Full Notification

Commercial Marijuana Businesses in City of Santa Ana Targeted with
Justice Department Warning Letters and Asset Forfeiture Lawsuits

LOS ANGELES – In the latest of a series of federal enforcement actions against the commercial marijuana industry in California, federal authorities today moved against 63 illegal marijuana stores in the City of Santa Ana.

In federal court this morning, prosecutors filed three asset forfeiture lawsuits against properties in Santa Ana where a total of seven marijuana stores are currently operating. Authorities also executed federal search warrants at two of the stores involved in the asset forfeiture actions. Additionally, prosecutors sent warning letters to
people associated with 56 other stores not involved in the forfeiture actions. The federal actions involve all known marijuana stores in the City of Santa Ana.

The federal actions in Santa Ana were done in cooperation with the Santa Ana Police Department and the Santa Ana City Attorney’s Office.

The three civil asset forfeiture complaints filed this morning in United States District Court target three properties in Santa Ana where seven marijuana stores are currently operating. The civil lawsuits state: “Under federal law, the distribution of marijuana (a Schedule I controlled substance under Title 21) is prohibited except under
very limited circumstances not applicable here. The government is informed and believes that at all times relevant to this complaint, the operation of the [marijuana stores] on the defendant property was not (and is not) permitted under California law.”

The forfeiture lawsuits allege that the owners of the properties knowingly allowed commercial marijuana stores to operate. The buildings named in the asset forfeiture lawsuits currently house:

• GLC (or the Green Love Collective, currently in a suite that formerly housed a store called Old Remedies) and The Dispensary Store, which are operating in a building at 1638 East 17th Street, a property owned by chiropractor Mark Burcaw, and previously have been the subject of administrative citations issued by the city;

• SoCal Compassion, Club Meds and Well Greenz, which are located in a building at 1651 East Edinger, another building owned by Burcaw, and are illegal marijuana operations that prompted Santa Ana to file a civil lawsuit last year seeking injunctive relief against Burcaw and the three marijuana stores; and

• J Pacific Life (which is located in a suite that formerly housed marijuana stores called Saddleback Meds and The Natural Alternative) and Healing OC, which operate out 1665 East 4th Street and have been the subject of numerous warnings and administrative citations from the City of Santa Ana.

In conjunction with the filing of the asset forfeiture complaints, the United States Attorney’s Office today mailed out letters to the property owners and operators of 56 marijuana stores that are either currently operating or were recently closed in Santa Ana. The warning letters give the operators and landlords 14 days to come into compliance with federal law or risk potential civil or criminal actions.

The Drug Enforcement Administration executed two federal search warrants this morning with the assistance of the Santa Ana Police Department at J Pacific Life and Healing OC.

Today’s enforcement actions in Santa Ana follow similar actions over the past 18 months across the seven-county Central District of California. Starting in October 2011, prosecutors began filing asset forfeiture lawsuits and sending letters to marijuana operations in selected areas in the Central District of California (see, for example,
http://www.justice.gov/usao/cac/Pressroom/2012/129.html).

With the lawsuits filed this morning, the United States Attorney’s Office has filed a total of 30 asset forfeiture complaints against properties housing illegal marijuana operations in the district. Eighteen of those actions have been resolved with the closure
of the marijuana stores and consent decrees. In some cases, consent decrees required property owners to disgorge rent payments made by a marijuana store operator, and in all cases the consent decrees required the property owners to agree, among other things, that they would no longer rent to people associated with illegal marijuana
operations or the property would be subject to an immediate forfeiture to the government.

Including today’s efforts in Santa Ana, federal enforcement actions – asset forfeiture lawsuits, warning letters and related activity – have now targeted more than 525 illegal marijuana businesses in the Central District of California. The majority of those businesses previously targeted are now closed, are the subject of eviction
proceedings by landlords, or have been the subject of additional federal enforcement actions.

In October 2011, the four United States Attorneys in California announced the coordinated enforcement actions targeting illegal marijuana cultivation and trafficking
(see: http://www.justice.gov/usao/cac/Pressroom/2011/144a.html).

The United States Attorney’s Office is working in Santa Ana with the Drug Enforcement Administration, IRS - Criminal Investigation, the Santa Ana Police Department and the Santa Ana City Attorney’s Office.