Sean Spicer, Trump’s press secretary, stated recently Trump’s AG Jeff Sessions will do more to enforce federal marijuana laws. He particularly has his eyes on recreational use. This appears to be a significant change from the AG and the DOJ under former President Obama. Specifically, Spicer said that Trump would be taking legal action against states that have legalized recreational use.
It appears that Trump takes a different view relative to the use of medical marijuana. If this is true, then States like Michigan will be free to pursue regulations allowing the cultivation, use and sale of medical marijuana. Because Michigan’s new Medical Marijuana Licensed Facilities Act sets forth an appropriate regulatory scheme, it is unlikely that the new AG will take legal action in Michigan. The same may not be true of states with a less developed regulatory scheme.
The prior administration took a relatively hand’s off approach to marijuana, allowing states to pass laws making either medical or recreational marijuana use legal. Trump recently indicated he would allow States to be more autonomous in certain areas, such as the transgender bathroom issue in public schools. Trump’s position on marijuana contradicts this approach.
Now, with the new administration, there remains a fair amount of uncertainty relative to the law enforcement environment, and this is keeping some investment dollars on the sidelines. Although investors are not able to apply for or obtain medical marijuana licenses pursuant to Michigan’s Licensed Facilities Act until the end of 2017, prudent investors have already begun planning. This statement by Sessions may make some investors Leary of the risk.
Investing in marijuana-related businesses has always been risky if only because marijuana remains totally illegal at the Federal level, and is still a category or schedule one drug in many states including Michigan. Ironically, schedule one drugs are those without recognized medical use and with a high addictive potential. Because of this marijuana business, and the money derived from them could theoretically be subject to civil forfeiture. The statements recently made by Sessions, however, may increase this risk to an untenable level for many investors.