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Drugs and the City

Pot Farms in Strip Malls, Storefront Dispensaries and a New Economy

Story by Zak Stone

Published on Dec 23, 2013

Sickness is everywhere in Los Angeles. Many people are looking to heal. Three of them are on the boardwalk in Venice Beach. They’ve taken the bus here from UCLA, where they’re freshmen, and they’ve just emerged from an office called The Green Doctors with medical marijuana cards in hand. To get those prescriptions, they’ve paid somewhere between $40 and $250 — depending on how well they negotiated with the medical assistant — for a doctor to briefly examine them and record their complaints about anything from PMS to glaucoma.

Now they look bored as they stand next to a comedian named Eugene Meaux, who is shilling DVDs of his stand-up comedy routine to passersby while coordinating the free shuttle service for a nearby marijuana dispensary called the Beach Side Collective.

The Beach Side Collective is no longer beachside. New zoning rules forbidding collectives from selling weed on Venice’s historic boardwalk pushed it ashore. These days the dispensary buses people directly to its new premises, several blocks inland, the exact moment they walk out the doors of The Green Doctors with pot cards.

“I met an actress and she was looking to just get people to get on the shuttle,” Meaux says, explaining how he got hired. “This is a hustle job for me.” He’s convinced the students — two guys, one girl — to go for a ride.

What did the taller boy get his card for? “Depression, anxiety, insomnia,” three of the more common reasons marijuana gets prescribed. Back pain is the most.

“Ahh, I could’ve said back pain,” his friend realizes.

“But I think if you’re an 18-year-old guy…” the first student replies with a shrug.

Meaux tells them they just give you options. It doesn’t matter which one you pick. Then he notices a man with a Bluetooth headset in his ear a half-block farther down the boardwalk. “Oh, the ride is here.” He corrals the kids and two other shuttle passengers and leads them to the driver. The students follow him toward the street, disappearing from the boardwalk, the crush of tourists and the palm tree-filtered sunset over the Pacific on an October afternoon. If all goes as planned, they’ll board the shuttle, descend at Beach Side and buy weed legally for the first time with immunity under California’s 17-year-old medical marijuana law.

Back at the entrance to Green Doctors, two more touts, dressed in acid-green medical scrubs with a weed leaf and company logos on their shirts, work the boardwalk. “Come on in, guys,” one yells at a pair of bathing suit-clad pedestrians strolling by, arms intertwined. “Couples that blaze together, stay together.” As I watch her work, her colleague briefs me on the ethics of the job. It’s an industry faux pas, for example, for doctor’s offices to direct patients to any one dispensary in particular, which would be anticompetitive. (Meaux is not part of their operation — at least, not officially.) “You give them the options,” he says, “tell them about Weedmaps, THC Finder,” two web start-ups that function as Yelps of the dispensary world.

The missed opportunity to profit off referrals is no big deal. “At the end of the day, it’s not about making money,” he says, with a surfer’s twang. “It’s about helping the patients.”

But everywhere you look in the world of medical marijuana, it’s a little bit of both.

From the Black Market to the Boardwalk

The scene described above is mundane for the Venice boardwalk, an entry point into L.A.’s dynamic, mostly unregulated and seemingly unstoppable medical marijuana industry. Since California voters passed Proposition 215, the Compassionate Use Act, by 1 million votes in 1996, and their state became the first to consider weed medicine, Los Angeles has unwittingly become a guinea pig for what happens to American cities as they reevaluate their relationship with the drug, moving it from the black market into the light.

It’s a slow process. After 17 years of half-hearted attempts to fit medical marijuana into the mainstream economy, the optics of hustle culture still shroud the weed market. Medicinal pot has lent a veneer of legitimacy to the drug dealing already prevalent in Venice, a subcultural Mecca, while becoming the latest offbeat attraction for tourists snapping selfies in front of signs that say “Kush Doctor.” Weed seems at home here, as it does more and more throughout the rest of Los Angeles and much of California.

“It’s shocking, from my perspective, the number of people that we all know who are recreational marijuana users,” Lt. Gov. Gavin Newsom, who favors full legalization, told the New York Times last year. “Increasingly, people are willing to share how they use it and not be ashamed.” Possession of less than an ounce was decriminalized in 1975. In 2009, the state tax board estimated that 400,000 Californians use marijuana every day. And in a city like Los Angeles, navigated largely by automobile, it’s commonly viewed as less risky to drive stoned than drunk and hazard a DUI checkpoint. A survey conducted this fall by the California Office of Traffic Safety found that slightly more Californians were driving with THC in their system than alcohol (7.4 percent of drivers versus 7.3 percent). Recent polls show that 65 percent of Californians, and 58 percent of Americans, support full legalization of marijuana. Last year, Colorado and Washington became the first states to take that step.

Medical marijuana cards from Green Doctors range in price. Patients have spent between $40 and $250.

Washington, D.C. is reacting to the rapid shift in public opinion. This summer, Deputy Attorney General James M. Cole said the federal government would no longer interfere with enforcement in states where legal marijuana was well regulated. But look no further than Los Angeles — where the political bureaucracy is still slowly working out the kinks — to see that California may not qualify. Part of the ambiguity comes from the generous terms under which California enables access. Unlike the other 21 states (including D.C.) to legalize medical marijuana, California’s pioneering law lets doctors prescribe marijuana to patients “in the treatment of cancer, anorexia, AIDS, chronic pain, spasticity, glaucoma, arthritis, migraine, or any other illness for which marijuana provides relief.” [Emphasis added.]

While family dentists and psychiatrists don’t regularly prescribe pot for toothaches or depression, MDs interpreting “any other illness” to include common maladies like anxiety and insomnia do a brisk business at offices specializing in pot cards. Once prescribed marijuana, patients can either grow it themselves or join a non-profit collective where fellow members can supply it to the group.

Those “collectives” are the pot dispensaries that have come to dominate L.A.’s strip malls since they first began opening in the early 2000s, and swelled to as many as 1,000 by some counts, before a series of raids shrunk their numbers slightly. “Essentially, we have tacit legalization of marijuana with these dispensaries,” California Senate Majority Leader and President Pro Tempore Darrell Steinberg told a Sacramento radio show this spring. Steinberg and State Assemblyman Tom Ammiano co-authored a bill that would have regulated medical marijuana business under the Department of Alcohol Beverage Control. (Unlike liquor stores, they currently answer to no one.) “Legislation has been difficult in part because some of the opposition” — mainly from the law enforcement lobby — “keeps misleading legislators and the public,” Ammiano writes in an email. But the bill, like others before it, wasn’t passed, and local governments continue to bear the burden of deciding how pot should be bought and sold on city streets.

“California has come to be a kind of hodgepodge of different social models for taking something that was once illegal and making it legal,” says Columbia University sociologist Sudhir Venkatesh, who has studied underground economies in Chicago and New York City. The different approaches have meant that there is no clear answer to the question of how legalized medicinal marijuana affects a city.

“There’s no such thing as ‘good medical marijuana policy’ at a city level,” says UCLA Public Policy professor Mark Kleiman, who helped Washington State craft its new marijuana laws. “There’s absolutely no reason for cities to be working in pharmaceutical regulation.” More than 200 California communities, including Fresno, San Bernardino and Pasadena, have banned pot shops outright. The California Supreme Court upheld the right of municipalities to do so in a ruling earlier this year.

Other cities, including Oakland, West Hollywood and San Francisco, saw the benefits early on in formalizing a long-thriving sector within the black market economy, including millions in new tax revenue and savings in law enforcement time and budget. These cities quickly put tight restrictions on the number of dispensaries that could open, thinking tight regulation would help lessen impact and ensure tax revenue reached city coffers. The thesis proved accurate: Oakland’s Harborside Health Center, one of four dispensaries allowed to open, now brings in upward of $20 million in revenue annually, employs more than 100 workers with benefits, serves 108,000 patients and has become that city’s second biggest retail taxpayer. The city now regularly defends its dispensaries against aggression from the federal government.

Los Angeles, on the other hand, has failed to successfully execute either a ban or an enforceable ordinance, although it’s tried both. Carmen Trutanich, a city attorney who left office this summer, interpreted state law to mean that selling pot over the counter was illegal, but spent much of his term fending off lawsuits from dispensaries defending their right to exist. And for good reason. Owners of top dispensaries can bring in tens of thousands of dollars a day. That fact has been a mixed blessing for L.A. as dispensaries, some law-abiding, some not, cluster in storefronts lining streets in Venice, Eagle Rock and Studio City, creating new taxable revenue but also nuisance complaints and other headaches for law enforcers to handle. Pot shops that sparked complaints among neighbors — for allowing minors to enter, patients to smoke weed on-site, or customers to snatch up limited street parking — were often the first to get raided by the city.

“There’s places in downtown L.A. and other parts of the city where they had ‘bikini Fridays,’” says Yami Bolanos, owner of the dispensary Pure Life since 2006 and an outspoken critic of rogue dispensaries. “There’s nothing medical about ‘bikini Friday’ at a dispensary.” The sleazier pot shops weren’t just taking business from dispensary pioneers and medical marijuana advocates like Bolanos. Their disrespect for decorum was also ammunition for a city looking for reasons to crack down on the whole industry. Seven years ago, Bolanos created the Greater Los Angeles Collective Association (GLACA), a political alliance of dispensaries who agreed to register with the city, pay taxes, keep accurate records and respect neighborhoods — essentially, to formalize the dispensary system through self-regulation. The ultimate political goal was a citywide ordinance that would guarantee their right to operate.

“For seven years I’ve been fighting the city, begging them for an ordinance, for rules,” Bolanos says. “I’m a 58-year-old woman that’s had a liver transplant. I’m a three-time cancer survivor. I didn’t want to go to fucking jail.”

“The Most Expensive Whack-a-Mole Game.”

For all the dispensaries, raids and headaches, L.A. has not seen the windfall that many predicted. In 2012, the city’s several hundred dispensaries paid just $2.5 million in taxes. Compare that to the $1.4 million that Oakland, with one-tenth the population of Los Angeles, captured from its four dispensaries in 2011, and it’s clear that strict regulation pays off. (That doesn’t even include taxes from other weed-oriented businesses from bakeries to web start-ups, not to mention the cost-savings from reducing expensive court cases and police raids.)

Compared to the gains, dispensaries cost cities relatively little. The availability of medical marijuana has not caused a spike in pot smoking among Los Angeles teens, according to a 2012 study. For years, law enforcement officials had worried that dispensaries — who deal mostly in cash — would be targets for robbery, but a UCLA population research study found “no relationship between density of dispensaries and crime,” using Sacramento as a case study in 2011. “Banks are more likely to get robbed than medical marijuana dispensaries,” Los Angeles Police Chief Charlie Beck told the Los Angeles Daily News after commissioning an LAPD study on the topic in 2009.

But that statistical reality hasn’t yet caught up with the reality of tough-on-crime California politics. “Not a single city council member [in California] has lost their seat on their city council because they voted to ban dispensaries,” says John Lovell, lobbyist for the California Narcotics Officers Association, which opposes medical marijuana. In 2007 the L.A. City Council put a moratorium on new dispensaries, which was later overturned. Both the LAPD and DEA have conducted raids, in spurts, since 2008. Last year, a full ban on dispensaries passed the 15-member city council unanimously, securing votes from its 14 Democrats (including Eric Garcetti, who became mayor of Los Angeles this summer).

After acquiring medical marijuana cards, patients can peruse Weedmaps and THC Finder, which function as Yelps for dispensaries. Credit: Flickr user HolyWhiteShirt

These days the medical weed industry is powerful enough to eke out a compromise from the city. This spring, GLACA responded to the ban by advocating for Measure D, which eventually passed. The measure means that dispensaries registered before the 2007 ban get to stay open, so long as they pay 6 percent in city taxes, stay 1,000 feet away from schools and 600 feet away from places like parks and churches. Meanwhile the vast majority of the city’s dispensaries must close or face misdemeanors that could result in fines and up to six months in jail.

While some of the illegal dispensaries probably never should have been allowed to open in the first place, others aspired to be legitimate businesses and have made significant investments in equipment, retail space and finally, employees — meaningful in a city where unemployment has hovered in the low teens since the financial crisis. “I know people with college degrees that are working at dispensaries,” says David Welch, a lawyer who represents dispensaries closed by the new law. His 30-plus clients who voluntarily shut down after Measure D had each employed an average of five workers. “They’re either back on social security or looking for jobs.”

Of course, California’s medical marijuana program was meant to help the seriously ill, not serve as economic stimulus. And while activists like Bolanos insist that it’s the patients who will benefit when a functioning system is realized, the Oakland example makes it impossible to not think about just how much of an economic impact monopoly-holding dispensaries could make.

That is, assuming the illegal dispensaries go away. “Obviously, the businesses aren’t volunteering to say, ‘Okay, the law was passed. We’re gonna get out of the dispensary business,’” says City Councilmember Tom LaBonge, whose district includes parts of Hollywood and the Valley. As of late October, the city attorney’s office had filed 52 criminal misdemeanor complaints against operators and landlords in violation of Measure D. While Welch believes the city will slowly expand its crack down, it’s still possible to drive through L.A. and find dispensaries with “‘Grand Opening’ signs on their front doors,” he told me.

One of those newcomers sits just up La Cienega Boulevard from Bolanos’ collective. She is, rather understandably, outraged. “People don’t follow the law in Los Angeles? Cause that’s exactly what’s going on,” she complains. “They close down 52, and the same people go and open somewhere else. Nobody’s afraid of the city here.” But it seems odd to expect a class of people who have risked jail for years to suddenly shape up, just because of the threat of a misdemeanor. “It’s the wild, wild west,” says Diane Goldstein, who spent 21 years in law enforcement in Redondo Beach, two of them running a narcotics unit, and is now a board member of Law Enforcement Against Prohibition. And it’s a cautionary tale to the thousands of other municipalities around the country, which will inevitably deal with similar turf wars as legalization and medicalization of marijuana spreads from coast to coast. The dynamics of the “war on drugs” don’t necessarily disappear the moment marijuana is brought into the light.

Remembering her time fighting dealers in Redondo Beach, Goldstein sounds like she’s describing the illegal dispensaries in Los Angeles. “Every time you clamp down on a drug dealer, 10 more pop up,” she says. “I call it the most expensive whack-a-mole game.”

American Dream

According to most of Southern California’s political establishment, Van Ton is one of those moles: A drug trafficker who has illegally grown and sold pound upon pound of marijuana for more than a decade, undeterred by raids, the threat of arrest and endless court dates. Adversaries include the DEA, the LAPD, the Los Angeles City Council, former city attorney Trutanich, the Eagle Rock Neighborhood Council, the four small cities where he’s opened dispensaries, district attorneys from four Southern California counties, and, most recently, the U.S. Department of Justice.

I meet Ton through an old-fashioned pot dealer. Let’s call her Lisa. I didn’t know anyone in Los Angeles who bought weed from a drug dealer, given the ubiquity of dispensaries, until a college student in my building tells me he avoids collectives on principle. “It’s like the farmers’ market,” he explains. “I just like to support local — people that I know.”

I begin to understand what he means when he brings me by Lisa’s, a cozy bungalow full of succulents, cats and cat-themed art, where pesticide-free marijuana is dispensed affordably and affably, mostly to other college students who live in the area. The community feel is a sharp contrast from the average dispensary, where interactions take place through bulletproof glass cages, under the watchful eye of armed guards, and where it’s impossible to know the quality or safety of the product. “The Armenians at the dispensary are mean to me,” one of Lisa’s customers tells me, summarizing the lack of trust (and racist biases) that many dispensary owners engender in their customers, who reluctantly keep shopping.

That is, except for Ton, a former boss of Lisa whom she insists is one of the only good people in the industry. “[He] taught me pretty much everything I know about this,” she says, waving fingers affixed with lime green press-on nails at a pipe packed with weed. That is, everything from growing cannabis to running a business effectively.

Indeed, Ton’s businesses have been so effective that they nearly broke L.A.’s dispensary system, inspiring last year’s citywide ban. They’ve cost him so much in legal fees that he’s had to stop keeping track, he says, “because if I did, I’d probably kill myself.”

While activists like Bolanos insist that it’s the patients who will benefit when a functioning system is realized, the Oakland example makes it impossible to not think about just how much of an economic impact monopoly-holding dispensaries could make.

Lisa suggests I meet Ton, and on a crisp Saturday night I show up at his house in Woodland Hills, a large home with a Spanish roof, an Escalade in the driveway and sweeping views of the San Fernando Valley, to find him in a celebratory mood. We take a seat by the fire pit overlooking the pool. Van turns the fire on and dumps a bunch of plant detritus over the coals — waste trimmings from his homegrown pot plants. A soft white smoke begins blowing in my eyes as he settles into his story.

“I just beat the United States of America two days ago,” he announces with a grin. On Thursday, he learned that the federal government agreed to a drop civil assets forfeiture case against one of his shops, the American Eagle Collective (AEC), which was at the center of an anti-dispensary backlash in northeast L.A.’s Eagle Rock neighborhood, where it was open between 2008 and 2011. The feds didn’t focus their investigation on Ton. They hadn’t even charged him with anything. Instead, they had threatened to seize the $2.5 million building, which his elderly landlords Walter and Diane Botsch own, just for renting to a dispensary.

Ton covered the cost of hiring his lawyer Matt Pappas to defend the Botschs’ and voluntarily shut down AEC to take attention off the building. “We’ve had six of these cases,” Pappas says. “In every case the landlords and the dispensaries are in compliance with California law.” After a protracted legal battle, during which Pappas passed on the opportunity to settle, the federal government said it would drop the case with prejudice if the defendants agreed not to sue for legal fees — an admission of the government’s wrongdoing that, Pappas says, “would indicate to me that the policy coming down from Washington matches lockstep with what James Cole said in the memo.” (Namely, that the federal government is no longer interested in interfering.)

Ton, for his part, is blunter. “They got their tails tucked in between their legs,” he says. “When I gave [the landlords] the good news, they broke down crying.”

If the federal government no longer plans on pursuing civil assets forfeiture against dispensary owners and landlords, it’s a huge win for medical marijuana. The $83 million California received from the feds in 2012 in exchange for turning over cash and property from those suspected of breaking federal law is a major financial incentive for cities to keep dispensaries illegal. Of course, not all this money comes from marijuana-related busts — and the data doesn’t get that specific — but the reality is that every dispensary removed from the risk of raid represents a loss of potential income for law enforcement groups, many of whom have successfully convinced municipalities to continue the fight against medical marijuana. “If you took marijuana away from that,” Pappas says, “a lot of DEA agents and a lot of people that are involved in forfeiture would lose their jobs.”

Pappas thinks that many California cities are too lazy to implement and enforce sensible regulation about medical marijuana, and see bans as a simpler choice. But he imagines cities have calculated that they’ll make more money off seizing assets from dispensaries than by taxing and regulating them. Consider Los Angeles, where the LAPD alone brought in $3.5 million from assets forfeiture last year. Compare that to the $2.5 million the city made from taxing dispensaries — the value of Ton’s landlords’ single building. Pappas points out that “in all these forfeiture cases, the federal government didn’t arrest anybody, didn’t charge anybody that was involved in the patient groups. They just went after the landlords. You do that for improper motives.” He means to profit as quickly as possible, since civil assets forfeitures can proceed even before a conviction.

There’s something else that all these cases had in common. “Every case that Matthew Pappas does, I’m helping cover the cost,” Ton says. “Every single case that he works on. Because I believe in what he’s doing.”

Inside Harborside Health Center in Oalkand. The dispensary’s revenue is well over $20 million a year. Credit: Flickr user spotreporting

The two make odd bedfellows. Pappas, 46, is a former software engineer who never smokes cannabis. He got involved in medical marijuana law because of his daughter, who used it to wean herself off an addiction to prescription-strength opiates after a life-threatening accident. Two months ago, he announced he was running for the city attorney’s seat in Long Beach.

Ton, 35, on the other hand, got into weed for the money. Born in Vietnam, he was brought to the Valley by his asylum-seeking parents at age 2 and put to work at the family auto body shop at age 12. “It sucked,” Ton says, and he was determined to escape. But after dropping out of high school his sophomore year and taking on odd jobs, he found himself in his early 20s without many options.

“I was lost. I didn’t know what to do with my life.” The solution, it turned out, would be to start a new family business. In 2000, Van says one of his brothers approached him and said, “‘We gotta make something of ourselves, you know?’ So we thought about it and we jokingly said, ‘Man, let’s just grow weed.’ And he’s like, ‘Fuck it, let’s do it.’ And I was like, ‘Are you serious?’”

The timing was right: just a few years after medical weed was made legal, collectives were forming and looking for product. The Ton brothers bought some books, researched how to grow cannabis online, ordered some seeds from Amsterdam, and planted them in a closet with grow lights. “I wasn’t successful my first couple of grows, but I stuck to it,” Ton says. “I just started getting better.” Soon, the Tons were supplying dispensaries with OG (Ocean Grown) Kush, the indoor hybrid Southern California made famous. One closet turned into a garage, which turned into a house, which turned into seven, tucked away amid the Valley’s suburban sprawl.

In 2005, Ton’s botanical experimenting resulted in a new strain he called Louis XIIV (Louis the 13th). While Ton says it was nothing special — just another OG grown particularly well — it was a hit, and aficionados “came from all over the place for that famous strain.” As word got out that the Ton brothers grew some of the best weed in Los Angeles, business began to boom. The Tons got better at growing and their yields shot up. The only problem: Every fall, mega-farms in Northern California would harvest their outdoor product, send it south to L.A. dispensaries, and undercut the sales of local indoor farmers like Ton, whose electricity costs make indoor pot much more expensive to produce.

In autumn 2007 an extra-bountiful harvest made Ton realize that his best business move was to integrate vertically: He decided to open his own dispensary. He looked for a spot for seven months, but most landlords won’t rent to dispensary-owners — they’ll either ask for double the rent or hang up the phone. And at the time, there was a rush on locations. In the wake of the city council’s new moratorium, everybody was trying to register their dispensary to get grandfathered in to whatever new ordinances the city would cook up next.

In 2008, the Botschs’ agreed to rent Ton a spot in Eagle Rock, a student and family-friendly section of L.A. sandwiched between the cities of Glendale and Pasadena, and close to Burbank. “Those are all dry cities,” Ton points out, which explains, in part, why the area along Colorado Boulevard was such desirable territory for dispensaries. AEC was the eighth to open in the neighborhood (population 24,000). A year later there’d be 14, according to Ton. In 2010, Michael Larsen, then-president of the neighborhood council, says he counted 22 dispensaries within a 1.2-mile radius.
“It was a big surprise to everybody [on the neighborhood council] that this business model existed,” Larsen says. “So we looked into what the rules are — state, local regulation — to govern these business, so we could get a handle on who they were and what they we doing… And we found out quickly that there were no rules. There were absolutely zero rules as far as land use or anything.” The lack of oversight meant that there was nothing Larsen or the neighborhood council could do when neighbors complained about the dispensaries, other than call the cops or alert their city councilman Jose Huizar (who later became the Council’s biggest cheerleader for a ban). And one very popular collective, in particular, was drawing many of the complaints: AEC.

“I changed the game in Eagle Rock,” Ton says. “I brought compassion to the dispensary.” In 2008, an eighth of weed would sell for about $75. “When I opened up, I immediately dropped prices down to $55. Why? Because I was the grower. I could justify my own pricing.” Ton says patients would come from as far away as Palm Springs, San Diego and other cities around Southern California where medical marijuana wasn’t accessible, to stock up on an ounce or two at a time.

They weren’t just stoners, either. “A lot of ill and sick people were coming in my doors,” he says. “I’ve had cancer patient after cancer patient on the verge of death,” who would credit Ton’s product with stimulating an appetite again or easing chronic pain. “It would break my heart. I couldn’t charge them. I took them under my wing and gave it to them for free. It became one patient, and more and more and more” (including Pappas’s daughter). “And I realized, ‘Wow what I’m doing is actually helping these people.’ And that’s when it changed me.”

“Every time you clamp down on a drug dealer, 10 more pop up. I call it the most expensive whack-a-mole game.”

Ton started thinking like an activist, not just a business owner. The legal environment he was operating in — with the constant threat of raids or orders to close — wasn’t only menacing to people who made money selling marijuana. It was bad for the patients. Ton had snuck in after the 2007 moratorium, which meant he was in a precarious situation. But he realized that the moratorium, which was supposed to stand for just 45 days while the city council grappled with the terms of a more permanent ordinance, had been extended in violation of state law.

“They broke their own law, and I knew it,” he says. “When they started trying to shut down these [post-moratorium] dispensaries… I rallied up the stores and we sued the city.” (He was right: In the fall of 2009, a judge would declare the moratorium invalid.) But that suit would mark just the beginning of clashing with Los Angeles. In 2010, the LAPD raided Ton’s second shop in North Hollywood and his home, seizing $80,000 worth of product, plus $20,000 in cash that Ton had on him and an additional $14,000 in the store. (He says he was on his way to pay his taxes in person, the only option since banks don’t typically allow collectives to keep an account.) He resumed operations in North Hollywood and opened a third dispensary, Down to Earth, two miles from his home in Woodland Hills. “I didn’t give a shit because I knew what I was doing,” he says. “I wasn’t doing anything wrong.”

After supporting Jose Huizar’s opponent in the March 2011 citywide election, Ton says he noticed Huizar “started going on a rampage against the dispensaries in Eagle Rock.” In November, Huizar proposed a full dispensary ban to the city council. In May 2012, AEC got raided and the civil asset forfeiture proceedings began. About that time, Ton decided he needed to do more to fight the city.

Ambiguous Legalities

Raids are a cost of doing business in the dispensary world, and most dispensary people I interviewed had a raid story. The most absurd belongs to Kristin Trammell, a medical marijuana activist who used to manage a dispensary in Long Beach. At work one day, she got a phone call from the police asking her to come out with her hands up. She complied. “There was a SWAT team, and helicopters, and probably like, 20 or 30 guns pointed at my head,” she says. “It’s, like, the middle of the afternoon.” The reason for such a show of force? “Now this is not a very logical assumption,” Trammell says, but the Long Beach Police “_assumed_ we were being held hostage because they couldn’t get through” to the dispensary on the phone. (The actual explanation? Call waiting hadn’t been set up yet.)

Other times, the patients are targeted. Marla James, president of Americans for Safe Access, Orange County, tells a story of the time she returned home to find six armed DEA agents surrounding her handicapped van. The shock and awe turned out to be merely in service of handing over a letter from the attorney general demanding that she close down an Anaheim collective where she volunteered. James and her fellow collective members have since hired Pappas to sue the city of Anaheim for turning over that collective — which provided free marijuana to terminally ill patients — to the DEA and effectively banning dispensaries from operating there.

“I am in a wheelchair, I only have one leg, and I’m legally blind,” James told the crowd gathered at a protest outside a gathering of anti-marijuana law enforcement groups in the Inland Empire this September. “I can’t grow [cannabis] myself. I depend on the collectives to be there, and there are a lot of people in my shoes, or shoe, who need medical marijuana and can’t get it.” James, a type-1 diabetic, lost a leg after an aggressive infection in her ankle required amputation. She uses medical marijuana as an alternative to Oxycontin, to which she was once addicted. “I’m not covered under the American Disabilities Act… I can’t ask for anything. I use a Schedule 1 Drug.”

Pappas argues that if marijuana is a medicine in California, dispensary bans and other policies that keep it from sick people amount to discrimination under the California Disabled Person Act. It’s no different than “when officials get up and say ‘methadone clinics cause crime’ or ‘methadone clinics are proliferating in our city,’” Pappas says, which was also ruled as discriminatory. “When we ban or we treat those differently than a comparable use — a pharmacy or a medical clinic or a hospital — that is discrimination.”

Pappas isn’t arguing that cities don’t have the right to order dispensaries to close after 8pm or stay away from schools — he encourages that kind of zoning as a way to keep the numbers under control. But if his case in Anaheim wins, which he expects it will, it will mean that even putting a cap on the number of dispensaries allowed in your city could be seen as discriminatory. “In Oakland, it’s great. They’re supportive of the patients,” he concedes. “They’ve got numerical caps. It’s going to be a problem for them.”

Which means, of course, that L.A.’s new Measure D — the one that says Ton’s three dispensaries are illegal — could be overturned as early the end of this year. “A decision from that court will be binding on Los Angeles. It will be binding throughout the state,” Pappas says, which might explain why Ton is helping fund Pappas’s cases.

For Ton, fighting the city through indirect lawsuits is part of a strategy to create better rules for patients while keeping markets open for dispensaries. (He’s currently helping with campaigns against dispensary bans in the cities of Riverside and Santa Ana, too.) When Measure D was on the ballot this spring, it faced off against two other measures: Measure E, the version of D the city didn’t back, and Measure F, organized in part by Ton. All three said similar things, and restricted dispensaries’ locations away from places kids go. Measure F’s main difference was that it said an unlimited number of dispensaries could apply, not just the people who registered early on. There was no numerical cap, but Ton estimated the number of dispensaries would naturally max out around 200 given the tight zoning rules.

It’s likely that that type of regulation would have been enough in Los Angeles. In the aftermath of D, legal dispensaries are having a hard time relocating within the confines of compliant zoning. “I have to move. I’m 138 feet from a school,” says Bolanos, a main backer of Measure D. “Everybody’s having a hard time relocating. There are no places to be found.”

Post-ICO dispensaries that happen to have compliant spots realize how valuable the real estate is. “They’re sitting there and they’re saying ‘Hey, I’m sitting on a compliant spot. You want me to leave? Give me $20,000.” And that’s just to give up a lease. A real estate agent who’s closed deals on locations for dispensaries in the past tells me, “A guy in Koreatown wants $1.5 million for his [D-compliant] location,” adding, “And he will get it.”

Not even the winners are able to enjoy their spoils in L.A.’s medical marijuana politics. If Bolanos and other pre-ICOs can’t relocate by mid-December, they’ll no longer be able to operate legally. “We’re asking the city council to instruct the city attorney to find a solution to create an extension,” Bolanos says. But it’s next to impossible to tweak the language of a voter initiative, considered to be the literal will of the people, which was what made passing one so desirable in the first place.

There is, of course, a magic bullet: “I think the right solution in the end is going to be legalization for non-medical use,” says Kleiman, the UCLA policy professor, “and just get rid of the medical stuff entirely.”

With new zoning rules in place, weed collectives that were once on the Venice’s boardwalk have been forced to move.

It’s a hard fit to match marijuana with the medical system, when pharmacies, insurers, hospitals and mainstream doctors’ offices haven’t embraced it yet. Given the medical system’s resistance to change, it might just be easier to make regulations strict enough under recreational use — with testing for mold, pesticide and THC levels required and labeled for — so medical users could shop from that system as needed. “I think we’re headed to national non-medical legalization in 10 years,” Kleiman says.

In the meantime, many localities are entering the medical phase and ought to attempt a more graceful transition than Los Angeles. Even in states where medical marijuana is alive and well, as money enters the picture it’s likely entrepreneurs will clamor for access to open up further, or for different rules to emerge among different municipalities.

When Sudhir Venkatesh thinks about L.A.’s disjointed medical marijuana sector, it’s hard for him to ignore how much it mimics the black market it was intended to replace. Los Angeles is “very balkanized… in which there are a number of entrepreneurs who have acted largely on their own,” the sociologist says. Ton, for example, is someone who’s highly political through his lawyers, without being embedded in a political movement or connected to other leaders of industry. The problem for independent actors, according to Venkatesh, is that “If you don’t spread wealth around in the urban economy,” you’re going to face more challenges. To earn legitimacy, L.A.’s weed industry “would need to make its revenue central to the functioning of the city,” and “go to political leaders and make the claim that this is the amount of revenue that is going to be generated for the region if we all act together.”

That slowly seems to be what different actors in medical marijuana are doing. The Measure D activists collaborated with the union and made inroads into the city council. Ton is helping Pappas jumpstart a political career. If he’s elected, Pappas will become the city attorney of the L.A. metro area’s second city, a mainstream politician who has actually served as an activist and has a record of helping patients.

Strip Mall Pot Farm

“I feel like I’m in a Kanye West video, you know what I mean?” Ton says. The hydroponic grow-house we’re sitting in has a nightclub-like quality, with 11 high-intensity discharge lamps bouncing neon orange light off the mylar-coated ceiling and walls. The absence of windows creates that placeless time-warp atmosphere that good nightclubs, or Las Vegas casinos, strive for. From inside, you would never imagine that we’re sitting in the same type of two-level strip mall that shows up on nearly every commercial block in the San Fernando Valley — the exact same space that would normally be occupied by a doctor’s office or Thai Massage parlor. Here, it’s been gutted to make way for 100 or so weed plants, spread out over three rooms.

“I’m mimicking what Mother Nature already does, but indoors,” Ton explains. In one room, a blue light imitates summer sun, to encourage seedlings. A green light in a third room prods adolescent plants to grow leaves. The orange-hued light in the current room recreates the rays of the autumnal sun, letting older plants know the end is near. Easily cresting five feet, the 42 plants surrounding us are nearly ready for harvest, so Ton’s begun reducing the number of calories they get from troughs of nutrient solution that sit beneath the plants. “What that does is starve the plant,” he says. “It will cannibalize itself” — eating up energy stored in the foliage — “which prepares it for death.”

Around his plants, Ton’s inner naturalist emerges. He walks me through the steps a grower takes daily: Using a meter to check the pH levels of the nutrients, caressing the foliage to look for diseases or bugs. “They know when I’m in the room. They know when I’m taking care of them,” he says. “These are my girls.”

In the next room over in the mini-mall are his boys — the six or so guys in their 20s who help run Down to Earth, the dispensary where all this weed goes after it’s harvested. The shop is clean and busy. The “budsmen” behind the counter seem to know the customers (who are also mostly men) coming in and out, as if it’s a barbershop. “When people come in and they’re in need of a certain strain, usually we can help them narrow it down,” says Max Garen, a 23-year-old student who’s worked for Ton for years. Ton seems like a fairly hands-off boss who isn’t necessarily in the shop every day. “What I like about my employees is every single one of them would go to jail for me,” Ton tells me. “They would never drop my name — never ever. It’s like I don’t exist.”

“They know what I’m fighting for and what I’m about,” Ton adds later.

“I didn’t give a shit because I knew what I was doing. I wasn’t doing anything wrong.”

A song by Sublime plays over the speakers. A chalkboard offers pricing information by strain, including one called “Het Say,” which means “The Best” in Vietnamese, according to Ton. A statue of Buddha smoking a joint is positioned on bamboo shelves, along with brownies, cereal bars and banana bread. Several shelves are dedicated to clothing, a “pop-up shop” for a patient’s brand. Ton spent $80,000 getting the grow ops built, and he spends about $10,000 per month on wages and electricity, another $5,000 on plant nutrients, and $11,000 to rent the entire strip mall — partially because he needs the space, partially because he doesn’t want to deal with neighbors.

Of course, it’s all illegal after Measure D. Ton’s landlord received a letter from the city that it’s filing a criminal case against him for renting to Ton. Ton’s been asked to leave the property, which means he no longer pays rent while he waits to hear about eviction. But Ton seems calm, and even talks about reopening American Eagle in Eagle Rock, now that his landlords have gotten out of trouble.

Outside in the parking lot, there’s a large meat smoker and grill engraved with the word “PRINCESS,” Ton’s nickname. They plan to fire it up the following Sunday to smoke turkey and brisket for a Thanksgiving barbeque. At one point, Ton says 100 growers, budsmen and others in his network would show up at his holiday parties. With AEC closed, the crew is a bit smaller, but this shop alone employs 10 budsmen.

It’s clear that Ton doesn’t just build dispensaries and grow-houses. He builds institutions. He points out the Mercedes sitting in a parking spot, which he bought for his “right-hand man,” who was formerly homeless. “This is what I want to do. This is what I love to do. I don’t want to do anything else with my life.”

Our features are made possible with generous support from The Ford Foundation.

Zak Stone is a freelance journalist based in Los Angeles and a contributing editor for Playboy Digital. His reporting on business, technology and culture has appeared in New York, Los Angeles, Fast Company, The Atlantic Cities, GOOD and elsewhere. He tweets at @_zs.