Chicago law firms cultivate marijuana-specific practices
Lawyers increasingly help navigate highly regulated world of medical cannabis.
Monica Gutierrez wants to be an intellectual property lawyer. But here she is, sitting in a law class on marijuana.
The gray area between state and federal law intrigues Gutierrez — she needs to learn how to help cannabis businesses get their names federally registered, she said — and she’s not alone.
Law firms throughout Chicago, from national firms to solo operations, are carving out cannabis practices. Full of lawyers with expertise in real estate, mergers and acquisitions, intellectual property, and other specialties, firms are increasingly offering to help companies navigate the highly regulated world of medical marijuana, in Illinois and elsewhere.
But that world remains limited, compared with other industries, and plagued by uncertainty. Plus, the stigma surrounding the federally illegal drug still remains, barring some firms from advertising their cannabis practices.
And when it comes to dealing with a substance the federal government puts in the same class as heroin and LSD, there are plenty of issues on which to counsel.
“Every area of law you can think of, when it intersects with cannabis, it gets complicated,” said Dina Rollman, who teaches the cannabis law class at Illinois Institute of Technology’s Chicago-Kent College of Law with her business partner, Bryna Dahlin.
The two women formed their firm, Rollman & Dahlin, in January 2016 to focus on the cannabis industry, and they saw their workload consistently expand over the first year, Rollman said. The firm counsels companies that grow and sell marijuana as well as businesses that intersect with the industry, from advertising agencies to vaporizer manufacturers.
Their practice’s growth has mirrored that of the cannabis industry, starting with Illinois and branching out to other states, Dahlin said. Cannabis practices at other firms have expanded with the industry too.
Law firm Thompson Coburn helped multiple companies through Illinois’ initial application process for medical marijuana dispensary and cultivation licenses in 2014 and is helping those companies and others navigate the varying laws as they expand to other states.
The St. Louis-based firm now has an established cannabis practice, to which attorneys across four of its offices with varying areas of expertise contribute. Diane Romza-Kutz, a partner in the firm’s Chicago office, has expertise in food safety labeling that she applies to the cannabis industry, for example. Colleagues work with high-growth companies or specialize in land use, she said.
Cannabis law covers a number of legal disciplines, so firms are carving out whole practices to cater to the growing industry, said Bob Morgan, president of the Illinois Cannabis Bar Association and head of the cannabis practice at Chicago-based Much Shelist.
“A cannabis business needs not just a cannabis-focused lawyer but also one that really understands litigation and corporate law and intellectual property law and all these different types of practices,” said Morgan, who was the first coordinator of Illinois’ medical marijuana pilot program. “A single attorney would not normally have that kind of competency.”
William Bogot, a partner at Philadelphia-based Fox Rothschild who heads the firm’s marijuana practice from its Chicago office, came to cannabis law through gambling, so to speak. He’s a regulatory attorney who worked for the gambling industry.
“The gambling space is a very highly regulated world,” Bogot said. “When the new medical cannabis law came to Illinois, it wasn’t all so different . ... It was kind of like a natural fit for us.”
Before its cannabis practice was officially carved out, some attorneys at Fox’s 21 other offices around the country already were working in the space, Bogot said. The Chicago office was doing cannabis licensing and regulatory work, a partner in Denver was doing cannabis tax audits, and an attorney in California was doing real estate work for cannabis companies, for example. It was time to formalize, he said.
Now, 48 of the firm’s nearly 800 lawyers are part of the cannabis practice group. Fox’s offices in states initiating medical marijuana programs are providing expansion opportunities, Bogot said.
State lawmakers approved Illinois’ pilot medical marijuana program in 2013, and dispensaries started opening two years later. Since then, licensed dispensaries have generated more than $53.8 million in retail sales, according to the state.
The Illinois Department of Public Health keeps a watchful eye on the program, which is still in its pilot phase. Cannabis companies must abide by laws dictating everything from where facilities can be located to how they dispose of plant waste.
While some pioneering states, such as Colorado, grant medical marijuana cards to patients based on broad definitions of symptoms and conditions, Illinois specifies a limited number of conditions that cannabis can be used to treat. As of April 5, there were 18,300 qualifying patients in the state.
That’s still small enough that few attorneys in the state practice solely in the industry, Morgan said. But attorneys in Illinois are getting their feet wet. The Illinois Cannabis Bar Association, founded in fall 2015, has 60 members, all of whom find cannabis law woven into their practices in one way or another.
Illinois lawmakers introduced legislation last month proposing to legalize recreational marijuana, but they said it probably won’t come up for a vote until next year.
The stigma surrounding marijuana remains in place for some law firms. They practice in the field but don’t advertise it because of concerns about what other clients might think, Morgan said. It also remains unclear how the industry will grow, and how the Trump administration policy will treat the drug.
For most attorneys in the space, the excitement surrounding working in a new industry wins out.
Gutierrez, set to graduate from law school next month, shares that sentiment.
“Nobody really knows what they’re doing in this area, so there’s a lot to learn, and there’s a lot of firsts,” she said. “It’s pretty exciting.”