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1.
   

Free Possession Pardons Now Law

The federal government inaugurated Bill C-93, its new no-cost, expedited pardon system for those convicted of simple cannabis possession WHEN?, waiving the usual $631 record suspension application fee, and canceling a previous waiting period. Despite being free, record suspensions are not exactly simple to get.
Global News

Because the U.S. keeps its own data on those who have previously crossed its border, Customs and Border Patrol agents often have independent records of arrests. Regardless of whether they are pardoned at home, Canadians can still be banned from the U.S. if they lie about being arrested.

Quick Hits

  1. Drug-impaired driving arrests are up again in Saskatchewan, continuing an 11-year trend.
    GrowthOp
  2. This year, the Cowichan Exhibition's agricultural competition will include a cannabis-growing section, with judges examining finished buds.
    Twitter—Dan Adelman

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We publish three free newsletters: 1) WeedWeek by founder Alex Halperin 2) WeedWeek California by Donnell Alexander and 3) WeedWeek Canada by Jesse Staniforth, as well as the WeedWeek Podcast and original reporting. The original WeedWeek newsletter has 11,000 subscribers.

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2.
   

CannTrust Investigated By Ontario Securities Commission, Police

CannTrust announced the company is being investigated both by the Ontario Securities Commission's Joint Serious Offenses Team, a partnership with the RCMP's financial crime branch and the Ontario Provincial Police's anti-racketeering arm. (The Leaf has a helpful summary of l'affaire CannTrust if you've missed the last few weeks.)

The same day he received and replied to an email about the company's unlicensed growing, now-former chair Eric Paul (as well as director Mark Litwin) sold $1M in CannTrust shares, followed by another $5M in shares over the following 30 days.
Globe and Mail

  • Earlier this week, interim CEO Robert Marcovitch promised transparency and said, "We are aggressively getting our house in order."
    Globe and Mail
  • Marcovitch would not say whether other board members knew about the unlicensed growing, noting the findings of the Board's special committee "are most certainly confidential save for what we clearly want to provide, as we should as a public company."
  • He did not rule out cuts to jobs at CannTrust's Pelham facility.
    Financial Post

CannTrust hired US investment bank Greenhill & Co. to conduct a strategic review that may conclude the company should be sold in whole or in part. It may also recommend strategic investment, business combination, or other changes. The company's legal liability has not yet been determined, while Health Canada may suspend or cancel CannTrust's licenses.
Globe and Mail, Bloomberg, MJ Biz Daily

3.
   

Bruce Linton:
The WeedWeek Interview

This week on the WeedWeek podcast, Alex and Donnell sit down with Bruce Linton, one of the most interesting conversationalists in the industry.

There's a reason WeedMaps editor Nicolas Juarez called WeedWeek "the best weed podcast in existence." Check it out!
Soundcloud

Quick Hit

  1. I wrote a piece for Leafly noting the divergent approaches to legal cannabis at music festivals across the country. At Osheaga in Montreal, where I live, they've decided only to allow sealed legal cannabis—meaning it must have an unbroken cannabis excise tax stamp. They also won't allow bongs.
    Leafly, CityNews, Global News

4.
   

Sole Ontario REC Retail
Lottery Bank Overwhelmed

The only bank still willing to back Ontario's REC retail lottery applicants is Alterna Savings, which required them to open an account and deposit $300,000. (BMO stopped accepting new applications in late July.) As of Tuesday, Alterna confirmed the bank has "exceeded the limit of applications that we can presently process, and will not accept further application for this AGCO allocation." The Globe reported, "With nearly a week left before Ontario begins accepting submissions for its second cannabis retail lottery, the window to enter might already be effectively closed."
Twitter, Globe and Mail.

  • Ontario's second round of REC retail licensing began on July 31 serving First Nations applicants on a first-come, first-served basis for eight licenses.
  • The non-Native lottery portion of the next REC retail round, awarding 42 licenses, will begin with vetting of applicants between August 10 and 19, before the lottery itself on August 20.
  • Lawyer Trina Fraser warned lottery entrants to get legal advice on their offers-to-lease, particularly if they're about to agree to begin paying rent before October, when the new stores will be allowed to open.
    Twitter—Trina Fraser
  • When the Doug Ford government canceled the previous Liberal government's plan for a provincial monopoly REC retail system, it was left with at least $1M in contracts for construction and interior design of a single Ontario Cannabis Store in Guelph. The Ontario Cannabis Store would not comment on how much of the contracts were paid, or about how much of the ordered materials were delivered.
    The Record

Quick Hits

  1. Citing need for refrigeration units, new display cabinets, and additional counters ahead of edibles and cannabeverages become legal, the Nova Scotia Liquor Corporation has been given the provincial go-ahead to renovate its 11 cannabis-liquor stores and the one standalone cannabis store. When the stores were built last year, they were "for legalization in 2018" and did not anticipate products other than those legalized last October.
    Global News
5.
   

Good Week for Aphria

Public Domain

After a disastrous Q3, Aphria surprised analysts with an 85% quarter-over-quarter surge in net revenue.
Bloomberg

  • Aphria's cannabis sales were $18.5M, which represented a 159% increase quarter over quarter, and were bolstered by $50M received as part of Green Growth Brands' failed hostile takeover.
  • The company's net revenue was $128.6M for Q4, ending in May. The company also predicted net 2020 fiscal year revenues of $650M to $700M. MarketWatch
  • In a celebratory mood, Aphria filed its financial statements at 4:20.
    Twitter—Max Cherney

The news also made Aphria the first major LP to show positive retained shareholder earnings. Bloomberg's Kristine Owram said, "Aphria, once thought to be at death's door, turns a net profit, while CannTrust, once thought to be one of the best companies in the industry, says it's under investigation by the OSC."
Twitter

  • Aphria's Jamaican subsidiary Marigold announced it is licensed to open its first store, Sensi Medical Cannabis House, in Kingston.
    Newswire
  • Aphria CEO Irwin Simon reported since the CannTrust scandal broke, "We’ve seen a nice increase in our medical cannabis business." He said he was "absolutely" interested in acquiring assets from CannTrust.
    Bloomberg

Quick Hits

  1. VIVO Cannabis and 48North each made strategic $1.25M investments in Toronto headshop conglomerate Friendly Stranger Holdings Corp, which intends to expand into REC retail.
    NewsWire
  2. LP Sundial Growers debuted on Nasdaq and plummeted 35%. Analysts said CannTrust has everybody nervous.
    Bloomberg
6.
   

Friendly Bear Fails to Wound Hexo over Snapchat Ads

https://secure.flickr.com/photos/anoldent/

Short-research firm Friendly Bear mounted an abortive attack on Hexo with accusations Hexo was "running aggressive product promotions on Snapchat as recently as June 2019."

  • Calling its findings "Canntrust 2.0," Friendly Bear claimed "We see significant similarities between CannTrust and Hexo," and imagined Hexo "the next victim of the Summer of Cannabis Scandals" (bold Friendly Bear's).
  • Though Friendly Bear insists Snapchat is "synonymous with teenagers" and ad slogans like "A Fresh Spark" and "Are You Ready" encourage "risk taking, and [associate] Hexo's brand with 'glamour, excitement, and vitality" (contrary to Health Canada ad regs), it was hardly on par with growing 12,000 kilos of cannabis in unlicensed rooms and deliberately deceiving Health Canada regulators.

Neither Hexo nor investors found the attack convincing. Hexo told media it was " scrupulous in adhering to rules and regulations surrounding cannabis promotion, both federally and provincially," and added it geo-fences ads to prevent from breaking provincial law. Stocks actually went up following the release of Friendly Bear's report.
Bloomberg

Quick Hits

  1. Molson Coors CEO Mark Hunter, who championed the brand's partnership with Hexo, will step down after 17 years helming the beer company. He'll be replaced by head of US operations Gavin Hattersley, who is also eager to buck declining beer sales with cannabis drinks and "spiked seltzers."
    Global News, CBC Business
  2. Cronos acquired US CBD-infused lotions-and-edibles company Lord Jones in a USD$300M deal. CNBC, Bloomberg
7.
   

This Week in Legalization 2.0

https://flickr.com/people/10506540@N07

Once vaping cannabis extracts is legalized in the fall, analysts expect vape-pens and other related technology for vaping extracts to occupy a sizeable share of the market. LPs are enthused because the retail price of extracts is nearly ten times that of dry flower, but everyone's rushing to get ready in time.
CBC Business

Selling packaging to cannabis producers is big business. With edibles, beverages, extracts, and topicals about to come on the market, the cannabis-packaging industry will get more complicated, but no less lucrative. Here's a chart of how many grams of packaging each LP uses to hold a few grams of flower.
Globe and Mail, Twitter

Baked Edibles founder Brandon Wright, now CEO of legal edibles maker Dynaleo, warned the cannabis industry does not yet have a unified system of testing standards and methodologies for already-legal products. Noting inconsistent standards led to public wariness of edibles, Wright warned that the approach of ingestibles legalization will likely overwhelm the testing system.
Twitter—Brandon Wright

Quick Hits

  1. Health Canada has updated guidance for regulated parties.
    Dropbox
  2. Aurora partnered with the UFC to research and develop CBD-related products designed to soothe professional fighter injuries.
    The Star
8.
   

Health Canada
vs. MED Research

https://commons.wikimedia.org/wiki/User:MB-one

Health Canada is having a disturbingly hard time explaining why researchers still need permission to possess cannabis when every other adult Canadian can carry 30 grams in public. Research licenses are notoriously hard to get, and Health Canada is stringent to the point of absurdity about a now legal product.
CTV News

Quick Hits

  1. According to the lead researcher of a University of Calgary study about cannabis and mental health, there's an association between cannabis consumption and mental health, but it's often among the weakest associations and researchers have no idea if one causes the other.
    CBC Calgary
  2. PEI wants as many of its residents over the age of 16 as possible to participate in an anonymous online survey about cannabis use. To sweeten the deal, they're raffling off an iPad, as well as passes to the Confederation Bridge (a $47.75 value), the latter of which could only be more PEI if it came with one of Anne Shirley's braids baked into a Russet Burbank potato.
    CBC PEI, Anne of Green Gables, Stompin' Tom Connors
9.
   

BC Compassion Club Shutters As Dispensary Raids Continue

https://www.flickr.com/photos/43444811@N00

The Vancouver Island Compassion Society shut its doors after 20 years serving a middle-aged population suffering from chronic illnesses, pain, and anxiety. The threat of heavy fines or seizures of property was too much, and operators say federal and provincial regulations—which prevent REC retailers from associating cannabis with medical care, and require sealed packages—make it difficult to provide the same kind of services to patients as they did.

  • The VICS was wise not to expect mercy from the BC government's Community Safety Unit because it only served a medical market. Shortly after the VICS closed, the CSU raided that Kamloops's Canadian Safe Cannabis Services compassion club.
    Kamloops Matters
  • MED patients were irate. Activist Dana Larsen said, "Many people rely on [compassion clubs] to access cannabis medicines. Medical cannabis access is still a serious problem for patients."

The Toronto Star editorial board said the Ontario government and others have botched REC retail, and only have themselves to blame for illicit dispensaries providing access to a product that's too hard to get legally.
The Star

Quebec is ramping up efforts to raid and arrest illegal growers.
Global News

Quick Hits

  1. Sales of dry flower were up 7% across the country in May, with cannabis oil sales up 19%.
    The Star
  2. After BC's Liquor Distribution Branch announced it would not carry clones—and suggested the government allow farm-gate sales—solicitor general Mark Farnworth said the government is considering changing the law to allow LPs to sell clones and seedlings direct to the public.
    MJ Biz Daily, Business In Vancouver
10.
   

Feds Failed in FN Consultation

Jesse Staniforth

The government of Canada failed in its duty to consult Indigenous people about legalization, which is a particular problem because "Regulating the use of traditional medicinal plants is consistent with the law-making authority exercised by many Indigenous peoples since time immemorial," argues articled First Peoples Law student Jesse Donovan. For that and other reasons, Donovan argues Canada must not challenge "legitimate expressions of Indigenous law-making."
Policy Options

Quick Hits

  1. The Canadian cannabis sector is overwhelmingly white and bypassing communities of colour, argued political science scholar Chuka Ejeckam.
    Globe and Mail
  2. For a lot of Baby Boomers, legalization has meant returning to cannabis for the first time in years—now for therapeutic purposes.
    Winnipeg Free Press

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