Marijuana & Ethics

In September, I was on a CLE panel with Michelle Childs, Jake Perkinson, and Dave Mickenburg.  We discussed the legal ethics of advising clients on issues related to marijuana. In particular, the ethics of advising clients on issues that are legal under Vermont law, but illegal under federal law.

Jake and I will be joined by Chittenden County State’s Attorney T.J. Donovan on a panel that will discuss the issue in Montreal during the YLD Thaw.

In a nutshell, the issue is this:  Rule 1.2(d) of the Vermont Rules of Professional Conduct prohibits lawyers from counseling a client to engage, or assisting a client to engage, “in conduct that the lawyer knows is criminal . . ..”

Like Vermont, several states have decriminalized the possession of marijuana and have authorized the medicinal use of marijuana.  However, the possession, use, manufacture, and distribution of marijuana remains illegal under federal law.  As such, lawyers in those states have expressed concern that providing advice to clients on something that is legal under state law — medicinal use of marijuana – might nevertheless violate Rule 1.2(d) to the extent it might be considered to be assisting the client to do something this illegal under federal law.   Their concern is that, as written, Rule 1.2(d) draws no distinction between state and federal law, or between federal laws that are enforced and those that are not.

I have a power point presentation that goes into much more detail.  If you would like me to send it to you, please email me at michael.kennedy@vermont.gov

In the meantime, the Professional Responsibility Board recently voted to recommend that the Vermont Supreme Court adopt the following comment to Rule 1.2(d). This is the approach that most states with medicinal marijuana laws have taken.

• Proposed Comment to Rule 1.2 of the Vermont Rules of Professional Conduct:
• “[14] With respect to paragraph (d), a lawyer may counsel a client regarding the validity, scope and meaning of Title 18, Chapters 84, 84A, and 86 of the Vermont Statutes Annotated and may assist a client in conduct that the lawyer reasonably believes is permitted by theses statutes and the rules, regulations, orders and other state and local provisions implementing the statutes. In these circumstances, the lawyer shall also advise the client regarding the potential consequences of the client’s conduct under related federal law and policy.”

The proposal has not yet been forwarded to the Supreme Court, but will be soon.

Here’s a cautionary tale from Colorado.

Many banks do not accept funds from marijuana-related businesses, even if those businesses are legal under state law.   In Colorado, a general counsel for medical marijuana dispensary opened an account for the dispensary.  He deposited funds from the business into the account. He did so despite having actual knowledge that the bank did not allow medical marijuana dispensaries to open accounts.  The lawyer admitted that his conduct violated Colorado’s ethics rule that prohibits dishonest conduct.

The lawyer was publicly reprimanded by the Colorado Supreme Court.  The decision is HERE.