City identifies medicinal marijuana dispensaries operating without licenses

October 01, 2007

Tracy Manzer, Long Beach Press-Telegram

LONG BEACH - Proposed legal action by the Long Beach city attorney's office is expected to ignite a new battle in the ongoing war over medical marijuana.

Police have identified 11 locations in Long Beach where medical marijuana is sold to patients by dispensaries, which, according to the city attorney's office, are operating illegally.

City records obtained by the Press-Telegram show none of the 11 locations has been issued a business license or permit to operate as a dispensary in Long Beach.

Of the 11 locations, four have licenses for unrelated businesses - including a barber and beauty shop, retail clothing store, industrial space and real estate. The remaining locations have no license or permit.

"Whether they have a license which was issued for another kind of business, which is fraudulent, or they are operating without a license, it's all ... in violation," said Deputy City Attorney Richard Anthony.

Anthony said earlier this month that the city has never issued a license to any medical marijuana dispensary since the 1996 passage of Prop. 215, the compassionate use act that legalized marijuana for California patients suffering from debilitating conditions and disorders.

Federal law still prohibits the use of the drug in most cases and questions regarding how the drug would be dispensed within California began to arise not long after the state law's passage.

The issue of dispensaries and whether or not they should be permitted came to a head in Long Beach in 2005, when the City Council placed a six-month moratorium on the issuance of licenses while city staff investigated potential legal problems.

Despite impassioned pleas by medical marijuana advocates, the city attorney's office ultimately decided against allowing dispensaries or clinics to operate and declared no licenses would be granted once the moratorium expired, Anthony said.

Anthony did not know why action against the city's dispensaries has not been taken since the 2005 decision, but added that Deputy City Attorney Cristyl Meyers is preparing to take action now.

Meyers confirmed Friday the action is pending, but said she could not discuss specifics until this week.

Timely case

At least one California city that recently enacted a similar ban was able to defend the move in the first round of litigation Friday.

The recent lawsuit filed by a dispensary against the city of Anaheim for its new ban - which was scheduled to take effect earlier this month until an Orange County Superior Court judge temporarily blocked the law on Sept. 4 - is being closely watched by Long Beach authorities and advocates.

Judge David Thompson ruled Friday that his temporary order against Anaheim's ban was to be dissolved. The lawsuit, however, remains in effect.

In Friday's ruling, the judge noted that the plaintiff - The Qualified Patients Association - failed to show the city ban on clinics violated state law or patients' rights, said Anaheim City Spokesman John Nicoletti.

Thompson also ordered both parties to return to his court on Oct. 16 to discuss the status of the pending trial, Nicoletti said.

Despite the recent push to limit medical marijuana dispensaries, advocates, local owners and staff at dispensaries insist they are operating within state law. They cite a state appellate court decision that upheld the right of medical marijuana co-operatives and collectives to provide patients with safe and reliable access.

They pay state taxes through the sale of the drug and pay federal and state taxes for employee payroll. According to an analysis by the California chapter of the National Organization for the Reform of Marijuana Laws, marijuana sells for roughly $10 to $15 for a single gram, the equivalent of one or two joints.

They say they are also regulated by the Los Angeles County Department of Health, which oversees the issuance of medical marijuana ID cards - which cost $153 in Los Angeles County - to patients.

Patients seek permission to use marijuana from doctors under California's voter-approved Prop. 215 and a follow-up 2003 law, which clarified the original proposition and ordered counties to issue the identification cards to patients.

As of Sept. 22, 35 California counties - including Los Angeles and Orange counties - have signed up to participate in the identification card system and 16,421 cards have been issued statewide, far below the expected 150,000, according to the California Department of Public Health.

City ban

However, federal law still forbids marijuana possession in most cases, creating what Long Beach city officials, as well as many other communities, say is a conflict between federal, state and local laws.

And local authorities maintain that, in order to operate within the city, dispensaries must comply with the Long Beach ordinance as well as state law. Because Long Beach has effectively banned dispensaries, those within Long Beach are in violation of city law.

At the time the city enacted its moratorium, city officials were aware of at least two locations, said Councilman Val Lerch - who removed himself from voting on the matter two years ago because he felt he was too personally involved in the issue.

Lerch explained then, and in an interview with the Press-Telegram this week, that although he brought the matter to the council's attention - along with then Councilman Dan Baker - he did not think it would be appropriate to vote on the issue because of a personal connection.

The 9th District councilman's wife suffers from multiple sclerosis. Although medical marijuana has been shown to be extremely effective in treating debilitating symptoms of the chronic disease, she does not use it, Lerch said Thursday.

"As long as federal law prohibits it, my wife will never use it," Lerch said, adding that she was raised the daughter of a probation officer and believes strongly in following all laws.

Lerch also made it clear that if his wife were to change her mind, he would support her decision to seek treatment.

"Someone who sells drugs next to a school should be hung from the highest point," Lerch said.

"But I also support the legal use of a drug that was approved by voters and, from all accounts, has a legitimate value for patients," he added.

Owner talks

Staff at several of the dispensaries in the city said they received letters threatening federal legal action by the U.S. Attorney's Office at the beginning of the year. The letters were followed with Drug Enforcement Agency raids at 10 medical marijuana clinics in Los Angeles and West Hollywood and more than 13 dispensaries in San Diego.

None of the staff at any of the Long Beach dispensaries who agreed to speak with the Press-Telegram was aware of pending action by the Long Beach city attorney's office, however.

All of the locations cited by police were contacted for interviews. Only one owner and manager was willing to speak with the Press-Telegram and asked that only his first name, Mark, be used, citing concerns of federal prosecution.

Mark has managed Herbal Solutions Compassionate Caregivers in Naples for about a year and a half. He started the dispensary after struggling to find safe and reliable locations to purchase medical marijuana for his terminally ill grandfather.

City records show that he does not have a business permit for the location.

"I did this because of my grandfather, who died of colon cancer," he said. "When I tried to find (medical marijuana) ... I had to go find it illicitly and it was scary."

His patients regularly thank his staff for providing a safe place to get their prescriptions filled, he said.

They are also constantly aware of the threat of raids and other legal action by federal authorities, he added.

"I can't tell you how many patients ... walk in crying, talking about their fear that they could lose their ability to get their medicine."

Mark criticized the city's ban, saying he and the other dispensary owners would pay any business permit fees and could be a valuable contributor to local sales tax coffers, he said.

"By not allowing us to apply for business permits they are forcing us to operate illegally, that's not what we want to do," he said. "We pay our taxes to the state, we also pay taxes to the federal government through our payroll."

Doctor's office feel

Herbal Solutions sits at the back of an office and retail complex on Second Street.

There are no signs outside the business. The first thing that tips a visitor to what is inside is the security camera bolted next to the front door.

Inside the lobby are signs prohibiting access to those without prescriptions, but it otherwise looks like a typical doctor's waiting room with the requisite outdated magazines and minimal furniture.

The notable exception to the otherwise generic doctor office vibe is the powerful odor that envelopes everything in the office and the very large, and very polite, security guard.

Some neighbors who live behind Herbal Solutions, as well as some surrounding businesses, said the dispensary's owner is abusing the compassionate-use law for a tidy profit.

"I voted for Prop. 215 and I can tell you that what they are doing is not what I or most of the other voters had in mind," said Naples resident Bill Hearn.

About two blocks west on Second Street, another dispensary - GJS Medical Service/United Caregivers - that was preparing to open was denied a lease when a neighboring business owner complained to the landlord.

There is no business permit registered for the site, according to city records.

"Most of the (patients) are college kids who know where to go to buy their prescription card for about 150 bucks," said the business owner, who asked that his name not be used.

"I didn't get out of college that long ago; I can tell you where to get the cards," he said. "This isn't about people with cancer or AIDS, these are teenagers and college kids scoring some pot."

Already gone

In the case of another dispensary - B/C/C, 1824 E. Broadway - the federal warning, along with pressure from some neighbors upset about the clientele who frequented the business, resulted in the landlord evicting the dispensary, according to neighboring businesses and residents.

City records show the property is licensed for commercial space rental.

Quality Discount Caregivers sits in a strip of businesses on San Antonio Drive on the edge of Bixby Knolls. It has a comfortable atmosphere with better coordinated furnishings than most of the other dispensaries, a detailed sign on its front window and an ATM machine - which was out of cash on a recent visit.

City records show that there is no business permit registered to the site.

One of the managers there said customers have commented they are more professional than some other co-operatives, and they have no problems with police or neighbors.

"I've seen a lot of kids, a lot of young guys, go in there. I haven't seen any old people," said Stacy Lin, who works in the area and lives in Long Beach. "But they don't bother anyone, they're real mellow."

Quality Discount Caregivers also advertises in the back of the OC Weekly, along with massage therapists and alternative businesses geared toward youth. In the ad, the dispensary offers a 25 percent discount to first-time patients.

All 11 locations listed by the Police Department came up after simple Internet searches for medical marijuana dispensaries.

Narcotics Division Sgt. Paul LeBaron said the department's list of dispensaries was compiled on the basis of community complaints.

"The Long Beach Police Department respects the right of patients who are legally prescribed medical marijuana," LeBaron said. "The problem is with drug operations abusing the spirit of the law and using the law to legitimize ... drug dealing."

Advocates respond

Even medical marijuana advocates acknowledged co-operative and collective models can be and are abused.

"I am not a big supporter of co-ops because I've seen too many of them fail to do what they are intended for, which is to serve the community as a true co-operative," said David Zink, a local advocate.

"I'm also not in favor of law enforcement using any excuse to go after patients and care-givers," Zink added.

"And I'm disappointed in Long Beach and the City Council for not recognizing the potential (gain)," he said. "This is not something that is going to go away, and the city is passing up financial opportunities that other communities are benefiting from."

A Huntington Beach man who uses medical marijuana to treat nerve pain from an automobile accident echoed Zink's statements. He said he knows a number of local owners of dispensaries.

"Yeah there are cartels who abuse it," said John, who asked that only his first name be used. "We know there are people out there who abuse it, but that's still better than having people who really need it being forced to go to the streets."

The community would be better served if authorities would prosecute pharmaceutical companies who sell highly addictive medications that do more damage than cannabis, he said.

The true co-operatives, John and others insisted, would be happy to open their books to authorities and comply with any regulations deemed necessary.

By shutting down the dispensaries, the city will be hurting the patients in most need of a safe access, said Diana Lejins, president of Advocates for Disability and a supporter of medical marijuana patients and right.

Lejins predicted such action will lead to a rise in crime, saying patients will be forced to turn to illicit street dealers.

She questioned why the city was taking action now, after two years, and suggested the city adopt a policy of only prosecuting locations where complaints are lodged.

"The bottom line is we have this opportunity to regulate the situation," she said. "To just eliminate them is downright cruel."

Problems ahead?

If dispensaries are prosecuted, they must prove they are true nonprofits to operate under the state law, said Bruce Margolin, a West Hollywood criminal defense attorney who specializes in medical marijuana cases and who is the director of Los Angeles NORML.

But Margolin added that the law protects patients' rights not only to use medical marijuana but to have safe access to the drug.

The veteran lawyer also warned that Long Beach could open itself up to potential lawsuits, much like those filed against Anaheim, if it pursues legal action against the local dispensaries.

"One could easily argue this is a denial of due process," Margolin said, referring to the ban on business licenses.

"(The city) just can't arbitrarily take away their business," he said.

Tracy Manzer can be reached at or (562) 499-1261.

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