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Pot Progress in Peril?

Pot Progress in Peril?

Former drug prosecutor named interim US Attorney for L.A. day before Cole Memo repeal

This week has been a busy week for Attorney General Jeff Sessions, and as a result a  nerve-racking week for the cannabis industry. This comes in the week that California, the country’s largest cannabis market, begins recreational cannabis sales. And for Los Angeles, newly the world’s largest city with recreational cannabis, the stakes are even higher.

As has been widely reported, on Thursday Sessions replaced the 2013 Cole Memo. The Cole Memo was an Obama-era policy which instructed US Attorneys not to prosecute cannabis operations that were in compliance with state cannabis laws. For the last four years that policy guided the Justice Department’s cannabis prosecution policy. Under Sessions’ latest memo, US Attorneys now have the option to prosecute businesses in the cannabis industry at their sole discretion, even if those businesses are following state laws. As concerning as it is, that’s not all that Sessions announced this week.

The day before he repealed the Cole Memo, the Attorney General appointed 17 interim US Attorneys across the country. One such appointment was for the Central District of California, which covers much of Southern California including all of Los Angeles County. While it is not unheard of for an Attorney General to appoint interim US Attorneys, it is a rare occurrence. Sessions only had the opportunity because President Trump has not yet nominated permanent US Attorneys to fill the positions.

Interim US Attorneys are not guaranteed a permanent appointment. In fact, they can only serve for 120 days. After that, President Trump must nominate for senate approval permanent US Attorneys to fill the vacancies. Looking at the situation from a zoomed out lens, it is safe to assume that those interim prosecutors are going to fall in line and run their office in a manner that would please the powers that be, to turn their short time in office into a permanent appointment. Think of it as a probationary period for them to prove that they are the right person for the job.

In the span of two days, the Attorney General first appointed 17 new heads of local US Attorney offices, and then the very next day gave them all the green light to prosecute cannabis businesses at their discretion. Oh, and their job security depends on them impressing the same administration that chose Sessions. Coincidence? Probably not.

WHAT DOES THIS MEAN FOR THE L.A. CANNABIS INDUSTRY?

Sessions appointed Orange County Big Law attorney Nicola Hanna to run the Central District of California US Attorney’s Office. He will serve from his office in Los Angeles. This is Hanna’s second time through the revolving door of government, having worked as a federal prosecutor early in his career. From 1990 to 1998, he was an Assistant US Attorney in Southern California. During his tenure, Hanna served for three years as Deputy Chief of the Organized Crime Drug Enforcement Task Force. His work earned him many awards and commendations, including from the DEA, FBI, and IRS.

After leaving his post as federal prosecutor, Hanna joined the multinational law firm of Gibson, Dunn & Crutcher. His practice focused on white-collar crime, securities litigation, and regulatory enforcement matters. Hanna now leaves his high-paying partner position to lead the nation’s largest group of federal prosecutors outside of Washington, D.C.

This leaves cannabis businesses in Los Angeles unsure of how the future will play out. They have a newly appointed interim US Attorney who made a name for himself prosecuting high level drug trafficking and money laundering cases. He was appointed the day before—and sworn in the day after—his new boss instructed US Attorneys to prosecute cannabis businesses at their own discretion. Also, he is presumably looking to prove himself to both the President and Senate, to turn this temporary appointment into a permanent position.

In a week that started as an exciting time for the Los Angeles cannabis industry, there is now turmoil. Many worry that Sessions’ moves suggest a premeditated crackdown on cannabis businesses—something which Sessions has expressed support for since his appointment. He has now given his subordinates latitude to prosecute cannabis businesses in states where they are operating legally under state law.

One solace that cannabis businesses can take away from this saga is that it puts the onus on Congress to finally make a decision about how the federal government will treat state-legal cannabis businesses. With the Cole Memo in place, congress had no incentive to act on their outdated cannabis laws, because a mandated lack of enforcement nullified federal prohibition in the legal states. Now that the Cole Memo has been replaced, marijuana prohibition once again has teeth. The fact that federal law may actually be enforced may be the driving force necessary for Congress to finally align federal law with the will of the people who elected them.

Only time will tell which way the pendulum swings in Los Angeles. For answers, Angelenos should be asking Mr. Hanna how he plans on interpreting his mandate, and Congress if they will finally act?

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