West Hollywood Medical Cannabis Busted by LAPD and IRS

The following report on the LAPD's raid of the
"Yellow House" medical cannabis club was taken
from a news blog:
- D.G.

http://wehonews.blogspot.com/
WeHoNews.com
-----------The only independent web-based news
for West Hollywood----------- soon to be located
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Wednesday, May 11, 2005

5/11/05 - NEWS: - City of WeHo Upset by RaidWest
Hollywood Medical Cannabis Club Busted by LAPD and IRS
By Ryan Gierach

After an eight-month investigation, LAPD narco
squad officers and Federal Internal Revenue (IRS)
agents raided a medical cannabis club operating
in West Hollywood, arresting 14 people and
seizing 800 pounds of marijuana product
(wholesale value, $2.5 million; retail value over
$5 million) and between $300-500,000 in cash.

The Yellow House, or Compassionate Caregivers
medical marijuana facility at 1209 N. La Brea
Ave., West Hollywood, CA. Photo by Ryan Gierach

City officials both applauded and booed the bust
by another jurisdiction's law enforcement agency.
"We support any law enforcement agency's removing
from our neighborhoods any business involved in
illegal activity," said Helen Goss, city
communications director.
But condemnation of the tactics buzzed through
city hall. One city staffer told WeHoNews that he
felt violated. Jeff Prang, city council member
and a deputy sheriff himself decried the raid
into the city from a neighboring city's law
enforcement agency, even though routine warrants
are often served inter-jurisdictionally.
"This was not routine in any way?I don't want
LAPD conducting any more of these raid in our
city," Mr. Prang said point-blank. "It is?the
City council's intention to act as arbiter of
what is lawful in our community, not LAPD."
The targeted club, Compassionate Caregivers
located at 1209 N. La Brea Ave and commonly known
as the "Yellow House," had been under
surveillance by LAPD since September 2004 after
the arrest of a Compassionate Caregiver patron
with 60 marijuana plants in his possession, all
allegedly purchased at Yellow House.
According to LAPD spokesperson Sgt. Plows, that
surveillance found that the club allegedly sold
large amounts of marijuana to customers on a
regular, sometimes daily, basis. State law
forbids the sale of more than eight ounces of
medical marijuana to a patient at one time.
"We formed the opinion that the club was in
violation of Health & Safety Code 11360
(transportation, distribution or importation of
controlled substances) through the surveillance,"
Sgt. Plows told WeHoNews.com. "They regularly
sold 8 ounce and one pound quantities to people
who made sometimes daily buys. There were an
average of 235 visits a day to the house. That's
drug dealing, not medicine dispensing."

Gate and notice at Yellow House on May 9, 2005.
Photo by Ryan Gierach

Acknowledging that the IRS had been involved in
the months' long investigation, Sgt. Plow said,
"The key to [IRS involvement] in this raid was
the money-laundering investigation [the IRS] is
conducting into these businesses. This one was
obviously set up for profit, and the law says
they should be non-profit."
LAPD arrested employees and patrons en masse and
charged 13 people with felony counts of H&SC
11366 (maintaining a place for selling, giving,
using controlled substances); one man allegedly
holding 21 grams of marijuana but no letter of
recommendation identifying him as a medicinal
marijuana user was charged with a misdemeanor
count of possession.
Most of those arrested were bailed out the
following morning and are being represented by
West Hollywood lawyer Bruce Margolin. Mr.
Margolin's website states that he was "an advisor
for the California Compassionate Use Act - Prop.
215...He is the author of "The Margolin Guide To
Marijuana Laws" and is unarguably the nation's
foremost authority on marijuana law."
Calls to Mr. Margolin, who is traveling, went
unreturned before press
time.
Calls to the IRS went unreturned by press time as
well.

Many cancer, arthritis, and HIV patients rely on
the medicinal qualities of marijuana. Patients
decry those who would pervert the system by
purchasing it, and sometimes re-selling it, for
recreational use. Photo by Ryan Gierach

As to LAPD's plans to crack down on the other six
clubs still operating in West Hollywood, Sgt
Plows told WeHoNews that no other clubs, so far
as she had been told, were under surveillance by
LAPD.
"That doesn't mean they aren't surveilling, it
only means they don't tell me what they are
doing," she said. "This surveillance began with a
lead from another arrest; LAPD has no plans to
raid other clubs [in West Hollywood]."
According to Kristin Cook of the city's public
safety staff, such inter-jurisdictional
investigations are quite common, especially in
drug cases. "This case was unusual because the
'gentleman's agreement' that exists between
agencies about prior notification of a major raid
didn't happen," she said. "The city and the
[Sheriff's] station are displeased at the short
notice we received."
Capt. David Long, chief of the West Hollywood
Sheriff's Station, told WeHoNews.com that "they
did give us a 15 minute notice as a courtesy and
safety measure, but I would have liked a little
bit more information and time before they came in.
"I can't say they won't come in again, but we
will see to it that they won't come in without
prior knowledge," Capt. Long said.
Ms. Cook acknowledged that discussions on the
controversy had begun between municipalities.
Sgt. Plows told WeHoNews.com that LAPD Chief
William Bratton and Sheriff Lee Baca had already
spoken about the raid and bettering inter-agency
communication.
"From our perspective," Sgt. Plows said, "this
was a routine raid until we found so much product
and cash."
Mr. Prang told WeHoNews.com that news of "so much
product and cash" at the business heightened his
concerns for the public's safety, making it more
urgent that regulations be put in place to
protect the residents from the dangers a
concentration of medical marijuana distributors
posed.
"When you have businessmen who keep that much
marijuana and hundreds of thousands of dollars in
cash, and guns, in their shops, they're going to
be targets for violent crime," he said.
"My concern is these guns near residential
neighborhoods; money, drugs and guns invite
disaster."

Two of the clubs at Fairfax and Santa Monica
employ security guards with guns to guard their
premises. Those charged with the public's safety
consider them dangerous. The clubs claim the guns
act as deterrents against robbery. Photo by Ryan
Gierach

Susan Healy Keene, acting director of community
development for West Hollywood informed
WeHoNews.com that the first "all-hands" meeting
of the committee put together to explore
regulating medical marijuana facilities in the
city would meet Wed., May 11 at city hall.
She said that the committee would look at a wide
range of issues, including safety issues and
neighborhood impacts, revenue assessments, among
others.
The founder of West Hollywood's first opened -
and first raided and closed - medical marijuana
co-op, Scott Imler said, "It's about time [the
city] began putting some thought into this; this
raid is the unfortunate result of their 'don't
ask, don't tell' policy since the LACRC raid (Mr.
Imler's co-op was shut down in 2001 by the Bush
Administration; he escaped with a relative slap
on the wrist - one year probation).
"They got stung and are still dealing with a
$300,000 lawsuit [with the Dept. of Justice over
the raid], so it's understandable that they would
be reluctant to regulate. But now they are beset
with all these clubs they know nothing about.
They have to try to find out what's going on
inside them."
For Mr. Prang's part, "this is an issue about
which I and the entire council feel strongly.
Patients ought to have access to the medicine
they need. West Hollywood is a strong supporter
of patients' right to obtain medical marijuana.
"We do not condone drug dealing in our city. We
do not approve of otherwise healthy people
abusing the system by obtaining letters from 'pot
docs' to use medicinal marijuana recreationally,"
he said.
"We acknowledge that problems arise because of
the rapid proliferation of these clubs in our
small city, and we will regulate them so that
they can provide their service and medicine
safely in our community."
Seeking a response to those comments on public
safety, WeHoNews made calls to the Medical
Marijuana Farmacy, the club employing the most
visible of the armed guards (pictured above).
Those calls were not returned. When WeHoNews.com
approached the manager of the latter on the
street for comment, she walked briskly away.