COURT MAY ORDER BAN ON POT SALES

A Judge Concludes That State Law Does Not Allow Marijuana to Be Sold.
Another Hearing Is Set for January.

A Los Angeles County Superior Court judge, concluding that state law
does not allow medical marijuana to be sold, proposed an injunction
Tuesday that would order an Eagle Rock dispensary to cease selling it.

"I don't believe that a storefront dispensary that sells marijuana is
lawful," said Judge James C. Chalfant at a hearing on a lawsuit that
City Atty. Carmen Trutanich filed Oct. 28 against Hemp Factory V.

The civil suit is Trutanich's first attempt to use the courts to
close a dispensary in a city that has seen hundreds open while the
City Council debated an ordinance for more than a year and a half.

Chalfant's injunction would be a victory for Trutanich, who sought
unsuccessfully to persuade the council to explicitly ban medical
marijuana sales. Chalfant accepted the same legal argument that the
council sidestepped and appeared ready to grant the injunction
Tuesday but set an additional hearing for late January.

Trutanich Challenge

The case could test Trutanich's double-barreled challenge to the
city's dispensaries.

In addition to maintaining that sales are illegal, he has also argued
that the state's food-and-drug safety law applies to medical
marijuana. He reached that conclusion after samples of marijuana from
dispensaries, including Hemp Factory V, were found to contain pesticides.

In an Oct. 30 decision, Chalfant sided with Trutanich and ordered the
dispensary not to distribute pesticide-tainted marijuana. His
proposed injunction would also require Hemp Factory V to label its
marijuana as though it were a typical medicine.

William W. Carter, the chief deputy city attorney, would not say
whether other cases would follow, but said, "This is an ongoing
investigation involving a number of different locations."

He said the case was filed because the council had not passed an
ordinance the city attorney could enforce. "It became a crisis in
L.A.," he said.

The judge, in forceful comments, said he believes state laws allow
collectives only to cultivate and distribute pot.

He noted that dispensaries create "a whole host of problems" and "a
serious risk of cheating." Chalfant said that an entrepreneur could
pay himself $500,000, call it an expense and declare that his
business adheres to the law's requirement that medical marijuana not
be sold for profit. "Any way you slice that banana," he said, "that
is the sale of marijuana for profit."

Hemp Factory V is not one of the city's more flamboyant dispensaries.
It is tucked into a Colorado Boulevard plaza behind a Popeyes and a
Pizza Hut. It has no sign, only an American flag decal.

The collective and its operator, Gevork Berberyan, came into
Trutanich's sights after a Food and Drug Administration lab tested
pot from some dispensaries. The sample from Berberyan's store had one
of the highest pesticide levels: 8.5 parts per million of bifenthrin.

An FDA analyst noted that that was 170 times the level allowed for
one category of herbs. Berberyan's attorney, Mark Rabinovich, has
challenged that comparison, noting that higher levels are allowed in
other categories.

Berberyan's dispensary was also one of the City Council's first
targets. The council voted to shut it down June 9, when it denied
Berberyan's request for a hardship exemption from a moratorium on new
dispensaries. The Eagle Rock Neighborhood Council, exasperated at the
proliferation of stores, had asked the council to close it.

The city's lawsuit hinges on at least five undercover buys, which it
says show that Hemp Factory V is a business.

Undercover Buy

In court documents, LAPD Officer Brent Olsen acknowledged that the
dispensary appeared to verify his doctor's recommendation. But, he
added, he performed no activities that would be typical of a
collective. "I simply filled out forms, was quoted a price for
marijuana and was able to buy marijuana at that quoted price," he said.

In a bid to show that the dispensary was violating Chalfant's Oct. 30
order, the city attorney said four additional samples have tested
positive for pesticide residues, including variations of chlordane,
which is banned in the U.S.

Chalfant engaged in an extended discussion with Rabinovich about
whether sales should be allowed. The judge said the state Supreme
Court's 2008 decision in People vs. Mentch makes it clear that
patients and caregivers can collectively cultivate marijuana but not sell it.

Rabinovich argued that the term "cultivation" was ambiguous. The
judge agreed, but said that Hemp Factory V was primarily involved in
distribution. "You've got the cart before the horse," he said. He
agreed Rabinovich could provide more information on how the
dispensary cultivates marijuana.

He and Rabinovich also tangled over whether the state's Sherman Food,
Drug and Cosmetic law applied.

Rabinovich said that Hemp Factory V had no ability to comply with the
law's requirements to label marijuana and test it for purity.
Chalfant responded, "I don't think that's a legal argument."

In his proposed injunction, Chalfant noted, "If Hemp Factory were
operating as a true collective, its members would be growing the
marijuana and they could avoid inclusion of pesticides."

Asha Greenberg, of the city attorney's office, told Chalfant that the
problem for Hemp Factory V was that it was selling marijuana. If it
were just growing it like a collective, she said, the law would not apply.

"It would be like if I was growing tomatoes in my backyard and giving
them to my friends," she said.

Chalfant asked the lawyers to address the issue at the next hearing.