3 Ways to Protect a Cannabis Business Partnership From Litigation

By David Olsky As the cannabis industry grows, it’s increasingly essential for business owners and investors to protect themselves from potential litigation. Partnership disputes, unsavory business practices and “off-the-books” backroom dealings abound, particularly in contrast to other, more mature, established industries. In a piece featured on MJBizDaily, Fortis partner and litigation expert David Olsky dispenses his three key pieces of advice for how businesses can protect themselves from bad actors,

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How to Survive the Upcoming Consolidation Boom in Cannabis Industry?

By Julie Herzog  As the cannabis industry matures, we are seeing a consolidation boom, with larger companies gobbling up smaller ones at an unprecedented rate. This is being driven largely by Big Pharma, who are eager to get their hands on this rapidly growing market. While this consolidation can be good for the industry as a whole, it can be difficult for smaller businesses to survive.  In order to effectively

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New Ruling Helps Clear Up Industry Confusion on the Matter of Delta-8 THC

By Michael Annerino On May 19, 2022, the United States Court of Appeals for the Ninth Circuit issued its opinion in AK Futures LLC v. Boyd Street Distro, LLC, 35 F.4th 682 (9th Cir. 2022). In it, the Ninth Circuit held that “the only statutory metric for distinguishing controlled marijuana from legal hemp is the [0.3 percent by dry weight volume] delta-9 THC concentration level.”  The Court also writes that

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The Top 3 Legal Mistakes Cannabis Businesses Make (And How to Avoid Them)

By Henry Baskerville The cannabis industry has attracted many creative, innovative entrepreneurs. And while they’re often skilled at cultivation, production, extraction or brand-building, sometimes, they aren’t as knowledgeable about business legalities and navigating the myriad risks inherent in running a cannabis company. Entrepreneurs in other industries often have an MBA and strive to build their business for years before it ever hits $5-10 million in annual sales. But in cannabis,

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5 Tips to Prepare Your Cannabis Company for a Sale

By Julie Herzog and Mike Goral The cannabis M&A market was on fire in 2021, and rising hopes for federal legalization and the potential passage of the SAFE Banking Act will stoke further acceleration in 2022. As a result, cannabis entrepreneurs have visions of dollar signs dancing in their eyes. As an M&A attorney and cannabis accountant with several decades of combined experience, we can tell you that those who

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How to Customize Cannabis Lease Agreements and Stay Protected

By Cara Thornton The cannabis industry can be a minefield of potential legal, tax, and licensing issues. In particular, cannabis lease agreements can be a hotbed of hidden problems. Many operators have been forced out of business altogether over a dispute with their landlord over an actual or purported lease violation. Some of the most common — and seemingly innocuous — provisions in a standard lease agreement can be problematic

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Cannabis M&A: How to Prepare Your Company for Sale

By Julie Herzog The past three years have been erratic in the world of cannabis M&A deals and valuations. Still, the one thing that remains the same is that cannabis entrepreneurs – like all entrepreneurs – have visions of a profitable exit in their future. All M&A transactions face challenges and complexities, but cannabis businesses deal with unique valuation considerations and risks other industries don’t. As a result, cannabis M&A

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Don’t Despair: State-legal Marijuana Businesses Can Find Relief in the American Rescue Plan Act

With every tax return sent to the IRS, owners of cannabis businesses find themselves angrier and more disappointed with the United States Tax Code (Tax Code) and the Internal Revenue Code (IRC). This frustration stems from a simple, small provision in Section 280E of the IRC: cannabis businesses may not claim any business expense deductions under the Tax Code, resulting in effective tax rates of 80% or higher for many

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Top 5 Things You Need to Know about California’s Prop 65

By Henry Baskerville As of Jan. 3, 2021, the labeling requirements of California’s Proposition 65 will apply more broadly to cannabis and CBD products. This is because California’s Office of Environmental Health Hazard Assessment (OEHHA) has added THC to its list of approximately 1,000 chemicals that may cause reproductive harm. As a result, Proposition 65 warnings will now be required for all products sold in California that contain any detectable

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Top 5 Steps to Take Before Obtaining a Cannabis License in a Newly Legal State

By Henry Baskerville With five states recently passing legislation allowing some form of marijuana sales, many hopeful cannabis dispensary operators will be throwing their hats into the ring. However, because cannabis is still classified as a Schedule 1 drug under the Federal Controlled Substances Act (CSA), each state will have its own maze of laws, regulations and oversight agencies for potential licensees to navigate. Fortis partner Henry Baskerville shares counsel

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