How Much Does it Cost to Shut Down a Single Pot Clinic? $1 Million, Reportedly

The case of a Stockton medical marijuana grower and seller who faces at least five years in prison may hold lessons for Eagle Rock’s own pot entrepreneurs.

One of the more interesting sidelights of Wednesday’s vote in the Los City Council seeking to prepare a draft for yet another ballot initiative on the vexed question of medical marijuana came early in the proceedings.

During the public comments period, a young man who identified himself as William West and announced that he has had full-blown AIDS for the past 10 years made a rambling, two-minute statement about how medical marijuana has helped his condition—and how he feels about the recent closure of pot clinics amid a federal crackdown on some of them.

“My caregivers are shut down and pushed aside,” the speaker said, imploring City Council President Herb Wesson to do something about the situation. (Along with Council member Paul Koretz, Wesson is pushing for an ordinance that will allow a tighter but more accommodating medical marijuana landscape in Los Angeles.)

“Please … find a medium.”

Regardless of what compromise the City Council is able to come up with, a glaring, largely unarticulated question still remains: Will federal authorities continue to prosecute owners of pot clinics even after the City Council passes new laws to regulate the local medical marijuana industry?

The question is an important one because, according to a recent article in The Atlantic monthly magazine, a single prosecution of a marijuana clinic costs taxpayers as much as $1 million.

Titled “The High Cost of Shutting Down One Medical Marijuana Operation,” the Jan. 14 article recounts the case of Matthew R. Davies, a 34-year-old entrepreneur who is being prosecuted for growing and selling medical marijuana in the recently bankrupt city of Stockton, CA.

Click here to read Davies’ story, first reported by the New York Times.

A U.S. attorney appointed by President Obama in 2009 wants Davies, a father or two, “to agree to a plea that includes a mandatory minimum of five years in prison,” according to The Atlantic.

“Let’s set the legal questions aside and think through the costs of this course,” says the article, listing seven concerns, including $235,000 in incarceration costs and the likelihood that unsavory drug dealers, including violent cartels, would fill in the void left by prosecuted, tax-paying entrepreneurs such as Davies.

“Doesn't that seem awfully ‘expensive’ when the only real benefit is sending the message that you can't get away with openly flouting federal drug laws?” asks the magazine. “If that's the biggest benefit you can plausibly claim, isn't that a sign that the law should change?”

Eagle Rock novelist Mark Haskell Smith, who explored the underground world of botanists and farmers who grow pot in his recent nonfiction book, Heart of Dankness, thinks that the reportedly high cost of prosecuting people in the medical cannabis industry is a shame, not to mention a waste of resources.

What’s more, Eagle Rock’s contribution to the city’s tax base has been substantially impaired by the recent shuttering of its medical marijuana dispensaries, leaving a string of empty storefronts in the neighborhood.

“If it's accurate,” said Smith, referring to the reported $1-million cost of a single prosecution—and presuming that the owners of the 10 or so pot clinics in Eagle Rock that have shut down are being or likely to be prosecuted—“looks like [Eagle Rock Neighborhood Council Immediate Past President] Michael Larsen and [Council member] José Huizar cost Eagle Rock about $ 10 million.”

Both Larsen and Huizar have fought to shut down medical marijuana dispensaries in Eagle Rock, arguing that they are illegal businesses that also disrupt the neighborhood’s quality of life.

Michael Larsen January 20, 2013 at 03:14 AM
For the record, and to correct esteemed community leaders from neighboring mountains, I am in favor of well regulated medical marijuana laws. I voted for Prop 215. The problem is that government has dropped the ball on regulation, and the system has been hijacked by recreational profiteers. Good for them; bad for Eagle Rock. I'll continue to fight for the neighborhood until, at the very least, MMDs are regulated on par with liquor stores.
Rob Schraff January 20, 2013 at 03:24 AM
Got it - just like a liquor store. Which is not what Prop. 215, SB-420 or any of the March L.A. City ballot initiatives provide. Not that your are disingenuous or anything, Mr Larsen. Keep that DEA number handy!
Anonymous Nimby Crank January 20, 2013 at 03:46 AM
By the LAPD, not the DOJ, you are mixing up your agencies. In actuality there was never a raid by the DEA@AEC. After the May LAPD raid they shut down their dba American Eagle Collective and reopened under and new group of letters, TFC, with a new straw owner. There will never be any charges filled against AEC, because they don't exist anymore nor does TFC. In addition asset forfeiture cases go against property owners not tenants. Do you have documentation regarding the two landlords that fought back against their Asset Forfeiture case? Please tell me this post was factual based and you aren't another MMD crusader making up statistics for further your cause. This board already has plenty of that going on.
that January 21, 2013 at 06:34 PM
yes it was lapd that raided aec. and yes aec will never open again. even though....charges may still be filed but i doubt it. there were operating withing state law. yes DEA did make an appearance at TFC...what happened?? their guns drawn and TFC made em wait in their waiting room for 30mins while they tried to get an OK for a search warrant, which they were not succesful in doing so.....they left n vowed to return. great way to spend resources there. asset forfeiture cases. i'll only name one i'll leave the other one anon. united states of america vs real property located at 2601 ball rd, anaheim, ca (i'll leave their names out of it) but u can look it up case number SACV 12-1445-AG (MLGx) look up the transcript too and see how judge guilford slams the DOJ for trying to take a proprty from a landlord that didn't have anything to do but entered a legal lease with the collective owner. i'm not making stats up. i can site cases all day long to support mmj. i am a crusader for the cause. i do want every patient to have access. reasonable regulation. i feel feds should get out of our state and calling in the feds was a waste of time and resources. soon cases will be heard with the ones willing to fight the big bad feds and will prevail.
Anonymous Nimby Crank January 22, 2013 at 12:54 AM
If you truly believe that a federal agency went into an establishment with the intent to raid them without a search warrant, in hand, then that is your prerogative. I believe they just went in to give them a "friendly" reminder that they had been issued a federal cease and desist order, and that they had yet to comply, but whatever the circumstance their desired result was achieved. As far as resources go, people who do not want MMD's in their residential neighborhoods, would not concur that it was a waste of resources. Which for the record is always the cry when the government enforces something someone believes shouldn't be enforced. Truly you can not believe that 100 carloads a day of 18-24 year old males blaring the latest 2chainz album while driving down your street at 60 mph is actually a "patient?" And don't give me the "It's between them and their doctor" nonsense, that is just industry speak and easily seen through. Lastly, California is still in the United States and as I have said before. The Constitution is plain: Federal law is the “supreme law of the land” (Article VI, section 2). So not enforcing Federal law is unconstitutional. That is why the executive branch can not force the DEA to stand down, it's technically treason to officially request. Personally, just zone them away from residential, done.


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