2 biggest US cannabis firms are joining forces to lobby Trump 🤝

RESCHEDULING
Pro-rescheduling lawyers snipe back-and-forth about delay

What happened: By now, you’re well aware that the Drug Enforcement Administration (DEA) hearings, set to kick off next week, to debate reclassifying cannabis from the most restrictive Schedule I to the less restrictive Schedule III of the federal Controlled Substances Act have been postponed for at least three months. 

Lawyers working for the pro-reform side sought the delay which was granted by the judge presiding over the hearing. 

But there is clearly some disagreement over whether this was the appropriate strategy, even among those that support rescheduling. 

Zoom in: The lawyers who sought the delay include Shane Pennington and Matt Zorn. 

Pennington is working on behalf of Village Farms, a cannabis firm, and Hemp for Victory, a trade group, and others on the pro-reform side. 

Zorn, for his part, is representing the Connecticut Office of Cannabis Ombudsman, he said on X. 

They maintain the entire hearing was bound to go against those on the side of cannabis reform. They say the DEA, based on its planned witness testimony, allegations of improper contact with Smart Approaches to Marijuana, an anti-cannabis reform group, and the agency dismissing Colorado’s participation in the hearing, clearly does not want to see cannabis reclassified to Schedule III. 

Pennington went on The Dales Report podcast to further explain his position and his track record defeating the DEA in court. 

But, but, but: Khurshid Khoja, the legal counsel for the National Cannabis Industry Roundtable, one of the witnesses set to participate in the hearing, published an op-ed on Wednesday in Marijuana Moment calling the delay a “procedural sideshow.”

The debate clearly has gotten acrimonious, as Khoja took to LinkedIn to say he has been threatened with legal action over the op-ed.

On the other side: Village Farms CEO Michael DeGiglio and Hemp For Victory’s Robert Head responded to Khoja’s op-ed on Thursday, saying that had they not intervened, they expect that whoever takes over as DEA head on January 20 — incoming President Donald Trump has not nominated anyone yet — would likely reject the rule change, and it would have been “game over” for the regulated cannabis industry. 

What they’re saying: “Nonetheless, counsel for these parties fundamentally misunderstood how this proceeding, this tribunal and this judge are legally-bound to proceed — and in so doing have potentially set back the entire movement for cannabis reform,” Khoja writes.

And: “If the hearing had resulted in a Schedule I or II recommendation, as could reasonably be expected since the deck was heavily stacked against schedule III, it would have been game over for the state-regulated cannabis industry,” DeGiglio and Head write. 

What’s next? It’s still unclear what the result of the appeal will be or when the hearings will resume. We’ll try and find out more and update you as we know. 

Either way, it’s another three months that cannabis firms are going to have to contend with onerous 280E taxes — but that may be a small price to pay for rescheduling to happen. 

We’ll soon find out. 

-JB

“I did have an opportunity to smoke pot in college,” Outgoing Treasury Secretary Janet Yellen said on The Late Show with Stephen Colbert. “It was okay, neither here nor there. I did inhale.”

Two largest industry trade groups combine 🤝

The US Cannabis Council and the National Cannabis Roundtable, two of the industry’s largest trade groups, are combining to form the US Cannabis Roundtable in an effort to align messaging as Donald Trump prepares to take office. The US Cannabis Roundtable is backed by the largest US cannabis companies, including Green Thumb, Curaleaf, Verano, Trulieve, and Cresco Labs. 

Congressional Cannabis Caucus Chair expects SAFER Banking to be reintroduced 👀

Rep. Dina Titus, the new chair of the Congressional Cannabis Caucus, said in an interview with MJBiz she expects the SAFER Banking Act, a cannabis banking bill, to be reintroduced this Congress. She also said legislation around medical cannabis for veterans and access for researchers as priorities. 

Key Toronto agency says it doesn’t have the funds to enforce cannabis laws 🤔

Toronto’s head of municipal and licensing standards told the City Council budget committee that the agency can no longer afford to shut down illicit cannabis shops in the city. The department received $8.5 million from the city to shut down illicit shops — which once numbered around 100 in the city but dropped to less than ten. However, due to the lack of enforcement, the agency says that number is back up to 70 and many are linked to organized crime, StratCann reports.

Cannabis information site Leafly removed from Nasdaq 📉

Cannabis information site Leafly will be delisted from the Nasdaq today, and moved to trade over-the-counter. The company failed to earn at least $500,000 in net income in the last fiscal year, a requirement for remaining listed. The stock dropped 60% yesterday on the news, and is down over 99% since it started trading. 

Safe Harbor touts $25 billion 💰

Cannabis compliance firm Safe Harbor Financial said it processed $25 billion of cannabis-related funds on its platform, in a press release. 

Two more states have joined the billion-dollar cannabis club: Missouri and Massachusetts.

Massachusetts cannabis retailers sold just over $1.6 billion worth of cannabis last year, according to the state’s Cannabis Control Commission, while Missouri — in only its second year of legal sales — sold over $1.46 billion, per the state’s Division of Cannabis Regulation.

Take a deeper dive into Massachusetts’ numbers here, and Missouri’s here. 

And here’s Massachusetts cannabis year, charted:

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