Issue link: https://www.epageflip.net/i/137678
4B Daily News – Tuesday, June 18, 2013 Businessman tries his luck at building pot brand SEATTLE (AP) — For the activists who led the effort to legalize recreational marijuana in Washington state last fall, Jamen Shively was one of their biggest fears: an aspiring pot profiteer whose unabashed dreams of building a cannabis empire might attract unwanted attention from the federal government or a backlash that could slow the marijuana reform movement across the country. With visionary zeal, the 45-year-old former Microsoft manager described his plans to a conference room packed with reporters and supporters last month, saying he was tired of waiting for a green light from the Obama administration, which still hasn't said how it will respond to the legalization of recreational pot in Washington and Colorado. Shively vowed to quickly raise $10 million and eventually build his company, Diego Pellicer, into an international pot powerhouse. Though he promised a ''cautious and measured'' expansion, Shively's approach nevertheless contrasted with that of state regulators who want to avoid repeating the national experience with Big Tobacco and Big Alcohol, industries that profited wildly on addiction and abuse. Mark Kleiman, who heads the team hired to be Washington's official marijuana consultant, responded on his blog: ''It was inevitable that the legalization of cannabis would attract a certain number of insensate greedheads to the industry.'' Shively's ambitions — ''We are Big Marijuana,'' he proclaimed — don't merely raise questions about what marijuana legalization might look like in the long run and whether large corporations will come to dominate. He also risks getting himself indicted. The Justice Department has said while it doesn't intend to prosecute sick people for using marijuana, it will go after those who try to get rich from commercial sales. It hasn't said yet whether it will sue to block Washington and Colorado from licensing pot growers, processors and stores. The legalization votes in Washington and Colorado have created a fever for cannabis-related investing, to an extent. Conferences have focused on the parameters for legally investing in ''ancillary businesses'' — those that supply equipment needed by pot grows, for example — without financing the actual production or distribution of marijuana, which remains illegal under federal law. Shively isn't skirting the edges of the nascent industry, but diving right in, in a way that few other entrepreneurs are. Some companies that make high-end marijuanainfused products, such as Colorado-based Dixie Elixirs, are planning to make their brands available in other states, but it's not clear anyone else is taking steps to create a pot empire. ''Developing a national brand in an industry in which it is illegal to move the core product across state lines presents some serious logistical challenges,'' said Betty Aldworth, deputy director of the National Cannabis Industry Association. AP photo In this May 30 file photo, former Mexican President Vicente Fox, left, turns to Jamen Shively, CEO of Diego Pellicer, after speaking during a news conference in Seattle. Diego Pellicer's business plan estimates $120,000 of pure profit per month, per recreational pot store. Shively said he plans dozens of stores in Washington and Colorado, earning his company the ''Starbucks of Pot'' nickname. At the May 30 news conference, Shively announced Diego's first corporate deal — an arrangement with a Seattle medical marijuana company called the Northwest Patient Resource Center. He said Diego would be starting in the medical marijuana market in Washington and Colorado, and then transitioning some dispensaries to recreational pot stores once the states begin issuing licenses. Shively said the arrangement was ''not in violation of either federal or state law,'' but it was troubling enough to one of the dispensary company owners that he's walking away from the deal — and the company he helped found — because he fears it puts everyone involved at risk of federal prosecution. ''I'm not an activist. I'm just a businessman,'' said the part-owner, Thomas Jun, a 42-yearold father of three. ''I can't afford to do any federal time.'' According to Shively, Diego Pellicer has acquired the option to buy Northwest Patient Resource Center, but does not actually own it. That's what gives Diego Pellicer some protection and allows it to position itself for the time when more states legalize pot and Congress changes federal laws, he said. No marijuana will be moved interstate. ''We don't touch cannabis. We don't have ownership of cannabis,'' he said. ''It's not a perfect insulation or buffer, but it's the best possible mechanism that we can come up with.'' Through his lawyer, Douglas Hiatt, Jun provided the AP with internal company documents, including a draft of the $1.6 million agreement dated May 30. The deal directs monthly payments of up to $50,000 from Diego be used to ''to further develop and enhance NWPRC's customer locations and to otherwise grow its business as currently conducted.'' Former federal prosecutors say that could be seen as a conspiracy to violate federal law. ''It certainly would make me nervous to be involved in anything like this,'' said Laurie Levenson, a professor at Loyola Law School-Los Angeles and a former assistant U.S. attorney. Shively called the draft provided to AP ''an obsolete document,'' but declined to provide further details. He also declined to discuss a $10,000 check he wrote to the dispensary company May 27. The deal highlights the tension between the varying degrees of acceptance of marijuana by the states and the outright prohibition by the federal government, which makes banking and other business functions problematic. For example, beyond the growing and sale of marijuana constituting federal crimes, the movement of money related to marijuana sales likely constitutes money laundering. Dixie Elixirs won't be directly involved in the growing, processing or sale of pot in multiple states, said Tripp Keber, its managing director. Instead, it will license its technical know-how and recipes to people in Washington or elsewhere who want to produce products under the Dixie Elixirs brand — and try to avoid the attention of federal prosecutors by adhering to state laws. ''Big public federal indictments are going to do the industry a disservice,'' Keber said. If Shively's model is endorsed by the regulators writing rules for Washington's pot industry, ''then we would be increasing the risk of intervention by the federal government,'' said Alison Holcomb, the Seattle lawyer who drafted Washington's law. Shively said investors are advised that the company and those involved could face federal prosecution. A copy of Diego's business plan includes 11 bullet points listing risks the company faces. None specifically suggests those involved could be prosecuted. Investigators 'zeroing in' on Colo. wildfire start COLORADO SPRINGS, Colo. (AP) — Rain helped firefighters douse Colorado's most destructive wildfire in state history, while a new wind-whipped blaze in California forced evacuations and threatened homes Monday near Yosemite National Park. Investigators believed Colorado's Black Forest Fire was human-caused, and were going through the charred remains of luxury homes destroyed and damaged in it last week. Even though the fire was mostly contained, officials were not letting victims back into the most developed area where there was concentrated devastation from the fire because the area was being treated as a possible crime scene. Residents have been anxious to return but investigators want to preserve evidence, and firefighters also are working to make sure the interior of the burn area is safe, by putting out hot spots and removing trees in danger of falling. ''We're not ignoring you and we're with you,'' El Paso County Sheriff Terry Maketa said. In some cases, residents who were escorted back for emergency situations have refused to leave again. Nearly 500 homes have been lost in the 22-square-mile fire near Colorado Springs, which is 75 percent contained. Two unidentified people who were trying to flee were found dead in the rubble. Wildfires were also burning in other parts of Colorado as well as California, where more than 700 firefighters battled the Carstens fire. That fire near the main route into Yosemite National Park in the Central Sierra foothills began Sunday afternoon and has burned about 1 1/2 square miles or 900 acres, California Department of Forestry and Fire Protection spokesman Daniel Berlant said. HOME SERVICES DIRECTORY Online: Publishes 24/7 $ 109 Print and Online Per Month www.redbluffdailynews.com Three additional online locations at no extra cost! No early cancellation, non-refundable In Print Every Tues. - Thurs.- Sat. Building Construction Clock Repair Construction R. G. SIDES Grandpa's Clocks Burrows Construction Your Repair & Remodeling Expert • Room Additions • Framing • Full Service Concrete Work and Foundations • Electrical Work, New and Repairs • Plumbing Work • Drywall Installation • Tape/Texture • Trim/Crown Molding • Finish Work • Doors & Hardware • Windows & Skylights • New Roof Comp. • Concrete Work, Colored Overlays • Retaining Wall, Concrete or Block • Masonry Work • Fences • Buildings • Brick Work • Set-up Manufactured Homes and Repairs • Small Jobs • Tile Work, Bathrooms, Kitchens, Counter Tops, Floors, Shower Pans & Walls Office # 530-209-9999 Your Clock Repair Shop Jim Paul 20910 Pebblestone Dr. Red Bluff 530-736-7079 Mechanical, Battery and Electrical clocks Call for appt. Alle Construction ns Constructi Remodel, New Additions, Siding Repair and Replacement, Water and Dryrot Damage Specialist, New Construction Foundation to Finish REFRENCES Lic#824770 A-1 Sprinkler Systems Commercial & Residential Free Estimates 526-2527 •Sprinkler System Installation & Repair •Year Round Lawn Service •Landscaping Design •Pruning •Post Hole Digging State Contractors Lic.# 845881 Fencing on Residential • Commerical PATIOS • DECKS With more than 140 engines and two helicopters on the scene, the crews have contained about 15 percent of the blaze so far. ''The strong winds and dry conditions have been major factors. The fire moved quickly,'' said Berlant, adding that Monday's weather forecasts estimate gusts of up to 20 miles per hour. No structures have been burned as the exact cause of the fire has yet to be determined, Berlant said. House Remodel / Specialist Rental Turnovers / Repairs Bathroom Remodels / Tile Painting • Electrical • Plumbing • Drywall Repairs • Fences • Decks • Concrete • Garages Quality at a reasonable price FREE ESTIMATES 530 949-6162 Lic.#639360 Member NAWCC Ph: (530) 515-9779 Landscaping Advertisement Landscape/Fence Lawn Care Steve's Tractor • Wood Fence • Field Fence • Chainlink Fence Installation & Repair Free Estimates (530) 736-6570 Serving The Greater Tehama County Area Since 1994 Green again landscaping HONEST & DEPENDABLE ★ LAWN SERVICE ★ WEED EATING ★ HEADING ★ GUTTER CLEANING ★ TREE TRIMMING ★ FIRE BREAKS Scott West (530) 566-7951 If this was your Service Directory ad customers would be reading it right now!! Call us at 527-2151 For more information & Landscape Service • Fence Building • Landscaping • Trenching • Rototilling • Disking • Mowing • Ridging • Post Hole Digging • Blade Work • Sprinkler Installation • Concrete Work Cont. Lic. #703511 Steve Dyke 385-1783 CA LIC#914460 Professional Lawn Care LA W N C LL Lic # 6478 ARE A Commercial • Residential (530) 529-3689 Tree Service Tree Service Certified line clearance tree trimmers *Specializing in hazardous tree removals *Beautification/Canopy Lift Trimming & Pruning * Firebreaks Free Estimates ~ Senior Discounts 5 Millon dollar insurance coverage • Mowing • Edging • Weedeating • Clean-ups • Free Consultation Voted #1 Tree Service in Tehama County We can beat any licensed contractor prices! Call for a bid (530) 736-9327 www.alllawncare.net License #879689 Blinds Need Blinds? C P A A L U L L Paul Stubbs 527-0842 North State Blinds & Draperies www.nsbd.biz Lic.#906022 Landscaping Torres Landscaping Mowing, Pruning, Weeding, Blowing, Cleaning, Trimming Yearly Yard Maintenance Monthly or One time available All around LAWN Maintenance Free Estimates Cell: 530-526-3752 Home: 520-529-5474 Ramon Torres Lic.# 10034 Tractor Service Tractor Dan "Have Tractor-Will Travel" Mow (Rotary or Flail) Till - Disk - Rip - Harrow Load - Light Hauling Gannon Box - Float Dan Marshall Owner/ Operator Insured Tehama County Resident since 1958 (530) 527-1437