Blog

Oregon Will Make it Easier to Find Cannabis Business Owners

Privacy for Oregon cannabis businesses just got tougher

People who own businesses often try to keep their names off state-controlled websites and other public registries, to the extent possible. There are various reasons for this: the owners may hope to avoid receiving tax and legal documents in front of clients, may wish to avoid media inquiries, or may simply cherish their privacy. With cannabis businesses, owners have a whole slew of reasons for wanting to maintain their anonymity. In Oregon, however, that is about to become a bit more challenging due to House Bill 2191, which takes effect on January 1.

To be clear, under Oregon state law, information related to marijuana business applications and ownership has always been subject to disclosure via an ordinary public records request. Those requests are easy to make in Oregon, and almost always cheap or free. There are some exemptions to the disclosure rule, but they relate mostly to security. Business ownership status is not a security concern, according to the Oregon Liquor Control Commission (OLCC). That said, public records requests are targeted in nature to a specific business or other matter, and it’s hard to do a quick sweep if you are looking for a certain someone. The online Secretary of State business search page, by contrast, allows anyone to simply type in the target individual’s name, and get immediate results.

Most law firms, like ours, offer registered agent services for their business clients. These services come at a standard fee, and one attractive feature is that the law firm will list itself as the point of contact for official documents, thereby shielding the names of business owners. In Oregon, an owner did not have to be listed at the initial registration in the case of an LLC, historically; and in the case of a corporation, neither shareholders nor officers needed to be listed. On renewal, the standards were a bit tighter, but overall, most business owners were able to remain discrete, like in Delaware and other states. That will be harder now.

Under HB 2191, an individual with direct knowledge of business operations and activities must be identified on the articles of incorporation/organization (including amended, restated, conversion and merger filings). In the case of a corporation, that person may be a director or controlling shareholder; in the case of an LLC, that person may be a member or manager. Alternatively, either type of business can list “any individual that has direct knowledge of the operations and business activities.” Anyone forming a marijuana business and hoping to remain discrete had better find a partner who is willing to be listed.

HB 2191 also adds a requirement that any new company list its principal place of business, rather than a P.O. Box or other address, upon incorporation. This mirrors the I.R.S requirement, and the principal place of business “must be a physical street address” rather than a commercial mail-receiving agency, mail forwarding or virtual office. This new rule probably won’t bother anyone running a dispensary, but producers, processors, and wholesalers may not be so keen on the change.

HB 2191 is a rare example of an Oregon law that affects cannabis operators but did not go into effect immediately on passage. Unlike many other new laws that passed in the last session, HB 2191 is not specifically targeted toward the cannabis industry and wasn’t a “quick fix” in nature. Still, pot business owners should be aware that their information is about to become more searchable. Heads up.

Read more

Colorado Revenue Department Releases ‘Highly Desired’ Data Trove

The Colorado Department of Revenue is now releasing the state’s cannabis sales data from Jan. 2014 to the present and will release monthly reports going forward on the seventh business day of each month.

The Revenue Department’s Office of Research and Analysis will produce the reports which will show gross sales minus wholesale sales for retail and medical cannabis shops county-by-county.

“We know this information is highly desired by the general public, media and researchers. To that end, in our efforts to be as transparent as possible, we will now provide aggregate sales data. That, coupled with state tax revenue data already provided, will give an accurate picture of the financial footprint of this burgeoning industry.” – Mike Hartman, executive director of the Colorado Department of Revenue, in a press release

According to the data already released by the department, Colorado sales have reached more than $1.2 billion so far from January to October and will likely exceed 2016’s total sales of more than $1.3 billion by year’s end. The report shows that since legalization in 2014, cannabis sales have exceeded $4.2 billion.

The state’s monthly sales data shows that retail sales in the state peaked last July – to about $140 million – but fell slightly in September to about $130 million.

Read more

Aurora Cannabis and CannaRoyalty Close to International MMJ Tech Deal

Canadian cannabis firms Aurora Cannabis and CannaRoyalty have signed a letter of intent which would give Aurora exclusive rights to MüV brand products – to which CannaRoyalty holds the licensing rights – in Canada, Europe and Australia.

The products covered under the agreement include:

MüV Metered Dose Inhaler MüV Transdermal Patch CBD Sports Gel CBD Hydrating Lotion THC Sports Gel THC Hydrating Lotion THC Pain Relief Cream

The products are developed by CannaRoyalty investee AltMed Enterprises. CannaRoyalty holds an 8.3 percent equity stake in AltMed, along with licensing rights for MüV products in carious jurisdictions. AltMed is headquartered in Sarasota, Florida.

“This agreement with Aurora represents a significant opportunity to accelerate the growth of AltMed’s award-winning MüV product line on an international scale, leveraging our relationship with one of the world’s most dynamic cannabis companies. The MüV line meets the growing need for specialized products with alternative delivery mechanisms, especially in critical jurisdictions, such as Canada and Germany, where consumers to date have been limited in terms of product choice.” – Marc Lustig, CannaRoyalty CEO, in a press release

The letter of intent gives Aurora exclusive rights for 90 days to negotiate a final agreement.

Read more

Cleveland School of Cannabis Receives State Approval

The Cleveland School of Cannabis, formally known as Cleveland Cannabis College, has received approval from the Ohio Board of Career Colleges and Schools – making them the first school east of Colorado with state-approved career programs.

The board approved all four programs by the school – Cannabis Business, Cannabis Horticulture, Medical Applications of Cannabis, and Cannabis Executive –  contingent upon an occupancy permit from the city, which is expected this week. The certificates offered by the school are considered the same level as an accounting certificate, real estate certificate, paralegal certificate, among others.

“As an educational facility that is working to advance the study and understanding of cannabis in our country today, we are incredibly honored to be the second state approved institution in the country right now.” – Richard Pine, dean of recruitment and public relations, in a press release

Registration for classes at the school are ongoing with courses expected to begin next month. The state-approved certificate programs run from $6,500 to $12,500. Program hours range from 136 to 266.5. Single courses are also available, as well as state-required classes for physicians and dispensary owners and employees. Pine indicated that the state’s cannabis industry is expected to create more than 4,000 jobs.

Read more