How to Handle Commercial Leases
with Green Tenants
Nixon signed the Controlled Substances
Act into law.
the drug's potential for abuse, accepted
medical use and dependence potential.
The worst offenders were assigned to
Schedule 1 high potential for abuse,
no currently accepted medical use and
no accepted safe use under medical
supervision.
Marijuana was and remains a
Schedule 1 drug.
the Compassionate Use Act to allow the
use of medical marijuana.
have since legalized marijuana for
medical or recreational use. Despite state
level legalization, it remains illegal at a
federal level for landlords to knowingly
lease or manage space for manufacturing
or distributing marijuana. Landlords
violating the Controlled Substances
Act face criminal penalties including a
20-year imprisonment, a fine of $2 million
and forfeiture of the landlord's real estate.
Attorney General David W. Ogden of
the United States Department of Justice
released a memorandum addressing
federal prosecution in states permitting
medical marijuana (the "Ogden Memo").
marijuana prosecution under the
Controlled Substances Act, stating:
traffickers of illegal drugs, including
marijuana, and the disruption of illegal
drug manufacturing and trafficking
networks continues to be a core
priority in the Department's efforts
against narcotics and dangerous drugs,
and the Department's investigative
and prosecutorial resources should
be directed towards these objectives.
As a general matter, pursuit of these
priorities should not focus federal
resources in your States on individuals
whose actions are in clear and
unambiguous compliance with existing
state laws providing for the medical
use of marijuana.
that although marijuana remained illegal
at the federal level, the Department of
Justice was unlikely to prosecute those
complying with state medical marijuana
laws. The Ogden Memo did not, however,
legalize marijuana nor represent an
official policy of the Department of
Justice it merely encouraged selective
enforcement. The Department of Justice
remained empowered to prosecute
landlords leasing space to marijuana
dispensaries, as shown in Marin Alliance
for Med. Marijuana v. Holder.
leasing space to marijuana dispensaries
operating in compliance with state
marijuana law. The U.S. Attorney's
Office demanded the landlords take
steps to discontinue their tenants' sale
of marijuana, threatening criminal
prosecution, fines, imprisonment and
forfeiture of the landlord's real estate.
The landlords sought to enjoin the U.S.
Attorney's Office from prosecuting based
on several theories of law, citing the
Ogden Memo. The Marin Alliance court
found for the U.S. Attorney's Office and
reaffirmed that marijuana remained illegal
at the federal level despite state law to the
contrary and that the Ogden Memo did not
legalize marijuana, was not a statement of
official policy, and was mere guidance for
the Department of Justice.
Even though the Department of Justice
can still prosecute landlords leasing to
state sanctioned marijuana dispensaries,
landlords remain eager to access the
Cohn P.C., where he handles corporate, land
use and real estate matters. He has assisted
clients ranging from developers to international
companies to small businesses.
20 Brace Road, 4th Floor
Cherry Hill, New Jersey 08034
856.354.0766 Fax
mhaviland@earpcohn.com