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Law firms take the plunge into cannabis law

Emerging Practice Areas

In November 2018, 1.5 million Missourians voted “yes” on Amendment 2, legalizing medical marijuana as part of the state constitution. The overwhelming vote made Missouri the 33rd state to make cannabis legal in some form, even as it remains forbidden at the federal level.

The legal implications were enormous and, for many Missouri lawyers, irresistible. From helping entrepreneurs jump into Missouri’s hottest market to advising traditional businesses and governments how to deal with the new legal landscape, attorneys are finding that plenty of clients need legal advice.

Perhaps someday cannabis law will be as staid and normal as contract law. But for the moment, it’s a wide-open field where the rules are still being written and the precedents don’t exist. Missouri Lawyers Media has selected for recognition a cross-section of pioneering lawyers and firms from across the state that have leapt into the state’s most innovative emerging practice area.

Reporting by Scott Andera, Scott Lauck, Dana Rieck and Jessica Shumaker.

Peter Andreone, Andreone Law/Hoban Law Group

Peter Andreone

Andreone

For Peter Andreone, the passage of Amendment 2 signaled an opportunity to shift gears in his practice.

Andreone, who started his own firm, Andreone Law, in 2015, previously focused on corporate and transactional law. Today his practice provides a wide range of services to cannabis companies, from helping them with license applications to entity formation, real estate, taxes and banking.

He said he was excited to start a practice in a growing area.

“I’m a believer in the power of cannabis as a medicine and firmly support the legalization of it,” he said. “I just kind of see over the last couple of years that the public perception of it has changed — a lot more people are accepting it, and a lot more Americans live in legal states than don’t.”

Andreone said he first became interested in cannabis law when his home state of Maryland started its medical cannabis program. He is a licensed attorney in that state, in addition to Kansas and Missouri. As he started to work in that space there, he reached out to the Hoban Law Group, a Colorado firm that specializes in cannabis law.

He became of-counsel with the firm in 2018, and after Missouri’s medical cannabis amendment passed, he became active in Missouri.

Hoban Law Group has about 50 attorneys in states with a legal cannabis market. Andreone said his association with the firm helps to augment his expertise and better serve clients.

Aubrey Gann-Redmon, Spark! Legal Solutions

Aubrey Gann-Redmon

Gann-Redmon

Less than two months after Aubrey Gann-Redmon’s mother died of cancer, Missouri voters approved the use of marijuana for medicinal purposes.

Gann-Redmon still wonders what would have happened if her mother had the opportunity to use medical marijuana as a part of her treatment, as the Kansas City attorney always has been an advocate of natural medicine.

She said she’s worked for years with clients she calls marijuana migrants, assisting them in moving their assets to states where medical marijuana was legal.

Gann-Redmon’s firm, Spark! Legal Solutions, also concentrates in probate and trust litigation. But Gann-Redmon estimates that earlier this year about 90 percent of her firm’s caseload was dedicated to helping small-business owners — or, as she puts it, “craft cannabis clients” — apply for medical marijuana licenses. Now those clients wait to see if the government will allow them to open up shop in the once-illegal industry.

Once those licenses have been ruled on, Gann-Redmon said she expects she and her two partners will help with appeals from clients whose applications for licenses were not approved and work with approved licensees on staying compliant with the law.

She also understands that the passage of Amendment 2 will affect all areas of law and knows that lawyers need to stay up to speed. She planned to host a CLE in December on the intersection of probate, trust and medical marijuana.

“There are as many different legal issues as there are human beings on this planet when it comes to the cannabis scene,” Gann-Redmon said, chuckling.

John Kennyhertz, Kennyhertz Perry

John Kennyhertz

Kennyhertz

John Kennyhertz, a partner at Kansas City-based Kennyhertz Perry, previously worked for a private equity firm in California. He and other Kennyhertz Perry attorneys who worked in that state watched the medical cannabis field expand in California, forming an important cornerstone in his firm’s approach in Missouri.

“We’ve been working with the Department of Health and Senior Services. It’s new to them, too,” Kennyhertz said. “We’re trying to work things out, and looking at some other states that have had some problems to help avoid similar problems here.”

While the field is new, Kennyhertz said medical marijuana reaches into many other areas where the firm already has a firm footprint, such as banking, mergers and acquisitions, and corporate law. Five of the firm’s attorneys spend part of their time working with potential cannabis licensees and businesses — primarily banks — which Kennyhertz points out as a major advantage for his firm.

“Our firm is mainly focused on serving businesses and their owners,” he said. “From the standpoint to be innovative, move quickly and provide beneficial and well-thought-out legal advice, I think we move a lot faster when compared to a lot of law firms while still providing all the experience and resources our clients need.”

Dan Viets, Dan Viets Attorney

Dan Viets

Viets

As the kids might say, Dan Viets adopted a cannabis practice before it was cool.

Viets, a solo practitioner in Columbia, has been working on marijuana-related issues since the 1970s with such organizations as the American Civil Liberties Union and the National Organization for the Reform of Marijuana Laws. Then he served as a member of New Approach Missouri, which put the medical marijuana measure on the 2018 ballot.

In the year following the amendment’s resounding approval, Viets’ practice had blended the new with the familiar. He continues to defend people accused of criminal possession and use of marijuana, as he has for 33 years. It’s a practice that takes him all over the state, with a trial in Rolla one day and a night court appearance in Riverside the next.

These days, however, some of his clients appear to be in compliance with the new amendment.

“Frankly, not only don’t most defense lawyers know the new law, but very few police and prosecutors have that law memorized,” he said. “It’s important that people understand that this is part of our state constitution now.”

Viets also has branched out into helping applicants for medical marijuana licenses. As those licenses are snapped up, he expects that work to end, though it could lead to longer-term representation of those clients on compliance issues.

After all, how many other lawyers not only have memorized the amendment’s language, but also helped to write it?

“I kind of had a head start by being in on the drafting,” Viets said.

Armstrong Teasdale

Eric Walter

Walter

Armstrong Teasdale has been involved in the cannabis industry since 2014, when it began to help clients apply for marijuana licenses in neighboring Illinois.

“Once we had this practice up, I took it upon myself to just do a lot of independent reading and research and looking at other state’s laws, looking at how the federal government was reacting to those states with an eye toward the future day when Missouri would have this constitutional amendment,” said Eric Walter, a partner with the firm.

Walter said the attorneys at Armstrong Teasdale approach their cannabis clients like any others: in a serious, multifaceted and business-forward manner.

“Our clients are very sophisticated. They’re typically very successful business people in other industries, and they’re getting into this because they’re interested in the space. They think it has good opportunity, and they are interested in providing this medication to patients,” Walter said.

The firm helps clients to submit competitive license applications and stay compliant with the law, as well as secure all of the elements necessary for them to apply for licenses. Those include corporate structure, private security fundraising, lobbying, intellectual property protection, property requirements,  and mergers and acquisitions.

The firm also helps other business clients with employment matters surrounding the new cannabis law.

“In approaching this cannabis practice we also look beyond just these clients who are . . . marijuana-related businesses,” Walter said. “There are also a number of clients who want to serve the industry, and they want advice on how to do that given the federal constraints.”

Carnahan, Evans, Cantwell & Brown

Joseph “Chip” Sheppard III

Sheppard

Carnahan, Evans, Cantwell & Brown’s medical marijuana practice is made up of eight lawyers and several paralegals. Joseph “Chip” Sheppard III said the firm approaches medical marijuana cases as it does all others: with a focus based on each individual client’s business needs.

As a member of the board of directors for New Approach Missouri, which put the medical marijuana measure on the ballot, Sheppard is intimately familiar with the intent and language of the constitutional amendment. He also sits on the board of the Missouri Medical Cannabis Trade Association and is a member of the National Cannabis Bar Association and Missouri Cannabis Industry Association.

Sheppard said he knows that after the initial licensing period is over, these medical marijuana dispensers, manufacturers, cultivators and transporters will need help understanding regulations and complying with the laws.

He noted, as well, that while the firm did expect a lull in work while clients awaited the results of their license applications, it actually ended up with quite a few clients whose applications needed to be resubmitted after being returned due to clerical errors or misunderstandings.

“I think the biggest challenge is, usually in the practice of law you’ve got some precedent . . . for how constitutional provisions and regulations have been interpreted,” Sheppard said. “And we’re going to start with a clean slate. There’s not going to be any precedent for us to rely on in Missouri. We will have to look to the other 30 states that had medical marijuana before we did.”

Evans & Dixon

Don Kelly

Kelly

St. Louis-based Evans & Dixon traditionally has focused on insurance defense and workers’ compensation matters. But Don Kelly, the head of the firm’s business law group, said that as the wide-ranging effects of Missouri’s legalization of medical marijuana became clear this year, the firm decided to write an in-depth, online legal-resource guide to help explain the new legal landscape.

The result, he said: “Holy smokes!”

“I don’t think we’ve seen anything we’ve written and posted get so much interest so quickly,” he said. “There’s obviously people with lots and lots and lots of questions.”

With a team that includes Tim Gerding in Columbia and former state Rep. Kevin Corlew in Kansas City, Evans & Dixon now boasts a practice that looks at multiple aspects of cannabis-related businesses. In particular, Kelly said, the firm is focusing on the “utile aspects” of industrial hemp, a crop suited to Missouri’s soil that can be grown for everything from biomass to agricultural feed.

Meanwhile, CBD oil is a booming business that Kelly compared to the “family-video market of the 1980s.” Many hopefuls are jumping in, but few are likely to survive — particularly once the CBD industry inevitably becomes more regulated. For now, Kelly said, “it’s like going into an old apothecary in Hogwarts looking for eye of newt.”

Kelly said the intellectual property aspects of cannabis have been especially interesting for him, as entrepreneurs try to protect patents for a substance that remains illegal at the federal level.

“It’s made state trademark registrations relevant for the first time in years,” he said.

HeplerBroom

Gregg Kinney

Kinney

In the wake of medical marijuana’s legalization in Missouri, St. Louis-based defense litigation firm HeplerBroom began thinking about its potential involvement in the fledgling industry. Then the calls started coming from potential clients who wanted to secure dispensary licenses.

“We decided, well, you know what, we’re getting people calling us, so let’s do it,” said partner Gregg Kinney.

Kinney is based in Missouri and previously had worked with fellow partner Andrew Carruthers, of the firm’s Edwardsville, Illinois office, on issues with that state’s medical marijuana laws. With Illinois now set to allow recreational marijuana as of Jan. 1, the two states’ industries seemed to be in need of long-term representation.

“Our whole focus was to be a local law firm who could help you as much or as little as you wanted through this application process — and then who would also be here, assuming you were granted a license, to be your business attorneys throughout the life of your business,” Kinney said.

Although the hub of the cannabis practice is just two partners and two associates, Kinney said they can draw on the rest of the firm’s expertise in areas ranging from employment law to complex business formation.

Between the substance’s continued illegality at the national level and the unsettled state of regulation, Kinney said cannabis is “just a very different industry to be involved in.”

“It’s just like any other business, except for that fact that they’re in the unique industry where it’s kind of like the Wild West,” he said.

Husch Blackwell

Kris Kappel

Kappel

Plenty of firms help clients to navigate Missouri’s medical marijuana regulations, but Husch Blackwell might be the only one to have developed a proprietary software program to streamline that process.

Kris Kappel, a partner at Husch’s office in Kansas City, said the idea for the program came from the rush of applications for medical marijuana licenses her firm saw this year. A co-worker who heads the application process said attorneys kept getting bogged down in long email strings with clients as they worked on applying with the state.

“We thought there had to be a better way,” Kappel said. “Sending emails back and forth was getting to be really cumbersome and time-consuming, and Google docs are great, but they aren’t necessarily secure. So I called the IT group and asked if we could set something up.”

Just three days later, Husch attorneys had a new program that is able to alert them when clients finish answering all of the questions asked by the state. It then enables attorneys to make changes that clients can see almost instantly.

Kappel said the program can be customized for applications in other states as well. That — along with 12 attorneys working full time in the medical marijuana practice group and 45 more, including several in Missouri, spending as much as half of their time on the practice area — helps Husch to stand out.

“We’ve done it in Colorado and California, and consulted in those states,” she said.  “We’ve seen it before, so that puts us in a unique position to answer any question.”

Lauber Municipal Law

Joe Lauber

Lauber

Jeremy Cover

Cover

As businesses and entrepreneurs find ways to capitalize on the state’s newly legalized medical marijuana industry, Lauber Municipal Law’s clients find themselves having to adapt to a rapidly changing environment.

“This obviously has a huge impact on our clients, anywhere from the decriminalization of marijuana for anyone with a valid medical marijuana card to zoning,” said firm founder Joe Lauber.

Lauber Municipal Law is based in Lee’s Summit and has a second office in Jefferson City. It serves as the city attorney for 39 Missouri municipalities, plus one in Kansas. Those cities now find themselves contemplating permits for dispensaries, zoning issues for cannabis-growing operations and the employment issues that could arise once city employees begin to get medical marijuana cards.

“We spent a significant amount of time working with cities overhauling their ordinances,” Lauber said.

The firm has hosted training sessions throughout the state, both for city officials facing municipal governance and for police chiefs tasked with enforcing criminal laws and ordinances written at a time when marijuana was illegal across the board.

Lauber said all six of the firm’s attorneys have worked on medical marijuana issues that ebb and flow as Missouri’s regulator scheme falls into place. Jeremy Cover, a partner at the firm, added that cities face a lot of uncertainty.

“The most challenging thing for our clients has been the moving target,” Cover said. “Everyone is doing their best to comply and to put the amendment into action, but that has created some confusion and some stresses at times for our clients.”

Reynolds & Gold

Jon Gold

Gold

A look at Arkansas in 2016 started Jon Gold, partner at Reynolds & Gold, on the path to practicing medical marijuana law.

That year, Arkansas voters legalized the use of medical marijuana, and though the state didn’t allow sales of cannabis until 2019, Gold thought the legal area might be worth looking into for his Springfield-based firm.

“The field wasn’t of interest to me until I started looking into Arkansas,” Gold said. “The situations in Arkansas and Missouri [now] are similar because they had a cap on licenses, and when I knew it was more likely than not that one of our three measures about marijuana would get passed, I felt that there was going to be a need for legal work for people who had no knowledge of cannabis law.”

Gold said the fact that his partner, Ken Reynolds, is an attorney for six municipalities outside Springfield helped to solidify the decision to make medical marijuana a practice area for his firm. According to Gold, existing legal work with zoning ordinances and municipal law transferred well to regulations governing where cannabis establishments could set up.

While there are challenges in dealing with rules that were created quickly and left a short time for interpretation to help clients, Gold said his firm’s overall business law experience and knowledge of what has happened in other states will help clients.

“It’s like a brand-new industry unfolding on a daily basis. It is kind of exciting,” Gold said. “There’s not too many things that come around that allow you to work in a brand-new industry.”

Shook, Hardy & Bacon

M. Katie Gates Calderon

Calderon

Attorney M. Katie Gates Calderon said Shook, Hardy & Bacon began fielding cannabis questions from existing clients about two years ago.

“I think because we already had those clients and they trusted us and we had the regulatory expertise, it really wasn’t too much of a step for us to answer those questions and look into these issues,” Gates Calderon said.

Beginning in late 2018, Shook began fielding more of those questions more frequently, and it decided to formalize the work into a cannabis practice. It recognized that in a fast-growing and highly publicized industry, there almost certainly will be a wide variety of lawsuits.

Gates Calderon said the firm aggregated its resources to be positioned to help new or existing clients when those lawsuits hit.

“I think we have . . . the experience handling these types of issues in spaces that are sometimes under fire,” she said.

As part of Shook’s cannabis practice launch, the firm released a white paper that includes a survey of around 100 in-house counsel about where they saw legal needs coming up for the cannabis industry.

Gates Calderon noted that it has been a challenge for the firm to make sure attorneys are thinking through and taking a thoughtful approach to the risks to clients and even to the firm when advising for such products because the industry is full of gray areas.

Stinson

Zane Gilmer

Gilmer

Before voters approved medical cannabis in Missouri, Stinson was poised to provide legal assistance to its clients in the state, thanks to its deep well of expertise in other states where cannabis already was legal.

Zane Gilmer, who leads the firm’s cannabis practice from Denver, said when Missouri’s Amendment 2 passed, there was already a small team of lawyers in the state who had helped him on cannabis matters elsewhere.

“When Missouri went live, there was already some level of interest and expertise there,” he said.

The practice group has 10 lawyers firm-wide who provide a range of services, counseling on regulatory and compliance issues, banking and financial services, litigation, business and transaction law, and intellectual property and technology.

Gilmer said the firm is assisting companies with applications as well as other business needs. The firm also represents companies in ancillary industries, such as the areas of investing, technology and real estate.

Gilmer’s own background is in commercial litigation, including the area of financial services litigation. He has played key roles in Colorado, where he successfully argued before the Colorado Supreme Court that lawyers should be able to ethically advise their clients in the area of cannabis.

He said it’s been interesting working in a completely new practice area, calling it “The Wild West.”

“The Wild West might not even do it justice,” he said. “There aren’t many things now in this industry that surprise me.”

Summers Compton Wells

Dan Welsh

Welsh

Dan Welsh runs through the myriad issues that those seeking to enter the medical marijuana industry have to navigate.

“It begins with corporate structuring,” he said. “From there, it goes to assembling teams and transactional work to build a group that is going to be competitive in a capped market. It also involves the securing of real estate for cultivation, manufacturing and dispensary operations. It involves outreach to local governments. It involves zoning work to navigate ordinances with the newly created industry. It involves securities work to raise capital. It involves technical writing skills to assist with license application work. It involves intellectual property work to protect brand names and other IP.”

Welsh, a partner at Summers Compton Wells, notes that those are all areas where his firm long has concentrated. So when Missouri voters legalized medical marijuana, it made sense for the firm to launch a cannabis law practice group — a six-attorney core practice that can draw on the rest of the firm to meet clients’ needs.

In some respects, of course, cannabis remains an unusual practice area.

“It’s pretty rare that a brand-new, previously prohibited industry is suddenly legally permissible under state law,” Welsh said.

But in other ways, a cannabis business is no different from any other business. Welsh said clients — and lawyers — are much better off applying their existing expertise to cannabis than specializing in cannabis and then trying to learn, say, securities issues.

“I think our firm was very well-positioned to enter this space,” Welsh said.

Thompson Coburn

Gayle Mercier

Mercier

St. Louis-based Thompson Coburn is working to assist its clients with a wide variety of issues — from seed to sales — that may come up in cannabis law.

The firm’s interdisciplinary approach is evident in terms of who is involved with the firm’s industry group. Gayle Mercier, a partner in St. Louis who co-chairs the industry group, said all of the firm’s more traditional practice areas overlap in some fashion with the cannabis industry group.

She also said the group is growing — the group currently has 34 attorneys, up 10 from 2018.

Like other larger firms with offices in other states, Thompson Coburn is not a stranger to cannabis law. Mercier said the firm already has handled cannabis matters in its Los Angeles and Chicago offices.

Mercier said her interest in cannabis law stems from the experience of a friend in Illinois whose son is autistic and uses it medicinally. When Amendment 2 passed, Mercier saw a natural fit with her real estate practice, in which she has worked for 18 years.

“You can’t have cannabis without real estate,” she said, adding that she jumped at the opportunity to be involved in the burgeoning area.

“I was very excited about being a part of it. I dove in with two feet,” she said.

At the same time, Mercier said it also can be frustrating to not know all of the answers to clients’ questions. The Department of Health and Senior Services, she said, “is still working out the answers.”

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