Troubles deepen for co-founder of Mendocino County’s only cannabis distribution business

Lucas Seymour hoped his legal troubles as a cannabis businessman were largely behind him in early December after he and his partner secured a Mendocino County license to run their Ukiah-based distribution business.

But in the span of three weeks, Seymour and his firm, Old Kai, have become the target of a high-profile crackdown by local law enforcement that has ultimately forced Seymour to step down as co-owner of a company he helped create in 2016, in the runup to the state’s historic vote legalizing recreational use of marijuana.

The trouble for Old Kai began three days before Christmas with a reportedly routine CHP traffic stop and the seizure by local authorities of nearly 1,900 pounds of cannabis from a company truck just blocks from Old Kai’s warehouse. ?Seventeen days later, local officers, acting on a probation search linked to a 2015 misdemeanor conviction for Seymour, entered the firm’s place of business and removed boxloads of financial documents.

Seymour and his partners view the pair of incidents as clear examples of law enforcement overreach. They say they operate an aboveboard business looking to comply with all applicable laws, and their Santa Rosa attorney, Joe Rogoway, has produced documents he says give the company all the necessary clearance to operate in the county.

Mendocino County authorities, meanwhile, remain tight-lipped, with both Sheriff Tom Allman and a spokesman for District Attorney David Eyster declining to speak in any detai about the case.

It has sparked significant debate in Mendocino County, an Emerald Triangle stronghold with deep roots in the cannabis trade, and wider attention inside California’s burgeoning marijuana industry, where entrepreneurs in both the medical and emerging nonmedical marketplace are struggling to navigate a new maze of local and state laws while not running afoul of authorities tasked with policing that altered legal landscape.

“The driving force behind what I did with this company, and the seriousness with which I take compliance, is in part because of that incident,” Seymour said of his 2015 marijuana-related arrest. “I don’t want anyone else that is serious about compliance to feel the way I felt in that entire process.”

The whereabouts of Old ?Kai’s seized marijuana - ?1,875 pounds in all, and mostly a mix of old flowers and trim slated for concentrated cannabis oil production - remains unknown. It could be worth up to $750,000, industry experts say.

Sheriff Allman and other officials with the Mendocino Major Crimes Task Force, whose officers carried out the seizure, have refused to say if it has been destroyed, which is typical with suspected drug contraband.

“I look forward to talking about the case once further information can be revealed,” Allman said. “I’m not going to counter what has been said at this time.”

Concerns raised for industry

The case is causing ripples far beyond Mendocino County, as cannabis startups and medicinal marijuana purveyors seek to gain a foothold in the newly expanded recreational trade, which began Jan. 1.

“The industry certainly is paying attention to this case,” said San Francisco-based cannabis attorney Nicole Howell Neubert, who serves as chief political adviser to the California Growers Association. She and others are concerned by the possibility that law enforcement would take actions that could discourage businesses from joining the regulated market.

“It makes people think, ‘Even if I do the right thing I’m going to be treated like a criminal,’?” Neubert said. “It’s pretty devastating.”

At stake for Mendocino County is the trust of cannabis entrepreneurs, who are still confronting a federal government that views the industry as illegal, regardless of state laws. Tax dollars for local governments and livelihoods for growers are also at risk if more cultivators and businesses cannot be coaxed to join the regulated trade.

Case in point: If the seized cannabis from Old Kai’s truck is destroyed, it’s cultivators from a Covelo collective who’ll be primarily hit by the loss. No money had exchanged hands between the cultivators and Old Kai, according to Seymour and company co-founder Matthew Mandelker.

Pressed for action

Covelo pot farmer Joshua Artman, who had plants in the truck, and others in the local cannabis industry have pleaded with the county Board of Supervisors to look into the case. The board controls the Sheriff’s Office budget but has no authority over its operations, nor does it oversee the Major Crimes Task Force, which includes the Sheriff’s Office and local police departments.

Some supervisors have expressed concern law enforcement is undermining the county’s attempt to create a regulated local industry designed to reduce the negative impacts of the region’s thriving black market.