Eastern District of California Blog

Feds Bust Big Pot Operation

I guess they don't do marijuana cases in the Northern District:

A year-long federal investigation into a large-scale pot ring based out of Contra Costa County culminated in law enforcement arresting 19 people and seizing massive quantities of marijuana, weapons and cash Wednesday morning, according to the DEA Sacramento District Office.

Hundreds of law enforcement personnel served federal arrest and search warrants without incident Wednesday on individuals between the ages of 21 and 57 from Alameda, Contra Costa and Stanislaus counties in what the DEA dubbed "Operation Disco Dazed."

The DEA believes that marijuana from the multi-county operation was trafficked in locally and beyond California.

Upon serving the search and arrest warrants, law enforcement seized 3,606 marijuana plants from 14 indoor grow operations, 96 pounds of processed cannabis, 36 firearms, a 37-mm grenade launcher, 13 motor vehicles, 5 boats and $400,000, DEA Special Agent in Charge Anthony D. Williams and U.S. Attorney Benjamin B. Wagner announced today.

According to the DEA, those involved with the operation face charges related to the manufacture of, possession of and intent to distribute marijuana, as well as charges of conspiring to manufacture and distribute marijuana and maintaining a place for manufacture and distribution of marijuana.

The individuals arrested were from Fremont, Byron, Discovery Bay, Rio Vista, Oakley, Tracy, Fresno, Brentwood, Patterson, Mountain House and Salida.

KTVU.com, 5/16/12

Federal Crackdown Leads To Cheap Pot

The closure of hundreds of marijuana dispensaries across California and a federal crackdown on licensing programs for medical pot cultivation are leaving growers in the North Coast redwoods with harvested stashes many can't sell.

Some pot cultivators who sought legitimacy through the medical market are fleeing to the black market. So much cheap weed is getting dumped in the college town of Arcata, some local dispensaries say business is down 75 percent. Even the region's itinerant and colorful bud trimmers are going broke.

* * *

But the saturation of pot growers set off a price tumble by 2010, as a pound of prime Emerald weed slipped from $5,000 to the $3,000 range for marijuana grown indoors and to the $2,000 range for product grown outdoors. Lately, prices are in free-fall.

"Last I heard, a pound of marijuana is $800 for outdoor grown," said Mendocino County Sheriff Tom Allman in Ukiah. "That's plummeting. You might do better with tomatoes."

Sacramento Bee, 5/5/12

Efforts Faltering To Put Marijuana Legalization On California Ballot

Just weeks before the deadline for state ballot initiatives, the effort to put a marijuana legalization measure before voters in the general election is in disarray as the federal government cracks down on medical cannabis and activists are divided on their goals.

After Proposition 19 received 46% of the vote in 2010, proponents took heart at the near-miss. They held meetings in Berkeley and Los Angeles and vowed to put a well-funded measure to fully legalize marijuana on the 2012 ballot, when the presidential election would presumably draw more young voters.

Instead, five different camps filed paperwork in Sacramento for five separate initiatives. One has given up already and the other four are teetering, vying for last-minute funding from a handful of potential donors.

* * *

The state Board of Equalization estimates it annually collects between $57 million and $105 million in sales tax from dispensaries.

Backers of all four measures predict that the price of marijuana would drop if any of them passed. In Israel, where medical marijuana is legal, prices are a fraction of what they are in California.

* * *

Since October, the feds have waged a multipronged attack.

In California, the DEA has raided at least 36 dispensaries and growers, confiscating marijuana, cash and computers. The state's four U.S. attorneys have sent at least 150 letters to landlords of dispensaries, ordering them to evict their tenants or face seizure of their property and prosecution. They've also threatened cities and counties that have tried to set up a permit system for dispensaries and growers.

On the financial front, the Federal Deposit Insurance Corp. has pressured banks to close accounts linked to marijuana. And the IRS has audited dozens of dispensaries using an obscure provision of the federal tax code that prohibits drug traffickers from making any deductions.

LA Times, 3/10/12

SN&R: U.S. Attorney Breaks Silence On Medical Marijuana Battle

Wagner broke the Department of Justice’s near silence with regard to the crackdown during a candid, hour-long talk and question-and-answer session last Tuesday at a Sacramento Press Club luncheon. The $30-a-plate affair took place on the 15th floor of 1201 K Street, and inside, Wagner admitted that the cannabis cleanup was the idea of the four U.S. Attorneys in California, not Washington, D.C.

The four were upset because of what Wagner called “flagrant” marijuana sales in the state. So they declared war on medical marijuana last October, sending out hundreds of forfeiture-warning letters to dispensaries across California. His office is in the process of seizing at least one dispensary in Sacramento, while officials have closed more or less every dispensary in Sacramento County.

He reiterated that they’re not going after patients and caregivers, rather interstate transporters, huge pot farmers and illicit dispensaries grossing tens of thousands of dollars per day in cash.

But the media critique of the war is wearing on Wagner, it seems. He said he counts on good press to create a “deterrent effect” in regard to cases of mortgage fraud, child exploitation, human trafficking and major gang violence. But he’s not getting any of that.

“I think that the members of the press would be forgiven for thinking that marijuana enforcement is all that we do,” he said. “It is far from the most important thing that we do. I have many other higher priorities that have a much bigger impact on public safety. I did not seek the position of U.S. attorney in order to launch a campaign against medical marijuana.”

*  * *

SN&R news intern Matthew W. Urner got the biggest attention of the lunch, asking Wagner if he ever tried the second-most-commonly used mind-altering substance in America, and if so, what he thought.

“Uh,” said Wagner, “I’ll say that I went to college.”

Sacramento News & Review, 3/8/12

Feds Vow Crackdown On Valley Landowners Where Marijuana Is Grown

Federal officials warned owners of Valley farmland Thursday that if they lease land to someone growing marijuana, they could lose their property or face jail time.

Sacramento-based U.S. Attorney Benjamin Wagner came to the Fresno County Farm Bureau to detail his office’s stepped-up prosecution of large-scale pot farms. He met with about 65 people representing Valley sheriff’s offices, federal drug agents and the agriculture community.

“We want to send a message to land owners that they have to know what is going on on their property,” said Wagner, who is the region’s top federal prosecutor.

In the last 18 months, the U.S. Attorney’s office has filed cases against 35 people growing marijuana on agricultural land in Fresno, Madera and Stanislaus counties. Most of those cases have been in Fresno County, the U.S. Attorney’s Office said. Wagner highlighted one recent case involving the seizure of about 50 acres in eastern Fresno County.

Fresno Bee, 3/1/12

EDCA Court Dismisses Suit Seeking To Stop Feds From Enforcing CSA Against Medical Marijuana Collectives

In this El Camino Wellness Center v. Holder, 11-CV-2939-GEB, Order filed today, the district court dismissed with prejudice a medical marijuana collective's civil lawsuit that had sought to enjoin the federal government from enforcing the Controlled Substance Act against plaintiffs and other medical marijuana collectives in California. 

Thanks to News10.net, 2/28/12 for the court's order.

U.S. Attorney Vows Continued Crackdown On Large Pot Farms

Warning that there is a new "green rush" of people flocking to California to exploit the market for marijuana, the top federal prosecutor in the Sacramento region promised a crackdown today on huge pot farms on agricultural land in the Central Valley.

Benjamin Wagner, U.S. Attorney for the Eastern District of California, said his office is not interested in prosecuting sick people using medical marijuana. But he warned that the "unregulated free for all" that has allowed marijuana growers and merchants to make fortunes must come to an end, and he said in the coming months a new focus will be made on pot farms in the valley.

"There's been a proliferation of these large commercial grows on farmland, especially in the southern part of the valley from Stanislaus County down to Kern County," Wagner said at an appearance before the Sacramento Press Club. "And these grows are often tens of thousands of marijuana plants.

Sacramento Bee, 2/28/12; [updated story: Sacramento Bee, 2/29/12].

Fresno Grand Jury Indicts Seven Men In Medical Marijuana Scheme

A federal grand jury has indicted half a dozen Fresno men in an alleged medical marijuana scheme that saw weed shipped to at least eight other states.

The U.S. Attorney General, U.S. Drug Enforcement Administration and IRS made the announcement Friday.

The indictment is against Fresno men Joseph Edwin Gable, Elgeron Graves, Vincent Graves, Herman Graves, Damone Kelly and Catatea James. Kevin Eugene Spencer of Roseville was also indicted.

The men are charged with money laundering and trafficking.

SFGate.com, 2/10/12

Recent Fresno Sentencings

Three men were sentenced to prison terms between 20 and 30 months by Chief Judge Ishii for conspiring to grow and distribute marijuana in connection with the B&C Natural Things medical marijuana collective in Ridgecrest, California.  Bakersfield.com, 2/6/12

After a jury trial, a Modesto man was sentenced by Judge O'Neill to 135 months imprisonment for his part in a conspiracy to steal almonds from Central Valley growers and processors.  Modesto Bee, 2/6/12.

Chief Judge Ishii sentenced a Bakersfield tax preparer to 30 months for aiding the presentation of false tax returns to the IRS.  Bakersfield.com, 2/6/12.

Nine Year Sentence For Marijuana Cultivation

A Santa Barbara County man was sentenced today in federal court in Sacramento for his involvement in marijuana growing operations in El Dorado County.

Ryan Louis Ennis, 39, of Buellton was sentenced by U.S. District Judge John A. Mendez to nine years for conspiring to cultivate marijuana.

Sac Bee Blog, 2/7/12