Can medical-marijuana dispensaries declare bankruptcy?
To an increasing portion of the populace, medical-pot dispensaries are a business similar to many others—they have a building, some staff, a product.
That’s not to say that everyone wants that business near their home, but an increasing percentage of the population appear to view it as an industry like others—and like some others, one that has some needed regulation.
But a recent case in California throws that into question. After all, if the federal government is a significant holdout in the movement toward acceptance of the medical-marijuana industry, and if the federal government is in charge of the Bankruptcy Courts … you get the picture.
As a story by Stephanie Gleason begins:
“Mother Earth’s Alternative Healing Cooperative Inc. is in some trouble. The San Diego startup that opened last year is facing debt, the threat of eviction from its landlord and is involved in litigation. To deal with these issues, the company did what many would—on Wednesday, it filed for Chapter 11.
“However, Mother Earth isn’t just any business. It’s a medical-marijuana dispensary, licensed by the state of California and San Diego County, but it’s seen as illegal by the federal government. And, for now, it’s unclear whether the company can deal with its debts this way. After all, the Bankruptcy Code is a federal law.”
Read the complete story here.
In Arizona Attorney, we have covered broader aspects of the medical-marijuana controversy, specifically the dialogue over it in this state. But the intriguing question about bankruptcy is a good one. For if an entity cannot avail itself of bankruptcy protection, can it ever call itself a business?
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