marijuana, marijuana based preparations, or marijuana extracts or derivatives, synthetic marijuana, or any other illegal controlled substances?
  2. If the applicant’s goods contain Cannabidiol (CBD), is this derived from marijuana or from industrial hemp?
  3. Are the applicant’s goods lawful pursuant to the Controlled Substances Act?

I searched for another application and Office Action Letter from 2016 for another CBD product (both were vaporizer products rather than the lotions, balms, etc. that have been the subject of other applications). The questions to that applicant mirrored those above.

What I take from the questions that trademark examiners are asking is that perhaps the debate raging in academic and legal circles is for naught. It looks like at least the USPTO has resigned itself to there being a difference between cannabis or whole plant and hemp-based CBD in terms of definition and proscription under the federal controlled substances act.

So we have come full circle in my question, ‘Is it legal in all fifty states?’ If you answer yes to that question then please provide me the definition of marijuana/cannabis from the Controlled Substance Act from each of the fifty states individually and a copy of the documentation from a source showing how the industrial hemp was grown and processed and verifiable lab reports of the particular product’s contents.

Marijuana Matters

A Guide to Documentation and SOPs for Start Ups

By David C. Kotler, Esq.
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As your company grows, or whether you want to have certain documentation to make an application for licensure and/or for outside entities looking to invest, it is necessary to handle issues from a documentation standpoint. Learning how to handle situations with staff through proper employee manuals and how to establish and practice standard operating procedures can help businesses avoid common pitfalls with a little forethought.

Beginning with standard operating procedures (SOPs), there are many resources available to get assistance in crafting them. You can consult with individuals such as safety content producers, business consultants, lawyers, technical writers, and even borrowing SOP writers from other industries. I am aware of a Connecticut producer who tapped pharmaceutical SOP writers as consultants with the focus of establishing their standard operating procedures. I am not convinced that there is any proper person or method by which an entity may want to consider an SOP. As a threshold, however, it is important that a proper format is created, i.e., simple steps, hierarchical steps format or perhaps even a flow chart format.

One would want to consider the audience who will be reading the SOP and the information to impart to that audience. It is also important to consider SOPs that you want to update as practices evolve or change.

It is possible to create SOPs internally, and frankly, this may be the most recommended route. If the SOPs are being used for guidance and not just to support the license application process, this is particularly important. It is a time-consuming task and if created from the inside out, it can be most effective.

It is possible to get lost in the minutia by documenting every step taken within a particular process. I have seen SOPs number in the hundreds just for cultivation and processing operations. One particular entity in Colorado created over 63 SOPs within the past year. If you are writing your own SOPs, it is important to understand the scope and applicability, i.e. why a particular process is performed and how it is used, then the procedures and/or steps that are necessary to accomplish that particular process, clarify any terms that are necessary so that the reader is able to follow the steps throughout a particular outline, cover health and safety issues, address equipment and supplies and provide emergency procedures.

The process that I can attest to as being fruitful is interplay between an employee who is actually responsible for a given task and a third party looking from a 1000-foot view. For instance, have the employee who completes a number of tasks within the organization provide a list of what they do on a general day-to-day basis. From that list, have the third party extrapolate what topics might be covered, often times borrowing from other well known standard operating procedures that are seen across industries and come up with a master list of the SOPs which are desired. It is important for the employee and third party to collaborate to finalize SOPs.

Employee guides or manuals provide information on benefits, when time sheets are due, paydays, holidays, vacation days, sick days and more. For employees, it helps mitigate risk by providing guidelines for conduct, discipline, and local practices in the states in which you operate. Employee guides are most effective when they are created to match your company’s needs. When it is tailored to your company, you are certain that the policies meet the laws of the places where your offices and employees are located. It allows you to provide input so you can ensure that you have developed policies that your company will follow. Unwritten policies are unwise as they may cause issues and can potentially lead to lawsuits. There are three types of multi-state employee guides: a guide with favored nations status, meaning that the most liberal laws in one location apply to the entire organization; an employment guide for each location in which you operate; or you can create one guide with a local practice section.

Creation of employee guides is a time consuming and arduous practice, but once completed, they help guide the relationship between employee and employer. Employees should review the employee manual and sign off upon receipt and review. This will serve to protect the employer in the future should an issue covered by the manual arise.

An effective employee guide might include (but certainly not be limited to) the following:

  • An “employment at will” disclaimer
  • An anti-harassment policy
  • An internal grievance procedure
  • Equal Employment Opportunity (EEO)
  • Employee benefits
  • Paid time off (vacation, personal days, sick leave)
  • Unpaid leaves of absence
  • Americans with Disabilities Act (ADA) (for employers with more than 15 employees)
  • Jury duty, military leave
  • Hours of work
  • Introductory/probationary period
  • Legally mandated language concerning pay deductions
  • Proper E-mail/Internet usage
  • Professionalism/dress code
  • Drugs in the workplace
  • Social media policy

There are many other policies that would be included in order to comply with requirements that might be mandated by a particular regulatory scheme i.e. security compliance. The guide should be a living, breathing document that evolves over time based on new knowledge, changes in laws and business fluidity.

Both standard operating procedures and employee manuals or guides are integral to the viability of a cannabis related business whether a hands on the plant license holder or an ancillary company. I encourage my clients to craft self-created content that they have invested their time and knowledge into, with some help where necessary. Purchasing forms online does not provide a workable format and will only lead to problems in the future. You get what you put in and creating these documents internally and from the ground up gives more control to the business.

Marijuana Matters

Time to Litigate: The Defense That Helps the Client but Hurts the Industry

By David C. Kotler, Esq.
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From time to time, lawyers that service the cannabis industry find themselves representing a client with a litigation matter. By anecdotal evidence, it appears that there is an up-tick in cannabis related litigation over the past year and a half, mostly in circumstances where respective promises made have not been lived up to or those who have invested money are seeking its return. Perhaps a partnership formed within the last few years is simply becoming unraveled.

In the world of litigation, we see defenses, or what are known as affirmative defenses, may be filed in response to a particular lawsuit or claim. One such affirmative defense often utilized in litigation is that a particular contract or agreement may be void based on illegality or void as against public policy.

In fact, this particular grounds for dismissal was at issue in a case in Maricopa County, Arizona wherein a judge in April of 2011 dismissed a lawsuit seeking enforcement of a loan agreement where two Arizona business people loaned $250,000.00 each to a Colorado-based medical marijuana dispensary. The agreement in that case specifically stated that the loan was for “a retail medical marijuana sales and growth center.” Colorado had the foresight in 2013 to legislate against this type of defense when their general assembly passed a law indicating “a contract is not void or voidable as against public policy if it pertains to lawful activities authorized by” Colorado’s constitutional and statutory cannabis law.

The issue becomes germane in emerging states wherein the legislatures and courts have not been dealing with cannabis related matters for any length of time. This is particularly true and ripe for problems in states such as Illinois and Massachusetts that have recently moved forward with cannabis programs and experienced an influx of out of state consultants and companies looking to partner with and work with local residents for licensure purposes. In Florida alone, there have been at least three lawsuits in the past year dealing with cannabis related civil disputes.

To my knowledge, none of those disputes were defended upon, nor did the court address, the legality of the underlying subject matter. However, the question arises whether the lawyer’s obligation to their client necessitates raising this as a defense, for instance, to an action for non-payment of a promissory note for a loan to fund cannabis related business. If the lawyer practices and seeks clients in the industry and hopes to move the industry forward in a positive manner, is it incumbent upon the lawyer to assist the client by making the best legal argument or protect the industry and greater good? As an aside, the answer is to zealously represent the client. Potentially, an adverse ruling in a particular jurisdiction could ultimately affect enforceability of cannabis related agreements in that jurisdiction. It is possible that having a court ruling, even if it is a trial level court within the jurisdiction, at least provides some precedent and a basis for the industry moving forward in that particular jurisdiction. If the ruling is unfavorable like the Arizona precedent mentioned earlier, perhaps planning for jurisdiction and venue to be in more favorable environs is key to document drafting on the front end. For investors, knowing the enforceability of their agreements in a particular jurisdiction could mean the difference between investing in a venture in a particular state or not.

Ultimately, I believe that as advocates, we must do whatever is in our power to protect the client even if it means testing the legal bounds by making an argument that at first blush may hurt the industry. However, having courts develop precedent by which the industry can govern itself in business dealings is important and takes away uncertainty, which in turn allows for good decision-making on the front end. Hopefully, in the near future this will be moot as the federal government moves forward to take actions that provide more certainty and uniformity in dealings within the cannabis space.

Marijuana Matters

What Happens When the Attorney-Client Relationship Goes South

By David C. Kotler, Esq.
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Today I get to take a break from talking about what some lawyers, where ethically permissible, generally deal with in the cannabis space in terms of drafting leases, distribution agreements, licensing agreements, and/or application assistance. Within the cannabis industry, I personally serve as outside general counsel to entities to which I provide legal guidance and advice under retainer agreements, which comply, with my ethical obligations as a member of the Florida Bar. Over the last two years, I have spoken with individuals in other states and lawyers who practice in other states. As the cannabis industry has evolved, we continue to witness start-ups that need legal help and often take the most cost-effective route. In certain jurisdictions, I have heard of attorneys, particularly attorneys in Colorado, who have expanded into those jurisdictions and taken an equity stake of the start-up for their legal services. Whether or not this is true, and furthermore permissible, remains to be determined or even addressed by me, as this is a topic for another day.

But what happens when the lawyer-client relationship goes south?

It just so happens that in Florida a lawsuit is taking place between a well-known industry participant and its former lawyer. The names of the parties are omitted to protect them; however, perhaps more importantly, not to put myself in anyone’s cross hairs. This dispute was first reported in a reputable industry publication. Having had experience in media-worthy cases in the past, I am assuming that one party or the other reached out to self report the lawsuit for whatever advantage they thought they would garner. Upon review of the docket in preparation for writing this piece, I noted the docket’s length. For those who are unaware, a docket is essentially a listing of the dates and matters that have been filed during the pendency of a lawsuit.

The docket for the case begins between our anonymous parties, on October 26, 2015 with the filing of a complaint. Since October 26, 2015, there have been approximately 59 docket entries. In some cases, that number could encompass all of the docket entries over the life of a full litigation, short of trying a case, and probably gives the reader some idea as to the litigiousness between the parties. In part, this could be due to the personalities of both former counsel and new counsel representing the company in defense, but probably is not indicative of what would happen in every dispute between former counsel and a company. It is certainly a scary proposition considering the fees that may be incurred in defense of the action, aside from the sum that is allegedly owed to the plaintiff. Without getting into the minutia of the complaint, of note was a portion of the retainer agreement that served as the basis of the breach of contract claim, which granted the law firm incentive stock options pursuant to the company’s incentive stock program. It is imaginable that at the time of signing the retainer agreement, the company probably did not think too much about signing such an agreement; however, as time went on, this may have become problematic on a number of levels. Further review shows the parties airing out their dirty laundry in a public forum.

What example has this lawsuit shown us, and what can one take from it?

Well, this lawsuit is illustrative of what can go wrong for start-ups and newer companies in hiring counsel, either on a one-time basis or as outside general counsel. Giving stock options may not always be advisable as a means of deferring payment on the front end. Also realize that counsel who you hire will be privy to some very important and intimate details of how your company operates. In the cannabis industry, one might wish to be especially guarded, as the industry still has considerable exposure federally. The attorney-client privilege, which some readers may have heard about, can cover communications and work done on behalf of the company during the relationship and survive termination; however, that privilege may very well be waived if the services/fees of the attorney are being attacked or defended. Overall, like anything else, it is important to understand who you may be working with on the front end and memorialize any relationship properly and clearly in writing. Go into the professional lawyer-client relationship with reasonable expectations, reasonable demands, and pay reasonable compensation for the work being performed. As a business, don’t try to get something for nothing. And as an attorney, don’t expect the company to be your golden ticket.

Marijuana Matters

The Legal State of Cannabis in Florida

By David C. Kotler, Esq.
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It is now December of 2015 and we are one year removed from the loss at the polls of an amendment that would allow for full spectrum medical cannabis in Florida. The defeat of Amendment 2 allowed for the implementation of the Compassionate Medical Cannabis Act of 2014, albeit a rather rocky implementation, thus legalizing low THC, high CBD cannabis strains. I participated in many of the public meetings which took place and watched the different draft regulations set forth by the Florida Department of Health be debated, commented on and ultimately revised. The process underwent legal challenges and as of the publication of this, applications for five license holders were awarded.

As many might be aware, the Compassionate Medical Cannabis Act applicants were required to be nurseries continuously operating for over 30 years with a plant registration of 400, 000 plants as of the time of application. There were other relevant requirements, but the two foregoing were the most restrictive and narrowed the market of potential applicants.

Following in line with legislative means to put cannabis in the hands of a few large, Florida-centric entities, a Bill recently passed the Senate in Florida allowing for the expansion of the use of cannabis with higher THC content for patients with debilitating diseases under Florida Statute 499.0295. Presumably, the five licensees would then be authorized to expand their crop to include THC based plants and provide those to qualifying patients.

My fear all along has been that Florida would abandon the possibility of having a robust economic, yet patient-centric model not dissimilar to Colorado, Washington or Oregon, but more akin to what one might see in New York or what was narrowly avoided in Ohio. In fact, I have considered the possibility that should the new Amendment supported by United for Care passed, since that Amendment allowed for the Department of Health to promulgate the rules and regulations, that the Department could, assuming the five licensees are operational, merely give responsibility to the five licensees, allowing them to expand.

Alas, I believe, and I am happy to admit it, I may be wrong. In Florida, constitutional amendments require a review by the Office of Economic and Demographic Research. It is the focus of this body to analyze and report the economic impact that a particular amendment might have upon passage and effectuation. Data from numerous sources are reviewed and integrated into the Committee’s opinion. Of note, during my review of the October Economic Estimating Conference Meeting and Reports was the position taken by the Department of Health. Specifically, the Department of Health did not indicate that it could implement a system by merely expanding or working off of the framework it has for the Compassionate Medical Cannabis Act. Instead, the Department took the approach that a new set of regulations and guidelines, as well as departmental operations, would need to be implemented. In fact, it would need to be implemented to comply with the MMTC system authorized by the amendment. Whether one believes in the vertical model or one which licenses similar to Maryland and a few other states, the important point is that the Department of Health seemingly recognizes that a more robust model will have to be implemented.

So what does all this mean for patients and potential businesses in Florida? In regard to patients, I wish I could say that the potential for treatment through cannabis is foreseeable in the short term. However, I am not convinced of this. I do believe that the selections and process for which applications were selected under the Compassionate Medical Cannabis Act will be challenged, thus resulting in more delays. With regard to the Amendment and implementation should it pass, it will not be until the middle of 2017, approximately one and one-half years away. Should businesses begin preparations in Florida currently? In my honest opinion I believe it is hard to say. In the summer of 2014, I spent a lot of time counseling individuals and businesses on planning for the legalization of medical cannabis in Florida. Some clients were more aggressive than others and ultimately spent time and money, perhaps unnecessarily. On the flip side, I participated in the application process in Maryland and am of the belief that individuals who made application for Maryland cultivation licenses benefitted from an early start and preliminary planning.

I know a number of successful cultivators in legal states who moved on Maryland as a last minute decision once recognizing that although scored as part of an application, residency or lack thereof was not a bar to licensure. I am therefore of the opinion that certain preparation in advance is advantageous and allows alteration of the plan and adaptation at a later stage without wasting resources to accomplish much of the work that is capable of being accomplished in advance. I do believe there are a good deal of uncertainties, depending on how things move forward, as to what our model will look like and if that model will get into place, depending on the rollout of the Compassionate Medical Cannabis licenses as well as the possibility of some of the legislative initiatives catching wildfire, much as the Compassionate Medical Cannabis Act of 2014 did at the very end.