21 January 2017
Here’s the introduction to the piece
Federal appeals court judges on Tuesday reviewed the reach of racketeering laws, chewed over case law and opined over olfactory issues in a case that threatens to stamp out Colorado’s recreational marijuana industry.
A three-judge panel for the 10th U.S. Circuit Court of Appeals in Denver took oral arguments in a consolidated case that claims Colorado’s recreational cannabis laws fly in the face of federal controlled substances and racketeering laws.
The states of Nebraska and Oklahoma joined the dispute after the U.S. Supreme Court declined to hear their case. The appeals also included a lawsuit from county sheriffs and another from a Pueblo horse ranch. The plaintiffs’ challenges were among several raised in and after 2014, when Colorado’s first-of-its-kind foray into regulated sales of cannabis didn’t sit well with all, especially neighboring states concerned about federally illicit substances spilling over their borders. Those complaints and the Nebraska-Oklahoma suit were eventually struck down.
On Tuesday morning, in a crowded, small, upstairs courtroom at the Byron White U.S. Courthouse in downtown Denver, attorneys and judges reviewed the reach of RICO and other federal acts and the impacts of marijuana cultivation on nearby properties.
“I went into the courtroom thinking that this was a slam dunk,” Matthew W. Buck, an attorney representing a half-dozen marijuana businesses named in the suits, said in an interview Tuesday afternoon. “And I came out of it thinking that it would be more of a toss-up.”
Buck said his confidence about the outcome waned after judges appeared to align with plaintiffs’ arguments that the wafting smell of federally illegal marijuana from the Pueblo cultivation facility to neighboring properties such as the horse ranch damaged property values. The impact of the greenhouse construction on sight lines from the property also was cited.
“(If this case were remanded to district court), it would effectively open the floodgates for every single dispensary and every single cultivation facility to be sued under federal court for RICO,” Buck said.
The Racketeer Influenced and Corrupt Organizations Act, oft-used in the implication of crime families and fraudulent financiers, also allows for private individuals to sue “racketeers” who allegedly damaged a business or property — in this case, property values. With RICO at the heart of its complaint, the entity backing the Pueblo County horse ranch also argued that the federal prohibition of marijuana overrides state law.
“Colorado is authorizing violation of the (U.S. Controlled Substances Act) through this licensing regime,” Brian W. Barnes, an attorney for plaintiff Safe Streets Alliance, told the judges Tuesday. Safe Streets, a Washington, D.C.-based anti-drug and anti-crime organization, took up the cause of the southern Colorado horse ranchers.
Asked by Judge Harris J. Hartz as to whether a change in enforcement policy on the federal level, perhaps from a new U.S. attorney general, would solve his concerns, Barnes said he would welcome such a change but added it would be a “bank-shot” enforcement action against a third party and would not get at the heart of the state laws that stand in opposition to federal laws.
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