Welcome to our end of the year wrap-up post for The Week in Weed; it’s hard to believe another year has come and (almost) gone, but the calendar doesn’t lie.  In what we are calling an homage to Dave Barry and his always hilarious Year in Review, we’ll organize these stories by month.

Without further ado, here’s a look at the stories that grabbed our attention in 2018.
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No. We are not there yet. Are we making progress? Maybe.

The biggest impediment to explosive growth in the marijuana industry is lack of access to banking and robust financial services. Because banks face the risk of prosecution for money laundering and aiding and abetting in drug trafficking, most banks will not bank marijuana-related businesses (MRBs).

Why would any bank risk prosecution by banking MRBs? In 2014, following the issuance of the Cole Memorandum, the Justice Department and the Department of the Treasury Financial Crimes Enforcement Network (FinCEN) issued non-binding guidance on how financial institutions could serve MRBs. (For a more complete analysis of the laws related to banking MRBs see our blog post here.) The FinCEN guidelines called for fairly intensive, ongoing and expensive due diligence of any MRB customers, to the point where the risk/reward ratio for banks became inverted—high risk (jail, loss of banking license), low reward (low profit margins).

While most banks thought the risks far outweighed the benefits of having MRB customers, some financial institutions, mostly local banks and credit unions, saw in the FinCEN guidelines an opportunity and quietly began offering depositary services to MRBs. According to FinCEN, in 2017 there were over 300 financial institutions providing some form of banking services to MRBs. However, the vast majority of business in the industry is conducted in cash. For many businesses that touch the plant, this makes profit and loss statements questionable, taxing authorities nervous, and potential investors dubious about valuations.

Since the publication of the FinCEN statistics, much has happened to banking related to the marijuana industry—some of it good, some bad, and some ugly. Let’s take them in reverse order.
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In a recent article, senior officials with the Department of Justice’s Office of the United States Trustee (the “UST”), the federal government’s watchdog of the bankruptcy system, reaffirmed the department’s position that bankruptcy relief is not available to businesses in the weed industry.  Such a reaffirmation of a well-established policy is not new. However, the article is noteworthy in that it clarifies just how broadly the UST is willing to expand the scope of that policy and that it may prevent “downstream” participants, such as landlords of marijuana dispensaries, from accessing relief under the bankruptcy code.
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It’s only the second week of January, and it has already been a wild year in the cannabis industry.  First, legal sales of recreational marijuana started in California, and then Jeff Sessions rescinded the Cole Memorandum.  What next?  Here are seven stories to follow in 2018.
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Welcome back to The Week in Weed, your Friday look at legalized marijuana.  And what a week it was!  From California’s legalization of recreational pot to the rescinding of the Cole Memorandum, this has been a roller coaster ride for the industry.

Let’s start with California’s legalization:

LOS ANGELES (AP) — California on Monday becomes the nation’s largest state to offer legal recreational marijuana sales.

For the Bay Area’s cannabis community, legalization means reckoning with capitalism never imagined in Haight-Ashbury’s “turn on, tune in, drop out”  ethos of the late ’60s.


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According to reports appearing this morning in the New York Times and the Washington Post, Attorney General Sessions is expected to rescind the Cole Memorandum later today.  The Cole Memorandum is a Department of Justice policy that strongly discourages federal prosecutors from enforcing federal marijuana laws in states in which possession and use of

The Trademark Trial and Appeal Board (“TTAB” or the “Board”) recently affirmed two refusals to register trademarks:

1) an intent-to-use trademark application for POWERED BY JUJU for “smokeless cannabis vaporizing apparatus, namely, oral vaporizers for smoking purposes; vaporizing cannabis delivery device, namely, oral vaporizers for smoking purposes”, initially refused based on a lack of bona fide intent to use the mark in lawful commerce; and

2) a use-based application for JUJU JOINTS for “smokeless marijuana or cannabis vaporizer apparatus, namely, oral vaporizers for smokers; vaporizing marijuana or cannabis delivery device, namely, oral vaporizers for smoking purposes”, initially refused based on lack of lawful use in U.S. commerce.
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As we reported last month, on October 17, 2016, Innovative Industrial Properties, Inc., a real estate investment trust (colloquially, a REIT) specializing in the acquisition, ownership and management of industrial properties leased to experienced, state-licensed operators of regulated medical use cannabis facilities, filed a registration statement with the United States Securities and Exchange Commission under which the company is offering up to 8.75 million shares at an initial public offering price of $20 per share.  The Company simultaneously filed to list its shares on the New York Stock Exchange.
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