Perspectives

insights into california's cannabis industry

“Gram Shop” Laws For Cannabis Businesses in California
Compliance
Ken Stratton

“Gram Shop” Laws – What They Are and Why We Need Them in California

Consumer product companies typically reduce their product liability risk by focusing on product design, safety testing, and quality control. If a product is well made (for example, if it is not defective or adulterated), then its seller generally knows no one is likely going to sue for injury or harm arising out of the product’s use.   However, this is

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A Wage & Hour Primer for HR Managers of California Cannabis Businesses
Labor & Employment
Ken Stratton

A Wage & Hour Primer for HR Managers of Cannabis Businesses

We are offering the following observations so that HR managers in the cannabis field can better understand some of the rules that govern wage and hour requirements here in California. These rules are important because failure to follow them can expose employers (the operating cannabis companies) and sometimes their executives to significant civil fines and penalties and, in the case

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Will “Cannabis” Companies Slowly Become “Life Science” Companies?
Corporate & Transactional
Ken Stratton

Will Cannabis Companies Slowly Become Life Science Companies? : A Perspective from a “Life Science – Cannabis” Attorney

People from the cannabis field will often ask me how practicing “cannabis law” compares to my time spent practicing “FDA” (a/k/a life science) law at two publicly traded biotechs and a global medical device manufacturer. Given the many similarities between the two industries, cannabis and life science, but with one industry firmly established on the national scene and the other

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Disputes & Litigation
Ken Stratton

The Cannabis RICO Cases – Where Are They Now?

If you’ve been keeping up with cannabis litigation recently, you’ve probably noticed a growing number of cases brought against cannabis cultivators and dispensaries by angry neighbors alleging violations under the Racketeer Influenced and Corrupt Organizations Act (RICO), the federal anti-racketeering laws. This blog provides an update on the current status of these “cannabis RICO” cases, along with a prediction for

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Phantom Stock For Cannabis Businesses
Corporate & Transactional
Ken Stratton

Phantom Stock – Why Private Cannabis Companies Should Take Note

Privately held cannabis companies might want to give serious consideration to awarding their employees “phantom stock” rather than equity options. Working so close to Silicon Valley and its “option holder” millionaires, can make it easy for California entrepreneurs to forget the many challenges private companies face when awarding equity options to employees. Obviously, private companies lack a public market for

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Cross Border Cannabis Transactions
Corporate & Transactional
Ken Stratton

Three Important “Drafting Tips” When Negotiating Cross Border Cannabis Transactions

As the world continues to shrink, cross border transactions continue to become more common, even in the cannabis field where more countries are legalizing both medicinal and recreational use of cannabis. Today, there are at least thirty countries that allow the cultivation, manufacturing and use of medicinal cannabis (Argentina, Australia, Chile, Czech Republic, Denmark, Germany, Israel, Thailand, etc.). A handful

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Tilray's implications for “medicinal” cannabis companies
Corporate & Transactional
Ken Stratton

What the Heck Happened Last Week at Tilray? And its implications for “medicinal” cannabis companies.

What Tilray’s IPO means for “medicinal” cannabis companies? Tilray, Inc. describes itself as “a global pioneer in the research, cultivation, production, and distribution of medical cannabis and cannabinoids.” However, last week’s events make a pretty good case that Tilray (Nasdaq: TLRY) is not a pharmaceutical company after all despite being branded as one by companies like Yahoo Finance. This is very good

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On-Site Security Guard Requirements for Cannabis Retailers
Cannabis Law
Ken Stratton

New Local Cannabis Laws Proposed for San Francisco Raise Some Concerns

Co-Authored By: Charlie Lucero By now it’s well known that the City of San Francisco is considering two new cannabis laws: the first would be a local cannabis industry tax and the second would establish a new 9-member Cannabis Commission to oversee the industry within city limits. Last week, our attorneys attended a meeting sponsored by the San Francisco California

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Labor Peace Agreements for Cannabis Businesses in California
Cannabis Law
Ken Stratton

Labor Peace Agreements for Cannabis Businesses in California: Why Some Say the Law is “Siding Union”

Those thinking about operating a cannabis business in California may be surprised to learn they might need to enter into a legally binding “labor peace agreement” with a union in order to receive a license to operate. Cal. Bus. & Prof. Code § 26051.5(a)(5)(A); 16 CCR § 5002 (Bureau of Cannabis Control); 17 CCR § 40128(b)(2)(Dept. of Public Health); 3 CCR § 8102(x)(CalCannabis).  Recently

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Business
Ken Stratton

Converting Mutual Benefit Corporations into For-Profit Corporations

Over the past few months, many cannabis collectives organized as non-profit mutual benefit corporations under prior law, such as the 2004 Medical Marijuana Program Act, have asked us to help them convert into for-profit general share corporations (C Corps.). This isn’t surprising because the laws have changed and because cannabis operators wanting to attract new-money investors are learning fast that

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