Cannabis business owners should seek legal assistance to mitigate risks in the heavily regulated and evolving hemp industry.
Navigating the tricky waters of a federally illegal substance that’s now legalized in a majority of states, in some form or another, is not for the fainthearted.
Every lawyer knows about the complicated legal trapdoors—yet some dive in anyway. “I was first exposed to the industry working in-house at a cannabis business during law school,” said Alex Buscher, founder of the Denver-based Buscher Law LLC, via email. Buscher Law helps companies in the hemp and marijuana industry with business formation, state hemp law interpretation, leasing and licensing agreements, and securities.
While working in-house, Buscher completed a law review report of the hemp and CBD laws in all 50 states requested by Governor Jared Polis, who was a congressman at the time, and the Hemp Farming Act of 2018 hadn’t yet been introduced. “After passing the bar, I received my law license one month before hemp was officially legalized at the federal level,” he said. “At the time, very few lawyers or firms were paying attention to what I could see would be a massive industry, so I decided to hang my shingle.”
The details of the 2018 Farm Bill intrigued him. “The biggest misunderstanding regarding the Farm Bill is the belief that hemp and CBD were legalized nationwide,” he said.
“While there is more awareness that CBD is unlawful in food and dietary supplement products because of the publicity that CBD has received, product manufacturers and retailers may be unaware that even under the Farm Bill, some states still consider hemp or hemp products to be marijuana. Help- ing clients understand which states to enter and the nuances of the laws of each state is a very large portion of the firm’s legal work.”
The cannabis business owners that Buscher’s firm worked with wanted to do the right thing and follow the law. The reality is that it can be very difficult because of the tricky interactions between state and federal law, and the varying laws of each state.
“In terms of business development, the most important thing we can do is make sure our clients are aware of the costly and potentially business-ending risks and challenges that are unique to operating a business in the current regulatory climate,” Buscher said.
On the federal level, Buscher is also closely watching the MORE Act, which would remove marijuana from the federal Controlled Substances Act, the STATES Act, and the SAFE Banking Act. “I’m not optimistic about legalization this year because I do not believe Senate Majority Leader Mitch McConnell will bring the bills to the Senate floor until he has a political motivation to do so.”