Pubdate: Thu, 03 Dec 2015
Source: San Diego Union Tribune (CA)
Copyright: 2015 Union-Tribune Publishing Co.
Contact:  http://www.utsandiego.com/
Details: http://www.mapinc.org/media/386
Note: Seldom prints LTEs from outside it's circulation area.
Author: Joshua Stewart

MED POT SHOP HIT WITH $1.8M FINE

SAN DIEGO - A Pacific Beach medical marijuana dispensary has been hit 
with a $1.8 million penalty for operating outside of San Diego's 
zoning regulations, incurring by far the largest fine against a 
dispensary in city history.

That more than doubles the total amount of dispensary-related 
judgments the city has collected to date.

On Nov. 20, Superior Court Judge Timothy Taylor ruled against SoCal 
Holistic Health Inc. and the company's president, Ryan Murphy. 
Besides the $1.835 million penalty for operating illegally, Taylor 
also issued a permanent injunction against the dispensary and its 
president, prohibiting them from having a dispensary anywhere within 
city limits.

"The judges are sending a message, and so are we: Marijuana 
dispensaries can either follow the law or they will pay a high price 
for their actions," City Attorney Jan Goldsmith said in a statement Wednesday.

The dispensary will also have to reimburse the city's code 
enforcement division $1,065 in investigation costs and pay a 
currently undetermined amount of litigation costs. A spokesman for 
the City Attorney's Office said the dispensary waived its right to appeal.

Messages to SoCal Holistic Health's lawyers were not returned, and 
Murphy did not return a phone message left with a clerk at the 
Pacific Beach store at 1150 Garnet Ave. On social media, the 
dispensary was promoting deliveries of medical marijuana vaporizer 
cartridges that just arrived to the store's stock.

Penalties like this send a message to dispensaries that the city will 
work with some businesses, but it wants regulations and permitting 
processes followed, said Chris Boudreau, a board member for the 
Alliance for Responsible Medicinal Access, a cannabis businesses 
trade association.

But because of the lengthy permitting process to open a medical 
marijuana dispensary, and frustration with the way the city has 
handled the industry in the past, this case is unlikely to change the 
city's medical marijuana landscape, Boudreau said.

"The city definitely sends a fearful message with this win, but when 
looking at the atmosphere over the past few years, I don't know if 
this is really going to change the perspective of those rogue 
operators who feel they should proceed with a clandestine operation 
behind the city's back," he said.

Police Chief Shelley Zimmerman said the penalty shows that 
cooperation between law enforcement and the city's lawyers can 
effectively control dispensaries that don't follow regulations.

"This illustrates why San Diego's method for closing illegal 
marijuana dispensaries has proven so successful," Zimmerman said in a 
statement.

The penalty against SoCal Holistic Health comes as the city's medical 
marijuana industry shifts from dispensaries that skirted regulations 
and faced government crackdowns, to ones that meet a long list of 
conditions and satisfy various legal requirements before they're 
awarded a city permit and can open their doors as legitimate businesses.

Last year the City Council passed an ordinance authorizing as many as 
36 dispensaries in San Diego, with no more than four in each of the 
nine council districts. Land-use regulations limit dispensaries to 
commercial and industrial zones and require at least 1,000 feet 
between any two dispensaries, as well as between dispensaries and 
schools, playgrounds, libraries, childcare facilities and youth 
centers, parks and churches.

The law also requires dispensary owners to get conditional use 
permits and pay fees ranging from $8,000 to $24,000. The permits are 
good for five years.

So far, three dispensaries have opened with the city's blessings. The 
most recent, Southwest Patient Group, opened in November in San 
Ysidro, and follows permitted dispensaries that opened in Otay Mesa 
and the Midway District in March and August, respectively. Others 
have received permits and are expected to open soon.

"Every business has to comply with zoning laws." Goldsmith said. "You 
can't open a dog kennel or a dry cleaner anywhere you like, and 
neither can you open a marijuana dispensary in neighborhoods where 
city zoning laws forbid them. My office will continue to close these 
illegal dispensaries and see that their operators face stiff consequences."

A total of 290 illegal dispensaries have been closed through 
enforcement action since September 2011, the City Attorney's Office said.

All of these came to the office's attention through citizen 
complaints to the Development Services Department's Code Enforcement 
Division, and other illegal dispensaries are believed to be scattered 
around San Diego. The City Attorney's Office is trying to close them 
as well, spokesman Gerry Braun said.

The city attorney first took action against SoCal Holistic Health in 
December 2014, and the business was ordered closed in February. 
Despite this, it remained open.

Before this case, the biggest penalty was against John Nobel, a 
landlord who leased properties to illegal dispensaries. In December 
2014, he agreed to pay a $250,000 fine.

The City Attorney's Office said it estimates the city has been 
awarded $3.5 million in judgments. The money goes toward city code 
enforcement efforts.
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MAP posted-by: Jay Bergstrom