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Battle over Harborside pot dispensary heads to court

A variety of marijuana strains are available for patients at Harborside Health Center. Credit: Luis Sinco / Los Angeles Times

A federal judge in San Francisco on Thursday heard arguments in a case that is likely to decide the fate of the nation’s largest medical marijuana dispensary and could influence other cases involving clashing state and federal cannabis laws.

The matter under review by Chief U.S. Magistrate Judge Maria-Elena James involves efforts by federal prosecutors to seize two properties leased by Harborside Health Center in Oakland and San Jose unless alleged violations of federal criminal law -- the sale of marijuana -- cease.

Landlords who leased both properties to Harborside with assurances that the cooperative was in full compliance with state and local medical cannabis laws risk losing their properties under the civil forfeiture action.

“They can sell popcorn there. They can sell candy there. We’re just asking that the court advise Harborside that they cannot use the property for any illegal purpose,” Assistant U.S. Atty. Arvon Perteet told James during the packed hearing.

Whether the federal government has the right to seize the properties will come before James at a later date. Thursday’s hearing involved a request by the landlords and Perteet for a preliminary injunction to immediately halt marijuana sales at the facilities. 

Oakland, meanwhile, contends in a separate lawsuit against the federal government that the entire forfeiture action is illegal. Attorney Cedric Chao asked James to allow Oakland to make its case before she rules whether sales should be halted.

James declined to make any immediate rulings Thursday, but expressed some skepticism with the request for urgent action.

Preliminary injunctions generally are granted only when allowing an activity to continue would cause immediate harm. In questions to lawyers in the case, she asked why the federal government now contends that it will be harmed by Harborside’s continued operation while the forfeiture case -- or Oakland’s case to block it -- are litigated, given the fact that for six years federal prosecutors have been aware Harborside was a dispensary and until recently took no action.

Even when federal prosecutors filed the civil forfeiture action against Harborside’s landlords in July, they did not file criminal charges against the dispensary or seek a halt to sales. Instead, attorneys for the property owners noted, they put the landlords in the position of having to crack down on Harborside to hold on to their assets.

“It’s become clear that we have no other recourse to stop the illegal activity,” Paul S. Avilla, who represents San Jose’s Concourse Business Center, told James.

But Oakland contends that the federal action is illegal because the statute of limitations for forfeiture has passed. Closing Harborside, they added, would cause injury to the city and the thousands of medical cannabis patients who have relied on assurances by federal officials that they would not interfere with dispensaries complying with state laws.

Lawyers for the Justice Department are seeking to have Oakland’s lawsuit dismissed, saying the city has no legal right to file it. That matter comes before James next month.

Henry Wykowsi, who represents Harborside, said his client wants its day in court to air all the issues. If James orders Harborside to stop selling medical marijuana now, he said, the dispensary may not be able to afford to press ahead with a defense.

The federal court hearing comes a week after President Obama suggested that something should be done to address the clash of federal statutes and laws passed recently in Washington and Colorado that legalized the sale and recreational use of small amounts of marijuana.

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-- Lee Romney in San Francisco

Photo: A variety of marijuana strains are available for patients at Harborside Health Center. Credit: Luis Sinco / Los Angeles Times

 
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