Colorado Budtenders Arrested For Overselling To Customers

A group of budtenders from a Colorado cannabis retailer is facing charges after a year-long sting in Denver.

Thirteen budtenders from Sweet Leaf cannabis retail locations in the Denver metro area were arrested in connection with allegedly exceeding state sales laws on December 14. Sweet Leaf operates a vertically integrated chain of cannabis cultivation, processing, and retail businesses.

The Denver District Attorney’s office has currently filed felony charges against five of the budtenders for felony distribution of marijuana (more than four ounces) and misdemeanor charges for five more budtenders for misdemeanor distribution of Marijuana (more than one ounce). Three of the arrested budtenders have yet to be charged.

In addition to the charges against the budtenders, the state of Colorado has suspended several licenses for Sweet Leaf’s operations following the arrests and pending conclusion of an investigation. Search warrants in the case included one for Sweet Leaf’s headquarters. Officers had permission to look for and seize money; plants; records; documentation on operating procedures; video surveillance recordings; computers, thumb drives and passwords; and any evidence related to money laundering. Police have also frozen their bank accounts along, and have requested access to their safe deposit boxes and storage units. The owners have not been charged in the case.

The budtenders’ charges followed the December 14 raids at Sweet Leaf locations throughout the Denver area. A series of complaints from a neighborhood resident against the Sweet Leaf retailer initially drew the scrutiny of the Denver Police Department. Law enforcement officials said the neighbor reported people “making multiple trips each day to and from their parked vehicles to the store, and continuing these ‘loops’ for several hours at a time.”

Colorado law limits the amount of cannabis a person can possess to one ounce of marijuana flower or its equivalent in extracted form, and an additional rule limits the amount the can be sold in a transaction to that same amount. However, the time length between transactions, as well as how “transaction” is defined is not address in the law. Due to this apparent loophole, customers would use what investigators cal; “looping,” where customers purchase an ounce, return to a car a block away, and come back several times in the same day.

Lawyers from Sweet Leaf have argued publicly and in court that the limit in the law is for each purchase, not each day, and the onus is on the customer to not exceed the possession limit.

However, law enforcement officials in Colorado point to the Colorado Marijuana Enforcement Division’s earlier statement on its website related to these issues: “The division will seek administrative action against licensees attempting to circumvent the statutory and rule requirement imposing the limitation of one ounce per transaction of retail marijuana. Sales that are structured as multiple, stand-alone transactions may be viewed by the division as an attempt to evade quantity limitations on the sale of retail marijuana, resulting in recommendation[s] for administrative action. Further, an individual in possession of more than one ounce of retail marijuana or its equivalent is acting unlawfully.”

Looping was a known issue and the state recently amended the rules to solve this problem by explicitly limiting customers to a single transaction per day. The new rules also punish establishments that sell marijuana to a person if employees know within reason that the person has already purchased his or her limit.