The eyes of the law have always been very firm on players in the cannabis industry, and now it is no different that the gradual shift from ban to legalization is in full flow. Cannabis is still classified as illegal in the eyes of the Food and Drug Administration and the federal government even though many states have legalized its use for recreational and medicinal purposes. Many have subconsciously reached a state of relaxation in which they believe they can get away with activities that are still considered illegal in the eyes of the law.
Many small cannabis companies are gradually looking for ways to cut corners and make the most of the mature cannabis industry. However, it usually gets them on the receiving end of the law’s wrath. The latest victim of this is the owner of a cannabis delivery company in Massachusetts. Read on as we look at the nooks and crannies in the federal case that was sentenced to four years in prison.
A closer look at the crimes
A medical marijuana program includes the use of cannabis to treat medical ailments such as pain relief, inflammation, seizures, and overall wellness. A number of states with open markets for medical marijuana programs have instilled appropriate standards to help regulate the market and its participants. One common one is the set of regulations put in place to guide the prescribing physician and product supplier to the patient. It is therefore important for all players in these markets to be well aware of the requirements and regulations that exist in such markets. This is the truth that has put Diana Martin in a complicated situation before a federal judge in Massachusetts. She was sentenced to four years in prison as the owner of Northern Herb, a Massachusetts cannabis delivery company. The verdict was issued because she was accused of tax evasion, money laundering, and distributing and possessing cannabis. Martin had earlier pleaded guilty to the charges in court in May.
The full access of the cases with the stream of Northern Herb’s activities is manifold but their breach of cannabis laws is in line with the stipulated Massachusetts Medical Cannabis Program. All users of medical cannabis are required under state cannabis laws to enroll in the state’s medical cannabis program. Likewise, registered companies that will deal with such users are also required to require proof of such registrations from their customers. Unfortunately, Northern Herb has worked outside this required requirement. The company delivered cannabis to patients who placed orders for cannabis products online without requiring proof of registration from those to whom it was delivered.
The company was also violating cannabis laws while delivering cannabis products within states. The company was involved in delivering cannabis to unsupervised locations such as driveways and front doors. Delivery to these sites is prohibited because they can be accessed by unknown third parties which is not acceptable for the delivery of cannabis. The company has used various locations in places like Milton, Foxboro, Hyde Park and Canton to stock and distribute cannabis. These combinations of illegal activities and more made Northern Herb the target of a federal investigation and court case that led to the time spent and the payment of compensation.
The company was in full swing between 2015 and 2018 earning millions of dollars in revenue. It provided services to many Massachusetts citizens through its website where it offered cannabis products for sale and delivery. Throughout this period of operations, Northern Herb has not transferred any amount in tax because the company is not licensed from the state of Massachusetts. The plaintiffs claimed that the company’s revenue between May 2016 and July 1028 exceeded $14 million and that no amount was transferred as tax on its sales revenue. The company also runs a simple cash policy that is collected from customers and used to deal with suppliers and has fewer than 25 workers on its payroll. During this period, the company failed to report the wages of its workers to the Internal Revenue Service and did not issue W-2s or 1099s to its workers.
Judgment and its effects
The outcome of the federal sentencing of Diana Martin did not stop at the four-year prison sentence. She is required to pay $528,146 in compensation and three years of supervised release after she is released from prison. This follows the line of judgment of Tatiana Fredicks who was the office manager at Northern Herb. She was sentenced in September to two years of supervised release and refunded $82,000 after pleading guilty to conspiracy to distribute cannabis. The Martin’s lawyer speaking to Law360 He stated that his client’s four-year prison sentence was the result of intense negotiations.
It is important to note that the four-year prison sentence handed down to Diana Martin could easily have been higher. The advisory rulings guidelines set the penalty for such crimes from 108 to 135 months. However, Deana Martin’s attorney, R. Bradford Bailey, believes that such a punishment exaggerates the seriousness of the crime committed by his client. Diana Martin is facing trial by the US Attorney’s Office for the Massachusetts District on charges of counts since April 2019 before the final ruling in October 2021.
Deana Martin’s status and type is not the first in the cannabis industry, and certainly not the last at the moment. Such criminal offenses will always be frowned upon by the law, especially in countries that have bravely fought and won the battle for cannabis legalization. It is therefore important for the advancement of the industry that fewer such issues are published by the major players. This is to ensure that the common goal and common drive of all cannabis advocates around the world can be easily achieved. The goal remains universal legalization and is within reach.