This past June, a number of Ohio attorneys (including our firm) submitted a request to the Board for an advisory opinion on three distinct issues (for a primer on the professional issues involving Ohio’s medical marijuana law, click here):
The Board responded by announcing a non-binding opinion on August 11, that essentially prohibited lawyers from representing the Ohio medical marijuana community. The only remedy to the untenable situation existing in Ohio is a change to the Ohio Rules of Professional Conduct — something that Chief Justice O’Connor has asked the Board to consider. Recently, our firm proposed changes to the Rules clarifying that lawyers can represent Ohio medical marijuana companies, and also that Ohio lawyers can use medical marijuana and own/operate medical marijuana businesses.
The Board began its analysis noting that Rule 1.2(d) prohibits a lawyer from assisting a client engaging or seeking to engage in conduct the lawyer knows is illegal. Importantly, the Board notes that the Rule precludes attorney assistance with respect to conduct that is illegal under either state or federal law — and the Rule does not distinguish between federal laws that are not being enforced.
The Board decided that a lawyer “cannot deliver legal services to assist a client in the establishment and operation of a state regulated marijuana enterprise that is illegal under federal law.” The prohibited services include, but are not limited to:
Notwithstanding the above, the Board did conclude that Ohio lawyers may advise clients about the conflict between state and federal law, the consequences of engaging in conduct that is permissible under Ohio law but contrary to federal law, and the likelihood of federal enforcement under the current administration. Ohio lawyers can also counsel and advise about the meaning of Ohio law, and the requirements imposed by Ohio’s medical marijuana law. While a lawyer can advise how the medical marijuana law would be applied to a client’s proposed conduct, the Board’s counsel indicated to me in a conversation that this is essentially limited to a one-time conversation and does not involve ongoing advice.
Ohio lawyers can also represent clients in the following situations:
The Board stated that when assisting clients pursuant to Ohio’s medical marijuana program, Ohio lawyers should enter into a written fee agreement that “encompasses a mutual understanding about the exact scope of services the lawyer is ethically and lawfully able to provide under Prof.Cond.R. 1.2(d).”
The practical effect of this opinion and lack of access to an attorney raises some serious problems:
Patients will be unable to consult with legal counsel regarding legal possession of medical marijuana pursuant to the “affirmative defense” provision in House Bill 523;
Medical marijuana business will effectively be shut out of court when disputes arise, as corporate entities cannot proceed pro se (with the exception of small claims) – this largely leaves “self-help” as the only effective remedy should contractual breaches occur or other disputes arise involving a legal medical marijuana business.
However, the result of the Board’s advisory opinion relating to attorney representation does not bring Ohio into uncharted territory. Following the passage of Amendment 64, the Colorado Bar Association issued a similar opinion, concluding that Colorado lawyers should not engage conduct similar to that referenced by the Ohio Board of Professional Conduct. Soon thereafter, the Colorado Supreme Court added a comment to its version of Rule 1.2 specifying that Colorado lawyers could represent clients in conduct the lawyer reasonably believed was authorized by Amendment 64.
The Board’s analysis involving an Ohio lawyer’s use of medical marijuana applies equally to situations where an Ohio lawyer seeks to own, operate, or lend money to a medical marijuana business. In this context, the Board concluded that the single use of medical marijuana (illegal under federal law) would not violate Rule 8.4(b) but that repeated use might. In addition, the Board concluded that other misconduct relating to the use of medical marijuana, such as “lying to federal investigators or obtaining a prescription for medical marijuana for purposes of resale o providing it to a minor” could implicate Rule 8.4(b).
The Board did clarify, however, that Rule 8.4 (h) — engaging in misconduct that adversely reflects on the lawyer’s fitness to practice law — can be violated even when no other Rule is violated. Interestingly, the Board specifically cites to the case of Disciplinary Counsel v. Bowling, 2010-Ohio-5040, and describes that case as one where a magistrate was charged, but not convicted for marijuana possession under state law and violated Rule 8.4(h). However, in Bowling the parties actually stipulated that the magistrate violated Canon 2 of the former Code of Judicial Conduct by using marijuana occasionally to self-medicate after a stroke, and Disciplinary Counsel dismissed the alleged violation of Rule 8.4(h).
The Board’s caution that “repeated” use of marijuana is troubling in light of the fact that Ohio lawyers with chronic conditions would likely use medical marijuana on a repeated basis to manage the condition. In fact, the Board’s conclusion would allow a lawyer using marijuana once for the purposes of getting high to escape discipline, while a chronically ill lawyer could be disciplined for using medical marijuana under the treatment of a physician. Furthermore, it is not clear how an Ohio lawyer can own or operate a medical marijuana business in accordance with Rule 8.4 — for instance, is owning one business allowable, even though the business engages in repeated transactions?
In any event, the Board’s statement that Rule 8.4(h) can be violated even if all other rules are complied with should caution lawyers from owning or operating a medical marijuana business.
So where do we go from here? As stated above, the Chief Justice of the Ohio Supreme Court has indicated that the Court is aware of the issues presented by this advisory opinion, and will consider amendments to the Professional Conduct Rules later this month.
We’ve previously covered the topic of Ohio attorney professional ethics relating to House Bill 523 and the coming medical marijuana industry in Ohio. Well, today Ohio lawyers received the much-anticipated advisory opinion from the Board of Professional Conduct and it was…. less than encouraging.
I’m on the road coming back from an oral argument in central Ohio (I pulled over at a McDonald’s to write this, don’t worry), so I’ll hit the bullet points here and provide more in-depth analysis at a later time. Suffice it to say that the Board has chosen to follow the lead of the state’s that have drastically limited (if not outright prohibited) lawyer involvement in the marijuana industry.
From the opinion:
Under Prof.Cond.R. 1.2(d), a lawyer cannot deliver legal services to assist a client in the establishment and operation of a state regulated marijuana enterprise that is illegal under federal law. The types of legal services that cannot be provided under the rule include, but are not limited to, the completion and filing of marijuana license applications, negotiations with regulated individuals and businesses, representation of clients before state regulatory boards responsible for the regulation of medical marijuana, the drafting and negotiating of contracts with vendors for resources or supplies, the drafting of lease agreements for property to be used in the cultivation, processing, or sale of medical marijuana, commercial paper, tax, zoning, corporate entity formation, and statutory agent services. See also, Colo. Op. 125 (2013). Similarly, a lawyer cannot represent a property owner, lessor, supplier or business in transactions with a marijuana regulated entity, if the lawyer knows the transferred property, facilities, goods or supplies will be used to engage in conduct that is illegal under federal law. Even though the completion of any of these services or transactions may be permissible under Ohio law, and a lawyer’s assistance can facilitate their completion, the lawyer ultimately would be assisting the client in engaging in conduct that the lawyer knows to be illegal under federal law.
However, there is a range of conduct that the Board has deemed to be permitted:
[The current Rule] permits a lawyer to explain to the client the conflict that currently exists between state and federal law, the consequences of engaging in conduct that is permissible under Ohio law but contrary to federal law, and the likelihood of federal enforcement given the policies of the current administration. A lawyer may counsel and advise a client regarding the scope and general requirements of the Ohio medical marijuana law, the meaning of its provisions, and how the law would be applied to a client’s proposed conduct. A lawyer also can advise a client concerning good faith arguments regarding the validity of the federal or state law and its application to the client’s proposed conduct.
In addition to the permissible range of advice permitted under Prof.Cond.R. 1.2(d), the rule does not preclude a lawyer from representing a client charged with violating the state medical marijuana law, representing a professional license holder before state licensing boards, representing an employee in a wrongful discharge action due to medical marijuana use, or aiding a government client in the implementation and administration of the state’s regulated licensing program. With regard to the latter, lawyers assisting a government client at the state or local level in the establishment, operation, or implementation of the state medical marijuana regulatory system are not advising or assisting the client in conduct that directly violates federal law. The state or a local government is not directly involved in the sale, processing, or dispensing of medical marijuana prohibited by federal law, even though it is arguably enabling the conduct through the issuance of licenses and the maintenance of its regulatory system.
It appears, therefore, that until the Ohio Supreme Court amends the Rules of Professional Conduct Ohio marijuana businesses will be forced to operate without many of the kinds of professional legal advice that lawyers provide to clients in other industries. This result is simply untenable over the long term, given the regulated nature of the industry and the need for competent legal counsel.
I will follow up with an update on the course forward for Ohio lawyers and their clients in the medical marijuana industry.
A link to the full opinion can be found by clicking here.
I’m excited to announce that I will be one of the featured speakers at the Marijuana Business Daily Crash Course seminars taking place in Cleveland and Cincinnati next month, where I’ll have the opportunity to present and answer questions on the legal issues associated with retail dispensaries, marijuana processors, cultivators, and ancillary businesses in Ohio.
The Cleveland Crash Course seminar will take place on August 17 at the Doubletree Tudor Arms, with the Cincinnati seminar taking place on August 19 at the Kingsgate Marriott. Each seminar will begin at 10:00am and last until 6:00pm, including a networking lunch and networking cocktail reception following the presentations.
I’m honored to present alongside some of the most influential voices in the industry, including Robert Carp, Diane Czarkowski, Troy Dayton, Meg Sanders, Leise Rosman, and Chris Walsh. More information about the Crash Course seminars can be found below. If you register to attend one of the seminars, drop me a line in advance so that we can chat at the lunch or cocktail reception.
You can register for the seminars by clicking here.
You can learn about the featured speakers by clicking here.
You can view the Crash Course agenda by clicking here.
If you are at all interested in getting involved in Ohio’s coming medical marijuana industry, you should absolutely attend one (or both!) of the Crash Course seminars in Cleveland and Cincinnati. I hope to see you there!
More about Marijuana Business Daily:
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With the recent passage of H.B. 523, medical marijuana in Ohio will become a reality this September. Most people are familiar with the fact that the rule-making process will take some time, but Ohio attorneys are presented with a more difficult question: can we even advise medical marijuana businesses? To answer this important question, among others, I recently sought an advisory opinion from the Ohio Supreme Court Board of Professional Conduct Advisory Opinion Committee. The Committee will be considering these questions and the Board will hopefully issue an opinion before the end of the summer.
By way of background, all Ohio lawyers are bound by the Ohio Rules of Professional Conduct. Included within those rules is a prohibition against advising or assisting clients in conduct “the lawyer knows is illegal” (Prof.Cond.R. 1.2(d)) as well a prohibition against committing an “illegal act that reflects adversely on the lawyer’s honesty or trustworthiness” (Prof.Cond.R. 8.4(b)). These provisions are implicated because, while more than half of the country has legalized marijuana in some form, it remains illegal at the federal level under the Controlled Substances Act.
Ohio attempted to address attorney discipline in Section 3796.24(A) of H.B. 523, which provides that a professional license holder “is not subject to professional disciplinary action solely for engaging in professional or occupational activities related to medical marijuana.” The problem, however, is that attorneys are regulated exclusively by the Ohio Supreme Court, so it is not clear that the legislature can prevent the Court from imposing discipline against Ohio lawyers for violating the Rules of Professional Conduct.
I am seeking an opinion on three distinct questions:
Generally speaking, most states that have considered these issue have come down in favor of attorney representation of legal marijuana businesses, including Arizona, Colorado, New York, Washington (through the King County Bar Association), California (through the San Francisco Bar Association), and Illinois. A minority of states, such as Hawaii, have taken the opposite viewpoint. Connecticut’s opinion on the topic of advice to marijuana businesses offered little guidance, although Connecticut does allow for attorneys to use medical marijuana. In addition, Washington has approved attorney ownership of marijuana businesses and also attorney use of marijuana.
Guidance from the Advisory Opinion Committee has probably never been more imperative than when it comes to medical marijuana. Marijuana businesses not only have to navigate a complicated state regulatory environment, but also have to deal with the ever-changing federal approach to cannabis. Here’s hoping that Ohio lawyers have an advisory opinion sooner rather than later so that our role in this industry can have clarity.
Ohio is one of six states that have legal tests in place to determine if a driver is impaired by marijuana – but what do these tests really tell us? Not much, according to a recent study commissioned by the American Auto Association (AAA), the nation’s largest automobile club. According to their study it is not possible to set a simple blood-test threshold for THC (the chemical responsible for marijuana’s psychological effects). They insist that the tests have no scientific basis at all.
Determining whether someone is impaired by marijuana is far more complex than the simple tests that have been developed for alcohol. According to AAA’s CEO Marshall Doney, “In the case of marijuana, this approach is flawed and not supported by scientific data.”
Marijuana is not metabolized by the body in the same way as alcohol – there is no science that shows that drivers become impaired when their blood reaches a specific level of THC. It is possible for some drivers to remain unimpaired with relatively high levels of THC in their system. Others drivers with lower levels of THC in their system may be entirely impaired behind the wheel – and this inconsistency seriously discredits any universal THC standards for impairment.
A lot depends on the individual when it comes to marijuana. THC persists in the blood of frequent marijuana users long after use, while it dissipates more rapidly among occasional users. The current tests in place can only tell us if a driver has merely used the drug at some point – the presence of THC’s metabolites can linger in the body weeks after use. This could lead to the inappropriate conviction of drivers who are otherwise operating their vehicle safely. Further, the body processes active THC very quickly, so a driver may very well fall below the legal threshold before a blood test is administered.
Exactly how dangerous is driving under the influence of marijuana? It is about as dangerous as driving with a “noisy child in the back of the car,” according to Mark A. R. Kleiman, an NYU professor and specialist in issues involving drugs and criminal policy. By comparison, driving while using a hands-free cellphone quadruples the risk of an accident. Kleiman also noted that the average alcohol content in drunk driving cases renders you 15 times more likely to crash your car.
According to AAA – motorists are being convicted of driving under the influence of marijuana based on what seem to be arbitrary state standards that have no connection to whether the driver was actually impaired.
Yesterday the Ohio General Assembly completed its work on HB 523 by passing the final version of the bill to legalize medical marijuana in Ohio. The bill is now in front of Governor John Kasich, who has 10 days from passage to act on it. Should Governor Kasich not sign it, the bill would still become law and take effect 90 days after the Governor’s signature (or 90 days after the 10th day if he does not sign, but also does not veto the legislation). When reached for comment, Kasich spokesman Joe Andrews would not confirm that Governor Kasich would sign the bill, and only told Jackie Borchardt with Cleveland.com that “[h]e’s said if we need it and we got a good bill he’d be OK with it[.]” In the past, however, Kasich has signaled support for medical marijuana.
HB 523 allows for patients suffering from a number of conditions to use and possess a 90-day supply of medical cannabis in various forms, but there is a prohibition on smoking cannabis. The list of conditions includes:
Ohioans can submit petitions to the State Medical Board to include additional conditions later on. The final version passed by the General Assembly does have some differences from the substitute bill offered by Senator Burke during Senate Committee hearings. For example, the Committee modified the definition of eligible “pain” to include that which is either chronic and severe, or intractable — the prior version required pain to be chronic, severe and intractable, which would greatly limit the number of eligible patients. Second, the Committee removed the requirement for pharmacists to be present in dispensaries. Finally, the legislation splits the regulatory responsibility for the medical cannabis industry among three distinct agencies:
The Medical Marijuana Advisory Committee will recommend rules to these three agencies, and Ohio’s medical cannabis industry will be up and running within 2 years of the legislation’s effective date. For the full text of HB 523 as passed by the Ohio Senate, click here.
To be sure, this is not a perfect bill. It does not go as far as many advocates (including myself) had hoped. Among other things, the list of qualifying conditions is too restrictive, it gives too much unchecked authority to unaccountable political appointees, and the requirement that patients only possess a “90 day supply” of their medicine seems overly burdensome, especially considering patients who will likely have trouble making it out of their homes.
The real test begins once the three regulatory agencies begin writing the regulations. Will they allow innovation, entrepreneurship, and a vibrant industry that will provide safe and reliable access to cannabis for Ohio patients? Or will Ohio be like New York, with a system allowing for only a handful of dispensaries and a small number of registered patients?
It may very well be that the Ohioans for Medical Marijuana ballot initiative provides the best opportunity for Ohio patients to truly benefit from medical cannabis. HB 523 may, as critics argue, simply be too restrictive. But there is no real doubt that HB 523 is a step forward for Ohio patients. If you are somebody who has advocated for safe medical marijuana in Ohio for decades, then rejoice because your tireless efforts have borne fruit. But don’t celebrate too long, because the real fight is just beginning.
Stay tuned for deep dives into HB 523 and the rule making process going forward, as well as the progress for the Ohioans for Medical Marijuana ballot initiative.
In the wake of a medical marijuana bill clearing the General Assembly, a discussion of policy can begin to transition into a discussion of science. The legitimacy of cannabis as a pharmaceutical has created controversy for decades – this is thanks in part to state and federal regulations that make it extremely difficult to conduct clinical studies. However, with Ohio’s impending stamp of approval, it is anticipated that marijuana researchers in the state will be put on a longer leash. As a result, people can begin to look to the possible benefits of medical cannabis as a legitimate alternative to more traditional options.
Despite the strain to acquire clinical data on marijuana, there is a lot we do know. Several biological studies indicate that marijuana could potentially aid symptoms in a variety of medical conditions, ranging from epilepsy to cancer. Just a few of the potential benefits of cannabis include:
Continued research by scientists, doctors, and patients will explore the medicinal and therapeutic potential of pot, but the results thus far provide exciting prospects.
Newsweek, “Strong Medicine” p. 11-13
Today I had the opportunity to offer testimony on H.B. 523 to the Ohio Senate Government Oversight and Reform Committee, which is considering the medical marijuana bill passed by the Ohio House last week.
My testimony focused on the need for clarity as to precisely how (and how many) licenses will be granted by the State. Last year Ohioans rejected ResponsibleOhio’s cartel not because they opposed legalizing medical cannabis – in fact, current Ohio polling shows 90% of Ohioans favor it – but because they opposed the consolidation of market power in favor of 10 wealth investors. I am concerned that without sufficient direction from the Ohio General Assembly, the entity charged with awarding medical cannabis licenses will restrict the market so that we arrive at a similar level of consolidation.
Ohio’s medical cannabis industry is estimated to generate $100 million in annual sales, and a market of that size will function best when it is open to competition. Top-down planning does not work in any segment of the economy, and medical cannabis is no different. Over-regulation and market restriction will turn away entrepreneurs and innovators, and leave Ohio patients with poor access to the medicine they need. Consequently, I asked the General Assembly to ensure that applicants for medical cannabis licenses are judged by their own merit and the benefit they can provide to Ohio patients, as opposed to arbitrary restrictions from political appointees.
A version of my written testimony can be read by clicking here. (Full disclosure: I cleaned up a typo from the version submitted to the Committee. I would fire my copy editor for the mistake, but (a) he works for free, and (b) he’s me.)
In other news, Senator David Burke offered a substitute bill making a number of changes to the bill sent from the House. Here are some of the most notable changes:
There are some improvements in these amendments (the affirmative defense, reducing the timeline to license cannabis cultivators) but there are also some disappointing changes (removing the program to assist low-income Ohioans/veterans and offering a restrictive definition of “pain”). I am hopeful that the General Assembly will correct these issues as they continue to debate the bill.
All in all, this bill is an improvement over the current prohibition on medical cannabis in Ohio, but there are still items that should be addressed to ensure that Ohio’s medical cannabis industry is an open marketplace that will truly benefit Ohio’s patients. I’ll follow process of the medical marijuana bill as it continues to move through the General Assembly and keep you informed of all the latest developments in Ohio marijuana law.
Correction: an earlier version of this post indicated that a physician was necessary at the dispensaries at all times. That was a typo (again with the copy editor). The substitute bill requires a pharmacist to be present at the dispensaries.
It’s official – Ohio is on its way to becoming the 25th state to legalize medical marijuana. Today, May 10th 2016, the Ohio House approved a bill which allows for the use of marijuana in patients with qualifying medical conditions and a doctor’s recommendation. The legislation (House Bill 523) passed with a 71-26 vote. Now it heads to the Senate where it is expected to be approved quickly and on the governor’s desk by June. The bill is light on specifics, as it outsources much of the industry regulation to a nine-member commission that would have two years to write industry rules before qualifying patients can legally possess cannabis.
The bottom line: If you have a qualifying medical condition, an Ohio-licensed physician can recommend that you use marijuana for your symptoms. On top of that, if you are a parent or a caregiver you would not be arrested or lose custody of your children for using your doctor prescribed cannabis. Attorneys and other professionals would not be disciplined for providing services to cannabis clients. Further, this bill would urge the federal government to reschedule marijuana from schedule I to schedule II – a change that would catalyze clinical cannabis research.
But time to come back down to Earth for a moment – there are a few caveats in this bill to be mindful of. Smoking marijuana is still a no-go – your doctor would have to recommend an alternative method, like vaping, to consume cannabis. You are also not permitted to grow your own marijuana plants – the state would have to issue licenses for growing and selling the drug. And employers in Ohio retain the right to maintain a cannabis-free workplace. Patients using medical marijuana (even properly under state law) are subject to termination and would be rendered ineligible for unemployment compensation if terminated.
And Ohioans for Medical Marijuana is not standing down in its attempt to put a ballot initiative in front of Ohio voters this November. “It’s a shame lawmakers couldn’t have made history with a vote on a substantive and meaningful medical marijuana bill,” said Aaron Marshall, spokesman for Ohioans for Medical Marijuana. “Today’s vote will only bring false hope and empty promises to Ohioans suffering from debilitating conditions who need medical marijuana.” Marshall noted that the ballot initiative would allow for immediate use by qualifying patients through an affirmative defense and home grow clause.
All things considered – Ohio took a step forward today. But one has to wonder whether our elected officials will go far enough and provide Ohio with a well-regulated and well-functioning cannabis industry.
By mid-year the Drug Enforcement Administration (DEA) plans to reconsider marijuana’s classification as a Schedule I narcotic. In an April letter to several U.S senators, federal officials wrote that they hope to reach a “final determination” on rescheduling the drug – a decision that could be a defining moment for those involved in the legal marijuana industry. Schedule I is the most restrictive of the five ranks issued by the DEA. It is reserved for substances that have the highest potential for abuse and “no currently accepted medical use in the United States”. Graded alongside heroine and LSD, the DEA considers pot a dangerous drug with zero medicinal value.
The rescheduling of cannabis is necessary for a whole host of reasons. For starters, the current schedule I status of marijuana is out of touch with public opinion, scientific research, and state law. It has pitted federal authorities against states that have legalized medical marijuana. The schedule has prompted raids on growers and dispensaries that appear to be operating legally under state law. Seemingly endless bureaucratic hurdles discourage universities, hospitals, and individuals who wish to study marijuana. Most medical research of pot is prohibited. Further, schedule 1 is the only rank of drug that may not be prescribed by a physician under any circumstances under federal law. The denial of cannabis’s legitimacy as a therapeutic substance adversely effects tens of thousands of patients who could be utilizing it. Substances in schedules II and below are still subject to varying degrees of control, but unlike schedule I they benefit from medical recognition, research, testing, and safe manufacture.
People are increasingly skeptical of marijuana’s schedule – but the drug still remains very much illegal under federal law. The DEA has rejected petitions to reschedule cannabis 3 separate times. This is a not only a huge inconvenience for the budding and rapidly expanding marijuana industry, but federal regulation is also hindering much needed clinical testing. The DEA’s impending decision offers a glimmer of hope. Rescheduling certainly will not solve all of the marijuana industry’s problems – but it is a step in the right direction.