Washington Cannabis Regulators May Have Skirted Ethics Rules to Appease Special Interest Group
The Washington CannaBusiness Association, Headed by a Former Microsoft Executive, Is Playing a Major Role in Shaping the Emerging Legal-Marijuana Landscape
The lobbyist for a trade association that helped write legislation that will assimilate Washington State’s unregulated medical-marijuana market into it’s recently legalized recreational cannabis market appears to be having an oversized influence on the course of cannabis policymaking in the state, based on an examination of emails obtained through an open-records request.
That insider influence also appears to have crossed over some ethical borderlines and possibly influenced the course of an investigation into a licensed marijuana producer that was allegedly using banned pesticides on its cannabis crops, email correspondence shows. That investigation is being carried out by the Washington State Liquor and Cannabis Board (LCB) — which regulates and issues licenses for the state’s fledgling cannabis industry.
The trade group at the center of this storm is the Washington CannaBusiness Association (WACA), whose executive director and lobbyist is Vicki Christophersen. WACA’s president is Martin Tobias, a former Microsoft executive and serial entrepreneur.
Tobias provided the seed funding for WACA, and through a cannabis-focused real estate venture he controls, South Fork Business Park, he also provided the initial surge of funding, some $25,000, for WACA’s political action committee, state records show.
One of the tenants of the South Fork Business Park in Raymond, Washington, is WACA member BFM Washington LLC, a licensed cannabis grower. BMF is owned by Peter Saladino, who is a founding board member of WACA. Corporation records obtained by Narco News show that Saladino and Tobias also are business partners in two companies incorporated in Nevada: JJ OPCOOR LLC and JUJU OPCOCA LLC. BMF does sell product through a brand called Juju Joints, although it’s not clear if the two Las Vegas companies are connected to that brand.
Those connections and questions matter because they can help put into context where Christophersen and WACAs insider access to legislators and regulators may have been abused.
A Tangled Web
Public records obtained by Seattle’s alternative newspaper The Stranger revealed that late last year BMF became the target of an LCB investigation into the company’s alleged use of disallowed pesticides. The investigation resulted in a hold being placed on BMF’s cannabis inventory and a $2,500 fine, which was levied earlier this year, The Stranger reported, based on its own public-records request.
Information on the current status of the investigation was not available as this story was going to press. Rick Garza, director of the LCB, said it is his agency’s policy not to discuss ongoing cases with the media.
“If we are in the midst of an investigation of a licensee, the protocol would be not to discuss it with anyone,” he said. “We don’t want to impinge on that investigation in any way, shape or form.”
The Seattle Times reported last month that the BMF case was still under investigation and that the company had requested a settlement conference.
The emails obtained via a public-records request by Narco News show that WACA’s Christophersen in mid-December of last year reached out to the deputy director of the LCB, Peter Antolin, as well as James Paribello, the agency’s legislative and tribal liaison, asking for assistance with bringing some “clarity” to the BMF pesticide investigation. In one email, Paribello describes Christophersen as "BMF's lobbyist."
From Christophersen’s Dec. 14, 2015, email to LCB Deputy Director Antolin:
I am sorry to bother you but we have a situation that I need to talk to you about. See below for details. I think James [Paribello] talked to you about this Friday. I obviously have a panicked client [BMF] and would like to help bring some clarity to this as soon as possible. Can you help?
A couple hours after receiving Christophersen’s email, Antolin emailed LCB’s chief of enforcement, Justin Nordhorn, as well as Paribello and Rebecca Smith, LCB’s licensing and regulations director, with the following request:
Can I get a quick briefing on the BMF situation please? I would like to get back to Vicki [Christophersen] on Tuesday if possible. I’ve got some free time Tuesday morning at 8:00 and at 9:30. Thanks
Christophersen’s email to Antolin included a backgrounder explaining BMF’s alleged pesticide violations from the perspective of its owner, Saladino. That backgrounder also included a request “that the ‘administrative hold’ be lifted as to [BMF’s cannabis] inventory that has no connection to plants receiving application of the pesticides in question.” The backgrounder also noted that because of that LCB-ordered facility-wide inventory hold, BMF stood to lose out on hundreds of thousands of dollars in sales a week.
In the wake of Deputy Director Antolin contacting LCB Chief of Enforcement Nordhorn on Dec. 14, Nordhorn that same day emailed two supervisors under him in the chain of command — including Joshua Bolender, who is the supervisor of the investigating officer in the BMF case.
“Any additional information you can provide me [on the BMF case] by morning will be appreciated,” Nordhorn wrote in the email to Bolender and another LCB enforcement officer. “I will be trying to meet with Peter [Antolin] first thing in the am. Thanks.”
The next day, Dec. 15, 2015, LCB Deputy Director Antolin, sent off an email to Christophersen, and also cced Nordhorn:
I had a chance to discuss this issue with our chief of enforcement, Justin Nordhorn, and his deputy, Steve Johnson. Because BMF is currently under a complaint investigation I really can’t comment too much about the situation. However, I did discuss the issue of the entire facility being on an administrative hold with Justin and Steve and they are looking at this situation and looking at possible alternatives to the current hold on [inventory at] the facility. I’ve cc’d Justin and asked him to follow up with you once the investigation is at a place where he can share info. [Emphasis added.]
Although the public records obtained by Narco News are silent on the ultimate result of Antolin’s intervention in the BMF case, the public records obtained by The Stranger, and published online, do seem to indicate that LCB shifted its position on the inventory hold within days of Christophersen contacting LCB’s Antolin.
The evidence report obtained by The Stranger indicates that on Dec. 11, 2015, the investigating officer in the BMF pesticide case notified the company that “all marijuana on the licensed premises was being placed on administrative hold” and also informed BMF that it "could not deliver or destroy any marijuana until further notice."
Then on Dec. 17, three days after Christophersen sent her email to Deputy Director Antolin, the LCB supervisor in the case, Bolender, sent a letter to BMF’s Saladino. That letter indicated that certain cannabis products were being exempted from the administrative hold — including all cannabis products onsite that were purchased from other cannabis growers or processors as well as all marijuana plants “propagated” after Oct. 8, 2015.
LCB Director Garza said he was not familiar with the interchange between his deputy director and WACA’s Christophersen. He added that he would look into the matter.
“That doesn’t sound right,” he told Narco News.
Based on Washington law, Garza may well be right. The state’s Ethics in Public Service Act mandates that “no state officer or state employee may use his or her position to secure special privileges or exemptions for himself … or other persons.” Whether or not that prohibition was transgressed in the BMF case would be a matter for the Washington State Executive Ethics Board to investigate and decide.
Christophersen’s lobbying effort in the BMF case represents only one incident in a much larger policy-influencing push by WACA, which is arguably playing a major role in guiding the direction of the cannabis-legalization agenda in Washington.
Christophersen and WACA not only helped to write and lobby for the passage last year of SB 5052 (the Cannabis Patient Protection Act) sponsored by Republican Sen. Ann Rivers. Christophersen also continues to work with Sen. Rivers and the staff of the LCB to write new legislation for the industry, the recently obtained LCB public records show.
In addition, Christophersen, as head of WACA, is playing a key role in helping to shape the LCB rules for the recently enacted 5052 legislation — which will determine how cannabis business licenses are awarded in the future, and much more.
LCB Director Garza, however, says the fact that a lobbyist like Christophersen is playing such a significant inside role in helping to draft legislation and rules is simply how government works in this country.
“It’s not uncommon for lobbyists, and that’s why they’re hired by the industry, to write bills,” Garza told Narco News in a telephone interview. “And when you consider how important reconciliation [of the medical marijuana and legal recreational cannabis market] is, it makes sense that a new industry coalition, [like] WACA, even if it only has 50 members — it’s out there, being funded — it’s going to have an influence in the legislation.”
Garza was quick to point out, however, that he and his staff go out of their way to open the agency’s doors to many parties for input.
“You don’t have to be part of a trade association to get a meeting with me or our staff. I try to keep it as fair as possible,” Garza said.
Although Garza and his staff may work hard to be fair, it’s also clear that Christophersen’s close alliance with Sen. Rivers did not go unnoticed by LCB’s Garza, the email correspondence obtained by Narco News shows.
Garza sent the following email to Deputy Director Antolin, Legislative and Tribal Liaison Paribello, Licensing and Regulations Director Smith and Rules Coordinator Karen McCall on Nov. 19 of last year:
Subject: Meetings regarding MJ Rules
I saw an email regarding a request from Vicki Christophersen to meet to discuss the MJ [marijuana] rules that we've taken on the road the last couple of weeks before the Board possibly acts on Dec. 2nd.
I want to ensure that those discussions occur if possible with the leads in this area. With Randy's departure, I placed Becky [Smith] as project lead on implementation of the new medical MJ legislation ... which includes the rules. Karen [McCall] should also be included as our rules coordinator given her understanding not only of the rules themselves but the reasons we're proposing them.
Peter [Antolin], I want you to get up to speed on these issues but I want to make sure given the tight timeline on these rules that we have everyone at the table to hear her association’s position on the rules. I think Becky and Karen already had a meeting set with Vicki [Christophersen] to discuss the rules. Can we coordinate this to one meeting? Vicki's group [WACA] is an important stakeholder given that they led the effort with the Legislature to pass the bill. [Emphasis added.]
My effort here is to make sure we're all talking to one another and sharing information. Thank you!
In a prior interview with Christophersen, she said WACA worked closely with Sen. Rivers’ office in drafting SB 5052. LCB emails show Christophersen continues to play a key role in helping to draft cannabis-market legislation and the resulting rules and regulations.
On Jan. 12 of this year, LCB’s Paribello sent an email to Director Garza, Deputy Director Antonlin and Chief of Enforcement Nordhorn, among others, indicating that Christophersen had just given him a “heads-up” that “they are working on a new draft” piece of legislation related to marijuana promotional items.
That heads-up from Christophersen came in the form of an email she forwarded to Paribello on Jan. 12 of this year. The forwarded email was written by Washington Senate Committee Services staff member Richard Rodger and had originally been sent to Christophersen and Sen. Rivers:
Hi Senator Rivers and Vicki,
I’ve attached an updated copy of the draft bill relating to personal services and promotional items. The attachment compares the new language with the existing statute for members of the alcohol industry (RCW 66.28.310).
I made a few edits to the draft, including the elimination of sentences that referenced product-tasting events and the removal a duplicate paragraph (one had dealt with wineries and one the same language for breweries).
The proposed title is: “An act relating to the provision of personal services and promotional items by cannabis producers and processors.”
I’ll send this over to the Code Reviser now, but let me know if you see the need for any changes!
Then, on Jan. 17 of this year, Paribello sent a separate email to LCB’s Chief of Enforcement Nordhorn and Rules Coordinator McCall seeking feedback on another piece of legislation in the making that Rodger had informed Paribello about via email two days earlier. In addition to Paribello, Rodger’s Jan. 15 email also was sent to WACA lobbyist Christophersen and Sen. Rivers.
From Rodger’s Jan. 15 email:
Please find attached my draft language regarding marijuana nuisance prohibitions.
… Let me know if this sounds ok to you and I’ll get it rolled into the technical fix draft and over to the Code Reviser’s Office. And, of course, I’m happy to make any edits you may want!
It now looks like the other five marijuana bills in the C&L [Senate Commerce and Labor] Committee will be scheduled for next Friday (January 22nd). We should be able to add this one too, once it’s ready to go.
Thanks and have a great weekend!
When Christophersen was asked by Narco News how she responds to critics that allege WACA has disproportionate access to and influence on LCB staff and the agency’s rulemaking, she replied as follows:
Our priority in working with state regulators and elected officials is to support a safe, quality-controlled and regulated cannabis marketplace in Washington. As the industry association representing I-502 license-holders, we are committed to advocating on behalf of our members across the state in collaboration with local and state officials, as well as our fellow businesses and stakeholders in the communities in which our members operate.
In addition to WACA, Christophersen, a former middle school teacher, also has been a long-time lobbyist for pharmaceutical giant Merck — boasting on her resume that she successfully defeated “legislation that would have created price controls for pharmaceutical products.” Since 2014, Christophersen also has served as a lobbyist for the Association of Washington Spirits and Wine Distributors.
Both organizations likely have more than a passing interest in the budding legal cannabis market in the state of Washington, given the pharmaceutical and alcohol industries also are legal drug-related business that could be impacted by the emerging cannabis industry.
According to WACA’s website, the organization currently represents fewer than 50 of the 1,200 or so marijuana producers, processors and retailers now licensed in Washington. The number of licensed cannabis retailers is set to expand by 222 in the near future, however, to pave the way for the assimilation of a portion of the state’s 800 or so grey-market medical-marijuana dispensaries. The balance of the dispensaries that do not obtain a LCB license will be forced by the regulators to close their doors after July 1 of this year.
One of those dispensary owners, medical-marijuana community leader Dawn Darrington, longtime owner of Choice Wellness Center in Seattle, said she closed the doors of her business this past February, with little hope her retail license application would make the cut.
“It’s evil what they [policymakers] have done, not creating a separate path for licensing medical-marijuana providers, people like me,” she said. “I started my cannabis business in May 2010 to serve patients, offering 100 percent organic products. I’m not a profiteer, and now I’ve lost everything.”