Our Federal Prisons Are Fueled By Drugs

That’s the takeaway from this report by the federal courts and U.S. Sentencing Commission.

To summarize, there are almost 200,000 people in federal prison today, and almost half of them (or 48%) are there for drugs. Almost all of them (93%) are men, and the vast majority are young, minority men. The breakdown is 35% Hispanic, 35% black, and 27% white.

Here are the top five types of cases:

  1. Drugs (48%)
  2. Guns (19%)
  3. Immigration (8%)
  4. Child pornography and sex offenses (7%)
  5. Major frauds (5.8%)

For fraud cases, the median dollar loss was $800,000, in case you were wondering.

For the drug cases, here’s the breakdown among drugs:

  1. Methamphetamine (32.8%)
  2. Powder cocaine (24.2%)
  3. Crack cocaine (20.9%)
  4. Heroin (9.5%)
  5. Marijuana (8.4%)

Finally, the report shows how often people are sentenced below, above, or within the range that’s recommended by the federal sentencing guidelines. Here’s a crash course on the guidelines if you want to know how they work.

  • Half were sentenced within the guideline range (50.4%)
  • A quarter were sentenced below the range with the government’s support (24.7%)
  • One-fifth were sentenced below the range without the government’s support (21%)
  • Relatively few were sentenced above the guideline range (3.9%)

SEC Lights Up Another Cannabis Company

In what may be a sign of maturity for the industry, the Securities and Exchange Commission has sued another marijuana-related business for violating federal securities laws.

Last month, the SEC charged a California-based company and two former executives with a classic pump-and-dump scheme. First, the Commission says, the defendants touted phony revenue to drive up the price of the company’s stock. Then they unloaded their own shares for millions of dollars. According to the complaint, much of the revenue came from a series of sham transactions with a shell company that the executives controlled. So the SEC charged them with fraud as well as offering and selling unregistered securities.

The company and one of the executives have settled the case without admitting or denying liability. The executive agreed to pay more than $12 million, among other penalties.

Meanwhile, the company has turned over a new leaf, so to speak, overhauling its management, business model, and board of directors.

The SEC will continue to scrutinize the market, however, which highlights something cannabis companies should already know: get your ducks in a row, and run your business the right way.

Puff and pass if you want, but don’t pump and dump.

California’s Next Gold Rush Is Green

Last week, California legalized recreational marijuana. So did Maine, Nevada, and Massachusetts, and four other states passed medical-marijuana laws: Arkansas, Florida, Montana, and North Dakota.

It marked the end of prohibition as we know it, which didn’t work for alcohol and doesn’t work for pot. Too many millions of people enjoy it responsibly or know others who do, and it’s safer than alcohol or tobacco. As a much-beloved sportscaster used to say, the game’s now in the refrigerator; the door’s closed, the light’s out, the eggs are cooling, the butter’s getting hard, and the Jell-O is a-jigglin’. Hopefully, Uncle Sam does the right thing, too.

Through Proposition 64, California voters enacted the Control, Regulate, and Tax Adult Use of Marijuana Act of 2016. It’s called the Adult Use of Marijuana Act for short. For a deep dive on the issues, see the state’s official voter guide to the election. It’s a big file, but a summary of Prop 64 starts on page 90, and the full text follows on page 178.

What do you need to know right now? These six things.

It legalized recreational marijuana for adults age 21 or older. You may now grow up to six plants on your property, and you may buy or possess up to 28.5 grams of cannabis, which is an ounce, or eight grams of concentrated cannabis.

It taxes the sale and cultivation of marijuana. It imposes an excise tax of 15% on retailers, on top of existing state and local sales taxes, as well as a cultivation tax on growers of $9.25 per ounce of flower and $2.75 per ounce of leaf. It will generate billions of dollars in tax revenue in the coming years, and it will save millions of dollars in costs to law enforcement.

It imposes standards on the testing, labeling, packaging, and marketing of marijuana. It prohibits marketing to minors, and it bars shops from operating within 600 feet of a school, daycare center, or youth center unless the local government approves. It also bars them from selling alcohol or tobacco.

It continues to punish those who use, grow, or sell outside the rules. It’s a misdemeanor to have more than 28.5 grams, grow more than six plants, or sell without a license. It’s punishable by up to six months in county jail, a $500 fine, or both, and you’re subject to large civil monetary penalties for each day you’re in business. Or you could face a felony based on your criminal history, your selling to or employing underage people, or the environmental impact of your unlicensed grow. Separate penalties continue to apply to minors and people age 18 to 21. Finally, you can’t use pot on the road, in a public place (except for shops that allow it), or anywhere that you can’t use tobacco.

It allows people to petition to clear their records. If you’re currently serving or have ever served a sentence for an eligible marijuana offense, you can petition the court to reduce your conviction and sentence or dismiss your case entirely. The court will presume that you’re entitled to this relief unless prosecutors prove by clear and convincing evidence that you’re not. If they can’t, the court will grant your petition unless it finds that doing so would endanger public safety. Many counties have already prepared to process these petitions.

The state will tax, license, and regulate marijuana businesses, and it will issue its first licenses by January 1, 2018. Cities and counties may further tax or regulate the industry or just ban it outright (but not ban its transportation through their jurisdiction). The main state agencies are as follows:

  • The Bureau of Marijuana Control (formerly the Bureau of Medical Cannabis Regulation): to license and regulate retailers, distributors, and testing facilities
  • The Department of Food and Agriculture: to license and regulate growers
  • The Department of Public Health: to license and regulate edibles
  • The Department of Fish and Wildlife: to regulate the environmental impacts of growing
  • The State Water Resources Control Board: to regulate the environmental impacts of growing on water quality
  • The Department of Pesticide Regulation: to regulate the use of pesticides in growing
  • The Marijuana Control Appeals Panel: to hear appeals from people and businesses affected by an agency’s decision

Federal Court Puts a Stop to Medical-Pot Prosecutions

In a resounding decision last week, the country’s largest federal court of appeals forbade the Justice Department from prosecuting people who comply fully with their states’ medical-marijuana laws. The court’s decision consolidated ten separate appeals from cases in Washington and California. The decision also applies in Oregon, Alaska, Montana, Nevada, Hawaii, and Arizona. It doesn’t apply in Idaho because Idaho has no such law.

The defendants’ appeals were based on a congressional spending bill that we wrote about eighteen months ago. That bill blocked the Justice Department from using any funding to interfere with medical-pot laws. It has since been extended through September 2016.

Based on the bill, each of the defendants had moved to dismiss their cases or restrain the government from further prosecuting them. But the trials courts denied them.

On appeal, the court agreed that Congress had spoken.

Thus the executive branch could not spend funds to prosecute the defendants if their conduct were permitted by their states’ laws and they complied fully with those laws. The executive could not spend funds on such cases because doing so would violate the Appropriations Clause of the Constitution, which commands that no money be paid out of the Treasury except by act of Congress. If the executive were spending money without authorization, it would violate the separation of powers. The defendants had standing to try to prevent it from doing so, and the courts were required to intervene.

Therefore, the court sent the defendants’ cases back to the trial courts with instructions that if the Justice Department insisted on prosecuting them, they were entitled to evidentiary hearings to determine whether they had complied with state law.

The court also warned, however, that “Congress could restore funding tomorrow, a year from now, or four years from now, and the government could then prosecute individuals who committed offenses while the government lacked funding. Moreover, a new president will be elected soon, and a new administration could shift enforcement priorities to place greater emphasis on prosecuting marijuana offenses.”

California Medical Association Says Legalize Marijuana

On February 1, the California Medical Association endorsed the Control, Regulate, and Tax Adult Use of Marijuana Act. Here’s the story from the Sacramento Bee, which features a short video running down the big questions about the ballot initiative. And here’s the press release from the CMA, which is the largest representative body of physicians in the state.

Meanwhile, the Obama administration has signaled that it will not revisit federal law in its last year unless Congress does.

All while people continue to suffer at the hands of prohibition.

Here are a couple of stories about a Missouri man who is 21 years into a life-without-parole sentence for nonviolent marijuana offenses. He will die in prison if the governor doesn’t grant him clemency.

Here’s one from San Francisco, of all places, where police took a guy down over $20 of pot because they were collecting overtime pay for their sting operation. They charged the guy with felony possession for sale, but a jury acquitted him in three hours flat.

Here’s another about a military veteran and father of two from Virginia who was deported for a nonviolent marijuana offense.

And here’s one about a Florida man who was mistakenly shot to death when a SWAT team raided his house over $200 of pot.

They’re a dime a dozen: casualties of a counter-productive policy that persists in 2016.

Congress Defers to State Laws on Marijuana

In a bold stroke before the turn of the new year, the 113th Congress of the United States passed an appropriations bill that funds the government through the fiscal year but expressly restricts the Department of Justice from using any of its funding to interfere with state laws on marijuana. Although the Justice Department had largely followed that rule of late as a matter of policy, Congress’s action gives it the force of law.

The bipartisan measure, which passed as part of an overall $1.1 trillion government-funding bill that keeps the lights on through September, bears these words:

“None of the funds made available in this Act to the Department of Justice may be used, with respect to the States of Alabama, Alaska, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Hawaii, Illinois, Iowa, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, New Jersey, New Mexico, Oregon, Rhode Island, South Carolina, Tennessee, Utah, Vermont, Washington, and Wisconsin, to prevent such States from implementing their own State laws that authorize the use, distribution, possession, or cultivation of medical marijuana.”

The measure is a remarkable step in the right direction, and it marks the beginning of the end of our badly misguided, counter-productive federal prohibition of marijuana, including its embarrassing Schedule I classification under the Controlled Substances Act.

“This is a victory for so many,” said the measure’s coauthor, Republican Representative Dana Rohrabacher of Costa Mesa. The measure’s approval, he said, represents “the first time in decades that the federal government has curtailed its oppressive prohibition of marijuana.”

Hear, hear. Let’s tag it, #regulatemarijuanalikewine.

Why Are We Punishing This Man?

Here’s a set of facts for you.

It appears that an Iowan jury has convicted a 48-year-old man of felony drug charges for growing marijuana that he uses to treat his terminal cancer.

It appears the jury was not permitted to hear one word about why the man was growing the marijuana because there was no medical-marijuana law in Iowa, so his medical condition was legally irrelevant. (Morally, of course, it was.)

It appears the man has two prior drug convictions—one in 2000 for growing psychedelic mushrooms, and one in 2011 for the same pot growing (for the same reason) he was convicted of last week—so he may be labeled a “habitual offender” and receive a three-year, mandatory-minimum sentence. He calls it a death sentence. In 2011, he pleaded guilty to avoid jail time; this time, he took his case to trial.

It appears that his full-time, caretaker wife was convicted along with him, and his parents, who are in their mid-seventies, have also been charged with running a drug house because they allowed their cancer-stricken son to move in and grow marijuana in their home.

The man’s name is Benton Mackenzie, his wife is Loretta, his parents are Charles and Dorothy, and his sentencing is set for August 28.

And boy, is he suffering. In 2011, he was diagnosed with severe angiosarcoma, a rare and aggressive cancer of the blood vessels that produces large, nasty skin lesions. If you’re not faint of heart, you can see a photo of them here, but beware, it’s graphic.

Just this year, the Iowa legislature passed a narrow medical-marijuana bill that permits the parents of epileptic children to use cannabis oil as a treatment. The same cannabis oil Mr. Mackenzie uses to treat his lesions and obtain relief from his terminal cancer.

But there’s no other law on the books to cover anyone else, so Mr. Mackenzie wasn’t allowed to breathe a word to the jury about medical necessity or any such defense, and now he’s a convicted felon again.

Is that what one looks like?

A Convergence of Pot and Patriotism

It’s been a good month for the U.S. Justice Department.

On May 12, it established a new policy that requires agents and prosecutors to electronically record their custodial interrogations in most cases.

Then on May 19, FBI Director James Comey publicly suggested that the Bureau may need to rethink its hiring policy on pot if it wants to attract the best and brightest to combat cybercrime and other threats to national security. You may remember Mr. Comey as the former Deputy Attorney General who, back in 2004, intervened in dramatic fashion when White House officials attempted to railroad a hospitalized John Ashcroft into recertifying a domestic-spying program that the Justice Department had determined was illegal. Say what you want about him, but the man has spent most of his professional life as a prosecutor and public servant. He’s probably no radical.

Mr. Comey’s remarks came during an unscripted, question-and-answer session following a speech he gave in New York. When one attendee said he had a friend who would make a great candidate for the FBI but who hadn’t applied because of the anti-pot policy, Mr. Comey encouraged the man’s friend to apply anyway. In one tongue-in-cheek moment, Mr. Comey said, “I have to hire a great work force to compete with those cybercriminals, and some of those kids want to smoke weed on the way to the interview.”

Two days later, Mr. Comey had to clarify his remarks at a congressional hearing when Alabama Senator Jeff Sessions confronted him about them. The Director hastened to clarify that, no, he didn’t want young people to use marijuana, and more to the point, he wasn’t going to change the Bureau’s policy on his own or any time soon. Too bad. Mr. Comey, with all due respect to the distinguished gentleman from Alabama, you’re right, he’s wrong, and we need all the help we can get.

Now let’s all go get a drink.

 

A Ten-Year Sentence for $50 of Marijuana?

And to make it worse, the poor soul may have been set up.

Here’s the story. Two cops stop a guy, supposedly for horsing around on his bicycle in the middle of the street. They pat him down, supposedly because he approached them holding out two Xanax pills in his hand and saying, “Do you want to talk to me? This is all I have.” They pat him down, and supposedly, they find baggies bearing about $50 worth of marijuana in all. They arrest him for it, and the guy is charged with possession for sale, convicted, and sentenced to ten years at hard labor.

Here’s where it gets worse. On appeal, the guy argued that he was entitled to a new trial because, get this, the two cops who arrested him were found to have planted cocaine on a different suspect one month after his arrest. By the time of his appeal, the cops had pleaded guilty to criminal charges of perjury and malfeasance in office, and they had been sentenced. Our guy had previously moved for a new trial before his sentencing, which took place just before the cops entered their guilty pleas, but his motion was denied by the trial court. Then, even on appeal, the appeals court affirmed his conviction, holding that the trial court did not abuse its discretion in denying the new-trial motion.

Sorry, buddy. No soup for you.

In case you were wondering, the two cops who planted cocaine received suspended sentences (meaning no jail time) and fines of $2,500 and $5,000, respectively. But the guy who was chucking a few bags of pot—if that—got ten years.

Lawful Marijuana Businesses Should Be Able to Bank, Says U.S. Attorney General

Three cheers for common sense. Speaking at the University of Virginia last Thursday, Attorney General Eric Holder said that lawful marijuana businesses should have access to the American banking system and that the government would soon offer rules to guide their relationships with banks.

Let’s hope so, because that is the only common-sense way to go about it, and for the twenty states that have legalized marijuana in some form or fashion, the alternative is something close to sabotage. If we are going to permit marijuana businesses to operate but then paint them in a corner by forcing them to hoard cash under their proverbial mattress, we should not feign shock or dismay if, for example, they come to rely on guns for protection, or if we leave potential tax revenue on the table, or if other ills follow as a result. “You don’t just want huge amounts of cash in these places,” according to Mr. Holder. “There’s a public safety component to this.”

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