On December 20, 2018, the Agricultural Improvement Act (“AIA”) of 2018 was signed into law. Among the changes made within the AIA was the long-awaited legalization of industrial hemp. The AIA removes hemp (defined as cannabis and derivatives of cannabis with less than 0.3% THC on a dry weight basis) from the Controlled Substances Act (“CSA”). This removal of hemp
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
The Bureau of Cannabis Control recently announced the release of final proposed cannabis regulations which were submitted December 3, 2018 to the California Office of Administrative Law (OAL) and are currently under review by OAL. The proposed changes will not be in effect until they are approved by OAL but we expect them to go into effect, as drafted, upon
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
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
Due diligence plays an important role in many types of cannabis industry transactions. Due diligence involves a third-party conducting a thorough review of certain documents and records related to a business. As a best practice, cannabis companies should remain aware of the various times when third parties may conduct due diligence with respect to their business. Often investors participating in
Federal Regulation of Hemp In 2014, US Congress passed the Farm Bill, which authorized states to implement pilot programs to study the cultivation of and market for industrial hemp. Within the Farm Bill, Congress defined industrial hemp as “Cannabis sativa L. and any part of such plant, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than
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
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
We have previously discussed in how the Medicinal and Adult Use of Cannabis Regulation and Safety Act (MAUCRSA) states that “a local jurisdiction may allow for the smoking, vaporizing, and ingesting of cannabis or cannabis products on the premises of a retailer or microbusiness … if all of the following are met: Access to the area where cannabis consumption is allowed is restricted
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