Cannabis Business Lawyer in Westchester County, NY
Keith R. Betensky, Esq. is equipped to advise clients in the cannabis industry regarding legal issues in New York. Since 2014 cannabis has been legal under New York law for medical use only. If New York legalizes cannabis for adult use, then the cannabis industry is likely to grow exponentially in New York, including Westchester County. The cannabis industry consists of growers, cultivators, processors, distributors and retail dispensaries. These businesses require experienced attorneys to navigate the State licensing process, comply with local municipal laws, form business entities, negotiate operating agreements, negotiate lease agreements, and navigate state and federal laws. The Law Office of Keith R. Betensky stands ready to advise clients regarding the foregoing issues and other related issues that arise in the cannabis industry in New York.
Cannabis Industry Background
The medical marijuana dispensaries that already exist in New York are the tip of the proverbial iceberg. The cannabis industry is enormous and the State of New York is positioning itself to bring many more jobs and substantial tax revenue. According to a co-authored report “2019 Update to the State of Legal Marijuana Markets,” from Arcview Market Research and BDS Analytics, after delivering $6.9 billion in global sales in 2016, $9.5 billion in worldwide revenue in 2017, and an estimated $12.2 billion last year, global sales are expected to grow 38% in 2019 to $16.9 billion, and hit $31.3 billion by 2022. That’s a compound annual growth rate of 26.7% between 2017 and 2022.
Experts Predict Cannabis Will Be Legalized For Adult Use in New York
Cannabis for medical use has been legal in New York since the Compassionate Care Act was passed by the State legislature in 2014.
Governor Andrew Cuomo published draft budget legislation on January 15, 2019, including cannabis legalization for adult use. Governor Cuomo’s proposed budget legislation plans to legalize, tax and regulate cannabis for adult use. Interestingly, the legislation also indicates that it is in the public interest to choose socially responsible licensees who will contribute to communities and people historically disproportionately harmed by cannabis law enforcement.
Governor Cuomo’s proposed budget legislation would establish an independent Office of Cannabis Management that would cap the number of cultivation, distribution and retail licenses allowed in the State. It would prohibit adult-use cannabis companies from vertically integrating, which would result in a larger number of smaller businesses, unlike New York’s medical cannabis market, which currently has 10 vertically integrated businesses up and running.
Cannabis Is Still A Controlled Substance Under Federal Law
Despite the fact that 46 states have legalized cannabis for medical use, cannabis is still considered a Schedule 1 controlled substance (along with heroin, mescaline/peyote and LSD) under the federal Controlled Substances Act (CSA) (21 U.S.C. § 811).
According to the United States Drug Enforcement Agency (DEA), drugs are listed on Schedule 1 if they exhibit the following characteristics:
The drug or other substance has a high potential for abuse;
The drug or other substance has no currently accepted medical treatment use in the U.S; and
It has a lack of accepted safety for use under medical supervision.
According to federal law, no prescriptions may be written for Schedule 1 substances, and they are not readily available for clinical use.
So how is it that cannabis can be illegal under federal law and legal under state law? Doesn’t federal law trump state law?
Beginning in 2016, several federal agencies issued guidelines and other policy memoranda to address the conflict between federal and state laws vis-a-vis medical marijuana. On August 29, 2013, the Department of Justice (DOJ) issued a guidance memo to prosecutors concerning marijuana enforcement under the Controlled Substance Act (CSA) making it clear that prosecuting state legal medical marijuana cases is not a priority.
The memo included eight guidelines for prosecutors to use to determine current federal enforcement priorities. Many State medical cannabis regulations ensure that any business with a license is meeting these same criteria. These guidelines include:
- Preventing distribution of marijuana to minors;
- Preventing revenue from the sale of marijuana from going to criminal enterprises, gangs or cartels;
- Preventing the diversion of marijuana from states where it is legal, under to state law in some form, to other states;
- Preventing state-authorized marijuana activity from being used as a cover or a pretext to traffic other illegal drugs or other illegal activity;
- Preventing violence or the use of firearms in cultivation and distribution of marijuana;
- Preventing drugged driving and the exacerbation of other adverse public health consequences associated with marijuana use;
- Preventing the growing of marijuana on public lands and the attendant public safety and environment dangers posed by marijuana production on public lands; and
- Preventing marijuana possession or use on federal property.
Therefore, while a conflict exists between federal and state law, the federal government has not prioritized enforcement of the Controlled Substance Act with respect to cannabis. In addition, future legislation may resolve this inherent conflict of laws.
Contact Us Today For A Free Consultation
Whether you are a cannabis grower, cultivator, processor, distributor or retail dispensary, an experienced New York attorney can help you navigate the state and federal laws to help your business succeed in New York. Call us today for a free consult at 914-338-8050.
 The Motley Fool. How Big Could the Marijuana Industry Grow? March 3, 2019.