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Law & Order

Los Angeles's Farmacy medical marijuana dispensary, Westwood branch. Credit: Kyle Jaeger.

Hit Job

An unusual DEA raid on one of LA’s most reputable medical marijuana dispensaries reveals the bewildering conflict between state and federal drug laws.

When an agent in plain clothes entered the pale green building off Santa Monica Boulevard in West Hollywood, it was early—around 10:30 in the morning on October 23, 2014, not a peak hour for the medical marijuana business. He gave the signal and members of a special task force under the Drug Enforcement Administration stormed the Farmacy’s entrance SWAT-style, some from around the corner and others from an unmarked gray pickup truck parked outside. Across Los Angeles, it was the same story: DEA agents executed federal search warrants against the collective’s Westwood location. As the team seized thousands in cash and cannabis, staff were detained inside, dumbfounded.

There were no arrests, but the message seemed familiar, one the agency has repeatedly conveyed to caregivers around the country by way of enforcement action and official statements: Feds rule, states drool, and marijuana isn’t medicine.

In 1996, California voters passed Proposition 215, a historic measure that called for the legalization of medical marijuana under a state-run regulatory system. It wasn’t the perfect law—a series of amendments have since reshaped the Compassionate Use Act, clarifying policies of compliance and enforcement that some lawmakers regarded as vague—but it was an unprecedented step forward for the pro-pot movement. For almost 20 years, California adults have been able to access medical marijuana under a doctor’s recommendation with relative ease.

As far as the federal government is concerned, however, the legal status of cannabis hasn’t changed. It is still a controlled substance—illegal to grow, possess, use, or distribute in the United States. Because federal law takes precedent over state law, efforts to regulate California’s medical marijuana industry have often been complicated by these policy conflicts, marred with miscommunications between the Justice Department and local agencies.

 

The receptionist at the Farmacy’s Westwood branch, a middle-aged man with a shaved head, looked at me apologetically and shrugged. I hadn’t heard the news. It was around noon on October 24, and he’d already been there for a couple hours, slumped over an unlit desk. Long and narrow, the store used to be a place where New Age parents would stock up on Chinese medicinals—dried roots, fungi, and plant extracts that were stored in the same gridded drawers, birch wood etched with Mandarin characters, which the Farmacy later repurposed for its own holistic products. But now those drawers were empty.

He didn’t answer my questions right away; rather, he’d turn and stare at the tall windows or down the hall, which tapered to a dim point by the back door. There wasn’t much left to see inside; the DEA had taken about everything, save two or three stacks of self-help books, office supplies and decor, and assorted minerals (amethysts, jade, pale pink rose quartz) for crystal healing. The receptionist was only there to let members know what had happened and then refer them to alternative shops. The Farmacy would reopen as soon as the shelves were restocked, he assured us.

It wasn’t a question of if, but when. “What was the point then?” I wondered out loud. He shrugged and stared blankly ahead.

 

Back in 2005, Farmacy cofounder JoAnna LaForce set out to do something different. A Southern California native, LaForce was a registered pharmacist who had worked at a hospice for 15 years. Her ex-husband, Michael Ommaha, an “elusive hippie” whose list of marijuana-related offenses once earned him a five-and-a-half-year stint at San Quentin, wanted to open a medical marijuana dispensary in West Los Angeles. He badly needed a business partner, though, who was familiar with the product and also knew how to build a brand. As it happened, his first choice, LaForce, was “happy to help” and accepted the offer straightaway.

The transition from hospice to collective, from pharmacist to caregiver, was natural. LaForce had seen “the value of alternative medicine, particularly cannabis, in helping with appetite, pain management, and anxiety” for terminal patients enrolled in hospice. “I found that I could use cannabis to decrease the pain medication, which in turn made patients able to spend their last days talking to their friends, spouses, to share good times,” she told David Samuel in a New Yorker article, “Dr. Kush.”

Feds rule, states drool, and marijuana isn’t medicine.

The transition was natural, but it was not easy. Three years after its West Hollywood debut, the Farmacy was raided by the DEA. Like many marijuana businesses in the jurisdictional gray area between state and federal drug laws, the pot shop was denied a credit line, so they had to deal in cash. LaForce—who turned 55 on the day of the bust, January 17, 2007—said masked agents took $60,000 and what amounted to $250,000 in cannabis. The federal agency left a receipt for “only $42,000,” she told Martin A. Lee, who wrote about the collective in his 2012 book, Smoke Signals: A Social History of Marijuana—Medical, Recreational, and Scientific. “They raided and pillaged,” LaForce said.

The Farmacy was one of 11 dispensaries raided that day in a multi-agency sweep that set a state record for single-day enforcement action against medical marijuana businesses. Justice Department records indicate that 5,000 pounds of cannabis had been seized that day. But if LaForce was right, then the real number is anybody’s guess.

What they lost—how much they lost—didn’t matter. Two days after the citywide crackdown, the Farmacy was open for business again. It was an act of “civil disobedience,” as LaForce put it.

“The Farmacy was at the forefront of a belated surge of dispensaries in Los Angeles,” Lee writes. “Upscale but modest,” the collective quickly grew in size and popularity, expanding from Westwood outward to Venice. And as it grew, LaForce became an authoritative voice in the industry. “Like health food and hip-hop, cannabis was going corporate,” Lee writes. It was a market that LaForce had barely tapped; and then, there she was: a bona fide cannabis executive who’d soon become an important industry representative, speaking at conferences around the United States and to best-selling authors and reporters at Rolling Stone and the New Yorker. It certainly seemed like the medical marijuana business had corporatized, with LaForce acting as CEO.

 

I’d been a member of the Farmacy for over a year, but I was more confused than distressed about the 2014 closure. I’ve had favorite dispensaries shut down before. It’s part of the dispensary community experience in California, showing up at the front door only to learn the shop has been vacated. But it was unusual for the feds to be involved, and I wanted to know why.

I left the lobby and the receptionist, walked a half-block, and turned right onto Le Conte Avenue where, tucked between a sports bar and the Los Angeles branch of Jews for Jesus, a door with a faint green cross marks the entry to Westwood Village Collective—not to be confused with the Westwood branch of the Farmacy. It’s the other dispensary within walking distance of UCLA—a cheaper option. A 20-something with wiry black hair took my driver’s license and verified that my doctor’s recommendation letter was up-to-date. I filled a foam cup with water from the cooler and tried to make small talk. I thought he might know something about the Farmacy, but no such luck.

The magistrate that authorized the DEA’s search warrants for the Farmacy raid also sealed the orders.

The employees there were always half-asleep, in any case. The lobby was cramped and stale, with a pungent smell that was mysteriously unlike marijuana. I got a gram of King Louis XIII, a top-shelf indica. It was dry, approaching the sell-by date—OK for them, but not for the Farmacy. And that’s the takeaway, so to speak: There are at least 410 registered pot shops in Los Angeles alone. But the Farmacy stood out, and not just for the quality of its product.

Over the last 10 years, the collective has been recognized by community leaders, law enforcement officials, and policymakers around the country as a model of compliance in the industry. After the January 2007 raid, attorney Manuel Klausner, co-founder of the libertarian Reason Foundation, wrote an editorial for the Los Angeles Times condemning the DEA for going after the Farmacy, one of “the best-run dispensaries in West Hollywood” and “a leader in treatment and education.”

“Reform is overdue,” Klausner contended. “It should be an urgent priority for our new Congress to stop the Justice Department from arresting or harassing sick people in the 11 states who have the legal right to use medical marijuana.”

 

Eight years later, Congress has only just begun to show interest in pursuing the kind of reform Klausner seeks, with the April 19 introduction of a bipartisan Senate bill that would legalize medical marijuana across the country. The Farmacy raids make up a fraction of cases that reveal the difficulties that federal agencies like the DEA have caused for medical marijuana providers in recent years. There are now 23 states where marijuana is legal for medical use (and four for recreational, plus the District of Columbia); and yet, even as such marijuana-tolerant measures continue to pass in state legislatures, the Justice Department continues to prioritize the enforcement of Drug War-era marijuana policies.

LaForce doesn’t know why the Farmacy was targeted last October, but thinks that the collective’s size might have been a factor. “We were so surprised because we had adhered to everything,” she tells me. They had moved the locations of two dispensaries, in Westwood and Venice, in order to comply with local regulations, and they even worked with oncology researchers on studies related to the potential medicinal benefits of marijuana for people with cancer. She was particularly surprised that it was a federal operation, she says. “We paid all of our taxes and there’s never been an IRS investigation on us… so that’s the only thing that I can think of.”

The DEA won’t say: The magistrate that authorized the search warrants also sealed the orders. When I asked DEA spokesperson Vijay Rathi why the agency had targeted the collective, he could only confirm that the actions were carried out “unilaterally” by the agency.

“Beyond that, I cannot provide any additional details, as DEA cannot confirm or deny the existence of any ongoing investigation,” Special Agent Rathi says. He referred me to the Cole memo, which is meant to set guidelines for marijuana-related enforcement protocol. “While the DEA is bound by the memo, we do not initiate investigations at the direction of any entity. We make an independent determination based upon the credible intelligence gathered about a drug trafficking organization and its impact on the community at large.”

The Cole memo, issued by Deputy Attorney General James Cole in 2013, reaffirmed the Justice Department’s commitment to the administration of federal law as stipulated in the 1970 Controlled Substance Act (CSA)—a Nixon-era statute classifying marijuana as a Schedule I drug with a “potential for abuse” on par with heroin—and stated that the Department reserves the right to use “its limited investigative and prosecutorial resources to address the most significant threats in the most effective, consistent, and rational way.”

Excess funds seized by federal authorities are deposited into a DOJ rainy-day account.

The memorandum lists eight enforcement priorities. If the DOJ determines that a collective has distributed marijuana to minors, for example, that could be cause for intervention. If it uses “state-authorized” business practices as a “cover or pretext” for illegal activities—or if the agency finds evidence of revenue going to criminal enterprises—those, too, are reasons to act. Dispensary owners can’t divert cannabis products to unauthorized states, and they have to make sure that it’s not being grown on public lands or even possessed on federal property. Violence and firearms shouldn’t be involved in the “cultivation and distribution” of marijuana, Cole writes, and the agency won’t tolerate drugged driving, either.

What the Cole memo’s priorities do not include as a red flag is the size of an organization. Nevertheless, large collectives targeted explicitly for their size before the memo was issued continue to face DOJ challenges. The most prominent example is that of Harborside Health Center in Oakland—believed by many to be the country’s largest medical marijuana dispensary. In July 2012 U.S. Attorney Melinda Haag brought charges against Harborside because, Haag said, “superstores like Harborside” are more likely to “abuse” state laws and put “marijuana in the hands of individuals who do not have a demonstrated medical need.”

Despite the shift of priorities subsequently laid out by the Cole memo, the Harborside case is ongoing and now being argued before the U.S. 9th Circuit Court of Appeals, suggesting that the DOJ’s new enforcement policies have been slow to take effect.

Whether or not the Farmacy’s size played any part in the decision to take federal action, as LaForce surmises, the legal marijuana industry is uniquely vulnerable, says Kris Hermes, a spokesperson for Americans for Safe Access, a leading medical marijuana advocacy organization. “It takes very little work on the part of the Justice Department to establish probable cause or to investigate whether or not they should prosecute because all of these businesses are really low-hanging fruit for the federal government in terms of its enforcement practices.”

Mark Kleiman, a former top criminal policy official at the Justice department in the early ‘80s who now studies marijuana policy issues at UCLA, has less sympathy for the marijuana industry’s difficulties. “In California, medical marijuana is a joke. A lot of these dispensaries—I don’t know the particular one you’re referring to—but there are dispensaries in LA that give you discounts if you buy by the quarter-pound and have signs that say, ‘Please don’t resell on the sidewalk outside.’ These are wholesale dope dealers,” he says. “If DEA asked me how to do this, I’d say work with LAPD, have them call out the people that are being a problem and shut them down.”

I figured I might have a better shot at getting answers through the agency’s Freedom of Information Act unit. I submitted a request last November seeking any records related to the October 23 raids. In an acknowledgment letter dated December 3, 2014, I was advised that “unusual circumstances apply” to my request because the agency would “need to search for, and collect, records from field facilities.” Due to the backlog of requests, however, they didn’t expect a determination to be made within 30 working days—the standard amount of time for cases with “unusual circumstances.” As of press time, I have yet to receive an answer.

 

LaForce’s 2007 allegation that the DEA wrote a receipt for approximately one-sixth of the value she claimed had been seized made me wonder if the Justice Department had an economic interest in sustaining a policy of marijuana-related enforcement in order to benefit from asset forfeitures.

Last year, the Washington Post ran a multi-part investigative series, “Stop and Seize,” which revealed how improper use of funds by law enforcement agencies had been normalized across the country, a system that developed out of lucrative forfeiture programs enacted in 1970. Asset forfeiture is the process by which law enforcement agencies seize and sell property associated with criminal activity, including that of the medical marijuana industry. It can be tacked onto, or used in lieu of, criminal prosecution.

“Hundreds of state and local departments and drug task forces appear to rely on seized cash, despite a federal ban on the money to pay salaries or otherwise support budgets,” the authors wrote. Audit reports indicate that the Los Angeles Police Department alone had participated in over 2,300 civil forfeiture cases since 2001—with $86.1 million worth of assets seized, $18.4 million returned to the department, and $5 million spent on a new helicopter. According to my own reporting, the same is true on the federal level: Excess funds seized by federal authorities are deposited into a DOJ rainy-day account.

“The practice has been controversial since its inception at the height of the drug war more than three decades ago,” the Post adds, “and its abuses have been the subject of journalistic exposés and congressional hearings.”

According to a Congressional Research Service report on selected legal issues of state legalization released last year, “Although an interested party may object to the seizure, given that such facilities are in clear violation of federal law, so long as the property is indeed being used for marijuana-related activities, it would appear unlikely that many successful challenges to these actions could be waged.”

“Last time I checked, committing a federal felony was not legal.”

This conflict between state and federal law puts marijuana proprietors in a constant state of uncertainty. The state laws that authorize them to operate—the growers, cultivators, distributors, and dispensary owners—nevertheless do not supplant federal law. Your shop’s compliance with local and state laws doesn’t mean the DEA won’t come around with a search warrant and clean you out.

I asked both Hermes and Kleiman what they thought about my asset forfeiture hypothesis.

“It’s possible that some U.S. attorneys undertook civil actions against landlords and dispensaries in order to accumulate assets and money for themselves and for the government,” Hermes says, but he stops short of calling it the driving force. “It’s flat-out an effort to undermine the proliferation of medical marijuana laws across the country.”

Kleiman, who argues against state-level legalization, is also unconvinced, saying that it couldn’t be true because the surplus from forfeitures went into a “general fund.” The DEA gets funded through appropriations, he tells me. “If they think that cannabis enforcement gets them more money from Congress, then that would be a motivation. But my guess is that the opposite is probably true. No, I think the DEA is doing this because they think cannabis is a dangerous drug.”

But what about the Farmacy? Of the hundreds of dispensaries in Los Angeles, the Farmacy not only complied with state law, but it had even implemented its own quality control mechanisms long before California developed the regulatory legislation governing medical marijuana safety.

“Look back at the Cole memo. ‘We will continue to go after large-scale, for-profit enterprises,’” Kleiman says, paraphrasing a passage from a 2009 version of the Attorney General’s policy guideline. “[The DEA goes] after large-scale, for-profit enterprises and everybody’s surprised. Why? They’re doing exactly what they said they’d do!” Kleiman reasons that it’s because Americans for Safe Access and “the rest of the industrial racketeers” presented the memorandum as an “everybody-into-the-water signal.”

“Having misrepresented what the Justice Department said, they’re now claiming the Justice Department isn’t doing what they said.”

Kleiman doesn’t deny that elements extracted from cannabis have potential value for patients suffering from certain conditions, such as those LaForce treated in hospice, but he emphatically rejects the idea that the state of California can legalize marijuana in violation of federal law. Compliance with state and local laws, reputation with communities, positive feedback from members—none of these factors offer compelling reason for the DEA to back off any particular dispensaries, he says. “Last time I checked, committing a federal felony was not legal.”

“You build an institution on arresting and prosecuting people, especially for marijuana. And it’s difficult to break that habit.”

The Justice Department tends to agree, and it hasn’t had much pushback, either. Though President Obama called for the decriminalization of marijuana as an Illinois state lawmaker in 2004, and even just this year remarked, “I think carefully prescribed medical use of marijuana may in fact be appropriate and we should follow the science as opposed to ideology on this issue,” there has been a sharp rise in DEA enforcement action under his administration. According to Americans for Safe Access, the agency conducted 528 raids between 1996 and 2013. No less than 270 raids have occurred in the years since Obama took office.

“For the last 40-plus years, we’ve been engaged in an all-out attack on marijuana and other drugs in this country, locking up a record numbers of people—far more than any other country in the world,” Hermes says. “That comes with a consequence: Not only are you ruining people’s lives, but you build an industry, you build an institution on arresting and prosecuting people, especially for marijuana. And it’s difficult to break that habit.”

Westwood Village sits in the shadow of a white high-rise off Wilshire Boulevard, a 20-story structure known simply as the Federal Building. Across the street from Veterans Memorial Park, where rows of granite headstones undulate over the crests of grassy hills, the Federal Building rests on less than one square mile of unincorporated land. Within its shadow, the Farmacy’s Westwood branch had quietly operated for years under the constant threat of an unpredictable bureaucracy.

The Farmacy reopened its West Hollywood location on November 22—less than a month after the raid. In Westwood, the shop remained vacant through the end of the year. When it finally reopened in February 2015, I stopped by to investigate. It looked as it always had: same products, same menu, same staff with the same cheery security guard posted in the lobby. My information was still in the system, the cashier said, but this was now the Westwood Collective. I called the other locations and heard similar accounts: In Venice, it was being called the Rose Collective, and in West Hollywood, they had renamed the flagship shop Cannacology. But aside from the names, nothing seemed to have changed.

“We had other people take over the management of it,” LaForce says. “We were tired. We’d given up the fight.”

Perhaps the new owners realized they weren’t up for the challenge, either. In late February 2015, only a few weeks after the reopening, I found brown sheets of paper had been taped to the windowpanes, concealing the store’s interior.

I didn’t need to see inside to figure out what happened. On the door, there was a piece of printer paper with a hastily written note that read: “We are sorry to inform you that we are permanently closed. Thank you for the years of support.”

This was the point.

Kyle Jaeger is a journalist based in Los Angeles, formerly with VICE and the Hollywood Reporter. More by Kyle Jaeger