Scams, Bills & A Mysterious Disappearance
Plus: Tegridy Farms for real.
The Broccoli Report
Monday, August 1, 2022
Time to read: 6 minutes, 42 seconds. Contains 1341 words.
We’ve got a lot of news to get to today, but first: a big thank you to everyone who contributed to our Lonely Hearts board! It was another great mix of brands and entrepreneurs, and I’m crossing my fingers that the posts lead to some business chemistry.
And if you spotted a potential hire on the board, this Friday’s dispatch is for you. For an emerging brand, bringing on employee #1 (or #10!) is a big deal. The stakes are high, and the pressure is on. So how do you do it right? We’re going to brush up on hiring best practices, from the questions you definitely should ask and the ones you definitely can’t, obligations for 1099 workers vs. employees, plus advice from fellow cannabis and adjacent businesses for knowing when it’s the right fit. Sign up as a paid subscriber today and never miss a Friday again.
One-Hitters: Cannabis News at a Glance
All right, let’s break down the Cannabis Administration and Opportunity Act (CAOA) filed last week. The bill—presented by Senate Majority Leader Chuck Schumer, D-NY, Se. Ron Wyden, D-OR, and Sen. Cory Booker, D-NJ—would do the following:
Decriminalize cannabis at the federal level
Remove cannabis from the list of controlled substances
Tax and regulate cannabis at the federal level
Grant states the power to keep or administer their own regulations
Federal jurisdiction over cannabis would be transferred from the Drug Enforcement Agency (DEA) to the Food and Drug Administration (FDA) and the Alcohol and Tobacco Tax and Trade Bureau, under a unique regulatory regime akin to those for alcohol and tobacco.
Expunge past federal cannabis convictions
Removes unnecessary pre-employment and random drug testing for cannabis for federal employees
Give active cannabis businesses a head start to get set up before the federal floodgates open
Eliminate 280e tax deduction restrictions
Standardize excise tax on products state-to-state
So, is this the federalization bill that will pass? Probably not. Not because it isn’t good enough, but because there is so much going into it. The legislators developed the 296-page bill with feedback from industry organizations and stakeholders over the past year. While it’s great to see such a range of concerns addressed, all those specifics create sticking points for Republicans to oppose. That said, President Biden is hurting badly for approval points, and this would be a broadly popular move amongst voters. Stranger things have happened.
While we wait for federal legalization, we’re also wondering what happened to the SAFE banking act. One state has decided to take matters into its own hands: Pennsylvania. Governor Wolf just signed a bill that paves the way for legitimate cannabis-related businesses to conduct transactions with financial institutions and insurance providers without fear of penalty or prosecution. (The state has not yet legalized adult use, but their medical market is thriving.)
Did you or someone you know invest in cannabis “crowdgrowing” platform Juicy Fields? You may be entitled to assist in their takedown. To those inexperienced with the average seed-to-sale tracking system, the selling points were intriguing. Juicy Fields connected people with licensed producers and distributors from around the world, allowing “e-growers” (rookie investors) to “buy” clones—as in, invest in individual plants at a real licensed medical partner’s farm. The pitch was this: Once the clones matured and were harvested and sold, JF and the e-growers would get a cut of that sale. Journalist Javier Hasse saw red flags from the start and actually met with executives in Uruguay to flat-out ask them if they were a scam. They didn’t offer illuminating responses, and over the past week, they stopped responding to investors (see more testimonials in this thread's comments). Now, it sounds like Hasse is looking for anyone who wants to share more insight. The current, unhinged state of their website certainly backs up these claims. Dario Sabaghi covered more of this saga for Forbes, but I haven’t read the article. (I’ve reached my monthly reading max of free Forbes articles, and after seeing the inside of that content machine, I refuse to pay for an online subscription. That’s a scam for another day.)
In an entertaining conversation with Bloomberg about Viacom’s $900 million South Park deal, co-creator Matt Stone shared that “finally bringing Tegridy Weed into real life” is a real possibility. If you haven’t kept up, Tegridy Farms—the Colorado cannabis farm run by Stan Marsh, the show’s bumbling dad character—really took center stage in recent seasons. After a recent catchup now that it’s all on HBO Max, I’ve got to admit that there are some pretty 🔥takes on post-state legalization cannabis culture.
A big announcement from the Broccoli and hemp fashion universe: The Broccoli X Afends collection drops this Wednesday, August 3rd. Inspired by psychedelia and a mutual love for all things cannabis-related, the collection of hemp beachwear features a trippy, optical illusion pattern by artist Josh Galletly in the form of a swimsuit, board shorts, a bucket hat, Broccoli’s first branded tee, and more. If you’re in LA, we’re celebrating the drop IRL with a party this Friday—head here to learn more. I'm making my way down for the party myself! 💃🏻
CBD brand Black Dahlia is about to launch their Communal Table Project, a pay-it-forward-inspired giveback approach. It will award three creators making a measurable difference in their communities a $5,000 grant they can use to fund projects or businesses promoting wellbeing in communities worldwide. These “Impact Creators” could be artisans, cultivators, or scientists—it’s about supporting the work of folks who give time, talent, products and/or services to support and uplift others. Submissions will open on August 1st, with winners to be announced in October. I don’t envy the judges determining the recipients, but I admire this thoughtful application of do-good funds.
In other media news, I really enjoyed the podcast, I Was Never There—a series that dives deep into the countercultural movements of West Virginia in the 1970s–80s by way of the mysterious disappearance of Marsha “Mudd” Ferber—an activist, iconic music venue owner, weed dealer, and local legend. The mother-daughter host duo of Karen and Jamie Zelermyer shares memories and discoveries as they attempt to answer the question of what happened to Karen’s friend and the revolutionary culture that Jamie grew up within.
I also enjoy the look of Green Monké’s limited-edition collab with skateboarder and queer activist Briana King. The custom can of their Tropical Citrus flavor features a purple-tinted interpretation of King’s beloved Venice Beach Skatepark, like a high-dosed skate sesh during golden hour.
One thing we could do to help cut down on illegal cannabis sales in California: Get unlicensed dealers off dispensary maps. Over the past few months, multiple complaints have been filed with the California Department of Cannabis Control (DCC) and the U.S. Securities and Exchange Commission (SEC), alleging that Weedmaps isn’t doing enough to audit their dispensary database for illegal operators. The complaints state the site is “allowing vast amounts of black market activity through their website, and they know about it but won’t do anything about it.” They further allege that there is an incentive for Weedmaps to let unlicensed dealers on-site as long as they’re paying for ads and better placement in search results.
The EduCapital Foundation contributed $1 million towards empowering the next generation of cannabis entrepreneurs, working with state organizations like the Rhode Island Cannabis Association to kickstart innovators in newly legalized markets. The donation will help fund scholarships for 1,000 low-income students to receive training in the adult-use cannabis industry. Each scholarship award winner will receive $1,000 toward their education, and five graduates will receive $10,000 in start-up capital to launch their cannabis business upon graduation. Learn more and apply here.
I’m leaving you with this insanely beautiful bong brand that I only recently discovered: Minh Le Studio makes one of a kind ceramic pieces (with really unique brass bowls and decoration) in the traditional style of their hometown of Bat Trang, a Vietnamese village located in the outskirts of Hanoi known for over 1,000 years for its ceramics.