Hladick, 083116 AKAGO, AGO AN2016101562

Case DateAugust 31, 2016
CourtAlaska
Chris Hladick
AGO AN2016101562
No. AN2016101562
Alaska Attorney General Opinions
August 31, 2016
         Chris Hladick          Commissioner          Department of Commerce, Community, and Economic Development          P.O. Box 110800          Juneau, AK 99811-0800          Re: Marijuana Social Clubs          Dear Commissioner Hladick:          You have asked for a legal opinion about the consumption and distribution of marijuana at so-called "marijuana social clubs," a generic term for physical venues where fee-paying patrons or members consume marijuana.          Your first question is about marijuana consumption at such venues. Alaska law prohibits consuming marijuana "in public."1 Regulations allow marijuana consumption at licensed retail marijuana stores that have state approval, but prohibit public consumption at all other "places of amusement or business" and places to which "the public or a substantial group of people has access."2 Thus, your question is whether people may lawfully consume marijuana at an unlicensed place that charges a fee for the privilege of entering and consuming marijuana on the premises.          The answer is no. If that place is not a licensed retail marijuana store, consuming marijuana there is unlawful. Charging people a fee to consume marijuana at a physical venue, if done regularly and for financial benefit, is to operate a business. The venue itself would therefore be a "place of business" where it is unlawful to consume marijuana, even if the venue's proprietor expressly invites people to do so. And even if this operation did not rise to the level of a business, the venue would still count as "in public" if a "substantial number" of people had access to it, so that consuming marijuana there would be unlawful.          Your second question is about the distribution of marijuana samples at marijuana social clubs. Without a license from the Marijuana Control Board, a person may not possess more than one ounce of marijuana or transfer marijuana for remuneration.3 You have asked whether a person without a Board-issued license acts unlawfully by charging people a fee to consume marijuana at a physical venue if he provides those people with marijuana samples.          If this person has "dominion or control" of the marijuana provided as samples— even if he does not own or have physical possession of the marijuana—he is acting unlawfully if the total amount of marijuana is more than one ounce or if he receives payment for transferring that marijuana to patrons.          LEGAL BACKGROUND          I. Alaska's marijuana laws and regulations.          Alaskans voted in 2014 to liberalize personal use of marijuana and to authorize a commercial marijuana industry regulated by a Marijuana Control Board.4 The resulting laws strictly control the sale of marijuana and establish limits for personal possession, use, and distribution of marijuana.[5]          Lawful personal use of marijuana entails the right to use, possess, and purchase one ounce or less of marijuana as well as the right to transfer one ounce or less of marijuana (and up to six immature plants) to another person "without remuneration."6 A person may lawfully assist another in personal use activities.7 However, it is unlawful to consume marijuana in public, with violations punishable by a fine of up to $100.8          Commercial marijuana cultivation, processing, testing, and sale are permitted only by four types of licensed "marijuana establishments" : retail marijuana stores, marijuana cultivation facilities, marijuana product manufacturing facilities, and marijuana testing facilities.[9] Each type of establishment plays a distinct role in the marijuana industry, must be licensed by the Marijuana Control Board, and is subject to the Board's regulations.[10]The Board's regulations establish a licensing process, health and safety measures, employee training requirements, and other requirements for each type of establishment.11They also create rules for enforcement and local government control.[12] The regulations prohibit consuming marijuana on the premises of any licensed establishment except for permitted areas of licensed retail marijuana stores.13          Despite the 2014 changes to Alaska's marijuana laws, it remains unlawful to possess more than one ounce of marijuana without a license and to sell marijuana without a license. Possessing more than one ounce of marijuana remains unlawful under Alaska's Controlled Substances Act;14 only licensed marijuana establishments are exempted.15 The Controlled Substances Act also criminalizes possessing any quantity of marijuana "with the intent to manufacture or deliver."16 This prohibition is partially supplanted by the 2014 amendments, which allow possessing or transferring up to one ounce of marijuana "without remuneration"17 and permit licensed marijuana establishments to sell marijuana to consumers.[18] But for those without a Board-issued license, transferring marijuana for remuneration remains illegal.19          II. Federal marijuana laws.          The federal Controlled Substances Act prohibits possessing and selling marijuana.20 The U.S. Department of Justice has advised that federal officials are less likely to enforce the prohibitions on marijuana in states that have legalized marijuana possession and sale if these states' regulations support the federal government's enforcement priorities: preventing distribution to minors; preventing revenue from marijuana sales going to criminal enterprises; preventing drugged driving and other adverse public health consequences tied to marijuana use; and preventing violence and the use of firearms in the cultivation and distribution of marijuana. 21 Yet the Department of Justice's current enforcement policy is no guarantee against federal prosecution. The Department of Justice cautioned that "[i]f state enforcement efforts are not sufficiently robust to protect against [those harms,] the federal government may seek to challenge the regulatory structure itself in addition to continuing to bring individual enforcement actions, including criminal prosecutions, focused on those harms."22 The Department of Justice could also choose to resume enforcing federal laws against marijuana possession and transfer at any time.          ANALYSIS          I. Alaska law prohibits the consumption of marijuana at a place where a fee is charged for that privilege unless that place is licensed as a retail marijuana store.          Soon after the 2014 changes to Alaska's marijuana laws, people began to operate physical venues where guests are invited to consume marijuana and marijuana products in a physical setting resembling a café, lounge, or nightclub. These venues, generically termed "marijuana social clubs," typically charge an entry or membership fee or demand a "donation". These venues do not purport to operate as retail marijuana stores authorized by Alaska's marijuana statutes23 and are not licensed by the Marijuana Control Board.          Because Alaska law prohibits consuming marijuana in public,24 consuming marijuana at these venues is legal only if they are not operating "in public." The Alaska Statutes do not define what places are "public" for purposes of the ban on public consumption, but the Marijuana Control Board has defined the term in a way that appears to prohibit consumption at these "marijuana social clubs":
"in public" (A) means in a place to which the public or a substantial group of people has access; (B) except as provided in (C) of this paragraph, includes highways, transportation facilities, schools, places of amusement or business, parks, playgrounds, prisons, and hallways, lobbies and other portions of apartment houses and hotels not constituting rooms or apartment designed for actual residence; [and] (C) does not include an area on the premises of a licensed retail marijuana store designated for onsite consumption under 3 AAC 306.305.[25]
         Depending on the particular facts, an unlicensed physical venue where people are invited to pay a fee for the privilege of consuming marijuana on the premises would be a "place[] of amusement or business" or a "place to which the public or a substantial number of people has access."          A. "Place of amusement or business"          The prohibition against public...

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