Justice Department Letters and Lawsuits Target Dozens of Illegal Storefronts
LOS ANGELES – LawFuel.com – US Legal Newswire – As part of an ongoing initiative against the commercial marijuana industry in California, federal authorities today filed three asset forfeiture lawsuits against properties housing six marijuana stores in Anaheim and sent warning letters to people associated with a total of 66 illegal marijuana operations in the cities of Anaheim and La Habra.
The warning letters and lawsuits target all known marijuana stores – including about two dozen stores that have closed in recent months – in the cities of Anaheim and La Habra. The vast majority of the marijuana storefront operations are in Anaheim – 38 are still open and operating – and two of the illegal stores are in La Habra.
The three civil asset forfeiture complaints were filed this afternoon in United States District Court in Los Angeles. The lawsuits are against three properties in Anaheim, one of which currently houses three marijuana stores.
The forfeiture lawsuits allege that the owners of the properties knowingly allowed illegal marijuana stores to operate in their buildings. The forfeiture lawsuits target properties that contain:
two marijuana stores located in one building at 503 North Anaheim Boulevard, a property that is co-owned by a man who was previously convicted in state court on felony narcotics charges – AAA Wellness Center and Anaheim Patients Association (formerly known as Anaheim Caregivers Association and Anaheim Caregivers Dispensary), both of which have been the subject of cease and desist letters issued by the City of Anaheim;
a marijuana store that operates under the name Releaf Health & Wellness in a building at 2601 West Ball Road, even though the store received a cease and desist letter from the City of Anaheim (the building formerly housed two other stores, the now-defunct Nature’s Top Shelf Collective and the recently closed Remedy Tree); and
three commercial marijuana outlets – Premium Organic Treatments PCA, Mid-County Patients Association and DKG Group Corp., all of which have received cease and desist letters from the City of Anaheim – housed in a building at 3148-3164 East La Palma Avenue.
“While these marijuana stores purport to be ‘medical marijuana dispensaries’ operating pursuant to California law, and claim to be distributing marijuana for medical purposes, such distribution is not a recognized exception to the [federal] Controlled Substances Act,” according to the asset forfeiture lawsuits.
Furthermore, according to the lawsuits, “The government is informed and believes that at all times relevant to this complaint, the operation of the marijuana stores on the defendant property was not (and is not) permitted under California law.”
In addition to the asset forfeiture action, federal authorities this morning executed federal search warrants at AAA Wellness Center and Anaheim Patients Association.
Federal search warrants were executed at the two marijuana stores in La Habra last Thursday.
In conjunction with the filing of the three asset forfeiture complaints, letters were mailed out today to the property owners and operators of 64 marijuana stores that are either currently operating or were recently closed in Anaheim. Federal authorities believe that 38 of those stores in Anaheim are still open for business. Letters also were sent to people associated with two stores in La Habra. The warning letters give the operators and landlords 14 days to come into compliance with federal law or risk potential civil or criminal actions.
Today’s enforcement actions in Orange County follow similar actions over the past 10 months across the seven-county Central District of California. Starting in October 2011, prosecutors began filing asset forfeiture lawsuits and sending letters to marijuana operations in selected areas in the Central District of California (see, for example: http://www.justice.gov/usao/cac/Pressroom/2012/074.html).
With the lawsuits filed today, the United States Attorney’s Office has filed a total of 16 asset forfeiture complaints related to illegal marijuana operations over the past 10 months. Fifteen of the lawsuits name real properties, and one case concerns cash seized from the operator of a marijuana store. Five of the 16 civil actions have been settled with court-ordered consent decrees that require the owners of the buildings to, among other things, forfeit rental proceeds paid by the operators of the marijuana stores, close the marijuana stores, and no longer rent to people associated with illegal marijuana operations or face immediate forfeiture of the properties.
In addition to the letters and the civil lawsuits, prosecutors have obtained indictments against the operators of storefronts in North Hollywood and Upland (in relation to the latter, see: http://www.justice.gov/usao/cac/Pressroom/2012/077.html).
Federal enforcement actions – the asset forfeiture lawsuits and warning letters – have now targeted nearly 300 marijuana stores and grows in the Central District of California. The majority of those stores are now closed, are the subject of eviction proceedings by landlords, or have been the subject of additional federal enforcement actions such as search warrants or, in the case of the G3 Holistic store in Upland, criminal indictment.
In October 2011, the four United States Attorneys in California announced the coordinated enforcement actions targeting illegal marijuana cultivation and trafficking (see: http://www.justice.gov/usao/cac/Pressroom/2011/144a.html).
The United States Attorney’s Office is working in conjunction with the Drug Enforcement Administration and IRS – Criminal Investigation. The cities of Anaheim and La Habra assisted in the investigations that led to today’s federal enforcement actions.