Owner dies day after state shut down her Anchorage cannabis club
One of the flashpoints of the nascent Alaska marijuana industry and its founder are both gone.
Pot Luck Events — the Downtown Anchorage scene of industry war meetings during the furious regulatory development stages of 2015 and unofficial social nexus for the cannabis industry — was shut down after the unofficial marijuana holiday of April 20 following pressure from the state.
The next day, April 21, owner and founder Theresa Collins died after a yearlong bout with ovarian cancer. Collins was a prominent organizer and advocate both before and after the ballot initiative that legalized recreational cannabis in 2014.
As a sendoff, Pot Luck Events is planning a memorial for her April 29. Attempts to reach other partners in the business were unsuccessful.
Collins lived just long enough to see her passion project shut down by a state action long in the making.
In an April 19 letter, newly minted Alcohol and Marijuana Control Office director Erika McConnell told Pot Luck Events that the time had finally come to close. The law, she wrote, is significantly more developed now than in the summer of 2015, when Pot Luck Events balked at similar notices that their business was illegal.
“Today, I can say with confidence that your business model is not supported by the law and you must cease operating as you have been,” she wrote. “It is AMCO’s hope and expectation that you will use this as an impetus to redirect your vision and resources toward lawful operations.”
Though the closure and Collins’ death sent shockwaves through Alaska’s cannabis scene, officials said the move is as much about preserving the industry as punishment. McConnell backed her order with most of the same arguments the state has used to oppose marijuana social clubs, including fear of a hostile White House.
President Donald Trump’s administration has shaken the cannabis industry nationwide, with Attorney General Jeff Sessions and White House press secretary Sean Spicer both denying medical marijuana efficacy and hinting at increased federal drug enforcement.
“(Pot Luck Events) is vulnerable to federal enforcement,” she wrote. “And unless the board uses its enforcement powers to issue violations for your business, Alaska’s entire regulatory scheme could attract unwanted attention from the federal authorities.”
McConnell also referred to a September 2016 opinion from state Attorney General Jahna Lindemuth that social clubs are illegal.
“When Alaskans voted in 2014 to liberalize personal use of marijuana and to allow a commercial marijuana industry, they also voted to prohibit public consumption of marijuana,” said Lindemuth in a statement. “Unlicensed marijuana social clubs are public places like any other place of business — such as cafes, movie theaters, or retail stores — where marijuana consumption is not allowed by law.”
Up till now, Pot Luck Events, the State of Alaska and the Municipality of Anchorage lived in a kind of staring contest.
The Marijuana Control Board batted back and forth on the issue of marijuana social clubs when it was crafting industry regulations in 2015. It eventually decided that it had neither the authority to ban them or to allow them. The business model did not fall into the four license types defined by Alaska law. The board asked the Legislature to define the clubs in statute, but lawmakers never spoke an official word about the issue.
Getting either police or regulatory enforcement onto the issue never happened, though officials tried subtler attempts. Former AMCO director Cynthia Franklin threatened to withhold a holiday party liquor licensed from the real estate owner because of the club’s presence on his property.
Collins, however, refused to close. She was convinced it broke no laws as the club depended on private memberships and therefore did not qualify as a public space where marijuana use is forbidden.
McConnell made it clear that Pot Luck’s closure doesn’t mean the state won’t still consider the much-debated and long-delayed onsite consumption provisions.
“As you know the MCB will be reviewing new proposals for onsite consumption—they were scheduled for the last meeting, but approving licenses was given priority,” she wrote. “They are on the agenda for May 15.”
The closure rides a new wave of enforcement actions, and could be a sign of things to come.
“Enforcement is getting busy,” said Cary Carrigan, executive director of Alaska Marijuana Industry Association. “They’re certainly being more proactive.”
The first months of 2017 have been marked by an increased enforcement presence. Marijuana Control Board meetings more heavily involve extended discussions of violations centered around unclear regulations, including the statewide seizure of imported CBD products.
Retailers are getting more warnings. On April 17, two days before the Pot Luck closure letter and just before the unofficial marijuana holiday of April 20, AMCO sent a letter to a cluster of cannabis businesses in the state warning them that the kinds of celebrations they were planning would land them in hot legal water.
“Over the past week the AMCO Enforcement Unit has discovered an alarming amount of social media advertisements for 4/20 celebrations at marijuana retails stores that are in violation of 3 AAC 306.360 (d). Games, competitions, raffles, etc. are strictly prohibited at marijuana retail stores,” the letter read. “Please be advised that if a 4/20 event held on your premises includes activities that violate any section of 3 AAC 306 further enforcement action may be taken against your license.”
Carrigan said he understands the impetus for enforcement, but that the industry is rankled that it seems more geared toward licensees. The state’s regulations, he said, are so often unclear that it seems like misdirected effort to go after otherwise law-abiding business owners while outright lawbreakers go unpunished.
As in prior Marijuana Control Board Meetings, Carrigan mentioned cannabis delivery service ACDC and the several unlicensed dispensaries.
“I just wish they were more stringent with people way outside the law, cracking down on the black market,” he said.
Correction: The original version of this story incorrectly named Theresa Collins as Theresa Peterson. We apologize for the error.
DJ Summers is contributor to the Journal and author the Business of Cannabis, set for publication in 2018. He can be reached at firstname.lastname@example.org or followed on Twitter @djsummers87.