#050 - The Far-Reaching Implications of the Chevron Ruling w/ Leah Heise of Wolf Meyer

How might the Supreme Court's recent decisions reshape the cannabis industry as we know it? This episode of High Spirits promises to answer that and more.

We dive deep into the pivotal topic of the Chevron ruling and its sweeping consequences for the cannabis sector, especially with Schedule III reclassification on the horizon. Leah Heise, a renowned legal expert in government enforcement, joins us to break down the complexities. Together, we explore the historical context of Chevron deference, the Supreme Court's shift in reducing it, and what this means for cannabis businesses navigating an increasingly uncertain regulatory landscape.

As we delve deeper, we tackle the controversial 280E tax code, its potential unconstitutionality, and the implications for cannabis businesses. From the future of the Farm Bill to the evolving state-level regulations and the current conservative push against big government, we cover it all.

We wrap up by reflecting on the legal challenges and strategies within the industry, while sincerely thanking our listeners for their unwavering support. We're excited to continue this journey with you for the next 50 episodes and beyond!

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Your hosts are Ben Larson and AnnaRae Grabstein.

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Transcript

Ben Larson: 0:05

Hey everybody, welcome to Episode 50 .. 5. 0. of High Spirits. I'm Ben Larson and, as always, I'm joined today by AnnaRae Grabstein. It is Thursday, July 11th 2024. And we're back. AnnaRae, how was your Fourth of July?

AnnaRae Grabstein: 0:28

It was so good. I just steeped in a pool all day at my brother's place and it was really chill.

Ben Larson: 0:34

Also chill. We had undefined lot of pool time. We went out to Rodeo Beach, which was incredibly foggy.

AnnaRae Grabstein: 0:50

After the hot week that we're having, I think the whole country's been experiencing a lot of heat waves it felt actually nice to be in that kind of that marine layer for an afternoon, so I wasn't planning For people that don't know that's out in the Point Reyes National Seashore area and I will correct you that it's Rodeo Beach, not Rodeo Beach. If you're a local you would know that.

Ben Larson: 1:02

If I was in Southern California I might call it Rodeo. If you're a local, you would know that if I was in southern california.

AnnaRae Grabstein: 1:07

I might call it rodeo, but you know. But yeah, it's, things have been really good, it's. Uh, it's been a super fun week. Um, I want, I'll shout out my almost seven-year-old. He got promoted um to the next belt in jujitsu, so our house has been abuzz with celebrations, oh wow.

Ben Larson: 1:26

At what point do you get afraid of him?

AnnaRae Grabstein: 1:29

Oh, I'm already afraid he's become stronger than me. It's a thing. But yeah, and you know, there's been a ton of cannabis news at the same time. Like often, the summer is slow, but we're seeing just so much in the news, especially from the federal government, whether it be conversations in Congress or the Supreme Court. There's just so much that's happening with cannabis that is leaving a lot to be discovered and opined on, not to mention what's happening with the presidential races. Post-debate has been really interesting as well, and while you know we don't necessarily focus on politics all the time, what happens with this election, I think, is sure to have a lot of implications on the opportunities in cannabis and hemp.

Ben Larson: 2:19

Yeah, it's like everything that we know, everything that structures the cannabis industry. It's like everything that we know, everything that structures the cannabis industry, the hemp industry it's all getting thrown in this martini mixer and someone's just like back there shaking it up and who knows the concoction that's going to kind of pour out at the end of it. But I mean, that's the main motivation for the conversation we're going to be having today. Yeah, like what's it all mean and where is it all going? And as we ask these questions, like new things pop up. And yeah, it's a little unsettling, but here we are still optimistic about the future.

AnnaRae Grabstein: 2:55

Yeah, it's unsettling, but I would say that it's also like why I have always been so passionate about deeply understanding the laws and regulations that underpin our industry, because this is not an industry that has a lot of certainty with laws and regulations, and so you have to understand what's ahead so that you can chart your business plan through it, and I think it's what makes it really fun. I think it also is what creates such an important and critical opportunity for the players that are willing to get in right now, because if you are willing to accept a little bit of that risk with with knowledge, um, you are getting into a place that other businesses that aren't willing to take a risk on policy and laws are staying on the sidelines, and that means you get to be an early mover, and that's an exciting place to be.

Ben Larson: 3:52

Yeah, yeah. Well, today we're going to be jumping into the Chevron ruling and the entire impact of that. I know LinkedIn has been abuzz with its impact on Schedule 3, but it sounds like it goes so much further than that and that's just the tip of the iceberg.

AnnaRae Grabstein: 4:09

Yeah, it really does. Are we jumping right in? Should I be queuing up our guests?

Ben Larson: 4:14

Might as well. I'm excited to chat with our guests.

AnnaRae Grabstein: 4:17

Okay, awesome. Well, today I'm really excited to bring on my business partner at Wolfmeyer, leah Heise, because she's who I turned to for this information. While she was a previous executive at two public MSOs, before that she was actually a government enforcement attorney at the National Oceanic and Atmospheric Institute and also at the US Coast Guard, which were two of the groups involved in the case that ended up getting Chevron overturned. So she is the one that helps me decipher what the heck is going on through all of this, and I'm really excited to bring her on to help all of you decipher what the heck is going on here. Leah is a total bad ass. I can't say enough about the work that we get to do together with clients to build strategy and guidance in cannabis companies, but her legal background is really why we're excited to have her on the show today. So, leah, thank you so much for joining us and welcome. Thank you for having me.

Leah Heise: 5:19

I appreciate it. As you guys said, it's a little bit of a turbulent time in cannabis right now, and we're seeing moves from the legislative bodies, we're seeing moves from the Supreme Court, we're seeing, certainly, moves in the executive branch, and our industry is based on law and regulations. We have to rely on politics, unfortunately, because it's going to swing our entire industry one way or the other, so it's so important to be dialed in on every level, you know, local, state and federal, and even international, depending on where you sit.

Ben Larson: 5:50

Okay, so let's jump right in. I know that I think we've all caught up to speed with what Chevron deference was or is and the ability for agencies to make decisions versus the courts. But let's actually rewind and go back to the original, like the impetus or the inspiration for creating or giving agencies the power to make some of these decisions, and then we can kind of work into the impact of overturning it.

Leah Heise: 6:21

Sure, I mean, if we go way back to sort of New Deal and when we were starting to really scale the government and we were putting more authority with inside of the executive branch to handle a variety of different issues, under cabinet members, there were always discussions on how do you manage this, even compared to a corporation, right? Like, how do you manage this? Even compare it to a corporation, right? Like, how do you manage this as a government, as government continues to scale and take on more and more issues? There was a lot of upheaval during all of those years, all the way up into Chevron, where they weren't sure what level of weight they should be giving to independent agencies in terms of enforcing and making their own regulations.

Leah Heise: 7:10

And when the Chevron decision was passed, it was passed based on an Environmental Protection Agency Act case because it was so scientific like inside of the EPA you're making decisions on particulate levels and things that are very, very scientific that you really need scientists and experts to weigh in on inside of an agency. And of course, the court at that time the Supreme Court said they were going to give strong deference to agency decisions within the framework that they had been enabled to do. And then for the next 40 years, the federal government relied on that deference and perhaps overreached a lot of times and overregulated a lot of times, utilizing Chevron as a way to say, okay, well, I can do this, because they're going to give me deference anyways. And what we saw was the Supreme Court now in Looper say, yeah, we'll give you some deference, but we're not going to just assume that what you're doing is correct.

AnnaRae Grabstein: 8:19

I can certainly see how this evolved, because lawmakers have so many issues that they are trying to move forward that span from, you know, like housing, and then the environment and consumer safety and international policy and all these things, and and once, once the Chevron ruling was in place those 40 years ago, it made it possible for lawmakers to be more ambiguous and set intentions in laws that then empowered regulators to interpret and decide on this ambiguous intention and how it should be implemented.

AnnaRae Grabstein: 8:56

And that's so familiar to anybody that has been running a cannabis business, because we've seen it at the state level over and over that the state will put a policy in place in the law that says something like we will create a track and trace program, and that the goal of track and trace is going to be for consumer safety, to prevent diversion and to make sure that taxes get paid.

AnnaRae Grabstein: 9:27

But they don't say how that's going to happen, and so then that becomes the law and then it gets turned over to the regulators and the regulators decide well, how are we actually going to do that in spirit? And then they do a whole bunch of really complicated things that many would consider overreach, and so I'm just trying to interpret this in terms of like, bring it into cannabis. And so what the Supreme Court said is at least on a federal level and I know I just explained a situation on the state level is that actually these agencies don't have the right to be so, so specific and specific and to bring up new, to create new details in the way that they interpret this ambiguous intention. Is that right?

Leah Heise: 10:13

So it depends on. It's going to be on a statute by statute basis. There are some statutes that are very explicit in terms of what the authority of an agency is, and if the language is explicit, it's explicit. But, as we know, because legislation is passed based on deals, partisanship, lobbying, what goes into a piece of legislation is more likely to be ambiguous because of all those deals than it is to be very specific. And now what happens with inside of these government agencies is going to end up being on a case-by-case basis. We're going to have to wait for interpretations. There was a new interpretation or a new argument that was done yesterday. It was an ERISA case and we'll see which way the Fifth Circuit goes under not having Chevron deference anymore. So we're going to start to see cases move through that will give us some guidance on whether or not there is weight or not weight given to any level of agency decisions.

Ben Larson: 11:20

So let's pick down the low hanging fruit here of the Schedule 3 conversation, and there's many things influencing the Schedule 3 conversation at this point in time. But as it pertains to the Chevron deference, why were people immediately reacting, saying this could totally blow up Schedule 3? And is that indeed a potential ramification of it?

Leah Heise: 11:43

Sure.

Leah Heise: 11:44

So for me the ramifications of this lack of Chevron deference is not necessarily based on the legality or the legal opinionsgation inside of a federal agency, knowing that perhaps when I'm responding to comments or we're working out strategy inside of the agency to move, you know, promulgate a rule that I always could rely on Chevron as a backstop, that if we didn't specifically answer that comment or if we were willing to push an envelope on our interpretation a little bit more, we had Chevron as a backstop to be like, okay, well, at least there's Chevron and we can just move forward.

Leah Heise: 12:35

But now, if I was sitting inside of an agency and I was promulgating a new rule, I am going to be far more methodical. I am going to dot all my I's, I'm going to cross all my T's, I'm going to have legal be looking at it. I'm going to have every different branch inside of the agency that potentially could be impacted on it also commenting and doing it. Which to me is going to slow it down. And that's my fear is that the slowdown of this process, the potential slowdown, will cause it to not happen before the election. And then we are already seeing, given what's happening in Congress and stuff, what the sort of Republican agenda is in terms of cannabis, and I'm a big fan of if somebody's showing you who they are believe them.

AnnaRae Grabstein: 13:28

So what I'm hearing you say is that it's not that Schedule 3 is dead, it's that Schedule 3 could get slowed down, because the broader implications of what Chevron is going to do for agencies is have them be more specific in the work that they're doing and be more careful so that they aren't faced with challenges. And that makes me think about just like the broader implications in general on legislation and implementation through regulations. So we've got laws and regulations that are in place already, and then we've got the future of laws and regulations, and I'd like to understand because, knowing that and I know I just cut myself off but knowing that we have a very conservative, pro-business Supreme Court and it's absolutely this overturning of Chevron has been part of the Republican agenda and pro-business group, so people think that this is good for business, and so I want to understand if this is good for business. Is it about going forward? It's going to be good for business or does it present opportunities for businesses for things that are already in place and changing them?

Leah Heise: 14:44

I think both, and I think it depends on whether or not the specific business issue that you want to litigate has already been decided, because the court was pretty clear that they won't go back and eradicate decisions that were made under Chevron, challenging a regulation.

Leah Heise: 15:05

However, it is a real opportunity for businesses to push the envelope a little bit more on everything labor laws, pollution, emissions, toxic waste, dumping not that we do that in cannabis, but all of it. And then when you combine it with the other two cases that gut punch the administrative state. One was SEC versus Jakarski which essentially said to the SEC if you're going to go after a civil penalty against someone, then you have to provide a jury trial. Provide a jury trial, which then takes it out of the administrative agency's hand to be judge, jury and executioner, which is not necessarily a bad thing. It just, you know, if it trickles down to the states and I'm a state cannabis operator and you just fine me $350,000 to because of some regulation that I think is stupid, I'm going to ask for a jury trial and I'm going to cite that case.

Ben Larson: 16:07

Interesting. So let's talk about that waterfall down to the States. Like does this call into question? Like because there's a lot of ambiguity in a lot of the decisions that the various cannabis regulators have made and there's a lot of friction in these industries. And we're sitting in Anna Ray and I are sitting in California where I mean I can think of five different cases right now where I'm like, wow, are these all going to turn to lawsuits? And is that the? Is that like a clear and present implication of all of this?

Leah Heise: 16:42

Sure, I mean the Supreme Court. Despite the fact that we have federal and state right, the Supreme Court is the ultimate law of the land. And if the Supreme Court says you can't defer to agency regulations unless a state has legislatively set up a different structure and even then I would still argue against it that deference is going to be at risk, which is a real opportunity for us to perhaps get some more measured and reasoned regulations in place that actually make sense for the industry. And then I think of metric. I mean, you raised it earlier, anna Rae like To me that's almost exactly the same as the Looper decision, right?

Leah Heise: 17:29

The reason why the court overturned Chevron in the Looper decision is because the National Marine Fisheries Service had mandated that observers be placed on the boats of fishermen, which fishermen did not object to. What they objected to was that they paid for it, which is exactly what metric does Metric or the states require, right? Like? So the states require you to have this software program. And then also, hey, you got to buy 80 bazillion million dollars worth of these tags that you then dump into the environment. So they're creating a financial burden, an additional financial burden to what we already have as an industry.

AnnaRae Grabstein: 18:11

I think that's up for grabs, and lawsuits are expensive. Lawyers are really expensive. Nothing is going to happen automatically. A company has to decide that the investment in a lawsuit is going to be worth a reward at the end when they win, and so it occurs to me that what this has done is just created a massive new opportunity for litigators.

Leah Heise: 18:46

Oh, it's a great, great opportunity for litigators. If I was a litigator, I'd be jumping up and down and I'd be looking for class actions. I'd be doing all kinds of stuff.

Ben Larson: 18:54

I think it's going to have to come down to class actions because a lot of cannabis companies don't have the money to litigate or at least bring relevance back to the professional associations that have been really struggling over the last several years.

AnnaRae Grabstein: 19:06

I agree that have been really struggling over the last several years.

AnnaRae Grabstein: 19:08

I agree, yeah, I mean getting the associations to lead some of the charge on this, I think could be really powerful, because we talk about the differences between the MSOs and the equity businesses and basically it's like this divide between the large corporate interests in cannabis and small independent operators that don't have access to capital and are struggling just to get their businesses open and running.

AnnaRae Grabstein: 19:34

And if you're in that situation as a small business, no matter how ridiculous a regulatory fine might be or how much you see that a regulation is overstepping the intention of a law, there isn't going to be a high prioritization of hiring an expensive litigator to take on the government. So I see this as like this incredible strategic tool for companies that have the resources and I mean, and I'm excited about that truly, it's like there's a lot of things on a personal level that when you talk about rolling back environmental rules or consumer safety stuff that I I kind of grit my teeth at, but at the same time, as someone that's worked in cannabis for a long time and feels really frustrated about how over-regulated the industry is and how that's led to to lack of success for so many businesses. I'm like, wow. Well, I hope that. I hope that we can figure out a way to take on some of this together and that people are ready to step up like, really get creative and think about how to unlock opportunities for their businesses using some of these new tools.

Leah Heise: 20:40

Yeah, and I think there are a lot of opportunities. I mean even not just the cannabis regulation stuff, right Like. Not just the cannabis regulation stuff, right Like? Are these family leave acts affecting you? There's a whole host of rules and responsibilities where we are required to do. One of them, I think, is 280E. I have always thought 280E was unconstitutional because 280E was based on a case where the court decided that a felon did not have the right to deduct business expenses, but that person was actually adjudicated a felon. They had a right to a trial. So what the IRS did was they took an entire, created a policy that basically declared us hire, created a policy that basically declared us felons without due process of law. So is that at risk?

Ben Larson: 21:36

Which I think would be great, and with the change in the statute of limitations, we are currently feeling the impact of that. So it is a live case.

AnnaRae Grabstein: 21:45

Live case. Oh, I love that Because even if your prediction that Schedule 3 slows down like really, at least for many businesses, the end of 280E is really the biggest plus. It really is For Schedule 3.

Leah Heise: 22:00

Well, schedule 3 is not giving us interstate commerce. It's not giving us a lot of the things that we've been hoping for, you know, access to banking public exchanges. It's not giving us any of that stuff. So maybe there's another path to get rid of 280E.

AnnaRae Grabstein: 22:15

Well, let's talk about the Farm Bill too, because the Farm Bill is an active discussion and the language is very much being debated on both houses in Congress debated on both houses in Congress. So that's an example going back to looking backwards versus looking forwards. The Farm Bill is looking forwards. Do you think that this new approach that the Supreme Court do you think the Supreme Court is encouraging lawmakers now to get more specific and less ambiguous, which could slow down the progress of the farm bill because they would try to make sure that more things were clear, or do you think that Congress just doesn't have time to think on that level and that they won't actually become more specific?

Leah Heise: 23:02

Yeah, I mean I would love to believe that this would give them the impetus to be more specific and to create legislation that is not ambiguous. But I just our Congress right now can't agree if the sky is blue or if a leaf is green. So I don't know how they would ever get a bill out that is absolutely specific unless everybody was aligned on whatever the particular bill was. And they are certainly not aligned on the farm bill. I mean, even the FDA continuously asked Congress to help them give them explicit authority to regulate CBD, and it's never happened.

Ben Larson: 23:43

So to your point there's just going to be a lot more lawsuits and the lawyers are going to make a lot more money.

AnnaRae Grabstein: 23:49

Which actually could lead to the hemp industry being able to I don't want to say stay status quo, but to keep THC flowing on the hemp side of the market for longer is what it sounds like.

Leah Heise: 24:04

Yeah that's what I think and we'll see what's happening on what happens on a state by state basis. More and more states are attempting to do some level of regulation. I think we just saw New Jersey. They did do a beverage carve out, but we just did see them move forward. We'll see if the governor signs it. I'm not sure if he signed that bill yet, but it's fascinating time for the hemp industry.

Ben Larson: 24:28

Before we, before we jumped on you, had been talking about how states have been trying to roll back some of the Chevron deference in the past. Leading up to this, can you kind of explain the progression of what was happening behind the scenes before the actual overturn?

Leah Heise: 24:48

Yeah, sure, I mean there's a whole bunch of things that have been happening. The states, a number of states, have gotten very weary of having Chevron deference and wanted to have more ability to do, give a little bit more free enterprise to the economies. So they were already legislatively creating new standards of deference. And they exist, and there are still deference that exists under federal law as well. There's a Skidmore deference, there's a bunch of different levels of deference. It's just not as high as Chevron was. So we'll see what happens in the States. It does trickle down, everything trickles down from the federal government, right Like, um, I mean, you can think about what everyone knows Miranda. Um, that was a federal law, every single state. When you're arrested you get read your Miranda rights, it's, it's. It gets incorporated into the whole ethos of the way a state regulates based on federal law, not only write the regulation, enforce the regulation and then judicially enforce the regulation. Why were they given that power? For it to sit in one location?

Leah Heise: 26:18

Historically, this has been a conversation that has come up for decades and decades and decades, and there have been numerous proposals over the years to transform administrative agencies and take that judicial function out of an administrative agency and some have even proposed doing like a separate circuit specifically designed to hear administrative cases.

Leah Heise: 26:43

And in fact, when I was at the Coast Guard, my the chief judge that I was working with was a big fan of this and he ended up entering into memorandum of understanding with multiple agencies to take their cases into the Coast Guard One to give the Coast Guard judges a more diverse sphere of work, because if you're an administrative law judge and you're sitting inside of Social Security, for example, you're hearing thousands of Social Security cases a year like mind-numbingly boring. So it gave the US Coast Guard judges a little bit more diversity in their work. They could hear oil pollution cases, they could hear National Fisheries Services cases, noaa cases, patent and trademark cases, department of Labor cases, and we ended up creating a whole docketing center that just took cases from all of these other agencies and then we ran them through and issued decisions. But I don't know that that even exists anymore.

AnnaRae Grabstein: 27:43

Yeah, this is so nuanced and it's like these things that happen behind the scene and I said I wasn't going to get into politics, but I think we kind of can't help it and it's like why is this happening and who is pushing this agenda forward? And how does this kind of relate to the broader political dynamic that's at work here? And so we know that the Supreme Court is stacked with more Republican appointees than in my lifetime, I think, and then we've got Republicans in Congress that are pushing forward different agendas. We have an election coming up in November. It seems like what's happening is sort of some structural opportunities that the Republicans are pushing forward to really marginalize regulatory agencies, and we know that's part of the agenda, right.

Leah Heise: 28:45

We know that they do not want big government. They want a retraction of big government. They see government as a blockage to the free market and to economic growth. Maybe it is, I don't know, but we are seeing a rise of sort of the conservative party ideals, and you can trace it all the way back to when Trump became president, even with the overturning of Roe.

Ben Larson: 29:15

They want a free market as long as it doesn't pertain to the cannabis and hemp industry.

Leah Heise: 29:20

Because that's not good for the public good. And what did I read this morning with the rationale for the House appropriation stuff? It was that minors with high levels of THC were more likely to develop schizophrenia, and all of this stuff. Meanwhile, all of the studies show that underage use actually decreases upon legalization versus increases.

AnnaRae Grabstein: 29:43

So this is the thing. We've got this situation where we're seeing Republicans in Congress be pretty anti-cannabis in the way that they are responding to the Farm Bill, to things that are coming up in the Appropriations Committee, trying to defund the rescheduling process. I've been trying to figure out. Is that because they think that if cannabis policy moves forward before the election it's good for Democrats and they don't? They want to slow it down and stall it so that are successful and in their elections in in november? Is that policy gonna keep moving forward? And as an eternal optimist, I'm like they can't really believe that. And we're seeing so much incredible economic growth on the in the hemp industry and in the cannabis space that that it's going to be undeniable that republicans who are pro-business want to support this. It's like what is going on.

Leah Heise: 30:52

I would like to believe that. I would like to believe that Republicans that are pro-business would absolutely support a multi, multi, multi-billion dollar international industry. I would like to believe that. But we are seeing some show their hands right and that they would listen to their constituents, and that more than 73% of the United States wants to have cannabis legalized. But we're seeing things like Virginia, for example, which passed adult use what more than four years ago, and they've never been able to commercialize that market. They put forth a commercialization plan and the governor vetoed it.

Leah Heise: 31:28

So I don't, you know, I don't know, I don't know what will happen. My, I am an optimist too, and I very much would like to believe that, you know, six months from now, I've stopped worrying about whether or not we're going to have an industry anymore, but it does make me nervous to see the states and the federal government making more moves in regards to cannabis than they have made in years, and not forward moves, backward moves well, when it started, it felt like it was going to be going forward, but the results resulting efforts have have all been in the opposite direction six weeks, most people thought that forward progress was a done deal, that there was nothing that was going to stop schedule three or slow it down, and that all of these other initiatives were going to keep moving.

AnnaRae Grabstein: 32:24

I mean, ben, you were in Washington DC not too long ago and, uh, did you, did you get a whiff of this? Did you feel that there was questions about if this was going to happen or not?

Ben Larson: 32:36

no, I mean like, honestly, going into my last trip in dc and it was only a month and a half or two months ago um, you know it was. It was ripe. I mean the, the, the risk, the rescheduling recommendation or the the proposed rulemaking from the dea and the farm bill draft were both dropped on the thursday of the week that we were actually there and even leading up to that, we didn't even know it was going to happen. We were having the conversations with various uh congressional members and, um, we were talking about, like you know, forward-looking uh conversations and 280E and all this kind of stuff, and all of a sudden it drops and that's what created this shitstorm. That has been the last six weeks where sentiment has really seemed to shift in, even just the last two weeks.

AnnaRae Grabstein: 33:25

And you're really active with a number of different trade associations and on leadership with NCIA. Are you guys talking about going to task in a new way, taking a different approach.

Ben Larson: 33:40

I think I think everyone's still trying to really find their footing in, like what is, what is the trajectory of all this? Like we, we didn't think we had to go back and reprove, as some of the headlines showing today. Like reprove, like the relevancy of the studies that have been done throughout history about the medical applications of cannabis. You know, it's like everything's being called into question now and, to Leah's point, this is only just going to delay the conversation and I mean, for those of us being in the industry this long, it's like the conversation is old and long and tired and now it's like just being revamped and we're going to have to keep having this conversation.

Ben Larson: 34:21

It's like to what end Not to take us into a dark place?

Leah Heise: 34:24

I wonder about clinical trials too. I wonder about clinical trials too and I'm more focused on clinical trials with the MDMA stuff that happened. Because how do you do a double blind study on a cannabinoid, right, I guess if you isolated a cannabinoid maybe you could, but anything that has an intoxicating aspect to it, how can you do a double blind study on something that if you consume that thing you're going to know you, you have a feeling from it, right? So if that, if MDMA study is not valid because the people knew they were on MDMA or a placebo, then how can we ever test anything that is of an intoxicating nature? That will be enough and approved by FDA.

AnnaRae Grabstein: 35:12

He's giving me the sideways look that he doesn't know we're talking about.

Ben Larson: 35:16

But so I generally know what we're talking about. I'm just it is so confounding yeah, that's the whole point of it is like are you feeling it or not?

AnnaRae Grabstein: 35:32

Whether it's physical or mental, really aren't equipped for drugs and interventions that actually make you feel a way, as opposed to just do something inside of your body that you can't feel technically but might give you side effects like a headache or the runs or all these like normal side effects that people have for medications. I did read something that the solution is to provide in a double-blind study, instead of a placebo, another compound that does make you feel a certain way, we have those they're called pharmaceuticals.

Ben Larson: 36:08

I felt madly euphoric off of pharmaceuticals I had when I shattered my elbow. It's true. There's precedent for this. This is insane.

Leah Heise: 36:20

It's almost like they're applying it to MDMA.

AnnaRae Grabstein: 36:32

And if we get to the cannabis issue in a biased manner which gives which is great, that Chevron is toast, because then you can go after them and be like you're not applying it based on science, yeah, well, and so again, I think that what, what you're saying is like, it's about going after them, and and now we have this new chapter that we're opening up, where businesses that are willing to take the risk of becoming strategic in terms of their regulatory and legal plans are going to be able to unlock opportunities specifically for their businesses. And that is intimidating to some and probably really exciting and opportunistic for others. But, like, but, it's it's a proactive approach and or, and it's it's both reactive and proactive. It's like all right, let's take this on, but also let's react to something that might've already happened. And I just I get where.

AnnaRae Grabstein: 37:24

I don't want to scare anyone away, because I think that there's more opportunity in all of this uproar for the people that are willing to step into it than the folks that are scared, that have always been scared. But if, like, if you're ready, let's go. Let's like, figure out a way to have legal precedent, support our existence as a product and as a consumable, like we can actually go to the Supreme Court now in a different way than we could before. That's exciting.

Leah Heise: 37:56

And we are seeing some already step into the fray. I mean stepping into the fray beforehand. You know the Verano can of provisions case which ended up getting dismissed, which honestly I think is a good thing because it speeds up how to appeal to get us some more laws. We are seeing, certainly, some of the MSOs that are saying, yeah, I'm not going to pay 280E, I'm going to either escrow it or I'm going to ask you for a refund and, despite what the IRS is saying, they're willing, on a risk reward analysis basis, say I'm willing to take that risk that you, the IRS, will fail on this.

AnnaRae Grabstein: 38:35

Yeah, the IRS issued a letter just in the last couple weeks a week basically saying that they were not cool with people not paying their 280E taxes, and I guess this is the perfect example actually that you could point to that someone could say, okay, I'd like a jury trial then, because I disagree, we disagree.

Leah Heise: 39:00

Well, and have you ever tried to fight the IRS on a tax issue?

AnnaRae Grabstein: 39:04

Only on a personal level and mostly just very basic things.

Ben Larson: 39:07

I can't even figure out how to get it in touch with them to know how much I actually owe them.

Leah Heise: 39:12

It's crazy, I mean they send bills in the mails. I don't know about you, but I feel like every couple of weeks I get a refund and then I get another bill for like $12 and 33 cents. And sometimes I just sit there and I'm like how do I know that this is something I actually owe to you? Like you're not providing me any proof or rationale for why this amount was incorrect or correct. And I've even had situations where they've refunded the money and then they've asked for it back. And then they've refunded the money and they've asked for it back and I'm like okay, and we just pay it because the IRS tells us to.

AnnaRae Grabstein: 39:53

Oh government. I don't think anyone in cannabis particularly loves like government regulations. It's all just like it's.

Ben Larson: 40:01

it's made me more frustrated with with the government working in cannabis than than I certainly was before it's like I already didn't like the government, but now I actually have to engage with it because I'm in the industry and it just makes it that much worse, Like when you're actually seeing the sausage be made.

Leah Heise: 40:24

It's like you know, makes you want to become a government vegetarian when I went into law school, I was such an idealist and even when I got out of law school, you know, the justice system worked and government works and it's all this beautiful little path. It's not. I mean, there is corruption through all levels of everything, everywhere. Um, and it just my I, my idealism has been burnt away and cannabis has scorched earth. It because we are overregulated?

Ben Larson: 40:57

Yeah, so, so yeah, the call to action is for the and I don't know who's, who's a member of these these organizations that can influence their direction, but start pulling together some class action suits and start fighting back, because nothing seems like it's getting done fast otherwise. And maybe this is the opportunity to to jump in and be, as Anna Rae said, proactive about going after it.

AnnaRae Grabstein: 41:22

Yeah, I'm excited. Can we get rid of track and trace? Let's go do it.

Leah Heise: 41:25

Oh God, I mean, and I don't mind track and trace, but can we get some different level of track and trace and and make it more rational to the end user?

AnnaRae Grabstein: 41:36

It just doesn't make any sense make it more rational to the end user. It just doesn't make any sense. Yeah, absolutely. Well, this has been great. I hope everybody learned some things. I think we're moving towards our last call with Leah now, so just thank you so much for joining us. It's been really fun to get to have this conversation. I know we went to some dark places, but we remain hopeful. We are also just trying to be realistic and understand what's ahead and what the fight's about. So, leah, we'd love to turn the mic over to you to give you a chance to make a last call on our audience industry.

Leah Heise: 42:19

This is a very good reminder to us all how important it is to pay attention to what is happening inside of Congress, inside of the judicial branch. This is going to be a plug out to Tom Angel for marijuana moment. Get his bill tracker. Just watching his bill tracker you can see at least what cards are being played and it'll give you an idea of which way things are going.

AnnaRae Grabstein: 42:42

Awesome. Thank you so much.

Ben Larson: 42:43

Amazing.

AnnaRae Grabstein: 42:44

And thanks for coming on. You know we've been working together for over a year and this is the first time you've been on the show, so it's fun for me to get to bring you on and share you with our audience. So thank you, thank you, I appreciate it.

Ben Larson: 42:58

And I really just appreciate your, your understanding of it all, like building some clarity around something that can be very kind of amorphous for a lot of us, but certainly some action items coming out of this. So thank you.

Leah Heise: 43:10

You're welcome. Thanks guys.

Ben Larson: 43:12

All right, we'll talk to you soon. And, ray, great to have you back. We missed you. Well, last week we were off, but the week before we had Scott on and you were not feeling so well, so it's good to have you back in the saddle.

AnnaRae Grabstein: 43:27

I am so happy to be here. I missed you too, and I missed just getting to have my Thursday recording session where I didn't have to do other work.

AnnaRae Grabstein: 43:33

So yes, it's so good and I can't believe we hit 50 episodes. So thanks everyone for coming along for the ride. You know we feel very helpful that anyone ever tunes in and listens at all. The feedback that we get means the world to us. So if you have something that you want to hear, a topic that matters to you that you're struggling with to understand, or just someone that you think is a total badass that needs to have their voice heard, please reach out to us. We're super easy to find.

Ben Larson: 44:01

Yes, easy to find. We are out there. Thank you, Thank you, Thank you. Don't forget to share and subscribe. We're excited for the next 50 and excited to have you along for it. So remember, folks, stay curious, stay informed and keep your spirits high Until next time. That's the show.