Mr Psychedelic Law

Florida may not be the first state that comes to mind in terms of progressive drug laws, but there is a grassroots movement gaining steam across the state to decriminalize psychedelic treatments for depression, PTSD and more. It’s happening at the local level, in city council chambers and town halls, and is largely the work of one man — Dustin Robinson, a Florida lawyer and founder of Mr. Psychedelic Law.

Dedicated to the use of “medical and spiritual research to drive RESPONSIBLE legal reform in Florida for psilocybin mushrooms and other psychedelics,” the project is an offshoot of Robinson’s law firm, Mr. Cannabis Law, and includes advisory boards made up of doctors, lawyers, spiritual advisors and more.

We recently sat down with Robinson to learn more about his on the ground campaign to decriminalize psychedelics in Florida, as well as what he’s seeing from a regulatory perspective on a national level.

Psychedelic Invest: Let’s start with your background. How did you get into this industry?

Dustin Robinson: I grew up here in South Florida and went to the University of Florida where I got my Master’s in accounting and then my law degree. So, I’m a Master’s in accounting, a CPA, a lawyer and I also have my real estate license.

I worked at Deloitte for a bit and then went to Holland and Knight out of law school. Eventually I went in-house, running a few multi-state manufacturing companies, and then a couple of years ago I got into the cannabis space.

My firm is a full-service law firm. Our attorneys handle everything from transactional matters to litigation, pretty much every area of the law except for criminal. We don’t deal with people getting arrested for marijuana possession, in other words.

But I represent a lot of cannabis doctors as well as some of the clinics, and about a year ago clients started inquiring about psychedelics. Quite honestly I didn’t know anything about psychedelics and I thought they were kind of crazy. But then I started talking to some of the doctors I work with and they started sending me some research and talking about some of the clinical trials they want to work with.

One of the doctors I work with is Dr. Scott Fisher. He’s doing clinical trials on psilocybin and its effect on depression right here in Fort Lauderdale. And I work with another doctor, Dr. Michelle Wiener, and she’s doing some research on it for end of life care relating to suicide.

PI: What have you been doing with this within your network?

DR: When I started doing my own research into psychedelics, I realized that there is huge medicinal value in it. Since then I’ve talked to a lot of veterans and just got connected with a lot of people throughout the country, so I decided to create my own not-for-profit called Mr. Psychedelic Law. We have a medical advisory board that is really made up of the top doctors in the state of Florida. Then we also have a spiritual advisory board of the top spiritual leaders in Florida.

Ultimately, our mission is to use medical and spiritual research to drive responsible legal reform for psilocybin mushrooms and other psychedelics in Florida. We’ve been going city to city going to all the city commission meetings, I’ve drafted resolutions for several cities to decriminalize psychedelics, and we’ve been taking a real city-level approach to this issue.

We’re just trying to educate people around this and building a community around psychedelics to really push for legal reform here in Florida.

PI: What’s the reaction been from folks there in Florida when you bring this up.

DR: Most of the time when I first stand up in front of a crowd at a commission meeting, they think it’s funny or just out there. But I bring doctors up there with me. I bring veterans that have PTSD that have been treated with psilocybin. I bring lawyers and lobbyists up there to speak too, and by the end of it we often get a very good reception.

Everyone has received this really well. There hasn’t been any city or county that has left us out of the room and not let us speak. Unfortunately, the pandemic has slowed down these activities, but pre-pandemic I was working with several commissioners in cities who were willing to sponsor my resolution for decriminalization. That has unfortunately fallen off as a priority this year, but the reception has been very good overall and I’m hopeful that we can pick that back up next year.

PI: What’s your take on the chances for national legalization or decriminalization?

DR: I think we’re getting there. In Colorado, Denver voted for decriminalization. Then Oakland did the same thing. Chicago has a resolution right now, and so does Santa Cruz. So, cities are starting to open up.

Then you have Oregon, which will probably be the first commercial market for psychedelics in 2022 or so. The way their bill that’s on the ballot this year is structured, I think it has a good chance to pass as it gives them two years to study and plan before rolling out a commercial market.

I think it’s looking good from a state and city perspective. From the Federal perspective, unfortunately, most psychedelics are still Schedule 1 substances. But what most people don’t realize is that the FDA actually views psychedelics more preferentially than they even do cannabis, and they have granted limited research into psilocybin for depression and other things.

PI: Has the process that cannabis went through over the last couple of decades helped smooth the way for psychedelics from a regulatory standpoint?

DR: Yes, there’s no doubt. They call cannabis a gateway drug, but it’s also served as a kind of gateway to legalization as well. I definitely think the legalization of cannabis has opened up the minds of a lot of people and has broken down a lot of stigmas. That’s paved the way for other substances to be decriminalized.

PI: Do you see a future of psychedelic treatments beyond what doctors are doing now for depression and PTSD? 

DR: I do, and there are a lot of things that can be treated this way. A lot of my doctors are doing ketamine treatments, some for mental health purposes and some for pain purposes. One of my clients is The Ketamine Fund, and they basically provide ketamine treatments for veterans for free.

Most of the clinical trials that are being done, especially from an FDA perspective, are focused on mental health disorders, whether it be depression, PTSD, addiction, etc. But there will be more applications in the future.

PI: Do you think that state-by-state and town-by-town is how we’re going to get to full legalization someday?

DR: Right now it’s the path of least resistance. Once municipalities decriminalize, and people see that the world isn’t crumbling down, we can start talking at the state level. In certain states like Oregon or Colorado, where they’re more liberal, we might be able to go straight to a state initiative. But in Florida, it might take more time and we’ll have to start smaller. But I think it’s really going to require states to take action as they did with cannabis, and unfortunately the federal government will have to catch up.

In today’s Republican-held Senate, the cannabis industry’s best hope for progress has been the Secure and Fair Enforcement Banking Act of 2019 (or the “SAFE Act”), which would allow state legal cannabis business to work freely with banking institutions. The Act puts in place safe harbors from federal money laundering and regulatory issues for banks dealing with the cannabis industry and would therefore open up banking for the entire industry, allowing it to take another step toward legitimacy in the eyes of the federal government. More importantly, passage of the SAFE Act allows the industry to grow and flourish with the assistance of the banking industry, which is fundamental to continued growth.

The SAFE Act is an incremental step forward, which is vital when dealing with Congress; nothing happens overnight in Washington D.C. This is especially true when talking about an industry with a War on Drugs-sized stigma attached to it. However, the main argument against the SAFE Act is that it’s just that: incremental; a half measure when a full measure is called for. That brings us to the Marijuana Opportunity Reinvestment and Expungement Act (the “MORE Act”).

The MORE Act includes many sweeping provisions, starting with the removal of marijuana from the Controlled Substances act (which would decriminalize cannabis on the federal level, allow states to set their own marijuana policies, and free any U.S. marijuana companies of their tax code 280(e) designation). It would also cause for incentivization for states to expunge low-level cannabis convictions, and create a federal tax on marijuana which would fund the newly created Opportunity Trust Fund, which is meant to assist groups which historically have been disproportionately affected by the War on Drugs. In my time dealing with federal lawmakers, a sweeping reform act such as the MORE Act has been described to me as a “Democratic Pipe Dream” with little hope of passing the Senate with its current membership.

However, the Senate’s membership is set to change subject to the November election results. Many political pundits (PoliticoForbesNY Times) believe that the Republican-held senate could be vulnerable to falling into the Democrats’ hands, changing the political landscape for the next few years. As such, the cannabis industry’s federal fight could abruptly pivot from incremental steps forward like the SAFE Act to the MORE Act’s sweeping cannabis reform. This switch would mirror a recent PEW Research Center’s finding that an overwhelming amount of Americans believe marijuana should be legal for medical or recreational purposes (the full study can be found here).

While I appreciate the value (and current necessity) of an incremental, strategic approach to federal reform of the cannabis industry, the best-case scenario for the industry moving forward would be a Democrat controlled Senate in November. This will allow the cannabis industry to push for full-fledged reform of federal cannabis laws, moving the industry forward at a rate which would be impossible under our current incremental approach. Right now, the cannabis industry in America is poised to be a massive boon (Forbes Cannabis Industry Projections), helping to create jobs and opportunities for millions of Americans. With the right help from the federal lawmakers, that dream can become a reality much sooner than expected.

Steven D. Avalon, Esq.
Associate 
Mr. Cannabis Law

By: Steven Avalon

An increasing number of our cannabis doctors have been reaching out to us about providing ketamine treatments as part of their medical practice. This blog will provide some background on ketamine as well as some of the potential legal issues surrounding ketamine use in the United States.

Ketamine is classified by Drug Enforcement Administration (DEA) as a Schedule III controlled under the Controlled Substances Act (CSA), which means that according to the DEA, the drug in question “has a currently accepted medical use in treatment in the United States; and [a]buse of the drug or other substance may lead to moderate or low physical dependence or high psychological dependence (21 U.S.C. § 812(b)(3)).”

With this Schedule III designation, federal regulations require individuals to register with the DEA prior to manufacturing, distributing, dispensing, or otherwise dealing in ketamine, with further rules regarding who can obtain a DEA registration. Only healthcare professionals such as physicians, Mid-level Practitioners (whose definition varies on a state-by-state basis, but generally can include nurse-practitioners and physician assistants), pharmacies, and hospitals/clinics can apply for DEA registration, and these registrations, once acquired, must be renewed at least every few years, and oftentimes annually.

Ketamine’s Food and Drug Administration (FDA) approved use is as a sole anesthetic for surgical procedures. However, many drugs are used for off-label use, which are non-FDA approved uses, which is generally legal unless the off-label use of a drug violates ethical or safety guidelines. Ketamine is being used off-label as a tool for therapy to treat a variety of mental health issues, including addiction, post-traumatic stress disorder (PTSD), anxiety, and depression. This use is legal as long as the prescribing doctor, dispensing pharmacy, and the manufacturer are registered with the DEA as outlined above.

Despite the stringent registration requirements, ketamine clinics are opening at a fast pace, largely in response to the mental health crisis the U.S. is facing, exacerbated by the coronavirus pandemic. When properly registered and run, these clinics can be vital in the fight against mental health issues, but as outlined above, proper navigation of the regulatory landscape is crucial for clinics and physicians to stay compliant with DEA rules.

Beyond regulatory issues, ketamine clinics have liability issues to be mindful of. Like any powerful anesthetic, clinics should ensure that patients do not operate a motor vehicle or engage in any other potentially dangerous activities while taking ketamine; starting with a warning to patients so they know what effects to expect from ketamine treatments, a liability waiver stating that the patient understands the risks and will not engage in any activities until a safe amount of time has passed, and ensuring that the patient has a ride home from any treatment sessions.

A key to expediting ketamine research and widespread use as a therapy tool is breakthrough therapy status, granted by the FDA. This status allows the drug in question (in this case, ketamine) priority review and by extension, approval, by the FDA for the use in question. In the past, the FDA has granted breakthrough therapy status to other psychedelics, including MDMA for the treatment of PTSD and psilocybin for the treatment of severe depression. These designations allow the research of each to flourish, allowing potentially life-saving treatments to be effectively studied, and upon a successful clinical trial, reach the market. Receiving breakthrough therapy status for ketamine therapy to treat mental health issues, especially in light of the coronavirus pandemic, could be essential to curbing the current mental health crisis our country faces.

Could today’s ketamine clinics be tomorrow’s Psychedelic Supervised Therapy Centers?

Mr. Cannabis Law, a full-service law firm focused exclusively on the marijuana and hemp industry, is excited to announce the addition of Steven D. Avalon, Esq. as an associate attorney at Mr. Cannabis Law. Mr. Avalon is a regulatory and transactional attorney with experience in federal regulation of marijuana and hemp as well as mergers and acquisitions experience with middle market transactions.

Mr. Avalon worked both as in-house counsel to a publicly traded cannabis investment firm and as an associate at a boutique firm specializing in transactional and regulatory law. During his time as in-house counsel, Steven oversaw mergers and acquisitions valued at over $50 million as well as ensured compliance within local, state, and federal law in the cannabis space. He also has experience lobbying Congress in Washington, D.C., making frequent trips to the nation’s capital to advocate on behalf of the cannabis industry. Finally, Steven helped navigate state laws to set up dispensary sites as well as statewide delivery for a Florida Medical Marijuana Treatment Center.

Dustin Robinson, Founding Partner of Mr. Cannabis Law, provided his comments on the addition of Mr. Avalon: “Mr. Avalon’s unique skill-set that combines cannabis-specific M&A experience with a deep understanding of cannabis operational compliance is going to make him a tremendous asset to our clients. The hiring of Mr. Avalon demonstrates Mr. Cannabis Law’s unwavering commitment to providing our clients and the cannabis industry with access to sophisticated legal expertise from professionals that are deeply passionate about the industry.”

 

Florida Hemp Companies Purchasing Out-of-State Product to be Used in Food Must Ensure the Hemp Comes From an “Approved Source” - Mr. Cannabis LawWith the complications surrounding certified seed in the state of Florida and other complications causing delay of hemp production within Florida, our clients with Hemp Food Establishment Permits are being forced to source hemp product from outside of Florida. Some are sourcing fully packed finished product while others are sourcing extract that will be formulated and packaged within Florida. Some are sourcing direct from suppliers outside of Florida while others are sourcing through brokers or distributors. Some are sourcing from nearby states like Tennessee while others are sourcing from west-coast states like Oregon.

 

Regardless of the where, what, and how of the product being sourced, all food consisting of or containing hemp or hemp extract must be sourced from an “approved source.”  Fla. Admin. Code. R. 5k-4.034(4)(a). Fla. Admin. Code R. 5k-4.034(2)(a) defines an “approved source” as a “food establishment manufacturing, processing, packaging, holding, or preparing food or selling food at wholesale or retail that meets local, state, or federal food safety standards from the jurisdiction of origin.” In order to demonstrate that the product is from an “approved source”, a Florida Hemp Food Establishment should require its supplier provide (a) a valid food license/permit; (b) the most recent food safety inspection report; and (c) a Certificate of Analysis verifying that the hemp product has been tested and contains less than 0.3% THC on a dry weight basis.

 

In many instances, applying the “approved source” rule is simple. Assume a Florida hemp retailer purchases a hemp tincture from a licensed Virginia hemp company. Similar to Florida law, Virginia regulates hemp tinctures as food and requires that the hemp companies obtain a food license and a food safety inspection report. Thus, the Florida hemp retailer should be able to easily obtain from the Virginia company the valid food permit, the most recent food safety inspection report, and a Certificate of Analysis verifying that the hemp product has been tested and contains less than 0.3% THC on a dry weight basis.

 

However, in other instances, the “approved source” rule is more complex. Assume that a Florida hemp retailer purchases a hemp tincture from a hemp company located in a state that does not regulate hemp as a food. Such company would likely not be able to produce a food license nor would it be able to provide a food safety inspection. Thus, such hemp tincture would not be from an “approved source” and the Florida hemp retailer should refuse to do business with such out-of-state hemp company.

 

Another instance that may cause confusion is when there are several middle-men between buyers and sellers. As the hemp supply chain has developed, many of these deals involve a broker or distributor that is trying to conceal the identity of the seller so that the buyer doesn’t try to go direct to the seller. For example, assume a Florida hemp retailer purchases a hemp tincture from a licensed Virginia hemp company but it is being purchased through a broker that is trying to conceal the identity of the Virginia hemp company. Under such circumstances, the Florida hemp retailer must demand that the broker provide a valid food license and a food inspection report for the seller. If the broker is not willing to produce such documentation, then the Florida hemp retailer should walk away from the deal.

 

The “approved source” rule is just one example of the complications created by a lack of uniformity in state hemp programs and a lack of guidance from the FDA with respect to hemp extract used in food. The team at Mr. Cannabis Law is here to help you navigate through this complex web of laws and regulations rife with legal inconsistencies and legal contradictions.

 

 

Two Distinct Legal Frameworks for Two Products that are not so Different

By: Dustin Robinson and Sean Hardwick

 

Can the Hemp Industry Transact with the Marijuana Industry? - Mr. Cannabis LawHemp and marijuana are botanically similar. Specifically, hemp is defined as cannabis with a concentration of 0.3% THC or less on a dry weight basis. However, cannabis is classified as marijuana both federally and in the state of Florida once the cannabis contains more than 0.3% THC on a dry weight basis. For operations, hemp and marijuana require a similar supply chain and infrastructure. While most states separate the hemp and marijuana industries into two distinct legal frameworks, the two industries could potentially complement one another through cooperation between hemp and marijuana operators. Yet, most state marijuana laws do not even contemplate the possibility of the two industries transacting with one another. This is a big mistake and states need to update their laws. Allowing hemp and marijuana operators to transact will improve supply issues in the marijuana industry; provide more sales channels for the hemp industry; improve patient access; and reduce costs in both industries.

 

There are numerous ways the hemp industry could one day transact with the marijuana industry. For example,  the hemp industry could sell CBD isolate to marijuana companies to be converted into THC distillate. There are several companies who have filed patents on technology that can do this in a safe and efficient manner. Another way in which the hemp industry could one day transact with the marijuana industry is by providing marijuana companies with various isolated cannabinoids derived by hemp, including, but not limited to, delta-8 THC, CBD, CBN, and CBG. It is much cheaper to produce these minor cannabinoids by using hemp than marijuana. And there is an increasing demand for these minor cannabinoids as additional research studies are published demonstrating their potential benefits.

 

However, the laws in most states prohibit these types of transactions. For example, in Florida a marijuana licensee must grow, process, dispense, and deliver the marijuana it sells; and it cannot contract out for these activities and it cannot purchase product from another grower to be processed. Thus, a Florida marijuana licensee cannot purchase CBD isolate or any minor cannabinoids from a hemp company. If a Florida marijuana licensee was able to purchase the CBD isolate or minor cannabinoids, it would improve patient access; drive down costs; and allow the marijuana licensees to develop more innovative products. It would be a win for the hemp industry, marijuana industry, patients, and customers.

 

Additionally, hemp companies and marijuana companies can create strategic partnerships. The sale of hemp-derived products occurs online and in retail stores. Therefore, a hemp producer needs to generate traction with its customers on the hemp producer’s website, a hemp distributor’s website, or through retail store. Yet, stand-alone hemp product stores are often unsuccessful. Furthermore, the sale of hemp products in other retail stores such as grocery stores, pharmacies, or convenience stores is generally not a primary focus for the retail store. By contrast, marijuana may only be lawfully sold within a state-licensed dispensary facility. Further, marijuana dispensaries are seen as a reliable place to purchase cannabis products because each marijuana product must undergo rigorous testing and can be tracked after it is sold. Specifically, each marijuana product is tested for potency; microbial contaminants; metals contaminants; and residual solvent contaminants (if any solvents were used during manufacturing). In addition, all marijuana products are tracked using the state’s track-and-trace system. Therefore, hemp products sold in a marijuana dispensary will be viewed as more reliable. As a result, hemp producers and marijuana dispensaries will both benefit. Specifically, hemp producers can generate higher revenue from sales to dispensaries and reach more customers from the exposure the hemp product receives from being sold within marijuana dispensaries. Furthermore, marijuana dispensaries can offer customers a wider variety of products. Therefore, commerce between hemp and marijuana operators benefits both hemp and marijuana operators.

 

In short, the interaction between hemp and marijuana can create a variety of benefits for both industries. While Colorado has provided guidance for the hemp industry to transact with the marijuana industry, most states have not established frameworks that allow for hemp operators and marijuana operators to transact with one another. Because marijuana remains a Schedule I controlled substance under the Controlled Substances Act, any transaction between the hemp operator and marijuana operator may be federally illegal. Furthermore, without established regulations or clarification from a state’s marijuana or hemp program, transactions between hemp and marijuana operators may violate state law as well. As more states recognize the interaction between the hemp and marijuana industries, the lines between the two industries will be further blurred which will further buttress the need for federal legalization.

 

 

 

 

 

By Dustin Robinson and Zachary Hyman

This article is featured in the eBook, Pivot Under Pressure: A Comprehensive Guide to Minimize Impact and Revitalize Your Small Business, which is available at https://millenniallaw.com/pivot/

 

The ABC’s of Cannabis and Coronavirus - Mr. Cannabis LawThe Coronavirus has impacted many businesses and industries, including the Cannabis industry.  The Coronavirus closures and government regulations concerning the distribution of Cannabis has created uncertainty as it relates to the future of the industry. To make matters worse, federal funding is not available, and Cannabis companies cannot file for bankruptcy. However, Assignment for the Benefit of Creditors (or “ABC”) state statutes, such as Florida Statute Section 727.104, provide an affordable alternative to bankruptcy that permits business owners to close while limiting your potential liability.

The ABC proceeding is commenced with the execution of an irrevocable assignment in writing.  Upon execution of this assignment, the party receiving the assignment receives control over a “legal estate” comprising of all of the assets of a business, and the assignor (or business) loses power and control over its property. Then, the assignee, or neutral third party who is responsible for marshalling and selling the assets of your business, commences an assignment proceeding. Generally speaking, an ABC is an efficient, relatively economical, and faster means for the administration of insolvent estates in Florida, and remains a viable alternative to Bankruptcy, especially if bankruptcy is not available to a company.

Below is a summary of what an assignment for the benefits entails, and how it can benefit your business.

  1. You get to choose the assignee. Pursuant to Fla. Stat. § 727.104, the people or entities in control of a business can select the assignee, or the person that will be managing the liquidation process, which gives flexibility in the approach to be taken with respect to your company, and the assignee can operate your business during the pendency of the ABC process.
  2. ABCs Limit Liability. An assignee has the right to reject real and personal property leases, and may be required, at a maximum, to only pay back rent and future rent not to exceed the greater of one year’s rent or fifteen percent of the rent remaining, and rent must be charged at the contract rate. Damages arising from the termination of employment agreements are also limited.
  3. Unsecured Creditors Cannot Pursue Collection Efforts. An unsecured creditor, such as a credit card company, or a creditor that does not have a security interest in your businesses’ assets, is prohibited from commencing any claims against your business, and must file a proof of claim in the Assignment of Benefits Case. As a result, all of the claims against your business, with the exception of secured claims, mortgages or other claims where a creditor has a security interest in your business’ property, must be heard and addressed in a single forum.
  4. The Assignee Can Assign and Prosecute Claims. The Assignee can assign and prosecute claims on behalf of your business, and certain legal defenses to such claims, such as claims based on your participation in the wrongdoing, do not apply to an assignee. This means the assignee can sell potential claims on behalf of your business at a higher value to creditors.

The ABC process provides business owners, for whom bankruptcy is not available, because they are in the Cannabis industry or cannot afford the process, a mechanism to close their company and limit potential liability from creditors. If your business is struggling, then the ABC process may be a viable solution to your financial distress. Consult with an attorney or financial advisor to see if the ABC process is appropriate for you and your business.