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Marijuana: Colorado Springs owes $3.3M-plus after dispensary prosecution fails, attorney says

In March, Rocky Mountain Miracles owner Ali Hillery was hit with felony charges over alleged discrepancies in the Colorado Springs dispensary's plant count. She was cleared of these charges last month, and her attorney, Sean McAllister, issued a motion calling for material seized by authorities to be returned by Monday. It was not -- so now, he's laying the groundwork for a lawsuit against the city, with damage demands expected to exceed $3 million.

McAllister offers a quick summary of the case.

Hillery "was raided on March 19 and 20. She had about 1,300 plants, and police said she had about fifty pounds of marijuana -- but when they raided her, they said she was only allowed 700 plants and about eighteen pounds of marijuana. So they took away 600 plants and 35 pounds of marijuana. They just cut down the plants, and they grabbed the marijuana whether it was cured, dried and harvested or wet and curing."

Inside Rocky Mountain Miracles.
Inside Rocky Mountain Miracles.

This last action was only one of many problematic parts of the seizure, in McAllister's view. "The local police clearly didn't know the rule that only finished marijuana counts as inventory. At the trial, the state's own expert came in and said it was in the process of curing -- it had fan leaves on it and was on the stalk. And that was one of the big reasons why we got an acquittal -- in part because they didn't know the rules about how to weight the marijuana, and in part because the jury found there was no way for the dispensary owner to know how many patients she had."

Indeed, McAllister has regularly raised questions about the vague process for record keeping at medical marijuana dispensaries. "The health department won't tell them how many patients they have, so there was no way for her to comply with the law -- because how do you comply if you don't know how many patients you have?"

In the end, Hillery was acquitted on all counts, prompting McAllister to ask that the city return the plants and product, in order to determine if any of it is still unable -- something he considers to be extremely unlikely. And that's only the beginning.

"The first step is to assess my client's damages," he says. "When they ceased all of the plants and marijuana, they basically turned her business upside down. She had to go out and buy wholesale marijuana, and make less than half the profit she would have otherwise, which caused real damages in the hundreds of thousands of dollars. And we estimate in our complaint" -- read it below in its entirety -- "that the plants and product they took was valued at $3.3 million."

This figure is based on "the DEA's own numbers," McAllister continues. "They say every plant produces a pound, and a pound is worth $5,000."

Other expenses further inflate the $3.3 million figure, McAllister maintains. "Not only did she have to buy product from other people, but she had to replant to replace the plants that were taken. And there were the legal fees for months and months of litigation over this illegitimate criminal charge. The City of Colorado Springs sought to revoke her license, which is still up in the air -- and even though the city might be withdrawing that petition, the damages associated with fighting the revocation, and the emotional distress of the whole thing, are considerable."

Hillery's case isn't the only one of its kind.

Continue to read more about the potential lawsuit against the City of Colorado Springs and see the aforementioned motion for return of property.

Bob Crouse after his acquittal.
Bob Crouse after his acquittal.

Last year, we told you about the acquittal of Bob Crouse, a Colorado Springs-based medical marijuana patient who was prosecuted for having more plants than were allowed under law. However, the plant-count rules are flexible when doctors recommend certain treatments, and Crouse needed additional plants to make Phoenix Tears, a cannabis-oil treatment that appeared to be having a positive effect on his chronic lymphocytic leukemia.

The marijuana seized from Crouse was ultimately returned, but it had developed mold and was unusable. As a result, he filed a notice in late December that he'd be suing the city for its value, thought to be in the $300,000 range.

As for the Hillery case, McAllister stresses that "we definitely intend to file suit." But who the complaint will target remains up in the air.

"It's possible that we'll file not only against the Colorado Springs Police Department, but also against the MMED" -- the Medical Marijuana Enforcement Division, the state agency charged with overseeing the MMJ industry. "Originally, MMED agents came in and said, 'You're out of compliance. We're calling the cops.' And in conjunction with the MMED, and at the agent's order, the Colorado Springs Police took the product away. They didn't independent verify the plant count. They followed the MMED agent's recommendations, which is an example of poor training -- and it's not how they've typically handled these cases in the past, which is another big reason we won. Dan Hartman and the current director, Laura Harris, both testified that there have been cases where other people were told they had too many plants, and they went through an administrative process to destroy them -- and nobody got charged."

In McAllister's estimation, a lawsuit is likely to be filed by the end of March, with court action apt to follow during the summertime. He believes the results will be important not only for medical marijuana businesses, but possibly for recreational outlets that may be okayed under the implementation of Amendment 64.

"Whatever we do with recreational marijuana, we can't have a system that exposes people to criminal liability for administrative problems," he says. "If this is a business, it should be treated like any other business. We need to get out of the mentality that marijuana is a crime and these people are engaged in a criminal activity. People are doing their best to comply with complicated rules, which even regulators don't always understand. So this represents the difficulty of transitioning from forty years of a drug war to a regulated model.

"These kinds of criminal charges represent an old way of thinking, and not a regulated, business concept of marijuana."

Continue to read the Rocky Mountain Miracles motion.

Here's the motion for the return of property.

Hillery Motion for Return of Property

More from our Marijuana archive: "Medical marijuana patient Bob Crouse acquitted: Another wasteful prosecution?"