The Wild East & Mushroom Root Beer
Plus: Suing towards interstate commerce.
The Broccoli Report
Monday, June 6, 2022
Time to read: 4 minutes, 59 seconds. Contains 997 words.
Good morning!
While I was away in far less cannabis-friendly environs, Rhode Island up and legalized adult use. Big news for our most petite state! The passage of RI’s legislation means that New Hampshire is the only state in New England that hasn’t fully legalized cannabis. It sure is looking like states are progressing towards federal legalization, whether the feds ever concede or not.
Before we get to the news: This Friday, we’re bringing back a reader favorite refreshed with a new round of perspectives.
One—if not THE—most shared, re-read, remembered Reports from 2021 was a roundtable asking four brands about their best marketing wins and biggest marketing regret. This Friday, CBD topical brand Weedsport, accessory brand Laundry Day, and edible brand Garden Society will spill the beans on their single most successful marketing moment—as in the move that ended up making them the most money. They’ll share what it cost, how it worked, and what that success meant to their brands—plus their biggest biffs. This will be another great one, but it’s only for paid subscribers.
One-Hitters: Cannabis News at a Glance
New York is in its gray market heyday, but how long can this pseudo-legal extravaganza of unlicensed lounges, legal public consumption, “snack shops,” and weed trucks last? Yet-to-be-licensed brands like Medly are already sponsoring fashion events. It’s a hell of a fun time for the cannabis-consuming community, but it may have unexpected consequences for these businesses. NY’s Office of Cannabis Management had sent out 52 cease-and-desist letters to sellers as of April 2022, indicating that letter recipients jeopardize their chances of securing a license. And the minute those licenses start rolling out, law enforcement will likely have a much easier, enthusiastic time cracking down on gray-area happenings. Enjoy it now, consumers and colleagues!
What about that lawsuit rumored to be filed against the government for not allowing interstate commerce? Big-dog multistate operators say they have retained superstar lawyer Davie Boies to represent them. (Boies represented the plaintiff in Hollingsworth v. Perry, which invalidated California Proposition 8 banning same-sex marriage, the failed health tech company Theranos, and Harvey Weinstein. Lawyers: a mixed bag.) The suit has yet to be officially filed, but we’ll be keeping tabs on it.
Broccoli just dropped Candy Cap Root Beer Delights: a sweet, sensory collaboration between Mushroom People and Rose Delights. They are made with foraged candy cap mushrooms, a 12-ingredient homemade root beer syrup, and guava flower CBD rosin from Hudson Hemp. Magical root beer-flavored forest sweets that sound more like something from Narnia? Yum!
Analyzing data from the Centers for Medicare and Medicaid Services in all 50 states from 2011 to 2019, Cornell University researchers found a decline in the volume of prescriptions targeting pain, depression, anxiety, sleep, psychosis, and seizures in states that have legalized recreational use.
Cannabis Amnesty, an organization working towards amnesty for all Canadians burdened by cannabis-related convictions, will benefit from Joints for Justice, an initiative launched by Entourage Health through its subsidiary Royal City. One dollar from every RC Joints for Justice pre-roll sold will go towards restorative efforts. Cannabis Amnesty also worked with creative marketing and communications agency Cossette on a short, memorable film called “Legalize Us” that shows the impact cannabis criminal records have on peoples’ lives.
On Thursday, drag artist LaGanja Estranga joins cannabis edu and delivery platform HiVi for I FEEL LOVE: A High Vibed Variety Show. The celebration, curated by Estranja for the queer community, starts at 6:00 p.m. somewhere in LA, with many beloved cannabis brands supporting.
Licensing processes, Delta-8 regulations, and residency requirements for legal operators vary from state to state, and just to add more complexity to the mix, each legal state tracks cannabis-licensing data in its own way. For example, Oregon maintains searchable databases of licensed and pending applications for licenses, while Arizona has a portal for individual businesses to check their status, without readily available public-facing lists of licensees. California’s Department of Cannabis Control (DCC) recently launched a data-visualization tool that organizes adult-use info from participating cities and counties in one place for the first time. As a state with hyper-specific rules and license caps per municipality, this is a game-changing tool for entrepreneurs (and journalists) tracking possibilities in multiple regions.
Speaking of progress: Illinois seems to be emerging from multi-lawsuit gridlock over residency requirements, retail application scoring, and pretty much every regulatory move the state has made. A judge lifted a court order blocking the issuance of 185 new business licenses for recreational cannabis stores, but things remain messy (what else is new?). The Illinois Department of Financial and Professional Regulation intends to hold three “corrective lotteries” in June to “ensure fairness for all applicants and correct any errors in the lottery process” for the 185 cannabis business licenses.
According to a recent survey by cannabis research firm New Frontier Data, 69% of people aged 18 to 24 prefer cannabis to alcohol. Caveats are in order, though. Per Bloomberg, the study included 4,170 current cannabis consumers and 1,250 nonconsumers—not exactly a representative generational sample.
On Tuesday, June 14th, a former IRS attorney and partner at cannabis law firm Greenspoon Marder will host a webinar to educate any business dealing with or preparing for a federal audit. The webinar will cover the history of 280E and BSA audits of cannabis companies, lessons learned from current tax litigation involving U.S. cannabis businesses, tax implications by company formation (e.g., S Corporation, C Corporation, LLC), the importance of Form 8300, as well as a live Q&A. This seems like a legit opportunity for folks with federal audit concerns to talk to a very expensive lawyer for free!
As someone without a yard or sunny balcony, I don’t have adequate sun to grow an autoflowering variety à la Cannabonzai, but at least I can enjoy this beautiful new tote.
To multifaceted gardens in every sense,
Lauren Yoshiko