Experienced Legal Defense, with Industry Expertise
Litigation in the cannabis industry is complicated. This new frontier for Oregon is constantly changing, adjusting to state regulations and reacting to the plant’s still-taboo image in the eyes of the federal government.
Recreational marijuana use officially became legal in the state on July 1, 2015, with the first retail licenses issued on October 1st of the following year. The marijuana retail industry in Oregon is quite new, and is still considered to be in the experimental phase of legalization. The state government is still trying to determine the best processes for each component of the business, from taxation to seemingly mundane details like packaging laws. Nearly every factor of cannabis sale is strictly regulated, and always being revised.
Attorney Michael Hughes offers a unique perspective to those in the marijuana industry. As a cannabis producer himself, with years of experience in business law and agricultural law, Hughes understands the intricacies involved in producing and selling cannabis.
If you need assistance managing the ever-changing bureaucracy of cannabis cultivation and sale, contact Hughes Law. Request an appointment online or call (541) 667-9567 to schedule a consultation.
Navigating the Complex Cannabis Business
The freshness of the industry and its variable status between states and the federal government put the cannabis business in a unique place legally, as compared to standard business law. Of course, starting any business will involve building permits, tax law, product transportation, employment processes, and other regulations. However, these basic business practices become complicated in a new industry where interstate cooperation is not possible and strict laws are in place.
Your business may face litigation if found to be in violation of start-up laws concerning licensing and building codes. These kinds of violations can result in legal action by the Oregon state government. Consequences in these types of cases are often financial, but can end in the outcome of a lost license.
Copyright law is another legal area to keep in mind when entering the cannabis industry. Business and strain names, branding, and merchandise are all subject to copyright infringement suits. Copyright is a complicated issue and is often determined on a case-by-case basis, as perceptions of what is considered to be similar branding can differ. A good rule is to avoid anything that resembles the intellectual property of another business. If your business is accused of copying another, an attorney can build a case around your intent with the branding, its actual similarity to the opposing party, any industry conflicts, and the likelihood of consumers actually mistaking one business for the other.
Cannabis Cultivation and Land Regulations
Cannabis cultivation, like all agricultural production, is subject to farming and land use laws, in addition to industry-specific regulations.
At the base level, you will need an agricultural land use permit. It is important to note that a permit is needed for outdoor and indoor growing operations. You may enter litigation in the process of trying to obtain a permit from the locale in which you are operating. Although it is legal in Oregon, certain cities and counties do have the option to ban the growth of cannabis in their district, and some local governments have chosen to do so.
As stated, cannabis laws change frequently. This extends to local zoning laws, which can change to prohibit cannabis cultivation even after businesses have already been established in that area. A turn to cultivation prohibition does not necessarily mean existing businesses have to immediately shut down. Depending on the area, the lawful permit of a business before prohibition may be enough to stay intact. Some places require that a business is “developed” at the time of prohibition in order to continue operating. The definition of “developed” varies between districts.
If you cultivate cannabis in an area where the right to do so is in question, you should evaluate the details of the laws, and see what your business needs to do to stay afloat. An experienced cannabis lawyer can build a case for your business’s status as lawful and developed, defending your company’s legitimacy to local government.
Cannabis and the Oregon Liquor Control Commission (OLCC)
Cannabis sales in Oregon are under the jurisdiction of the Oregon Liquor Control Commission. Base laws for the retail sale of marijuana are similar to that of alcohol, of course with the added cannabis-only regulations as well.
Like liquor sales, cannabis retailers need a license to sell. These licenses rely on the cooperation of business owners to follow the rules set in place by the OLCC. Any violation of OLCC rules can result in license suspension or revocation. It is critical to stay aware of OLCC regulations and any changes to those rules.
The Oregon Liquor Control Commission strictly disciplines those who violate licensing laws, especially repeat offenders. For those who have minimal transgressions, there is a possibility to appeal your case and decrease consequences.
Employing the assistance of an attorney will help to keep you compliant with the often unstable legal landscape of cannabis licensing. If your business has violated any OLCC regulations, a lawyer is a fundamental resource. An OLCC infringement may require a lawyer’s assistance to manage settlements with the organization and minimize legal fallout for your business.
Adherence to Hemp and CBD Laws
Hemp and CBD-infused items, although they are cannabis products, do not technically qualify as marijuana because of differences in THC levels. As they are in a different category, but still considered cannabis, hemp and CBD products are subject to their own regulations.
However, hemp and CBD are not nearly as strictly regulated as marijuana. Online retailers of hemp and CBD products enter the legal gray area of cannabis product law in states where recreational marijuana is illegal.
Beyond violations of state cannabis law, defective product lawsuits are potential legal consequences that can arise from the sale of hemp and CBD products. Lack of regulation has resulted in the manufacturing of products that contain additional, non-cannabis ingredients and misleading advertising in the space. The exaggeration of the medicinal properties of CBD is common. Although there is little government regulation, it is important to hold your own business to standards of monitoring the safety of your products, and clarity of your advertising.
The results of a defective product case can be financial or license revocation, depending on the scale of the issue. Businesses with supposed defective products can respond to accusations by adjusting their recipes or recalling products completely.
Work With Hughes Law
Our Oregon cannabis attorney provides expert business counseling for people entering the industry, as well as trial defense for established companies. The support of an experienced cannabis lawyer is essential in this growing industry.
If you are a cannabis industry professional in need of legal advice, contact Hughes Law to schedule an appointment. You can fill out a request form online or call us at (541) 667-9567.