No ethics sanctions for Colo. lawyers working with marijuana firmsReprints
Colorado lawyers have been given permission by the state's highest court to work with marijuana businesses without the threat of ethics sanctions even though those businesses are breaking federal law.
The rule change, signed Monday by Colorado Supreme Court Chief Justice Nancy Rice, states that a lawyer “may assist a client in conduct that the lawyer reasonably believes is permitted by these constitutional provisions and the statutes, regulations, orders, and other state and local provisions implementing them.”
The rule also requires lawyers to advise their clients about federal marijuana laws and policies.
Recreational marijuana use was legalized as of Jan. 1 under a constitutional amendment approved by Colorado voters, while medical marijuana was legalized in 2000.
However, while state law legalizes both medical and recreational marijuana use, ethics rules have prevented lawyers from assisting clients in activities that could be breaking federal law. For example, the Colorado Bar Association last year declared that lawyers could be sanctioned for providing such services as arranging a lease, negotiating a contract or soliciting financial help.
“I applaud the Supreme Court with using their insight and wisdom to allow us to share legal knowledge with clients,” said Mary Toney, a lawyer in private practice in Denver whose clients include marijuana businesses. “Without lawyers being able to help educate the public on Colorado regulations and statutes regarding first medical marijuana and now recreational marijuana, there would be chaos within the industry, and this burgeoning industry would suffer much confusion and missteps, which knowledgeable lawyers are able to guide people along the narrow legal path. I have always advised any client that marijuana is and remains unlawful under federal law and then go on to explain the limited scope within which marijuana is legal under Colorado law.”
Though no Colorado attorney has ever been disciplined for working with a marijuana business, Ms. Toney last year received a cancellation notice from her professional liability insurer, Hanover Insurance Co., citing the conflict between state and federal laws as the primary reason for discontinuing coverage.