Operators of medical marijuana dispensaries are welcoming action Monday by state lawmakers that would block prosecutions for illegal drug sales by cooperatives and collectives under certain conditions.

The state Senate on Monday approved legislation saying that a medical marijuana cooperative, collective or other business entity is not subject to prosecution for drug sales as long as the compensation they receive is reasonable and they follow security guidelines set by the state attorney general in 2008.


“It’s a long time coming. I’m glad they are doing something,” said Morgan Hannigan, manager of the San Jose Organic Relief dispensary in Vallejo.

Senate President Pro Tem Darrell Steinberg (D-Sacramento) said he introduced SB 439 because state law did not address medical marijuana distribution systems such as store fronts.


“It does seek to assure patients who need medical cannabis have access to it,” Steinberg told his colleagues. “It is intended to ensure that drug cartels and other criminals do not benefit from the lack of regulation.”

Allison Margolin is a private attorney who has successfully fought several prosecutions of her clients by the Los Angeles County district attorney’s office.


Prosecutors have argued that the Compassionate Use Act approved by voters in 1996 does not allow caretakers to sell drugs. As a result, prosecutors alleged that medical marijuana sellers Margolin represents in San Fernando, Pomona and Long Beach illegally sold drugs. Prosecutors have argued that a subsequent state law allowing medical marijuana collectives doesn’t allow for sales and distribution of the drug.

Margolin has a good success rate in defending her clients, but the proposed state law would clarify that her clients are not breaking the law even if they receive pay and benefits for their work.


“This legislation is sorely needed to prevent D.A. offices from continuing to use the marijuana laws as a sword rather than respecting them for their true purpose: as a shield for medical marijuana patients,” Margolin said.

Steinberg’s office also points to two Vallejo dispensary operators charged with illegally selling marijuana by the Solano County district attorney’s office after raids by Pomona police officers.


A judge ruled in December that the operators of the Better Health Group collective complied with the intent of state law in selling medical marijuana.

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patrick.mcgreevy@latimes.com