Article 7. Enforcement

Enforcement

§ 8600. Enforcement Applicability.

Notwithstanding any other provision of law, the department may take an administrative action at any time within five (5) years after the department discovers, or with reasonable diligence should have discovered, any violation of state law or local ordinances.

Authority: Sections 26012 and 26013, Business and Professions Code.
Reference: Sections 26013, 26031, and 26034, Business and Professions Code.

§ 8601. Administrative Actions-Operations.

The department shall use the violation classes and applicable fine amounts as follows:

§ 8601 (a) For the purpose of this section, violation classes are designated as “Minor,” “Moderate,” and “Serious.”

(1) “Serious.” Violations which preclude or significantly interfere with enforcement of any state law, or those that cause significant false, misleading, or deceptive business practices, potential for significant level of public or
environmental harm, or for any violation that is a repeat of a Moderate violation that occurred within a two-year
period and that resulted in an administrative civil penalty. All Serious violations are subject to license suspension or
revocation.

(2) “Moderate.” Violations that undermine enforcement of any state law, are likely to cause public or environmental
harm, or are a repeat of a Minor violation that occurred within a two-year period and resulted in an administrative
civil penalty.

(3) “Minor.” Violations that are not likely to have an adverse effect on public safety or environmental health.

§ 8601 (b) Repeat violations may result in an escalation of violation class.

§ 8601 (c) Table A below shall be used to establish the initial level of severity of the referenced violations of Division 10 of the Business and Professions Code and referenced regulations and the corresponding penalty range for “Serious,” “Moderate,” and “Minor” violation classes. For violations of other state law, including state labor laws and related regulations, the department shall utilize the definitions of violation classes in subsection (a).

Authority: Sections 26012, 26013, and 26031, Business and Professions Code.
Reference: Sections 26013 and 26031, Business and Professions Code

§ 8602. Administrative Actions - Recordkeeping.

Pursuant to section 26160(f) of the Business and Professions Code, if a licensee, or an agent or employee of the licensee,
fails to maintain or provide required records, the licensee shall be subject to a citation and a fine, which may be issued as a
Notice of Violation, of up to thirty thousand dollars ($30,000) per individual violation. The department shall use the violation
classes and applicable fine amounts as follows:

§ 8602 (a) For the purpose of this section, violation classes are designated as “Minor,” “Moderate,” and “Serious.”

(1) “Serious.” A Moderate class violation in which a licensee, or its agent or employees, willfully or knowingly refuses, impedes, obstructs, or interferes with an examination of records of the licensee, or willfully or knowingly prepares records that are falsified, misleading, deceptive, or omits any material information, or for any violation that is a repeat of a Moderate violation that occurred within a two-year period and that resulted in an administrative civil
penalty. All Serious violations are also subject to license suspension or revocation.

(2) “Moderate.” Violations that are likely to undermine an examination of records of the licensee, or are a repeat of a
Minor violation that occurred within a two-year period and resulted in an administrative civil penalty.

(3) “Minor.” Violations that are not likely to undermine an inspection of records of the licensee, or are an initial
violation.

§ 8602 (b) For the purposes of this section willful means a purpose or willingness to commit the act or omission referred to and does not require any intent to violate the law, injure another, or to acquire any advantage.

§ 8602 (c) Repeat violations may result in an escalation of violation class.

§ 8602 (d) Table B below shall be used to establish the initial level of severity of violations of Section 26160 of Division 10 of the Business and Professions Code, and the referenced regulations and the corresponding penalty range for “Serious,” “Moderate,” and “Minor” violation classes.

Authority: Sections 26012, 26013, and 26031, Business and Professions Code.
Reference: Sections 26013 and 26031, Business and Professions Code

§ 8603. Notice of Violation.

§ 8603 (a) The department may issue a Notice of Violation to a licensee that is in violation of applicable statutes and regulations. A Notice of Violation shall be served upon the licensee and the legal owner of the property. The Notice of Violation shall contain all of the following:

(1) A brief statement of the violation(s) alleged;

(2) The proposed penalty;

(3) A statement of whether the violation is correctable and a time frame in which the violation shall be corrected; and

(4) Notice of an administrative hold of property, if applicable.penalty. All Serious violations are also subject to license suspension or revocation.

§ 8603 (b) The right to a hearing will be deemed waived if respondent fails to respond in writing within thirty (30) calendar days from the date the Notice of Violation was received by the respondent.

Authority: Sections 26012, 26013, and 26031, Business and Professions Code. Reference: Sections 26013 and 26031,
Business and Professions Code

§ 8604. Emergency Decisions.

§ 8604 (a) Pursuant to Government Code sections 11460.10 through 11460.80, the department may issue an emergency decision and order for temporary, interim relief to prevent or avoid an immediate danger to the public health, safety, or welfare. Such circumstances include but are not limited to the following:

(1) To prevent the sale, transfer, or transport of illegal cannabis, nonmanufactured cannabis product, or cannabis
products in the possession of the licensee.

(2) The Department has information that conditions at the licensee’s premises exist that present an immediate risk to worker or public health and safety.

(3) To prevent illegal diversion of cannabis, nonmanufactured cannabis product, or cannabis product or other criminal activity at the licensee’s premises.

(4) To prevent the destruction of evidence related to illegal activity or violations of the Act.

(5) To prevent immediate threats to the environment.

(6) To prevent the offer, sale or transfer of any cannabis, nonmanufactured cannabis product, or cannabis product to
anyone by means of any written or oral communication that is false or misleading.

§ 8604 (b) Temporary, interim relief, may include one or more of the following:

(1) An order for the temporary suspension of a license.

(2) An order for the administrative hold of cannabis, nonmanufactured cannabis product, or cannabis product.

§ 8604 (c) The emergency decision and order issued by the department shall include a brief explanation of the factual and legal basis and reasons for the emergency decision to justify the determination of an immediate danger and the
department’s emergency decision to take the specific action. The emergency decision and order shall be effective when
issued or as otherwise provided by the decision and order.

§ 8604 (d) If the department determines it is in the public interest to issue an order for the administrative hold of cannabis,
nonmanufactured cannabis product, or cannabis product:

(1) The order shall provide a description of the cannabis, nonmanufactured cannabis product, or cannabis product to be subject to the administrative hold.

(2) Following the issuance of an order for administrative hold, the department shall identify the cannabis,
nonmanufactured cannabis product, or cannabis product subject to the administrative hold in the track-and-trace
system.

(3) Within twenty-four (24) hours of receipt of the order for administrative hold, the licensee shall physically segregate, safeguard and preserve all designated cannabis, nonmanufactured cannabis product, or cannabis product subject to the hold in the area designated on the licensee’s premises diagram.

(4) While the administrative hold is in effect, the licensee is restricted from selling, donating, transferring, transporting, gifting, giving away, or destroying the cannabis, nonmanufactured cannabis, or cannabis product that is subject to the hold.

(5) Nothing herein shall prevent a licensee from continued possession, cultivation, or harvesting of the cannabis subject to the administrative hold. While the administrative hold is in effect, all cannabis or nonmanufactured cannabis product subject to the hold shall be put into separate batches.

(6) Nothing herein shall prevent a licensee from voluntarily surrendering cannabis, nonmanufactured cannabis product, or cannabis product that are subject to an administrative hold. The licensee shall identify the cannabis,
nonmanufactured cannabis product, or cannabis product being voluntarily surrendered in the track-and-trace
system. Voluntary surrender does not waive the right to a hearing and any associated rights.

§ 8604 (e) If the department determines it is in the public interest to issue an order for the temporary suspension of a license:

(1) The emergency decision and order shall specify that the licensee shall immediately cease conducting all commercial cannabis activity under its license, unless otherwise specified in the decision and order.

(2) A licensee may continue to possess, cultivate, or harvest cannabis at the licensed premises during the temporary suspension of its license only as prescribed by the department in the emergency decision and order, in which case the cannabis or nonmanufactured cannabis product shall be put into separate batches.

§ 8604 (f) The emergency decision and order for temporary, interim relief shall be issued in accordance with the following
procedure:

(1) The department shall give notice of the emergency decision and order and an opportunity to be heard to the
licensee prior to the issuance, or effective date, of the emergency decision and order, if practicable.

(2) Notice and hearing under this section may be oral or written and may be provided by telephone, personal service, mail, facsimile transmission, electronic mail, or other electronic means, as the circumstances permit.

(3) Notice may be given to the licensee, any person meeting the definition of owner of the licensee, an agent for service of process, or other personnel at the premises.

(4) Upon receipt of the notice, the licensee may request a hearing within three (3) business days by submitting a
written request pursuant to Section 8605 of this chapter. The hearing shall commence within five (5) business days
of receipt of the written request for hearing.

(5) The hearing may be conducted in the same manner as an informal hearing under sections 8605 through 8607 of this chapter, however, the timeframes provided in Sections 8605 through 8607 shall not apply to a hearing under this section. Discovery or cross-examination of witnesses is not required under this section.

(6) Following the hearing, the emergency decision and order shall be affirmed, modified, or set aside as determined
appropriate by the department within five (5) business days of the hearing.

§ 8604 (g) Within ten (10) days of the issuance or effective date of the emergency decision and order for temporary, interim relief, the department shall commence an adjudicative proceeding in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code to resolve the underlying issues giving rise to the
temporary, interim relief, notwithstanding the pendency of proceedings for judicial review of the emergency decision
and order as provided in subsection (i).

§ 8604 (h) After formal proceedings pursuant to subsection (g) of this section are held, a licensee aggrieved by a final decision of the department may appeal the decision to the Cannabis Control Appeals Panel pursuant to Section 26043 of the Act.

§ 8604 (i) Notwithstanding administrative proceedings pursuant to subsection (g), the licensee may obtain judicial review of the emergency decision and order under Section 1094.5 of the Code of Civil Procedure in the manner provided in Section
11460.80 of the Government Code without exhaustion of administrative remedies.

Authority: Sections 26012, 26013, and 26031, Business and Professions Code; Sections 11460.10, 11460.20, 11460.30, 11460.40, 11460.50, 11460.60, 11460.70 and 11460.80, Government Code.
Reference: Sections 26013 and 26031, Business and Professions Code; Sections 11460.10, 11460.20, 11460.30, 11460.40, 11460.50, 11460.60, 11460.70 and 11460.80, Government Code.

§ 8605. Informal Administrative Hearings.

§ 8605 (a) The respondent may appeal a Notice of Violation by submitting a written request for an informal hearing to the
Department of Food and Agriculture, Legal Office of Hearings and Appeals, 1220 “N” Street, Suite 315, Sacramento,
California 95814 or via email to CDFA.LegalOffice@cdfa.ca.gov. The request shall be received within thirty (30) calendar
days from the date the Notice of Violation was received by the respondent. The request shall include the following:

(1) The respondent’s name, mailing address, and daytime phone number;

(2) The license number issued by the department;

(3) Copy of the Notice of Violation; and

(4) A clear and concise statement for the basis of the appeal or counts within the Notice of Violation.

§ 8605 (b) If the respondent fails to submit a timely request for hearing pursuant to subdivision (a) above, the Notice of Violation is not appealable and the department may proceed upon the violations noticed without a hearing.

Authority: Sections 26012, 26013, and 26031, Business and Professions Code.
Reference: Sections 26013 and 26031, Business and Professions Code.

§ 8606. Informal Hearing Schedule and Notification.

§ 8606 (a) The department shall schedule an informal hearing within forty-five (45) calendar days from receipt of the request for an informal hearing.

§ 8606 (b) (b) The department shall provide notice of the informal hearing to the respondent containing the following information:

(1) Date, location, and time of the informal hearing;

(2) A statement to the respondent that the respondent may, but need not, be represented by counsel at any or all
stages of the proceedings;

(3) Summary of the violations;

(4) Any other information or documentation necessary for the hearing;

(5) A copy of California Code of Regulations, title 3, section 8607.

Authority: Sections 26012, 26013, and 26031, Business and Professions Code.
Reference: Sections 26013 and 26031, Business and Professions Code.

§ 8607. Conduct of Informal Hearings.

Informal hearings shall be conducted as follows:

§ 8607 (a) The standard of proof to be applied by the hearing officer shall be a preponderance of the evidence;

§ 8607 (b) Hearings may be conducted by phone at the request of the respondent. The request for a hearing to be conducted by phone must be submitted with the licensee’s request for an informal hearing;

§ 8607 (c) The decision of the hearing officer shall be in writing and shall include a statement of the factual legal basis of the
decision;

§ 8607 (d) The written decision shall be issued within thirty (30) calendar days after the conclusion of the hearing;

§ 8607 (e) The decision shall be served on the respondent either by personal service, mail, email, or via facsimile based upon the method the appeal was received; and

§ 8607 (f) The respondent may appeal the department’s decision to the Cannabis Control Appeals Panel in accordance with
Business and Professions Code sections 26043.

Authority: Sections 26012, 26013, and 26031, Business and Professions Code.
Reference: Sections 26013 and 26031, Business and Professions Code.

§ 8608. Licensing Actions.

§ 8608 (a) The department may take any action listed in subdivision (b) below against a license for any violation of this chapter.

§ 8608 (b) (b) If the licensee holds multiple cultivation licenses, the department may take any one of, or combination of, the following actions on any of the licensee’s cultivation licenses:

(1) Revocation of the license;

(2) Suspension of the license for a specified period of time;

(3) Issuance of a probationary license with terms and conditions determined by the department; and

(4) Order an administrative hold of cannabis or nonmanufactured cannabis products.

Authority: Sections 26012, 26013, and 26031, Business and Professions Code.
Reference: Sections 26013 and 26031, Business and Professions Code.

§ 8609. Formal Administrative Hearings.

§ 8609 (a) Hearings concerning the following proceedings shall be held pursuant to chapter 5 (commencing with section 11500) of part 1 of division 3 of title 2 of the Government Code:

(1) Denial of an application for a license;

(2) Denial of a license renewal;

(3) Revocation of a license; and

(4) Suspension of a license for a period of time exceeding thirty (30) calendar days.

Authority: Sections 26012, 26013, and 26031, Business and Professions Code.
Reference: Sections 26013 and 26031, Business and Professions Code.

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