EX-OPERATOR OF MEDICAL MARIJUANA DISPENSARY TO BE SENTENCED FOR TAX
EVASION

RIVERSIDE - The ex-operator of Corona and Perris medical marijuana
dispensaries that took in more than $1 million is slated to be
sentenced later this month to home detention and several years
probation for tax evasion.

Ronald Bradley Naulls, 31, was arrested in July 2007 during a region-
wide crackdown on cannabis stores by Internal Revenue Service and Drug
Enforcement Administration agents.

He was charged with conspiracy to possess, with the intent to
distribute, marijuana; maintaining a drug establishment; distribution
of a controlled substance; and willful filing of a false income tax
return.

According to court documents, Naulls used "substantial amounts of
cash" received from the business for personal expenditures, including
paying the mortgage payments on his house.

Despite earning more than $165,000 from his Healing Nations
Collective, Naulls reported gross income of less than $30,000 -- for
2006 and 2007 combined -- according to federal prosecutors.

The property seized from the defendant's Corona home included a Lexus,
a Mercedes-Benz, $75,000 cash and 15 pounds of marijuana, according to
the DEA.

Naulls entered into a plea agreement with the U.S. Attorney's Office
in May, acknowledging his guilt on the income tax evasion charge.

Prosecutors dropped the other charges.

"After carefully reviewing this case and through the course of
negotiations with the defendant, we determined that the interests of
justice were best served by Advertisement

Primus Golf Academy resolving this case through a plea agreement that
led to Mr. Naulls pleading guilty to the tax offense," said U.S.
Attorney's Office spokesman Tom Mrozek.

Naulls is expected to be sentenced by U.S. District Judge Virginia
Phillips on Aug. 30 to six months home detention and three years probation.

The Healing Nations Collective, which was located in a strip mall on
West Grand Boulevard, provided marijuana to people with prescriptions
for the controlled substance.

Under California Proposition 215, medical marijuana dispensaries are
permitted. But federal law does not recognize them as legal.

Naulls' operations grossed an estimated $1.2 million in less than a
year, selling cannabis-laced products, including cakes and other
edibles, on a cash-only basis, according to the DEA.

"The defendant and his employees would purchase marijuana, hashish and
other controlled substances for cash from growers and vendors," the
plea agreement states.

Federal law enforcement agents staged several undercover operations in
which Naulls' or his employees sold them marijuana, according to the
U.S. Attorney's Office.

Within months of Healing Nations opening its doors, the Corona City
Council imposed a permanent moratorium on marijuana dispensaries in
the city and later refused to renew the defendant's business license.

According to federal prosecutors, Naulls operated a smaller outlet in
Perris.

The federal raids sparked protests by Healing Nations customers and
employees.