CITY TO WEED OUT POT SHOP

A medical marijuana dispensary that opened without permission in north
Gilroy will continue to sell cannabis until at least Tuesday despite a
"cease and desist" order from the city, a dispensary representative
said. The situation has city officials heated, residents curious, and
at least one councilman expecting an expensive lawsuit.

Gilroy's City Council will meet in closed session Monday evening to
discuss the matter and to give direction to city staff on what their
next steps should be.

Until then, "It would irresponsible for us to deny access to medicine
for the 165 Gilroy residents who have already registered with the
MediLeaf Collective," dispensary ombudsman Eric Madigan of Toluca Lake
wrote in an e-mail Thursday morning. "So we will continue to operate
as we work out the details ..."

Sgt. Kurt Ashley served the order to UR Health and Wellness Center,
run by MediLeaf, about 4:45 p.m. Wednesday, according to police - two
days after the medical marijuana dispensary opened without a license
and to the surprise of city leaders. The order called on MediLeaf to
immediately stop selling marijuana and to cease operating a medical
marijuana dispensary in Gilroy.

If not, "... the City will be free to take any and all legal actions
necessary to enforce your compliance with the law," the order read.

MediLeaf opened at 1321-B First St. despite the City Council rejecting
an ordinance 4-3 last month that would have allowed the dispensary.

The order cites MediLeaf for operating without a business license,
operating in a district that was not zoned for a dispensary and
violating federal law. It was signed by City Administrator Tom
Haglund, City Attorney Linda Callon and Development Center Manager
Kristi Abrams.

The document was addressed to MediLeaf directors Neil Forrest and
Batzi Kuburovich and to San Jose residents Mike and Kulwinder Kaur
Atkar, who own the shopping center that houses the dispensary. Before
the order was served, Mike Atkar said that the licensing issues did
not involve him - just the city and the dispensary.

MediLeaf representatives said the city code makes allowances for
nonprofits to operate without a license, but city officials say that's
not true.

MediLeaf is a nonprofit mutual benefit corporation that was registered
with the secretary of state March 29. Like many dispensaries, it
follows a closed-circuit collective model, in which marijuana only can
be acquired and grown by members. Its articles of incorporation
dictate that its directors will be paid $10,000 per month.

Attorney James Anthony, who said he was part of a "mercenary band of
lawyers" representing the dispensary, said attorneys would be glad to
speak with city officials about the matter.

"If not, we'll see them in court," he said.

Gilroy's position is similar to a situation recently seen in
Claremont, Haglund said. In that case, a state appellate court ruled
in the city's favor after a dispensary chose to operate without a
business license.

However, Councilman Perry Woodward, who supported the ordinance that
would have allowed MediLeaf, said the Claremont case was decided in a
different appellate district, and a judge could decide differently in
this instance.

"It's so darn frustrating that the council didn't have the foresight
to see this would be the immediate outcome of what they did," Woodward
said.

He anticipated that the city may have to spend hundreds of thousands
of dollars in legal fees to fight MediLeaf in court.

"They're setting this thing up," he said of MediLeaf. "They had to
know they're getting a cease and desist (order)."

Medical marijuana facilities have operated in other communities
without causing an uproar, he said.

While the city and dispensary fought it out, scores of people showed
up to the non-descript dispensary this week to become members or to
learn more about MediLeaf's services. Several of them spoke of
ailments, such as anxiety and pain surrounding amputated limbs.

Many of those people, such as Gilroyan Robert Vaca - who suffers from
back spasms - said the local dispensary would save them a trip to
Santa Cruz or Oakland.

"The medicine is just so much better than what you get from the
doctor," he said, referencing other painkillers, such as Vicodin.

Vaca said he does not have to increase dosages with cannabis as he
does with other painkillers and that the dispensary staff treated him
with respect.

Kelley-Jo Wendlandt, a MediLeaf member who volunteers at the
dispensary, said she has undergone four back surgeries for spinal
disorders and a botched operation. As a result, she has used medical
marijuana for nine years and has traveled to dispensaries as far as
Oakland.

"They're doing everything right," she said of MediLeaf. "There have
been a couple of places in Oakland that I didn't think were right at
all."

Neighboring businesses this week had mixed reviews. Staff at Togo's
Eatery and Rock Zone both said Monday that they were happy to see the
dispensary open, touting its medicinal value.

However, Anthony Figueroa, owner of Antdawg's Universal Strength
Headquarters, a martial arts studio adjacent to the dispensary, said
the dispensary should move near other pharmacies. Both he and his
brother, Angel, who co-owns the business, said several children belong
to their martial arts studio, and the brothers thought the dispensary
was a bad fit. The Figueroas also complained of particularly
young-looking people walking into the dispensary. They would likely
move their business elsewhere if MediLeaf stays in the shopping
center, they said.

Eric Smith, who heads South Valley Community Church - just down the
street from the dispensary - said several community members fought an
adult book store in Gilroy, but the city allowed it to exist because
it was legal.

Although many residents who showed up at the dispensary this week said
they patronized the cooperative solely to ameliorate medical ailments,
a few teenagers - at least one of whom claimed to have no medical
problems at all - were scoping out the store.

As Rock Zone manager Cassie Lopez explained the differences between
medical cannabis and street-bought marijuana, 16-year-old Jeremiah
Loyd proclaimed, "It's the same thing, though - bud's bud."

Loyd had previously entered the front lobby of the dispensary, and he
was flipping through a copy of a magazine and looking at a picture of
an EZ Grow Mushroom Kit as he stood in Rock Zone. Lopez kicked him out
of the store following his comment.

MediLeaf staff have maintained that only adults with a doctors note
will be able to apply for membership at the cooperative.

Gilroy-based Enterprise Protective Services is providing security for
the clinic, and sales director Miriam Vega said staff will aim to
prevent loitering in the parking lot and prevent problems with any
protesters who might show up. Security measures included 16 cameras
and patrol units, she and Kuburovich said.

Gilroy police have not responded to any disturbances in the shopping
center since the dispensary opened, Sgt. Jim Gillio said.

Councilman Craig Gartman took note of the security and the politeness
of staff when he stopped by the dispensary this week to get a look.

"It looks like a pretty clean, well-organized operation from what I
saw," Gartman said.

Councilman Bob Dillon, on the other hand, was upset with the
dispensary operators. He said his immediate reaction would have been
to have the city place a lock on the door.

Haglund said that any construction done without a building permit also
could constitute a safety issue. MediLeaf has not been issued any
building permits for their project, yet the Figueroas say that
construction had been going on in the building for two to three weeks
before it opened.

Kuburovich would not comment on matters related to the dispensary this
week, indicating through a gesture of zipping his lips that he was
keeping silent for legal reasons.

Councilman Dion Bracco also expressed ire with MediLeaf for opening
without a permit, and seemed further solidified in his opposition.

"I'm glad we didn't allow them in," Bracco said. "This shows what kind
of people they are."

He said he received 20 to 30 e-mails from people who were opposed to
the dispensary this week, while only one woman e-mailed him in support.

"People are ticked," he said. "People are hot right
now."

Although Monday's discussion is slated to be in closed session, Gillio
noted that there will be a public comment session beforehand, and
members of the public are encouraged to attend.

Gartman said it would be interesting to hear city staff's
interpretation of the municipal code regarding business licenses and
federal regulations.

"I guess that's the $64,000 question - do you need a business license
if you're a nonprofit?" Gartman said.

What people are saying

"People are using fear and deceit to discredit what's being
done."

- - Batzi Kuburovich, co-director of UR Health and Wellness Center, a
medical marijuana dispensary run by MediLeaf

"This is clearly not coming in the front door or openly or honestly."
- - Cat Tucker, Gilroy councilwoman

"The medicine is just so much better than what you get from the
doctor."

- - Robert Vaca, Gilroyan and collective member

"It's the same thing, though - bud's bud."

- - Jeremiah Loyd, 16

"It's so darn frustrating that the council didn't have the foresight
to see this would be the immediate outcome of what they did."

- - Perry Woodward, Gilroy councilman

"I'm glad we didn't allow them in. This shows what kind of people they
are."

- - Dion Bracco, Gilroy councilman

Is medical marijuana legal?

Federal

Federal law prohibits cannabis - along with LSD and exstasy, among
others - as a Schedule One drug, meaning it has "a high potential for
abuse (and) no currently accepted medical use in treatment in the
United States." However, U.S. Attorney General Eric Holder, at the
behest of President Barack Obama, said last month that the federal
government does not plan to prosecute people selling medical marijuana
in states where it is allowed by state law.

State

State Proposition 215 permits local jurisdictions to regulate whether
medical marijuana dispensaries can open in their localities.
Accordingly, last month the Second District Court of Appeals upheld a
City of Claremont ban on dispensaries, a decision which means cities
can bar citizens from setting up dispensaries. In addition, the Los
Angeles County District Attorney announced last month that prosecutors
would bring cases against hundreds of "over the counter" collectives
in the area that exchange marijuana for cash.

City

City code, sections 13.2, 13.44(a), 53.20 and 53.20, require that all
businesses be in compliance with federal, state and local laws,
effectively prohibiting a dispensary from opening since it would be in
conflict with federal law. In addition, all businesses - for profit or
nonprofit - must secure a business license prior to opening and prior
to remodeling. The City Council defeated an ordinance that would have
created guidelines to allow a dispensary to operate in Gilroy in a 4-3
vote - with councilmen Perry Woodward, Peter Arellano and Craig
Gartman dissenting.

Sources: City of Gilroy, U. S. Drug Enforcement Administration