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Marijuana: Judge rejects argument pot contracts can't be enforced -- and attorney's okay with it

In August, we told you about a major court ruling in which an Arapahoe County judge found that because marijuana is illegal at the federal level, medical marijuana contracts can't be enforced. Attorney Rob Corry subsequently (and somewhat reluctantly) made this same argument on behalf of a client, even though he's among the state's most vocal marijuana-reform activists. Now, a Denver judge has rejected it, and Corry's not griping.

As we've reported, the previous case involved a lawsuit against the Blue Sky Connection dispensary; in it, a plaintiff accused the center of declining to compensate him for approximately $40,000 worth of MMJ between June and October 2010. The trial took place this past April, and the following month, Arapahoe Judge Charles M. Pratt asked the assorted parties to explain "why this Court should not declare the purported contract void as against public policy" -- because "if the disputed contract violates federal law, it would be against public policy and would be void and unenforceable."

After receiving these responses, Pratt determined that the illegality of marijuana at the federal level superseded state law allowing its use for medical purposes. In his ruling, he cited a number of marijuana-related court cases we've covered in this space, including ones involving Jason Beinor, a medical marijuana patient who lost his street-sweeping job after failing a drug test; Leonard Watkins, an MMJ patient prevented from using cannabis while on parole; and Stacy Clendenin, a caregiver who a court decided hadn't gone beyond providing pot for her patients.

Pratt's conclusion? "Contracts for the sale of marijuana are void as they are against public policy," he wrote. "Accordingly, the contract here is void and unenforceable."

The ruling didn't set precedent, but it opened up a new line of defense for attorneys involved in medical marijuana lawsuits. As such, Corry made it a primary part of a court filing in the case of West v. Green Cross -- the latter being a dispensary that had retained his services. But the document follows mention of the Blue Sky decision with a highly unusual passage in which Corry essentially maintains that he had to put forward the theory whether he wanted to or not.

Continue to read more about the West v. Green Cross case and to see original documents.

 

The section in question reads:

Defendants recognize this is a somewhat unsettled area of the law, and that various attorneys and courts have taken a variety of positions about the legality of medical marijuana in light of federal law. However, pursuant to the Colorado Rules of Professional Conduct, licensed practicing attorneys are ethically required to raise and advance arguments on behalf of clients that could potentially benefit the lawyer's clients, notwithstanding the lawyers' personal interest or political views.

Just as surprising is the next paragraph, in which Corry writes that he's "ethically obligated to advise the Court of contrary authority as to the above federal illegality argument" -- meaning reasons to reject the very assertions he's putting forward.

Apparently, Denver District Judge Herbert L. Stein was impressed by the latter. In his dismissal of Corry's previous motion, dated November 21, Stein writes, "The Court finds Defendants' arguments on the unenforcabeability of said contract (and related claims) due to federal preemption to be unpersuasive at this stage. Colorado law will be applied in this case."

Corry's reaction? Part of him is pleased that Stein didn't add his voice to the notion that medical marijuana contracts aren't worth the paper on which they're written. But he remains troubled by the lack of clarity concerning the issue.

In his words, "We now need to decide whether we go through the lengthy and expensive process of dealing with the case at the district court level, or whether we take it to the Court of Appeals," where a decision would indeed set precedent.

The latter course makes sense to him "in light of Amendment 64. We need to know -- and every investor I've spoken with brings this up -- if we're above the law, or if we can be called into courts to deal with contracts.

"We need to know the landscape going forward, and we can travel either landscape," he continues. "If the landscape is yes, your contracts are enforceable in state court and your litigants can't just throw them out, that's fine. And if the converse is the case -- your contracts aren't enforceable, and you can't sue or be sued and expect the state court to deal with it -- we can deal with that as well. In that case, the industry would be uniquely above the law."

Continue to see the original motion to dismiss the lawsuit and the judge's subsequent ruling.

 

Note: The section of the motion to dismiss pertaining to the Blue Sky case can be found on pages eleven through thirteen of the document below.

West v. Green Cross: Defendants' Motion to Dismiss
West v Green Cross Denial of Motion to Dismiss

More from our Marijuana archive: "Medical marijuana at state level found illegal in potential blockbuster court ruling."


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