Racketeering Law Being Used to Fight Back Against Marijuana Industry
A group that opposes marijuana dispensaries has found a loophole that allows them to use the RICO act to target dispensaries and any firms associated with them in a long-reaching law that targets racketeering.
The opponents of legal marijuana have found a loophole in current laws that allows them to target marijuana dispensaries, and even those slightly associated with the company. Opponents are using racketeering laws to effectively fight the industry, and the strategy is turning into an uncontrollable mess that lawmakers will need to address in the future.
An example of the abuse of the racketeering law can currently be seen in Colorado.
Medical Marijuana of the Rockies, a pot shop that sold weed, was sued by a group out of Washington. Using the current laws, the group was able to target any firms doing business with the company. The landlord and accountant of the shop are also being sued under the racketeering law.
Opponents are making life impossible for the pot shop and anyone associated with them.
The question is: who will work with pot shops when even doing business legally can result in being sued?
Federal laws still dictate that marijuana usage is illegal despite being controlled on the state level. The approach to using racketeering is new, and has dire consequences for all businesses running pot shops, or working in any form with pot shops. The RICO Act would also be in effect in this case.
In the event that the lawsuit proves valid, the two businesses that say the pot shop harmed their businesses will be able to receive three times the penalty amount.
Owner of the now-closed shop, Jerry Olson, was forced to sell his entire inventory at a steep loss, stating that he has been “buried” in legal costs. The lawsuit forced Bank of the West to close the owner’s account so that they would be dismissed in the lawsuit. The bank states that they have a policy that does not allow them to work with recreational marijuana businesses.
Even the bonding company that worked with Olson has paid $50,000 to be removed from the lawsuit.
Alternative Holistic Healing, another dispensary, was also targeted by the same group, but the company is fighting the lawsuit and going on with their daily business activity. The group that is targeting both dispensaries says that this is just a test and that they will continue to go after all dispensaries in the state until they have all been closed down.
Many weed websites, such as Weedy, have continual updates on the matter and are watching the lawsuits closely.
Even if the lawsuit is dismissed in court, the effects of suing Jerry Olson’s company have already proved that one lawsuit can lead to business ruin. Companies associated with marijuana dispensaries will be more reluctant to work with businesses in the industry.