In Uncategorized on 08/28/2019 at 14:34

Ex-Ch J L Paige “Iron Fist”) Marvel has a review of the caselaw nailing the potteries in pot-friendly States with the Section 280E traffic tickets.

Boulder Alternative Care, LLC, GLG Holdings, LLC, Tax Matters Partner, Docket No. 16495-16, filed 8/28/19, goes for judgment on the pleadings.

They get more than they bargained for. “’ Colorado state-legal marijuana sales do not conflict with the federal Controlled Substances Act or any other federal drug law. Under those circumstances, the Supreme Court has made clear that state law must control. Since Colorado law controls, state legal marijuana sales cannot be considered “prohibited” under federal law.’” Order, at pp. 1-2.

Well, the Boulderers get bowled over (sorry, guys). The motion relies on facts outside the pleadings, thus Rule 120(b) turns the motion into one for summary J. And all y’all know I just love summary J.

The Boulderers get buried in a judicial landslide.

“The precedent regarding the application of section 280E to state licensed marijuana dispensaries is well settled. In Gonzales v. Raich, 545 U.S. 1 (2005), the Supreme Court rejected the argument that the cultivation and possession of medical marijuana, isolated to and policed by a state, somehow removed the activities from the purview of the Comprehensive Drug Abuse Prevention and Control Act of 1970 (CSA). The U.S. Court of Appeals for the 10th Circuit has consistently upheld denials of deductions and credits under section 280E, noting in its most recent pronouncement that ‘[d]espite its legality in many states, marijuana is still a schedule I “controlled substance” under federal law.’ Feinberg v. Commissioner, 916 F.3d 1330, 1333 (10th Cir. 2019), aff’g T.C. Memo. 2017-211, petition for cert. filed, No. 19-129 (July 26, 2019); see also High Desert Relief, Inc. v. United States, 917 F.3d 1170 (10th Cir. 2019); Alpenglow Botanicals, LLC v. United States, 894 F.3d 1187 (10th Cir. 2018), cert. denied, 139 S. Ct. 2745 (2019); Green Sol. Retail, Inc. v. United States, 855 F.3d 1111 (10th Cir. 2017), cert. denied, 138 S. Ct. 1281 (2018). This Court has also consistently applied section 280E, irrespective of any permissive state laws, to disallow deductions and credits with respect to a taxpayer’s trade or business that consists of trafficking in controlled substances. See Alt. Health Care Advocates v. Commissioner, 151 T.C. __ (Dec. 20, 2018); Patients Mut. Assistance Collective Corp. v. Commissioner, 151 T.C. __ (Nov. 29, 2018); Olive v. Commissioner, 139 T.C. 19 (2012), aff’d, 792 F.3d 1146 (9th Cir. 2015); Californians Helpingto Alleviate Med. Problems, Inc. v. Commissioner, 128 T.C. 173 (2007).” Order, at p. 2.

The issue the Boulderers raise is whether State law takes their admitted pottery out of CSA. “Petitioner misreads applicable case law from the Supreme Court, the U.S. Court of Appeals for the 10th Circuit and this Court. As noted above, the courts have consistently held that permissive state laws have no effect on Federal enforcement of the CSA. In following that precedent, we conclude that Colorado’s permissive medical marijuana laws have no effect on the CSA.” Order, at p. 3.

I’ll spare you a collation of my blogposts on this subject.

Ex-Ch J Iron Fist bounces the Boulderers’ motion. It’s unfortunate that the Rules don’t provide for cross-motions for summary J. That would save a lot of time.

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