Bankruptcies are Tricky for the Marijuana Industry
Even if marijuana is legal in a good number of states, it is still illegal federally. For this reason, apart from complying with state laws, owners of medical marijuana dispensaries must also learn to navigate federal laws so they can operate accordingly. Especially when filing for bankruptcy, conflict between state and federal laws can cause a lot of problems to those in the marijuana industry.
Filing for federal bankruptcy is a viable option…
When business owners go under, they have the option to file for bankruptcy in a federal court in order to liquidate or reorganize their business assets. Filing for bankruptcy gives borrowers the chance to keep some of their assets so they can continue to operate and even keep their creditors from suing.
… but not for marijuana business owners
The problem with marijuana business owners filing for bankruptcy is that, as stated earlier, marijuana is illegal under federal law. In Colorado, a U.S. District Bankruptcy Court decision states that marijuana dispensaries cannot file for federal court bankruptcy as long as federal law deems marijuana illegal.
This predicament should be a wakeup call for marijuana business owners who assume that bankruptcy laws do not apply to them. If your marijuana business is experiencing financial difficulties, experts advise that you resolve your dispute in a state court to ensure that what you are doing is legal.
Posted on September 2, 2014, in Dispensaries, Health, Health Services, Marijuana, Products and tagged CannaMedBox, legal medical marijuana, medical marijuana dispensary. Bookmark the permalink. Leave a comment.