THE PEOPLE, Plaintiff and Appellant, v. STACY ROBERT HOCHANADEL et al.

[richyrich]

That's not what my friend who is an Attorney with the state AG's office said. Everyone that purchases weed/clones/other services is a member of our collective.


It is illegal for a corporation in the United States of America to not pay income tax. Federal Income tax is irrellavent to payroll. Payroll is handled by the state.

Any attorney and even the AG's opinions and guidelines are not binding on the courts. This is specifically stated in the Hochanadel Opinion. I am not cutting down the structure of your collective. You have the papers together right. But, your statement saying it's legal to sell weed because of your collective is incorrect. Again, a reading of the Hochanadel Opinion will state this. This recently published Appellate Opinion is the current prevailing case law regarding this issue; no way around it. If you are a collective do your members have equal vote and equal holdings in the corporation? A proper collective should.

You are right about the federal tax number (EIN); total brain fart.

 

[richyrich]

Also note in the case which is the subject of this thread. That the party filing the apeal was the county. The superior court where the case originated ruled in favor of the defendent.

The panel of Appellate Justices in their Opinion reversed the lower court's decision because it was wrong in matters of law or factual findings. The superior court's ruling is completely irrelevant now. We will have to see the outcome of this case on remand for trial back at the superior court. It does not look good for Hochanadel at all. I think he will be found guilty under analysis of law. That is just pure logic. My opinion is a different matter.

 

[FreedomFGHTR]

If you are a collective do your members have equal vote and equal holdings in the corporation? A proper collective should.

This thread isn't about the legal standings of my business. If you have questions then subpeona me.

 

[richyrich]

I understand privacy, but you sure were willing to show a lot; so far as to show redacted pictures. Now you want to not answer, using red herring tactics, to evade the question. Ok. Privacy respected.

 

[richyrich]

This thread isn't about the legal standings of my business. If you have questions then subpeona me.

By claiming that the collective is your business, concedes that the members do not hold equal ownership because you are the sole owner. Thank you for the answer. No need to subpoena you.

 

[Blue Dot]

By claiming that the collective is your business, concedes that the members do not hold equal ownership because you are the sole owner. Thank you for the answer. No need to subpoena you.

Oh snap. If it were "democratically controlled" wouldn't there be a board and votes?

1. Statutory Cooperatives: A cooperative must file articles of incorporation
with the state and conduct its business for the mutual benefit of its members.
(Corp. Code, § 12201, 12300.) No business may call itself a “cooperative” (or “coop”)
unless it is properly organized and registered as such a corporation under the
Corporations or Food and Agricultural Code. (Id. at § 12311(b).) Cooperative
corporations are “democratically controlled and are not organized to make a profit
for themselves, as such, or for their members, as such, but primarily for their
members as patrons.” (Id. at § 12201.) The earnings and savings of the business
must be used for the general welfare of its members or equitably distributed to
members in the form of cash, property, credits, or services. (Ibid.) Cooperatives
must follow strict rules on organization, articles, elections, and distribution of
earnings, and must report individual transactions from individual members each
year. (See id. at § 12200, et seq.) Agricultural cooperatives are likewise nonprofit
corporate entities “since they are not organized to make profit for themselves, as
such, or for their members, as such, but only for their members as producers.”
(Food & Agric. Code, § 54033.) Agricultural cooperatives share many
characteristics with consumer cooperatives. (See, e.g., id. at § 54002, et seq.)
Cooperatives should not purchase marijuana from, or sell to, non-members;
instead, they should only provide a means for facilitating or coordinating
transactions between members.

 

[richyrich]

Yes, especially, since it is a corporation.

 

[Greyskull]

It is illegal for a corporation in the United States of America to not pay income tax. Federal Income tax is irrellavent to payroll. Payroll is handled by the state.

the california franchise tax board, yeah?
they get a check and the irs gets theirs... i think thats who it goes

best to have dedicated accountants on staff (oh no they need to be paid! greedy bastards!) handle that stuff so stoners don't forget. and Don't forget to document your meeting minutes!

 

[Blue Dot]

and Don't forget to document your meeting minutes!

what meeting minutes, FF is a one man show?

 

[Greyskull]

well you believe what you will lol. you already do concerning 215 so its not anything new, fair enough?
if he has an accountant, and i may be wrong, but meeting with an accountant discussing/conducting business matters can be included/classified as 'minutes' that are required to be met. Might be real 'loophole' level stuff, but whatever.

THE GOVERMENT PULLS SHIT ALL THE TIME

I guess you could classify 215 as a loophole though...

 

[Greyskull]

and i always subscribed to the 'believe 10% of what you hear and 50% of what you see" line of things myself...

 

[FreedomFGHTR]

By claiming that the collective is your business, concedes that the members do not hold equal ownership because you are the sole owner. Thank you for the answer. No need to subpoena you.

my business means my every day affairs. Interesting that I say if you want to talk get me in court and you assume I am guilty of a crime. Which agency do you work for?

 

[richyrich]

All on point now guys and fellas.

 

[Pythagllio]

I see you listed on your business license (tax permit) that it is a collective. So you are running a collective and claiming it is legal to sell weed through it. Am I correct? That is illegal and not a true collective.

Where do you find a legal definition of the word collective? I've found no mention of it in CA law, but that's a lot of text so I might have missed it. The word co-operative has a legal definition under CA law. Do you agree that Prop 215 insures the rights of patients to form cooperatives? Didja know that under CA law co-ops can be formed as for profit or non-profit entities? Some day someone will finally grab hold of this and start an agricultural cooperative as defined under CA law. For profit. Totally legal, protected by Prop 215 which the legislature can not limit so sb420 is irrelevent.

 

[Danknuggler]

I'd like to hear more about agriculture coops.That sounds like a great idea.How come nobody has done it if it can be done and be fully protected?For profit?Really?

 

[Pythagllio]

Hey, it's my interpretation. 215 specifically says co-operatives, and CA legally defines them. But even non-profit ag coops are set up for their members to make a profit on goods and services provided. You've probably bought food at the grocery store that was sold to them by agricultural co-ops, probably in the last month. Got any Land o' Lakes cheese or butter in the 'fridge?

"Starting an Agricultural Marketing Cooperative" http://cooperatives.ucdavis.edu/reports/ag_mktg_startup.pdf Lots of reading here.

Forming a Cooperative or Collective in California

Katovich Law Group has worked with many clients to form California cooperatives. Our cooperative clients include a self-help bike repair workshop, a software developer, a biofuel provider, a group of IT consultants, a group of small businesses conducting a “shop local” campaign, a solar energy business, a grocery store, and a web developer.

While any business can operate cooperatively and democratically, in California, if a business wants to use the word “cooperative” in its name, it must form under one of the cooperative statutes. California has statutes for electrical cooperatives, housing cooperatives, and agricultural cooperatives. Any cooperative that does not fall into one of these categories can form under the California Consumer Cooperative Statute. Despite its title, this statute can be used by any kind of cooperative. http://katovichlaw.com/2009/06/27/marijuana/

The link above explains that you can do a co-op, and also finally explains to me the missing link in any assessment of why a cannabis cooperative would have to be 'closed circuit', mainly because the protections of 215 only apply to natural human beings, so if the co-op goes outside its membership to hire a professional grower for example the entity could be prosecuted under state law. Perhaps this also makes impractical the idea of forming a for profit collective.

If you want to look up the specific laws you can find them on the CA State website.

 

[kmk420kali]

Where do you find a legal definition of the word collective? I've found no mention of it in CA law, but that's a lot of text so I might have missed it. The word co-operative has a legal definition under CA law. Do you agree that Prop 215 insures the rights of patients to form cooperatives? Didja know that under CA law co-ops can be formed as for profit or non-profit entities? Some day someone will finally grab hold of this and start an agricultural cooperative as defined under CA law. For profit. Totally legal, protected by Prop 215 which the legislature can not limit so sb420 is irrelevent.

Not to mention, I believe the AG Guidelines is the only place that mentions "Non-Profit"...and it is not a Law...just Jerry's thoughts--

 

[dwtc]

ok heres my ?

the CAP and TRADE bill that has passed the house and is going up for vote in the senate, if it passes will the states that have MMJ laws will be null and void?


this bill gives the GOV. unprecedented controle over the private sector. they would effectively be able to demand you retrofit your house with "goverment approved" light bulbs, appliances, thermastats, toilets, and what ever else they can think of.

this bill SPECIFICALLY AUTHORIZES gov. to send FEDERAL AGENTS to come to your house to check and see if you are in compliance with the bill. they will check your basements, attics and closets to check for compliances.

so when FEDERAL AGENTS find your grow what happens?


stay safe and FREE,,,,,,,,,,,,,,,,,,,,,,,,dwtc

 

[PharmaCan]

So, a friend of a friend of my second cousin is a grower and he has a little co-op going. Members buy their MMJ for $10/gram. Members are responsible adults who buy multi-ounces less frequently. There is no storefront, but semi-monthly meetings are held at discreet locations, so as to protect the security of the grow.

If you think about the economics of this:

Compared to dispensary prices, $10/ gram is a screaming deal.

It's a fantastic deal for the grower too. It's hard to find any dispensary to pay more than $3000 per lb, and this time of year it's down to around $2500 or thereabouts. $10/gram is $4,480 per lb! There's nothing to prevent the co-op from selling excess to a 'D'. Even more importantly, for every member of the co-op the grower has an almost ironclad defense against six plants. Any size grow could conceivably be legal with the formation of what really amount to modest-sized co-ops.

This is pretty much a win-win situation for everyone involved. The patients get their meds for a really cheap price - $280/oz for the math impaired - and the grower and his wife draw generous salaries for doing the growing and running the co-op.

Personally, I think we should see more growers getting involved in the distribution to patients and fuck the middle-men. The two biggest things growers worry about is getting busted and getting ripped off. The way that all the decisions and models and rules, etc in California seem to be going, the closed circuit co-op is what is going to be allowed and that goes directly to legal crops and higher profits for growers who take advantage of the situation.

The ripped-off part is a justification for high security and secrecy as to what can be disclosed to co-op members, it's just the nature of the business. Get them to sign a proxy once in a while and the democracy issue should be settled.

JMO

PC

 

[Vespatian]

The challenge facing dispensaries is one of complying with the laws that apply to them and only them (in some cases).

Medical Marijuana dispensaries will be judged in court strictly on their compliance with the laws and guidelines that have been created specifically for them. The HOCHANADEL decision is a perfect example of this, and I encourage everyone to take 15 minutes and read the document FreedomFighter has linked to.

Freedom Fighter is a very smart guy, and he and I are after the same result, so I am not sure why he believes this Appellate ruling is positive for us. I assure you that Mr. Hochanadel was not happy about this decision because one of the possible (likely) outcomes of this ruling was that he may be hauled back into court to face charges that were initially thrown out by the original trial judge.

In HOCHANADEL, the Fourth District Court of Appeal was faced with two questions:

“First, did the MMPA unconstitutionally amend the CUA when it authorized "cooperatives" and "collectives" to cultivate and distribute medical marijuana?

Second, did the court err in quashing a search warrant for a storefront medical marijuana dispensary called CannaHelp located in the City of Palm Desert, California, and dismissing the criminal charges against the defendants Stacy Robert Hochanadel, James Thomas Campbell and John Reynold Bednar (collectively, defendants), who operated CannaHelp, based on its findings that (1) CannaHelp was a legal "primary caregiver" under the CUA and MMPA; and (2) the detective that authored the search warrant affidavit was not qualified to opine as to the legality of CannaHelp?”

Their ruling:

“ We conclude the MMPA's authorization of cooperatives and collectives did not amend the CUA, but rather was a distinct statutory scheme intended to facilitate the transfer of medical marijuana to qualified medical marijuana patients under the CUA that the CUA did not specifically authorize or prohibit. We also conclude that storefront dispensaries that qualify as "cooperatives" or "collectives" under the CUA and MMPA, and otherwise comply with those laws, may operate legally, and defendants may have a defense at trial to the charges in this case based upon the CUA and MMPA. We further conclude, however, that the court erred in finding that CannaHelp qualified as a primary caregiver under the CUA and MMPA and in finding that the detective who authored the search warrant affidavit was not qualified to opine as to the legality of CannaHelp's activities. We conclude the facts stated in the search warrant affidavit provided probable cause the defendants were engaged in criminal activity, and, even if the search warrant lacked probable cause, the author of the search warrant affidavit acted in reasonable reliance on its validity. Accordingly, the court erred in quashing the search warrant and dismissing the charges against defendants. Finally, we conclude that, contrary to the People's contention, defendants Campbell and Bednar had standing to challenge the validity of the search warrant.”

The original trial judge in this case ruled that the search warrant was invalid and that all of the evidence obtained from it was inadmissible, so the defendants walked. The 4th District has now ruled that the warrant was valid, thereby putting them all at risk of being re-charged and tried. Right back where they started.

The 4th District also concluded that MMPA’s authorization of co-ops and collectives was valid, which IS good but it is also somewhat of a given in that the AG’s Guidelines already accepted and “legitimized” them, even provided a rough outline of how they must be structured and operated.

The Court in its decision relied upon and quoted extensively from the AG’s Aug. ’08 Guidelines, which is significant for those who believe they are nothing more than “Jerry’s opinion”. Among other instances, the decision directly quotes the Guidelines in ruling that dispensaries that merely make a new customer sign a form designating them as the customers Primary Caregiver and then immediately sell them weed are clearly out of compliance – illegal. Unfortunately for the defendants in HOCHANADEL, this is precisely how they were operating.

The bottom is that this decision is bad news for the defendants, and gives our side nothing more than what has already been given in the AG Guidelines.

I am not an attorney and this is not legal advice. This is simply my reasoned opinion, and I welcome all dissent, slander, and death threats.