A New Cole Memo? How Corruption in Maine Could Shape Federal Law

When you have a problem with an intruder, you call the police. But when you have a problem with your household, you have a conversation. This sentiment neatly sums up the federal involvement in the recent controversy surrounding Lucas Sirois and his medical cannabis company in Maine.

While the court case is ongoing with local police, accusations of heavy political lobbying, and trafficking, today, we will examine the intersection of federal and state law and the implications this may have for the cannabis industry going forward.

As Colorado, Alaska, Oregon, and Washington took the first steps towards actualizing a national network of legal cannabis markets; each state entity was granted an opportunity to create legislation that worked for their people and systems. Intelligent infrastructure is required for these states and others to allow growers and wholesalers to connect and be reliably taxed and traced—similar to any alcohol state.

While compliance is a part of any growing industry, the tech systems that states have adopted have been criticized for several reasons—they are environmentally wasteful through single-track items like tags and packaging, prone to scaling issues, and widespread system failure.

To this last point of contention, these system shutdowns have been shown to impact retailers differently depending on the size of their business. These systems renew the question of who the industry should serve between economic, political, and medical considerations and how often the specter of federal persecution of “street drugs” still pervades in state-level courts.

As developments in Maine show, state autonomy in developing and monitoring legal cannabis sales will require a synergy between federal law and state regulations—a line that blurs as states mature at different paces.

The Cole Memo and Maine’s Industry Growth

The Cole Memo was introduced to curb federal involvement (and spending) in state cannabis cases by only intervening in cases where cannabis is being diverted to youth, criminal involvement in the market, or illegally diverted to other states—otherwise, cases will be determined by courts in regards to state-level compliance.

Steps in June were taken by the state’s Office of Marijuana Policy in proposing regulations to more closely track the flow of medical marijuana plants from “seed to sale.” These measures were sweeping compared to the 2009 regulations that small operators had built their business models around.

Related: Enough is Enough – It’s Way Past Time to Free Luke Scarmazzo

With the support of more than 2/3rd of lawmakers, it was determined that the state should not change its regulations without first consulting local cannabis advocates, medical cannabis groups, and business owners. Legislation blocking these regulation advances passed without the Governor’s signature.

A loophole is opened here—Maine’s regulations are lax compared to those in which federal investigators typically operate. This predisposition to prosecute to long-standing prohibition standards has brought a high degree of federal scrutiny to the doors of businesses such as those seen in Farmington, which serve thousands of clients compliantly within Maine’s regulations.

The federal case against Lucas Sirois persists today. This hunt for federal ruling on a state case seemingly contradicts the standard that is set out by the Cole Memo and suggests a dangerous precedent where federal funds may be spent investigating state-legal “crimes” despite the contravention of the Cole Memo.

While new regulations are needed to address loopholes and allegations of corruption in Maine, these should be the considerations of state entities—not federal prosecutors. To punish a compliant business owner due to the grey area that federal entities perceive between state and federal law would be a gross overstep of power and a misuse of funds.

In Maine, the intersection of federal and state law is blurring while the state scrambles to update compliance regulations in the face of community backlash.

A holistic approach that involves business owners, medical users, and lawmakers has been the will of the Maine people, as seen in the LD 1242 vote of June.

Should the government win it would mean that any and all compliance issues for state-legal cannabis businesses are now a crime. Should Lucas win it would be a major win for both state’s rights and operators across the country. This might seem like your average cannabis case, but in reality, it’s a line in the sand for operators, regulators, and the industry at large.