Cannabis Weekly Round-Up: SAFER Banking Act Faces Uncertainty, Curaleaf Announces More Layoffs
The newly elected speaker for the US House of Representatives has a track record of voting against cannabis reform, throwing the future of the SAFER Banking Act into uncertainty once again.
Meanwhile, a US multi-state operator has confirmed its third round of layoffs since March of this year.
Keep reading to learn more about these developing stories and more recent cannabis industry events.
SAFER Banking Act faces fresh hurdles with new House speaker
The future of the SAFER Banking Act is once again being called into question with the confirmation of Republican Mike Johnson as House speaker this past Tuesday (October 25). Upon being sworn in, the Louisiana representative outlined what he hopes to accomplish as speaker. Among his top priorities are preventing a government shutdown by addressing the next spending bill before the extended November 17 deadline, and sending aid to Israel.
Johnson did not address the SAFER Banking Act, a proposed piece of legislation that could allow legally operating cannabis companies to access financial services that are currently hard to obtain given the drug’s federal illegality.
However, Johnson’s voting history shows he has been against any proposed cannabis reform, including the Medical Marijuana Research Act and House Bill 149, which moved to reduce penalties for individuals convicted of possession of small amounts of marijuana. Johnson also voted against the SAFE Banking Act in 2019 and 2021.
Representatives urge call on DEA for cannabis reform
A letter to Drug Enforcement Administration (DEA) Administrator Anne Milgram is urging the US agency to take state and federal cannabis reform efforts into account as it completes its review on cannabis scheduling.
News of the letter broke on Friday (October 27), and was first reported by PunchBowl News. It was penned by representatives Earl Blumenauer (D-OR), Dave Joyce (D-OR), Barbara Lee (D-CA) and Brian Mast (R-FL), who are co-chairs of the Congressional Cannabis Caucus. The move has gained bipartisan support, with 31 additional House lawmakers adding themselves as signatories to the letter.
The DEA’s review on cannabis scheduling was recommended by the US Department of Health and Human Services and the Biden administration. The letter writers also ask the DEA to consider going beyond rescheduling cannabis by removing it from the Controlled Substances Act entirely.
Curaleaf Holdings announces layoffs amid move to TSX
Curaleaf Holdings (OTCQX:CURLF,CSE:CURA) has confirmed rumors of an unspecified number of layoffs, according to MJBizDaily. The news was reportedly confirmed via emailed correspondence with the cannabis company.
This is the US-based multi-state operator’s third round of layoffs since March of this year. Curaleaf has retail stores and cultivation and processing facilities in 17 states, including a US$20 million medical cannabis dispensary in Utah. The company is currently in the midst of a restructuring following its bid to move its listing from the Canadian Securities Exchange to the Toronto Stock Exchange.
Cannabis companies band together in lawsuit
A group of companies that includes Verano Holdings (OTCQX:VRNOF), Canna Provisions, Wiseacre Farm and Treevit has enlisted the services of David Boies of Boies Schiller Flexnor, the law firm that represented Microsoft (NASDAQ:MSFT) in a lawsuit filed against the software company by the US Department of Justice in 1998.
The group has filed a lawsuit against US Attorney General Merrick Garland, stating that federal criminalization is “unconstitutional and unfair” to small businesses considering that cannabis is legal in 38 out of 50 states.
In a statement, Boies said, “Americans believe that cannabis should be legal and available subject to reasonable regulation by the states. 38 states have legalized some form of cannabis. The federal government lacks (the) authority to prohibit intrastate cannabis commerce. Outdated precedents from decades ago no longer apply — the Supreme Court has since made clear that the federal government lacks the authority to regulate purely intrastate commerce; moreover, the facts on which those precedents are based are no longer true.’
SNDL closes facility in Olds, Alberta
Government restrictions, high taxation rates and oversupply have made Canada’s cannabis industry a tough place to be for licensed producers, and an operation in the small town of Olds, Alberta, is the latest in the string of closures.
Calgary-based cannabis company SNDL (NASDAQ:SNDL) announced on October 19 that it has closed its facility in Olds. The facility, operating under SNDL’s original name of Sundial Growers, was among the first in the country to commence operations after the Canadian federal government legalized cannabis in 2018.
Cultivation will now happen at the company’s New Brunswick facility, while manufacturing, processing and production will be moved to a facility in Kelowna, BC
Securities Disclosure: I, Meagen Seatter, hold no direct investment interest in any company mentioned in this article.