Eastern District of California Blog

U.S. Attorney Subpoenaed Cannabis Business Records from Weedmaps

Lede from yesterday's Marketwatch story:

Federal prosecutors have launched a probe of cannabis companies in California, seeking a batch of records held by a startup that functions as a Yelp for marijuana dispensaries, according to a grand-jury subpoena reviewed by MarketWatch.

Criminal prosecutors in the U.S. attorney’s office for the Eastern District of California ordered the production of records from Ghost Management Group LLC, which owns a subsidiary called Weedmaps that provides an online directory of cannabis retailers. Weedmaps’ online services allow pot consumers to rate and compare stores, find deals and place orders for delivery.

The subpoena covers documents related to cannabis businesses listed on Weedmaps, and records related to its ordering service. The government also sought documents and other records kept by Weedmaps related to its own staff, investors and accounting, according to the subpoena issued late last year.

Six Year Sentence In Marijuana Cultivation Case

Yesterday, according to this EDCA US Attorney press release, Judge Mendez sentenced Yan Ebyam to 6 years in prison for two separate conspiracies to grow and distribute marijuana in United States v. Ebyam, No. 2:11-CR-0275-JAM & 2:11-CR-0276-JAM.

Obama Grants Clemency to EDCA Medical Marijuana Operator

Luke Scarmazzo and Ricardo Montes were high school football teammates who went on to bigger fame, fast riches and federal prison after opening a medical marijuana store in a conservative Central Valley town in the early era of the California cannabis industry.

Now President Barack Obama, as one of his last acts in office, is letting one of the two Modesto dispensary operators go free. The White House announced Thursday that Montes, 37, has been granted clemency. He will be released from prison on May 19 after serving nine years of a 20-year sentence for illegal marijuana distribution and conducting a continuing criminal enterprise.

Sac Bee, 1/19/17

No Christmas Clemency for EDCA Pot Pair

Today's Sacramento Bee reports that Luke Scarmazzo and Ricardo Montes have sought clemency from President Obama to reduce their federal marijuana trafficking sentences of 262 and 240 months, respectively.  The story says they opened Modesto's first medical marijuana dispensary in 2004.  But no luck yet for the pair as I didn't see their names on today's White House's list of the 173 persons granted sentence commutations and 78 pardoned inmates.  In fact, Dolly Ann Chamberlain is the only EDCA defendant on the list.  She received a pardon after being convicted of conversion of government money and receiving a probation sentence in 2002.  But there is still time for those waiting as the White House said it expects there will be more clemency grants before Obama leaves office. 

On a somewhat related note, according to Politico, Newt Gingrich has suggested that President-Elect Trump should consider prospectively pardoning his family members for all the crimes they may commit while Trump is in office:

 “In the case of the president, he has a broad ability to organize the White House the way he wants to. He also has, frankly, the power of the pardon,” Gingrich said. “It’s a totally open power. He could simply say, ‘Look, I want them to be my advisers. I pardon them if anyone finds them to have behaved against the rules. Period. Technically, under the Constitution, he has that level of authority.”

In other words, the rule of law doesn't apply to Trump and his family. 

 

EDCA Court Denies Adgate's Motion to Stay Prison Sentence

Today, Judge England denied defendant Steven Adgate's motion to stay his 26-month prison sentence on the ground that the court lacked jurisdiction to consider the motion since the time to file a notice of appeal had expired.   Adgate order denying motion to stay.  Adgate had argued that his prison sentence should be stayed based on the Ninth Circuit's recent McIntosh decision, which generally barred the Department of Justice from expending funds to prosecute medical marijuana actions that were in compliance with state law.  

Feds oppose McIntosh-based motion to stay prison sentence

Today, the EDCA U.S. Attorney's Office filed this opposition to defendant Steven Adgate's motion to stay his prison sentence based on the Ninth Circuit's recent McIntosh opinion, which held that an Appropriations Act of Congress (§ 542) barred the Department of Justice from expending funds to prosecute individuals who were in compliance with state medical marijuana laws.  No word on the hearing date yet.

Motion to stay prison sentence based on Ninth Circuit's Medical Marijuana McIntosh decision filed

Tuesday, I blogged about the Ninth Circuit's McIntosh opinion, which held that the Appropriations Act barred the federal government from prosecuting medical marijuana cases where the defendants were in compliance with state law.  Today, I learned that Sacramento attorney Bill Portanova filed this motion to stay his client's prison sentence in United States v. Adgate, No. 2:12-CR-00198-MCE, based on the McIntosh decision.   I'd expect many more McIntosh-based motions to follow.

Ninth Circuit Bars Feds From Prosecuting Medical Marijuana Actions That Complied With State Law

In U.S. v. McIntosh, No.15-10117, the Ninth Circuit held today that the Appropriations Act passed by Congress bars the federal government from prosecuting medical marijuana cases that comply with state law.  And from a conservative "states' rights" panel.  Here is the opinion's summary:

In ten consolidated interlocutory appeals and petitions for writs of mandamus arising from three district courts in two states, the panel vacated the district court’s orders denying relief to the appellants, who have been indicted for violating the Controlled Substances Act, and who sought dismissal of their indictments or to enjoin their prosecutions on the basis of a congressional appropriations rider, Consolidated Appropriations Act, 2016, Pub. L. No. 114-113, § 542, 129 Stat. 2242, 2332-33 (2015), that prohibits the Department of Justice from spending funds to prevent states’ implementation of their medical marijuana laws.

The panel held that it has jurisdiction under 28 U.S.C. § 1292(a)(1) to consider the interlocutory appeals from these direct denials of requests for injunctions, and that the appellants have standing to invoke separation-of-powers provisions of the Constitution to challenge their criminal prosecutions.

The panel held that § 542 prohibits DOJ from spending funds from relevant appropriations acts for the prosecution of individuals who engaged in conduct permitted by state medical marijuana laws and who fully complied with such laws. The panel wrote that individuals who do not strictly comply with all state-law conditions regarding the use, distribution, possession, and cultivation of medical marijuana have engaged in conduct that is unauthorized, and that prosecuting such individuals does not violate § 542.

Remanding to the district courts, the panel instructed that if DOJ wishes to continue these prosecutions, the appellants are entitled to evidentiary hearings to determine whether their conduct was completely authorized by state law. The panel wrote that in determining the appropriate remedy for any violation of § 542, the district courts should consider the temporal nature of the lack of funds along with the appellants’ rights to a speedy trial.

 

No Schweder Marijuana Case Sentencings On 4-20

Bryan Schweder's sentencing in his marijuana case (no. 2:11-CR-0449-KJM) will not be held on April 20, as originally scheduled.  It was reset to June 1, 2016.

Schweder Marijuana Order Out

Here is Judge Mueller's 38-page order denying defendants' motion to dismiss the Indictment in the Schweder marijuana case:   Schweder order