Standing Up: A Personal Journey To The Legal Cannabis Industry

Standing Up: A Personal Journey To The Legal Cannabis Industry

I never imagined I’d be writing about this topic. For 25 years, I’ve enjoyed an amazing journey as a serial entrepreneur building companies and brands, leading companies in the beer, wine and spirits, distribution, and technology industries. The alcohol industry has been good to me and to my family.

Other than a little exposure in college, I have not been around marijuana. A few years ago, I met a bunch of U.S. Marines. Travis McVey created Heroes Vodka and I helped him launch the brand. His friend Stephen told me a story that has stayed with me. Stephen Cochran served as part of the 2nd (LAR) Light Armored Reconnaissance Battalion, 1st Marine Expeditionary Force. He served in Iraq and Afghanistan and was severely injured on patrol. Stephen spent nearly a year in hospitals paralyzed, unable to a walk. After undergoing an experimental procedure at Vanderbilt, he was miraculously able to walk again. Stephen said,

“In recovery, I suffered from extreme pain and Doctors prescribed me every prescription medicine you could imagine. The pain meds nearly killed me. That is when I turned to cannabis. Today I’m raising my family, writing, and performing music. I give back to veterans wherever and whenever I can ( Semper Fi Fund). Medical cannabis is the reason I can do these things today. It saved my life and the lives of many of my fellow veterans.”

This conversation opened my eyes to the many benefits of cannabis. There are more than 50 medical conditions for which cannabis is legally recognized as some form of therapy or medicine including Alzheimer’s, anorexia, arthritis, cancer, chronic pain, epilepsy, and post-traumatic stress disorder. I’ve come across people suffering with chronic pain and others going through cancer treatment. Cannabis allows them to live their lives without the destructive side effects of opioid based pain medicines. The more I learned about the benefits of cannabis to people suffering, the more research I did to understand the industry. Based on this, I’ve come to believe that its place in society needs to change.

BEVERLY HILLS, CA – FEBRUARY 15: Al Harrington (L) and Viola Harrington arrive at exNBA Star Al Harrington Launches New CBD Business at Wolfgang’s Steakhouse on February 15, 2018 in Beverly Hills, California. (Photo by FilmMagic/FilmMagic)

Al Harrington is a 16-year NBA great and cannabis entrepreneur. I used to watch Al at Pacer’s games. Al found his way into medicinal cannabis and CBD to treat his pain from a botched knee surgery. He tells a funny story about recommending medical marijuana to his grandmother Viola. She suffered from multiple ailments, and after some initial resistance, she tried it and immediately felt better. His cannabis brand, Viola, was soon born. He also has his Harrington Wellness line of CBD. Al’s story is genuine. In an interview with Al, former NBA commissioner David Stern pronounced that the laws and rules need to change around cannabis (See Al Harrington and David Stern). Al, and my friend, musician, and NFL great Kyle Turley, have been outspoken advocates for awareness and change. It’s clear, cannabis prohibition and the aggressive pursuit of its enforcement have also particularly ravaged the African American community.

The opioid epidemic is destroying lives, families, and devastating whole communities. I personally have more than one friend who has lost a (grown) child recently, due to accidental overdose or tainted product. We must do something to stop this epidemic. Doctors overprescribing opioids is one of the primary causes. Many patients start out with legal prescriptions and become addicted. They then turn to the illegal market to meet their addiction needs. Cannabis can be used to help wean people off these destructive drugs. Ideally, it could be prescribed to avoid opioid abuse in the first place. It is a legitimate part of the solution. Given this, I decided to find out how I could make a difference.

I attended the MJ Business conference in Las Vegas and networked with Young Presidents Organization (YPO) and other friends. I wanted to figure out how I could play a positive role in this emerging industry. I did some research to understand what led to the abrupt prohibition of cannabis in the US in 1937. I learned that Indianapolis pharmaceutical powerhouse, Eli Lilly was in the cannabis business until the prohibition. Cannabis prohibition seems to have been motivated by a combination of racism and the business interests of a few that had political influence (Why Is Marijuana Illegal). I learned that many feel the ratcheting up of cannabis to a Schedule I drug (the same as Heroin) in 1970 also had racist motivations. It was certainly not based on science.

The American public now overwhelmingly supports cannabis legalization, with over 64% in favor according to Gallop. It is more popular than any current politician. State by state, citizens have made local option the law of the land. There are now 30 states plus Washington DC where medical cannabis use is legal. There are 9 states where adult recreational use is now legal. This is a prime example of the importance of state’s rights leading the way.

As the industry has come out of the shadows of illegal activity and into the light of permitted activities in many states, incredible entrepreneurial spirits have been unleashed. I feel the excitement of being at the forefront of another Repeal of Prohibition. This time though, we have the added dimension of extraordinary medical benefits. Drawing from my 25+ years in the beverage alcohol business, I see many parallels to the industry I know well. The legal framework around local option, licensing and taxes are similar to alcohol beverage laws in many respects. Constellation Brands [STZ] recent $191 million investment into Canopy Growth [WEED] further convinced me that this developing industry is going mainstream.

Legal cannabis is likely to rival the Beer, Wine and Spirits categories and exceed $50 billion annually in the coming years. Some analysts predict the US industry over $100 billion. Regardless of the number, it is and will be massive.

I met my partners Todd Kaplan and Courtney Dorne through YPO last year. I joined the team at Vertical Companies as a partner, President of Distribution and Chief Marketing Officer in January 2018. I could not be more excited in this venture, building a large scale new enterprise in the emerging cannabis space. One of my objectives will be to play my part in bringing the right coalitions together to address and correct the State vs Federal conflict that exists today.

Real March Madness – Indiana Says No To Leadership & Open Mindedness

Real March Madness – Indiana Says No To Leadership & Open Mindedness

Indiana Legislature Tells The NCAA, NFL, NBA, Eli Lilly, GenCon, Amazon, Salesforce, YPO, The Chamber of Commerce and Others to Take a Hike

Really? Is this what we elected a super majority of Republicans to do? Apparently, the leadership decided it made sense to push through the “Religious Freedom Act”. I wrote a piece called “It’s 2015: Where Have All The Leaders Gone?” last week, I had no idea how timely that was. Here is a recent story on the issue.Indiana closed for business

Indiana House OKs controversial religious freedom bill

The basic argument of those in favor of these laws seems to be quite weak. This post discusses the fact that the language is very similar to existing law at the Federal level and in the state. If that is so, why is it needed?

Indiana’s So-Called ‘Right to Discriminate’ Law Appears Very Similar to Existing Federal Law

I have yet to hear or read a strong argument in its favor. This is an issue drummed up by those wanting to drum up issues and make a seemingly principled stand on what other people do in their private lives. The hypotheticals they use like a caterer who does not want to serve a gay wedding are simply dumb. If any business like that really does not want to get someone’s business for any reason, they could simply make their bid not competitive and lose out to others. The idea you need a law to turn away business is the very example of conservatism gone amuck.

One of the more ridiculous arguments for a change in the language put forth was “A House committee last week tried to assuage the concerns of some business interests, including the Indiana Chamber of Commerce, with an amendment that exempts employers from any lawsuits brought by employees under the legislation.” They completely miss the point.

Have any of these people voting for this considered what this legislation actually permits? What if a Muslim shop owner decided their religion prevented them from serving Christians or Jews? Or Visa versa? Under the language of this legislation, that would be permitted wouldn’t it? How about another example, where a restaurant owner believes adultery is against their religion and refuses to allow people they suspect of committing it to dine in their establishment based on their religious conscience. How about couples living together in sin, unmarried, against the teaching of an owners religion. Who gets to decide? The idea that small government conservatives would put into place a framework for the state to arbitrate these questions strikes me as worse than counter intuitive.

And while I do not agree with much of what passes for journalism on MSNBC, this story was well done on putting this in perspective nationally and why this fight is not only wrong but in the end will cause damage to Indiana and ultimately will fail – Why ‘religious freedom’ laws are doomed

The bottom line is why do we have such an activist state government that feels it necessary to make a law like this? Starting with Governor Daniels and continued under Governor Pence, the state has done a great job of attracting businesses and rebuilding the economy in spite of the ridiculous headwinds from Washington. Indiana has a great track record in this regard, especially relative to its neighbor states of IL and MI. So why risk that momentum and progress now?

Consequences:

The big table top game convention that brings 56,000 people and $50 million to the State and is Indianapolis’ second-largest convention, is threatening to relocate its massive late-summer annual event to another city if Gov. Mike Pence signs the controversial “religious freedom” bill into law added in a letter to the Governor “Legislation that could allow for refusal of service or discrimination against our attendees will have a direct negative impact on the state’s economy, and will factor into our decision-making on hosting the convention in the state of Indiana in future years,” GenCon CEO Adrian Swartout said Monday in a letter to Pence.

GenCon threatens to exit Indy over ‘religious freedom’ measure

The Backlash to the Anti-Gay Backlash: “Religious Freedom” Bills Fail, As More People See What They’re Really About

My question is: how long can an organization like the NCAA or a company like Eli Lilly or Amazon who keeps expanding here stand by and do business as usual in such potentially hostile environment to their employees, customers and constituents. Many of my CEO friends around the world in Young Presidents Organization (YPO is a group of over 22,000 CEOs with a combined $6 trillion in revenue and 15 million employees) have been sending messages to the effect of “REALLY Smoke, what kind of state do you live in?” In the case of Arizona, Governor Jan Brewer vetoed similar legislation when confronted with the uproar of the NFL (and Super Bowl pullout) and the business community. Governor Pence, do you think we are immune to this? Do you think you are standing on principle? If so it is the wrong one.

How long until the NFL pulls the combine? How many NCAA tournaments do you think we will land going forward. Oh and by the way, what great timing Legislature to put Indiana in the national spotlight during March madness.

Conservatives Against Close Mindedness

Yes, one can be a conservative and be completely opposed to this kind of legislation and behavior. In fact, it is the opposite of true conservatism. This is government intervention at its worst. I’m a long time supporter of conservative causes and of many Republicans, who cannot reconcile this. For example, I whole-heartedly supported the Indiana legislative takeover led by Mitch Daniels and others that was mainly about fixing the education system in Indiana. The fact is the Teachers’ Union had a lock on the legislature and a group of like-minded business people and conservatives got together and supported state legislative candidates and made them competitive for the first time. This led to the current makeup of the legislature here. And there are many good things that have come out of that takeover. That said, this is not one of them.

In fact, it makes me want to put a fund together of like-minded people to knock off the knuckleheads who voted this legislation into law.   While I’m glad the Democrats (and 5 brave Republicans) all voted against this, I certainly don’t want to see the teacher’s union back in control preventing all kinds of experimentation and change in our troubled education system, but I also don’t want to see the current crop of “leaders” in place. Is there not a sensible center? How about a group of fiscal conservative, libertarian minded folks who can knock off the current group and create the kind of government that this state and its people deserve?

Who is with me?

Supporting the “Religious Freedom Act”:

Voting Yes:

Republicans: Arnold, Aylsworth, Bacon, Baird, Behning, Borders, Bosma, Braun, Tim Brown, Burton, Carbaugh, Cherry, Cook, Cox, Culver, Davisson, Dermody, DeVon, Fine, Friend, Frizzell, Frye, Gutwein, Hamm, Harman, Heaton, Judy, Karickhoff, Koch, Lehe, Leonard, Lucas, Mahan, Mayfield, McMillin, McNamara, Miller, Morrison, Morris, Negele, Nisly, Ober, Olthoff, Price, Rhoads, Richardson, Schaibley, Slager, Smaltz, Milo Smith, Soliday, Speedy, Steuerwald, Sullivan, Thompson, Torr, Truitt, Ubelhor, VanNatter, Washburne, Wesco, Zent, Ziemke.

Democrats: None.

Voting No:

Republicans: Beumer, Clere, Eberhart, Kirchhofer, Saunders.

Democrats: Austin, Bartlett, Bauer, Charlie Brown, DeLaney, Errington, Forestal, GiaQuinta, Goodin, Hale, Kersey, Klinker, Lawson, Macer, Moed, Moseley, Niezgodski, Pelath, Pierce, Pryor, Riecken, Shackleford, Vernon Smith, Stemler, Summers, Wright.

EXCUSED (not sure why you can be excused from something like this) Dvorak, Harris, Huston, Lehman, Porter, Wolkins.

At the very least, the businesses that choose to not serve Gays or Muslims or Jews or Adulterers or whatever this bills proponents and the supposed beneficiaries of it are really after, should be required to place stickers that get applied to the front door of their establishments and to be put on an easy to find list on the web. Those who think this is some great move to respect individual’s religion don’t get to have it both ways – The ability to discriminate based on your conscience AND the ability to remain anonymous. You may well choose to not serve someone out of your religious conscience under this law, but we don’t need a law to choose not to do business with you.

 

3/29 UPDATE: Well its been quite a week and Indiana has taken a beating on the national and international stage. Based on everything I’ve read including the law itself (here), this explanation in the Weekly Standard and a balanced analysis in the Star (here) and this lawyers blog post (here) among other things, I stand by my remarks above.   One thing I’ll add, the fact that similar laws exist around the country does not mean they are right.  There are so many laws on the books that may have made sense at one time or another, but today make no sense.  The attempt to balance an individuals right to practice their chosen religion with the basic right to not be discriminated against is not difficult in my mind.  No one has the right to discriminate for any reason.   Governor Pence, that was the right answer on today’s  This Week show with George Stephanopoulos.

Aside from that, the shear political ham handedness of the Indiana Republican leadership (who I supported and elected) is breathtaking.  Every lead in to the Final Four this weekend will have this issue front and center (assuming the NCAA does not pull it at the last minute).  The damage being done economically and reputationally to our state will take many years to overcome. And why?  What compelling reason or case was there that drove this?  You who practice politics for a living, have no excuse.   The damage to my business, my friends, and to my state of over 25 years gives me a high level of motivation to work to get you out of office.

 

April 4 Update:  An excellent post #RFRA firestorm overview…@CarlyFiorina ​ has it right. “Creating an Artificial Divide in Indiana

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