Metropolitan News-Enterprise


Wednesday, February 1, 2017


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Ethics Committee Seeks Comment on Whether Judges Can Own Marijuana Businesses


By a MetNews Staff Writer


The Committee on Judicial Ethics Opinions yesterday circulated a request for comment on a draft opinion saying judicial officers cannot have a financial interest in medical marijuana businesses.

“An interest in a commercial enterprise involving the sale or manufacture of marijuana that is in compliance with state and local law is still in violation of federal law pursuant to the Controlled Substances Act,” the committee said in the draft. “A violation of federal law violates a judge’s explicit obligation to comply with the law…and is an activity that involves impropriety or the appearance of impropriety. Moreover, such extrajudicial conduct may cast doubt on a judge’s capacity to act impartially….Therefore, the committee believes that a judicial officer should not have an interest in a commercial enterprise that involves medical or recreational marijuana.”

The committee does not identify the sources of requests for opinions.

It acknowledged that more than half the states have adopted medical marijuana laws, and that several, including California, have decriminalized recreational use. California’s decriminalized marijuana industry, the committee noted, could generate $1 billion per year in state and local taxes, and “investors are flocking to the lucrative industry.”

But federal law still bans the use, possession, distribution or manufacture of marijuana, without regard to state law. And as long as that’s the case, the committee concluded in its draft, it would be unethical for a judicial officer to have a financial stake in such an enterprise, whether through “a personal financial investment, private equity fund investments, maintaining shares in a corporation that invests in marijuana, maintaining a real property interest in a commercial property that is leased for marijuana growth or distribution, or a spouse’s or registered domestic partner’s financial interest.”

Federal law, the committee elaborated, not only criminalizes the possession and distribution of marijuana, but also involvement in related commercial activity.

“Any capital placed into a marijuana business not only puts an individual at risk of criminal prosecution, but such assets and investments are subject to forfeiture…and any investment of marijuana profits further violates federal law….Similarly, financial transactions that involve proceeds generated by marijuana can form the basis for federal prosecution under money laundering statutes, the unlicensed money transmitter statute, and the Bank Secrecy Act.”

The committee did acknowledge that the Justice Department has, as a matter of policy, declared that enforcement of marijuana laws against those who are compliant with state law, at least as to medical marijuana, is not a priority, and that Congress has barred the use of federal funds for such enforcement. But funding could be restored at any time, department policy can change, and even under current policy, authorities have said that prosecutions are possible where they would serve “an important federal interest,” the committee noted.

The committee also concluded in its draft that judicial involvement in a marijuana business would create an appearance of impropriety or partiality, given the large number of marijuana-related cases that come through the courts.

The document is CJEO Draft Formal Opinion 2017-010, and is open for comment until March 1. Comments, the committee said, may be submitted online at; emailed to; or mailed to Ms. Nancy A. Black, Committee Counsel, The Supreme Court of California Committee on Judicial Ethics Opinions, 350 McAllister Street, San Francisco, California 94102.

Comments are considered confidential unless confidentiality is waived, the committee said.


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