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Feds go after Pot Shops in Huntington Park, Eagle Rock, Hollywood

LOS ANGELES – As part of the ongoing federal enforcement actions against the commercial marijuana industry in California, federal authorities have taken a series of actions against 71 illegal marijuana stores in the City of Los Angeles and the City of Huntington Park.

In federal court this morning, prosecutors filed three asset forfeiture lawsuits against properties where marijuana stores are located. Authorities executed federal search warrants at three other stores. Additionally, prosecutors sent warning letters to people associated with 68 marijuana stores.

The federal actions involve all known marijuana stores in the Eagle Rock and downtown areas of Los Angeles, as well as the single store known to be operating in Huntington Park.

“Over the past several years, we have seen an explosion of commercial marijuana stores – an explosion that is being driven by the massive profits associated with marijuana distribution,” said United States Attorney André Birotte Jr. “As today’s operations make clear, the sale and distribution of marijuana violates federal law, and we intend to enforce the law. Even those stores not targeted today should understand that they cannot continue to profit in violation of the law.”

The federal actions in Los Angeles were done with cooperation from the Los Angeles Police Department, the Los Angeles District Attorney’s Office, and the Los Angeles City Attorney’s Office.

“As I’ve said before, in Los Angeles some medical marijuana clinics have been taken over by illegal for-profit businesses that sell recreational marijuana to healthy young adults and attract crime,” said Los Angeles Police Chief Charlie Beck. “These stores are a source of criminal activity because of the product they sell and large amounts of cash they have on hand. The LAPD will continue to work with our federal partners to remove these threats from our communities.”

The three civil asset forfeiture complaints were filed this morning in United States District Court against three properties on Colorado Boulevard in the Eagle Rock area of Los Angeles at which 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 forfeiture lawsuits house:

The Together for Change Collective, which previously was the subject of a civil abatement action filed by the Los Angeles City Attorney’s Office and search warrants executed by the LAPD. During an LAPD investigation against a prior store at the same location in May 2011, officers seized more than 500 marijuana plants and over $5,000 in cash from the store, as well as $14,912 in cash and a semi-automatic rifle from the home of one of the store’s operators;

House of Kush, where the store and property owner are the subjects of a civil abatement action filed by the Los Angeles City Attorney’s Office; and

ER Collective, where LAPD executed a search warrant in June 2010 on a prior store at the same location and seized approximately 11.4 kilograms of marijuana, 4.5 kilograms of hashish, liquid THC, and $17,000 in cash.

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 67 additional marijuana stores that are either currently operating or were recently closed in Los Angeles, and the one known store in Huntington Park (for a total of 68 stores). The warning letters give the operators and landlords 14 days to come into compliance with federal law or risk potential civil or criminal actions.

In addition to federal warning letters, the Los Angeles District Attorney’s Office sent its own letters to some property owners of Los Angeles stores providing notice that it is a violation of state criminal law to lease or make property available for a marijuana store.

The Drug Enforcement Administration executed three federal search warrants this morning with the assistance of the Los Angeles Police Department at the following locations in the City of Los Angeles:

Happy Ending Collective at 818 North Spring Street, which is believed to be the largest marijuana store in the downtown Los Angeles area;

Green Light Pharmacy at 522 South Lorena Street, which was the target of a Los Angeles County Sheriff’s Department investigation in early 2012 that determined that the operation was in violation of federal and state laws; and

Fountain of Wellbeing, 3835 Fountain Avenue, which has been the subject of repeated calls for police service since 2011.

This week’s enforcement actions in Los Angeles County follow similar actions over the past year 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/2012/074.html).

With the lawsuits filed this week, the United States Attorney’s Office has filed a total of 19 asset forfeiture complaints against properties housing illegal marijuana operations in the district. Seven 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 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.

Federal enforcement actions – the asset forfeiture lawsuits and warning letters – have now targeted more than 375 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 conjunction with the Drug Enforcement Administration and IRS – Criminal Investigation. Today’s enforcement actions in the City of Los Angeles involved the cooperation of the Los Angeles Police Department, the Los Angeles District Attorney’s Office and the Los Angeles City Attorney’s Office.