Author Archives: wdavidball

No Big Marijuana, Please: Medium is as Big as we Get

The spectre of Big Marijuana is often raised as a problem to be avoided in legalized markets (including, it must be said, by the Blue Ribbon Commission, of which I was Public Safety Chair). Though Big Marijuana is most often discussed in the context of adult-use markets, it is also of concern in the medical market—particularly one as large as California’s. The new regulations (AB 266, SB 643, and AB 243) no longer require market participants to be patients, and they no longer exclude for-profit companies. This doesn’t mean, however, that Big Marijuana is inevitable. California’s new medical marijuana regulations address concerns about market concentration in a number of ways, particularly when it comes to licenses.

At the outset, AB 266 allows for three sizes of cultivation license, each one bigger than the other. But taking a page from Starbucks (or Orwell), these are not small, medium, and large licenses: instead, they are specialty, small, and medium licenses. That’s right: the largest size of 3 cultivation licenses is a medium. To be fair, these cultivation sites aren’t all that large, as is spelled out in AB 243. The smallest licenses (type 1, or specialty) are 5000 square feet of canopy or less, the medium—er, small/type 2—size is between 5001 and 10000 square feet of canopy, and the “bigger than small but not large” medium/type 3 licenses are 10,001 square feet to an acre for outdoor grows and 10,001 to 22,000 square feet for indoor and mixed-light grows.. The Department of Food and Agriculture “shall limit the number of licenses”, but, as with many areas covered by the new regulation, substantive details about the limited numbers are going to be worked out administratively.

In addition to cultivation licenses, there are licenses for distribution, testing, dispensaries, and manufacturing. Distribution licenses can only be combined with testing licenses; they may not be combined with other kinds of licenses. This seems familiar enough, taking a page from the alcohol producer/wholesaler/retailer model–except that there is also a carveout for combining licenses. It is possible to hold cultivation, manufacturing, and dispensary licenses provided the dispensary license is 10A (permitting a maximum of three locations) and the total area of cultivation is not more than 4 acres of canopy.  This suggests that vertical integration on a smaller scale (Medium Marijuana) is permissible. Not being a horticulturalist, I’m not sure whether 4 acres of canopy is a sufficient limitation to prevent market concentration—it would depend on the yield of those four acres and on the number of “medium”/type 3 cultivation licenses that are ultimately authorized. We might also need to consider geographic/local market concentration as well. Given the relationship between state and local regulations, it might still be possible to have geographic concentrations of stores or cultivation sites that could result in local Big Marijuana, but this would, of course, depend on whether the local permitting system enabled that.

Finally, note that the licensed market does not include everyone authorized to grow medical marijuana. Individual patients can still grow their own marijuana, though they are limited to 100 feet of canopy and are not permitted to sell or even give away any of what they grow. Caregivers are allowed to care only for 5 patients at the most and their compensation is limited by 11362.765(c) (limiting compensation to, generally, expenses and that which is “reasonable”).  Already, one pro-patient group has indicated its displeasure with these new limitations and has threatened to sue on the grounds that the legislature has taken away rights granted by Proposition 215, a claim which, if true, would indeed invalidate the provisions. However, it is unclear whether Prop 215 granted an explicit right to be a caregiver for, say, more than 5 people or to grow for personal use with a total canopy size that was either unlimited or at least bigger than 100 square feet. At least for these patient groups, the medium sized marijuana market, personal edition, is not nearly large enough.

Is the Era of De Facto Legalization Over in California?

After a summer hiatus, we are back at the Drug Law and Policy Blog. I have a team of students who is going to help me cover the latest from the world of California marijuana regulation, but we’re going to start by walking through some of the huge changes wrought by a trio of bills: AB 266, SB 643, and AB 243, which, almost 20 years after the Compassionate Use Act (CUA) ballot initiative (also known as Prop 215), provide for statewide regulation of medical cannabis.

California has been described as having de facto adult-use legalization because it is so easy for people to get medical recommendations for marijuana use. Indeed, I have often heard in conversation with folks around the state that the reason the prior legalization initiative, Prop 19, failed—and why any future proposition might fail—is that the existing system worked well for everyone involved: people who wanted marijuana could easily get it. (This ignores other things that consumers might want, such as reliable testing and safety of products, many of which are covered in this new set of regulations.) Did the recent legislation change anything?

Nothing has changed about the qualifying conditions eligible for marijuana, which are set by the CUA and are quite broad. Instead, in this post I’ll focus on the other ways in which the medical market might constrict: regulating doctors who issue the regulations, regulations which are laid out in SB 643.

There are a number of “plain vanilla” regulations of the doctors who write recommendations, including requirements for disclaimers in advertising and prohibitions on doctors having any financial arrangements with licensees (punishable by up to a year in jail). There is a requirement that the recommender be the patient’s “attending physician”, but the definition of attending physician is given a particular meaning in Health and Safety Code 11362.7, and merely refers to a medical doctor or osteopath who has “taken responsibility for an aspect of the medical care, treatment, diagnosis, counseling, or referral of a patient and who has conducted a medical examination of that patient” (emphasis added) before issuing the recommendation.  As long as there is an examination, then, and there is some responsibility for some part of the person’s medical care, a doctor can issue a recommendation.  (Of course, a more restrictive definition of “attending physician” or what it means to “take responsibility” for an aspect of a patient’s care could limit the pool of those who could write recommendations, but the rest of this post will focus on different language, since the new legislation adopts these definitions without necessarily changing them.)

The two new limitations on recommendations, as I see them, come from changes to the Business and Professions Code § 2220.05, which establishes the “investigative and prosecutorial resources” of the Medical Board of California. Here, SB 643 made investigations and prosecutions of doctors who engage in “[r]epeated acts of clearly excessive recommending of cannabis to patients for medical purposes, or repeated acts of recommending cannabis to patients for medical purposes without a good faith prior examination of the patient and a medical reason for the recommendation” the fourth-highest priority for the Medical Board, just above sexual misconduct with a patient and just below a more generic prohibition against excessive prescribing of controlled substances. Of course, we don’t necessarily know just from the statutory language what a “clearly excessive” number of recommendations might be, nor is it clear either what a “good faith examination” of the patient is nor how many bad faith examinations constituted “repeated acts.” Nevertheless, there are some limits here.

Elsewhere in the bill there is a requirement for the Medical Board of California, in concert with the (newly established) Center for Medical Cannabis Research, to work on “developing and adopting medical guidelines for the appropriate administration and use of medical cannabis.” If one reads “administration and use of cannabis” to include the decision whether or not to recommend usage at all, this might provide some clearer guidance to doctors—and the Medical Board—about who is engaged in unprofessional (and license threatening) conduct.

So why would this matter? California’s medical marijuana industry is so large, in part, because the number of “patients” who can buy medical marijuana is so large. If the state begins to crack down on a few doctors who provide a large number of recommendations (and I don’t have any reliable information about how many doctors, if any, there are, nor about how many recommendations they provide), then we might see the size of the medical marijuana market start to shrink. One of the reasons I’ve been less than sanguine about the prospects for the electoral prospects of ballot initiatives to allow adult use in California is that, for many market participants, medical marijuana ain’t broke, so it doesn’t need fixing. Starting to distinguish between overly permissive doctors and those with some kind of established relationship with their patients might change the economics of the established medical marijuana market, and, with it, the electoral calculus as well. But it will all depend on how the statutory language is interpreted and on how effective enforcement activity is.

On-site Consumption Op-ed

I’m pleased to report that my op-ed on on-site consumption has been posted on USA Today online (and the print edition for Thursday): Bring Back the Opium Den.  I wanted to take a moment to comment on a couple of things that, for space reasons, didn’t make it into the final column.

I picked a pretty spicy title, and I know the very notion of an opium den generally isn’t associated with anything positive.  I wanted to use this title to call attention, however obliquely, to the racist history that (at least partly) animates drug laws.  By now, most people who have looked into marijuana prohibition know about Harry Anslinger.  But opium dens, too, were sites of anti-Chinese sentiment, and the irony is that China tried to ban opium only to have Great Britain go to war to stop them.  That’s right–one of the first drug wars was to keep markets open.  How the worm has turned.

I also wanted to say a few more things that got lost in the shuffle.

First, if we are concerned about kids, then it is curious that we allow any off-site consumption.  Kids only get alcohol that way.    We actually, in part, allow “to go” liquor purchases for our convenience and enjoyment.  Hedonism does sometimes outweigh public safety.  I’m not suggesting that that’s good or bad, but I do want to point out that it’s something that exists.  There are, of course, significant market incentives to cater to those desires, and that, too has regulatory implications.

Second, I had a lot more to say about how problems from onsite consumption could be managed (and should be understood).  If you could only buy marijuana for immediate consumption, businesses who sold marijuana would check ID immediately before consumption, not just before purchase, making sure that limits are placed on those who can consume marijuana, not just those who can buy it. If we’re concerned about usage, these businesses can limit consumption, the way bars can refuse service to drunken patrons.

As for DUID concerns, people do, of course, drive to and from private homes where they consume marijuana now, and they would also do so if there were no commercial establishments in which to smoke. But, more importantly, marijuana tavern owners could monitor use and face liability for over-serving someone. All of the ways in which we limit drunk driving apply to DUID, and this kind of regulation is made easier if there are centers of marijuana consumption.  Enforcement can be geographically centralized.

By keeping sales tightly linked to the spot of consumption, the state could also tax and track marijuana more easily. We could also make a good business opportunity—especially for restaurants. Who wouldn’t want to upsell someone with the munchies? It is unlikely that pot itself will command much of a premium in a legalized market, since its high price now is a function of the risk of prohibition.

Finally, I mostly wanted to call attention to an issue that doesn’t get the attention it deserves, other than from Seattle City Attorney Pete Holmes.  The RAND corporation just did a very large (218 page) study on legalization in Vermont and said almost nothing about the option of having onsite consumption.  Don’t get me wrong–I think the study is great, and I am an avid reader of the study’s authors both individually and collectively, but in such an otherwise comprehensive report there is one mention on p54 about how declining prices will create pressure for on-premises consumption, a mention that Washington and Colorado ban on-premises consumption (see, e.g., p104), but nothing suggesting that it is a policy option (on-site consumption is not included as one of the “Eight Regulatory Decisions for Legal Marijuana”).  The authors do suggest delivery as an option (pp108-109)–something that, in my view, would maximize the potential for diversion.  DUID could be an advantage of delivery, but only if we assume that everyone consumes in their homes upon receipt and that no one, instead, invites guests over or takes the marijuana with them.  (The authors also state that delivery could limit access to teens by requiring ID’s, etc., but once the door is shut, the state loses control over who consumes it when.)

The Rest of the Reading

Continuing my discussion of Doug Berman’s canon post, I wanted to talk about the reading for our class. I’ve only discussed the reading we’ve done so far (and will probably not get into the reading we’re doing in subsequent weeks unless I suddenly start finding more time in the day), but I’ve left out part of my requirements: that students read the news and blogs.

I do have canonical blogs, and I’m sure some of them will change over time. But all of the blogs in the blogroll (to the right of this post) are assigned reading, as is a Google News alert on marijuana.  Students know that the field is changing and we need to have up-to-date knowledge of the scientific and regulatory framework which we’re dealing with.  At the same time, I think it’s been extremely helpful to have the more in-depth knowledge that the reading in the prior article provides.

As we’ve said, most of our shorter hit-and-run posts will be on our twitter feed (@druglawpolicy).  Different teams of students rotate responsibility for the twitter feed each day.  Most of our blog posts here will be of at least a couple of paragraphs.

Thanks for reading so far—and now, here are my students…

On the other hand, here is (part of) our reading list…

In my prior post, I wrote in response to Doug Berman’s question that I was on the non-canonical side of things. (Fancy that—a Bay Area legal academic being non-canonical?) Having said that, I do think there is tremendous value in talking about what I’m having my students read (so far) and, more importantly, why I’m having them read these papers. I do think it’s important to give them some background in the subject so that they can fit their own policy domains into a bigger picture. My overwhelming criterion for reading is that it be of high quality—or, in the case of the Oklahoma/Nebraska complaint, that it be of extremely high salience. Ideally, the reading has both. I wholeheartedly recommend all of our reading so far.

This is our list:

How to Regulate Cannabis

I had the students read this over their break. I wanted them to get an overview of the field, and, in my conversations with them, the takeaway most of them reported was the understanding that there are a variety of options in regulation, that it isn’t a binary choice.

Overview of Recent Developments Affecting Medical Marijuana (California, 2012)

I had a couple of goals with this one. First, it’s just extremely well written and comprehensive, and we discussed the ways in which there is an art to summarizing the law. I wanted my students to try to internalize some lessons about legal writing from reading this. Second, I wanted my students to have substantive knowledge about the regulatory framework of the state (or not). All of the flagged issues in this material will also be important to a recreational market, and, moreover, statewide regulation (vel non) is, in my view, one of the important factors behind Colorado’s success and Washington’s troubles.

Alex Kreit, Controlled Substances, Uncontrolled Law and Kevin Sabet, Much Ado About Nothing: Why Rescheduling Won’t Solve Advocates’ Medical Marijuana Problem

I think these are both excellent articles that tell students what they need to know about scheduling under the Controlled Substances Act, but I also tell students that Alex Kreit recommended Kevin Sabet’s article to me. The extra-textual point I’m raising here is that good scholarship can come from a variety of places, and academics with integrity (like Alex) aren’t afraid to recommend it, despite disagreeing with Sabet on the big picture.

Robert Mikos, Preemption Under the Controlled Substances Act

As with all the articles listed above, my main criterion is “is this awesome?” This is an awesome article: really informative and helpful in structuring thinking. Having said that, stay tuned for a blog post from one of my students based on our class discussion that might tweak Mikos’s framework. This article does what you want an article to do: it provides a new way of thinking about a subject that engenders even more thoughts in response.

Nebraska/Oklahoma Complaint and Leave to File Complaint in the Supreme Court

As I indicated in my prior post, this has particular salience and is the perfect capstone to the prior reading: we understand the CSA, preemption, and commandeering, and now we can use that understanding to analyze the legal reasoning in the complaint.

That’s our reading so far—with a gigantic exception. More about that in the next post.

The Cannabis Canon?

Doug Berman raised an interesting series of questions in this post:  Is there now (or should there be) a “cannabis canon” as more law schools teach marijuana reform?  He presents two possibilities: one where there is divergence in courses to reflect the different situations throughout the country, and one where there is some kind of standardization. When it comes to my class (and my views), I’m on the distinction side.

As an intellectual/doctrinal matter, I think it’s too early for a canon. The facts on the ground are changing rapidly and most of the action takes place at the state level. California can look to Colorado, Washington, Alaska, and Oregon for certain examples, but the fact is that our existing statutes, regulations (vel non), and constitutions are different from one another and present different obstacles and opportunities. Taxation in California, for example, has become extremely complicated as the result of a series of statewide propositions.  Simple majorities are not enough to change tax rates, but taxes can be automatically adjusted if there is a mathematical formula. When it comes to marijuana taxation, I think most people would assume that the tax regime should be adjusted based on the ways in which the market responds, but that would be difficult in California. (One idea might be to have the equivalent of an “all or nothing” recalibration package, the way that some state sentencing commissions operate, or the way the federal base closure commission operated.) Our medical marijuana program is also the result of a statewide proposition, which means it will be much more difficult to change qualifying conditions, for example.

Because I want my students to write for policymakers, I want them to situate their suggestions in California law. We read an excellent overview of the law of California medical marijuana (more on that in my next post), but I wouldn’t expect that to be of national interest (even though it’s essential for work on recreational regulation in the state).

As a law professor, though, I think there’s a bigger issue: what is the purpose of a law school class? I don’t see my role as transmitting information. I see my role as training students in new skills. The law always changes—especially in this field. What stays the same are the analytical skills—and skills in workflow management—that you can use to attack these changes. So I’m planning to do something Doug did last year in his class—have students assign reading and teach the class something. Finding quality sources is a tremendously valuable skill to lawyers. Walking someone through a new field is also very important. I don’t want to do it for them—I want to help them learn to do it. Let’s be clear—there’s nothing arm’s length about my teaching style, and this is actually more work for me than doing it myself. But I’m only getting here because I have a clear view (which not everyone agrees with, naturally) of my role: as someone training someone to do the kind of work I do.

What does this have to do with the canon? I think the question about the canon, in some way, presupposes that without the right information, the educational value of the class will be reduced. I think that’s true if information transmission is the goal. If there are other goals, and the information used is a means of achieving those goals, then I think the issue of the canon isn’t so primary. Last class we read the complaint filed by Nebraska and Oklahoma against Colorado. We had an incredibly valuable class session discussing it, even though, as a whole, I think the quality of the legal arguments presented is poor. Should it be in the canon because it’s important? Should it be in the canon because it’s a good tool? Or is the question not about the reading material but what one does with it?

Welcome!

Dear Readers,

Welcome to the Drug Law and Policy blog. The blog is a product (and project) of a class I’m teaching this semester, the Drug Policy Practicum (what I’ll call the DPP–more on that in a minute.) In many ways, though, my writing this first post is a somewhat misleading start to the blog—this is going to be populated primarily by the writings of my fabulous students. Sometime in the coming weeks they’ll begin posting, first with a roadmap of the particular subject area they’ll be addressing, and later with substantive writing. As our about us section reads:

The Drug Law and Policy Blog provides in-depth legal analysis of drug policy and cannabis reform in the Golden State.  The blog is founded and maintained by students in Professor David Ball‘s Drug Policy Practicum at Silicon Valley’s most innovative law school, Santa Clara University.  Our aim is to provide a wealth of information for lawyers, legislators, business entities, advocates, law enforcement, and any individual invested in California’s political, social and economic leadership.

I’m really excited to be sharing their work and learning from them alongside you. And, by the way, that About Us section was written by my students.

My idea to teach this class was inspired by several experiences, which I’ll talk about in chronological order. In law school I had the good fortune to take classes with Joan Petersilia when she was visiting Stanford (she has since, to my delight, joined the faculty). Joan taught seminars on prisons that combined academics with policy—but policy that was meant to be disseminated to actual practitioners. In other words, we weren’t just writing for her and ourselves—we were writing for the world at large. Even before the DPP, I’ve always asked practitioners and policymakers what they’d like to see more research on. Students frequently write papers on those subjects and I’ve been pleased to disseminate the results.

The DPP has that baked in to its DNA. I’m a member of the Blue Ribbon Commission on Marijuana Law and Policy (BRC), and my students will be writing and researching about subjects of interest to my fellow commissioners. Obviously what they write won’t be the final word, but my goal is to have them contribute to the civic discussion both via dissemination to the BRC and to the world at large—which means you.

As far as the subject matter goes, my primary research and writing interests have been (and probably still remain) sentencing and corrections (another hat tip to Joan P) but this, of course, implicates issues about the drug war—not just when it comes to drug offenses but also the ways in which criminal procedure has been shaped by the drug war. But that’s a huge post. I read Doug Berman’s Sentencing Law and Policy blog every day, and when he started his Marijuana Law, Policy, & Reform blog, I subscribed to that (via RSS) too. I think marijuana policy is a fascinating example of scaling back the penal code, and it’s a rich opportunity to explore how to treat social problems via something besides the criminal justice system. I also think there’s great scope for thinking creatively about this, and, as someone who used to be a writer, actor, and improvisational comedian before law school, I’m always looking for that.

So my goals here are to showcase my fabulous students and to contribute something to the depth and legal analysis of marijuana regulation, with a particular focus on California. After a few more posts, I’ll fade into the background, but thanks for reading!