Cannabis Client Alert - Week of June 1 2021

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In this week’s edition

  • MORE Act, reintroduced in the House, would deschedule cannabis
  • Illinois to issue more licenses once new bill becomes law
  • Teenage use of cannabis hasn’t increased with legalization, report finds
  • Michigan moves to restrict Delta-8 and Delta-10 cannabinoids
  • Connecticut legislators may vote on legalization as early as next week
  • And more…

Federal

The MORE Act is Reintroduced into the House; Would Deschedule Cannabis - A bill to decriminalize cannabis and create social equity programs, the Marijuana Opportunity Reinvestment and Expungement Act of 2021, was reintroduced into the House last week by Rep. Jerry Nadler (D-NY).  The bill would create programs to invest in communities disproportionately affected by the war on drugs and would expunge prior cannabis convictions.  The MORE Act previously passed the House in 2019, but did not pass the Senate.

States

Tax Revenue Report - with legal adult-use cannabis reaped a total of $2.7 billion in tax revenue last year, with California alone collecting more than $1 billion in tax revenue, according to report from the Marijuana Policy Project. California has redirected its funds to community programs that help those adversely affected by the war on drugs. In Colorado, Michigan and Oregon, millions of the state’s total cannabis tax revenue went to improving public schools, with Colorado alone dedicating $404.5 million of revenue over the past seven years to the school system. 

AZ - Arizona lawmakers rejected cannabis advertising and marketing bills that would have (i) made it illegal to show a picture of a cannabis leaf or bud, (ii) limited billboard advertisements and (iii) prohibited sponsorship of any athletic, musical, artistic or cultural event. 

CT - A vote on cannabis legalization and taxation in Connecticut could take place as early as this week.  House Majority Leader Jason Rojas (D) stated that lawmakers are close to a deal on a legislative package.

DE - Delaware Governor John Carney (D) in an interview last week stated that he still considers cannabis to be a “gateway drug” and opposes legalization.  Simple possession of cannabis has been decriminalized in Delaware since 2015, and the Governor has hosted a series of roundtable meetings about cannabis legalization.

FL - Florida’s high court ruled last week that a legal challenge to the state’s vertical integration requirement for cannabis licensees is likely not in conflict with the state’s constitution.  The court found that the constitutional amendment approved by voters in 2016 did not contain specific restrictions that regulators could place on cannabis licensees.

IL - A new bill passed by the Illinois Senate last week will provide for 110 additional cannabis dispensary licenses in the state, including 55 licenses that were supposed to be awarded last year but have been in limbo due to the pandemic, and another round of 55 licenses which will be available for social equity applicants (with stricter social equity qualifications).  Applicants may only qualify for two licenses in these rounds rather than the 10 originally available in the first round.  The bill also requires public disclosure of dispensary owners, and medical patients will no longer be limited to one dispensary.

LA - The Louisiana Senate approved a bill last week to allow medical cannabis patients participating in the state’s program to smoke cannabis flower.  Currently, patients can vaporize cannabis preparations via a metered-dose inhaler, but smoking is not allowed and patients cannot access flower.  The bill now heads to the House for concurrence and technical amendments before being sent to the Governor John Bel Edwards (D) for signature. While a proposal to legalize adult-use cannabis died this week, the House passed a resolution requesting the Legislature to study the impacts of adult-use legalization before the start of the 2022 session.

NH - New Hampshire’s Governor Chris Sununu (R) signed a bill into law that expands the list of qualifying conditions for the state’s medical cannabis program to include moderate-to-severe insomnia and autism spectrum disorder.

NM - New Mexico, which recently legalized cannabis for adult use, last week published its proposed regulations for licensees.  A public comment period for the proposed regulations is underway and will close June 29. 

NM - Bright Green Corporation announced a $300 million investment to build one of the nation’s largest cannabis manufacturing and research facilities in Grants, NM.  The project would initially create 200 research and agricultural jobs.  Democratic Governor Michelle Lujan Grisham joined the announcement, expressing excitement about the development of a world-class research facility in New Mexico.  Bright Green entered into a memorandum of agreement with the federal DEA last week to facilitate the production, storage, packaging and distribution of medical research cannabis.

OR - In the wake of last year’s vape crisis, Oregon regulators are requiring cannabis vape producers to provide more detailed information about the ingredients contained in their products.  Previously, the state has banned certain additives including Squalene, Vitamin E acetate, Propylene glycol (unless in a metered dose inhaler) and Triglycerides, including MCT oil.  Last week, Oregon recalled vape products that allegedly contained cannabis-derived terpenes imported from California.

TX - Texas’s medical cannabis program will be narrowly expanded to add cancer patients and people with post-traumatic stress disorder as qualifying patients.  The bill originally included a provision that would have allowed chronic pain to be a qualifying illness for accessing medical cannabis, but this was removed by the Senate.  The bill also includes a THC limit of 1 percent for all products, which is a 0.5% increase over the current law.  The bill has passed the House and Senate and will now need to be signed by Governor Greg Abbott (R) to be enacted.

HEMP/CBD

Indiana CBD Industry Ends Lawsuit Over Smokable Hemp Ban - Since 2019, a group of hemp businesses have been in court challenging an Indiana law criminalizing the transport and sale of smokable hemp bud or hemp flower. In C.Y. Wholesale Inc. et al. v. Holcomb et al. the companies argue that it conflicts with federal hemp legalization.  But they recently gave the court notice of their intent to dismiss the case voluntarily after the state clarified that the law does not restrict shipments between out-of-state licensed entities that are merely passing through Indiana,.  The state’s House Bill 1224, meanwhile, would ban any enforcement stricter than federal law and would permit CBD consumables. 

Michigan Bills Would Define Delta-8, Other THC as “Marijuana” - Proposed legislation passed out of the Michigan House would include under the definition of “marijuana” all THC products, including hemp-derived products, thereby triggering testing and other restrictions.  House Bill 4517 would require Delta-8 THC to be regulated by the Michigan Marijuana Regulatory Agency.  The legislation now moves to the state Senate.

International

Mexico Court Begins Legalization Process - Mexico’s Supreme Court gave notice that it is preparing to annul the nation’s laws that prohibit cannabis use.  The court had previously ordered the Congress to legalize and regulate cannabis by October 2019, finding that it violates constitutional freedoms.  After multiple extensions, the current reform bill is still not finalized, leaving the matter up to the court. 

Greece - Greece’s Parliament recently showed strong support for a bill legalizing medical cannabis cultivation and sales.  In a voice vote last week, 158 members voted in favor of the bill, with 33 against, including opposition from the Communist Party of Greece.  Among other things, the bill would define medical cannabis to include products containing over 0.2 percent THC.

Morocco - Morocco recently adopted a law authorizing cannabis use in medicine, cosmetics and for industrial purposes.  Recreational use is still illegal.  Morocco, described as one of the first producers of hashish, follows a trend of African countries softening their prohibitions on cannabis.

Business

More Americans Are Showing Cannabis Use on Employment Drug Tests - A recent study showed that more Americans than ever are testing positive for cannabis use on employment drug tests.  In 2020, of more than 7 million employment drug tests administered by Quest Diagnostics, 2.7 percent came back positive for cannabis use.

Cannabis in California's Wine Country
Wine Spectator examines cannabis in California’s wine country—from the varying regulatory approaches to the sentiments of wine industry neighbors.  California’s wine regions that have also become cannabis cultivation hubs include Santa Barbara, Napa, Sonoma, Monterey and Mendocino counties.

Medical/Health

Autoimmune Diseases - Cannabinoids such as THC and CBD were found to reduce inflammatory responses in autoimmune diseases (AD), such as multiple sclerosis and type 1 diabetes, according to a forthcoming study in the Journal of Cannabis and Cannabinoid Research.  Synthetic cannabinoids also showed promise in two clinical trials within the review of 24 studies.  The article concludes, “Data from experimental animal models of AD showed that natural and synthetic cannabinoids downregulate inflammatory responses mediated by immune cells responsible for AD chronicity and progression.”

Teen Cannabis Use Does Not Increase with Legalization, Report Finds - “No measurable difference” was found in the percentage of high school students who have used cannabis, when compared to years before states began legalizing adult use.  The survey, by the US Department of Education, asks about cannabis use in the past 30 days and compares numbers since 2009.  The highest percentage was in 2011, before the first adult-use legalization (Colorado) in 2014.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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