The Ohio State Supreme Courts Board of Professional Conduct last week issued an official opinion stating that attorneys are not allowed to assist in the formation of state-legal medical marijuana businesses, because cannabis remains illegal under federal law. The opinion also clarified that Ohio attorneys are not legally permitted to consume medical marijuana, nor are they permitted to be personally involved in related businesses (something our firm has always advised against anyway).
This opinion follows Governor John Kasichs signing into law of House Bill 523, legalizing medical marijuana in Ohio. The law goes into effect next month, prompting attorneys to seek clarification from the Board of Professional Conduct as to whether or not they can assist cannabis license applicants with setting up businesses that comply with state and local law.
Weve written before about the legal ethics issues of representing cannabis clients. A dichotomy exists where cannabis business lawyers are advising their clients on how to comply with state cannabis laws, but where those clients businesses are illegal under federal law. To address this issue, and to provide peace of mind to attorneys practicing in this space, the ethics boards of most states with some degree of marijuana legalization have issued opinions allowing attorney involvement.
In Washington, for example, a new rule addendum was added to the state ethics rules footnotes and before that determination, our firm received its own ruling affirming our ability to represent cannabis clients. Colorados State Supreme Court went so far as to change the state ethics rules to make clear that attorneys could practice in the cannabis field while still upholding their ethical obligations.
Upon legalization of medical marijuana, Hawaiis ethics rules initially prohibited lawyers from assisting cannabis businesses. But an amendment to the ethics rules issued by the Supreme Court of Hawaii in October of last year allows lawyers to advise cannabis businesses. The caveat is that the lawyer must also counsel the client about the legal consequences, under other applicable law, of the clients proposed course of conduct. This makes perfect sense to us, as the policy of our firm has always been transparency, honesty, and a non-nonsense approach to the realities of federal cannabis prohibition. We even include the following disclaimer on our blog:
Please be mindful that possessing, using, distributing and selling marijuana are all federal crimes and that this blog is not intended to give you any legal advice, much less lead you to believe that marijuana is legal under federal law. Please also note that even though marijuana is illegal under federal law, you will need to pay federal taxes just as though you are a legal entity. This is true even if you are a state law not-for-profit entity.
When we first started providing legal advice to cannabis businesses, the ethics rules on this were murky. But we made the decision to test them by going ...
