P. v. Solis
Filed 5/15/13 P. v. Solis CA2/6
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California
Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or
relying on opinions not certified for publication or ordered published, except
as specified by rule 8.1115(b). This
opinion has not been certified for publication or ordered published for
purposes of rule 8.1115.
IN THE COURT OF
APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE
DISTRICT
DIVISION SIX
THE PEOPLE,
Plaintiff and
Respondent,
v.
JUAN CARLOS SOLIS et al.,
Defendants and
Appellants.
2d Crim. No.
B238099
(Super. Ct. Nos.
1331260, 1333860, 1364838, 1365541)
(Santa
Barbara County)
Juan Solis, Sinthia
Martinez, and Rudy Lopez operated what purported to be a medical marijuana
collective serving some 1,700 members.
In defending against various marijuana charges, they invoked the defense
provided by the Medical Marijuana Program (MMP)
collectively or cooperatively cultivate medical marijuana. The defense does not apply, however, if the
operation does not meet the definition of a "collective or
cooperative" and marijuana has been sold for a profit. Here, all of the collective's excess
income—purportedly about $80,000 a year—was simply treated by Solis as his
personal "salary" without any accountability or disclosure to the
collective's membership. Moreover, the
collective was not registered as a nonprofit and appellants admitted purchasing
marijuana from individuals who were not members of the collective. Because there was no evidence to raise a
reasonable doubt whether the collective operated for profit or was otherwise
lawful, the MMP defense did not apply.
Solis was convicted
following a bench trial on three
counts of possessing marijuana for sale (§ 11359), and a misdemeanor count
of selling or transporting marijuana (§ 11360, subd. (a)). The court further found that appellant
committed one of the possession counts while released from custody on bail
(Pen. Code, § 12022.1, subd. (b)). Martinez
was found guilty on one count of possessing marijuana for sale. Lopez was convicted on one count each of
possessing marijuana for sale and selling or transporting marijuana. Appellants were each granted three years
probation and ordered to serve time in jail with credit for time served. They contend their convictions must be
reversed because the evidence raised a reasonable doubt as to whether their
activities were protected under the MMP.
We affirm.
FACTS AND PROCEDURAL HISTORY
Pursuant to the parties'
agreement, the case was tried on the record of the preliminary hearing and
additional stipulated facts. On February 6, 2010, over 20 pounds of
marijuana was found in Glen Mowrer III's vehicle during a traffic stop. Mowrer told the police he routinely sold
marijuana to several local medical marijuana dispensaries, including The
Healing Center (THC), which Solis and Martinez
operated out of a storefront at 1437 San Andres Street
in Santa Barbara.
On February 17, 2010,
Solis's residence at 1107 San Andres Street,
and his adjoining residence at 701 West Carrillo
Street.
During the search of the residence at 1107 San
Andres Street, officers found a marijuana growing
operation with live plants, processing tools, and packing materials. Solis and Martinez
were at the residence when the warrants were executed and were both arrested.
At THC, officers found a
large quantity and variety of marijuana products along with sales receipts and
patient records. Several customers who
arrived during the search reported they became "members" of THC by
filling out a form and that their only involvement in the collective consisted
of purchasing marijuana. None of the
members knew how THC operated or gave any input in that regard.
Solis and Martinez
told the police they had been operating THC, which had about 1,700 members, for
the immediate past three years. Martinez
often worked at THC, did the bookkeeping, and occasionally bought marijuana
from vendors. She did not know how much
money she or THC had made over the past year.
Solis said he and Martinez
made all the business decisions for THC and provided no services to the
customers other than selling marijuana.
Solis admitted that THC was not registered as a nonprofit. He also admitted receiving about $80,000 in
income from THC in the past year, which he spent on family expenses and entertainment. Every week he bought approximately one pound
of marijuana and resold it to THC customers for double the price he paid. He did not have any information regarding the
source of the marijuana he purchased.
Any vendor could walk in, sign up for membership, and immediately sell
marijuana to THC. He knew that some of
the vendors provided false names in order to avoid potential "legal
problems."
When Solis was arrested,
the police told him that THC was being operated illegally and that he was prohibited
from conducting any further business.
Nine days later, Solis was operating THC again and had put a sign in the
window that said, "Yes We Are Open."
During a subsequent search and related investigation conducted in May
2010, the police verified that someone had purchased marijuana from THC that
same month. On June 3, 2010, the police conducted a controlled
purchase at THC through a confidential informant who possessed a doctor's
recommendation for medicinal use of marijuana.
When the informant stated he was a new customer, he was simply told to
fill out some paperwork without any discussion as to how the collective
operated.
On June 11, 2010, the police responded to an alarm
at Solis and Martinez's residence
at 710 West Carrillo and found another marijuana growing operation inside the
residence. On June 23rd, the police
executed another search warrant at THC and arrested Solis. When Solis was interviewed, he said that he
planned to continue reopening THC every time the police shut it down.
On June 25, 2010, Solis was arrested at THC along
with THC employee Lopez. The police
seized 28 marijuana plants and two scales.
Solis was released four days later on the condition that he refrain from
reopening THC or otherwise possessing marijuana.
On October 4, 2010, the police found a marijuana
vendor receipt signed by Lopez that was issued to THC on September 24, 2010. The vendor, David Ziemer, told the police he
had sold six ounces of marijuana to THC on that date. No documentation of Ziemer's membership was
included in the records the police had previously seized from THC.
On October 27, 2010, the police executed another
search warrant at 1107 San Andres and 710 West Carrillo. When the police entered the residence at 710
West Carrillo, Lopez fled through the rear of the property and was later
arrested at 1107 San Andres. Along
Lopez's flight path, officers found a brown paper bag containing bottles filled
with marijuana. In an outdoor area
between the two residences, they found a shed that contained a "makeshift
office" with a safe, marijuana products, papers indicating marijuana
sales, a scale, and marijuana packaging materials. Inside Solis's residence at 1107 San Andres,
the officers found numerous marijuana sales receipts and receipt books
containing the signatures of both Solis and Lopez. Many of the documents appeared to indicate
that THC had begun delivering marijuana to customers.
In rejecting appellants'
MMP defense at trial, the court concluded there was no evidence to raise a reasonable
doubt whether THC was operating on a nonprofit basis. The court reasoned: "Nothing in the statutes or the AG [MMP]
Guidelines provides for monetary payment for services rendered to the
collective or cooperative – certainly not on the order of $80,000 per year to
the self-described 'operator' and business decision maker of the collective,
who provided no services to the members of the dispensary other than selling
them marijuana. Monetary reimbursement
that members provide to the collective or cooperative is limited to an amount
necessary to cover overhead costs and operating expenses. Defendants have provided no evidence of
actual overhead costs or expenses that had to be reimbursed. Rather, the reimbursement amount or, as Solis
described it, pricing was simply double the amount [THC] paid for [the]
marijuana."
In disposing of Solis's
claim that THC members "pooled money" to collectively grow marijuana,
the court stated, "there is no evidence of such 'pooling.' There is no evidence demonstrating that money
paid pursuant to the set prices listed on boards at THC went into collective
cultivation of marijuana. To the
contrary, the only facts are that funds went to two destinations: 1) vendors,
two of whom appear not to be collective members, and others whose identity and
source of marijuana are unknown; and 2) Juan Solis' entertainment and living
expenses." The court also found the
evidence failed to create a reasonable doubt whether THC was operating as a
"collective" or "cooperative" as contemplated by the
MMP.
DISCUSSION
Appellants contend their
convictions must be reversed because the evidence compels a finding that their
activities related to the operation of THC were protected under the MMP. We conclude otherwise.
To determine whether a
conviction is supported by substantial
evidence, we review the entire record in the light most favorable to the
prosecution "to determine whether it contains evidence that is reasonable,
credible, and of solid value, from which a rational trier of fact could find
the defendant guilty beyond a reasonable doubt." (People
v. Silva (2001) 25 Cal.4th 345, 368.)
In applying this test, we do not resolve credibility issues or
evidentiary conflicts. Instead, we presume
in support of the judgment the existence of every fact the jury could
reasonably have deduced from the evidence.
(People v. Boyer (2006) 38
Cal.4th 412, 480.) "A reversal for
insufficient evidence 'is unwarranted unless it appears "that upon no hypothesis
whatever is there sufficient substantial evidence to support"' the jury's
verdict." (People v. Zamudio (2008) 43 Cal.4th 327, 357, quoting
331.)
In 1996, the California
electorate approved Proposition 215 and adopted the Compassionate Use Act (CUA)
(§ 11362.5), which provides an affirmative defense to prosecution for the
crimes of possession and cultivation where the marijuana is used for a
patient's personal medical purposes pursuant to a physician's recommendation. The Legislature subsequently enacted the MMP
to clarify the scope of the application of the CUA. (See People
v. Kelly (2010) 47 Cal.4th 1008, 1014.)
A defendant invoking the
MMP as a defense bears the burden of producing evidence in support of that
defense. (People v. Mower (2002) 28 Cal.4th 457, 477-481;
proving the defendant's guilt, the defendant need only produce evidence that
raises a reasonable doubt whether his or her acts were protected under the
MMP. (Ibid.)
Under the MMP, qualified
patients and their designated caregivers are entitled to "associate within
the State of California in order
collectively or cooperatively to cultivate marijuana for medical
purposes[.]" (§ 11362.775;
1172.) Although the MMP does not
expressly define what it means to "collectively or cooperatively cultivate
marijuana," the Attorney General guidelines (guidelines)
articles of incorporation with the state and conduct its business for the
mutual benefit of its members.
[Citation.] No business may call
itself a "cooperative" (or "co-op") unless it is properly
organized and registered as such a corporation under the Corporations or Food
and Agriculture Code. . . . Further,
'[c]ooperatives must follow strict rules on organization, articles, elections,
and distributions of earnings, and must report individual transactions from
individual members each year.'
[Citation.]" (
1010.) A collective is defined as
"'"a business, farm, etc., jointly owned and operated by the members
of a group." [Citation.]' [Citation.]
Thus, 'a collective should be an organization that merely facilitates
the collaborative efforts of patient and caregiver members—including the
allocation of costs and revenues.'"
(Ibid.)
The guidelines further
direct that medical marijuana cooperatives and collectives must be nonprofit
operations that "'acquire marijuana only from their constituent members,
because only marijuana grown by a qualified patient or his or her primary
caregiver may be lawfully transported by, or distributed to, other members of a
collective or cooperative . . . .
from outside the collective or cooperative for distribution to its members. Instead, the cycle should be a closed-circuit
of marijuana cultivation and consumption with no purchases or sales to or from
non-members. To help prevent diversion
of medical marijuana to non-medical markets, collectives and cooperatives
should document each member's contribution of labor, resources, or money to the
enterprise. They should also track and
record the source of their marijuana.'
[Citation.]" (
1010.) In addition, "'. . . [a]ny
monetary reimbursement that members provide to the collective or cooperative
should only be an amount necessary to cover overhead costs and operating
expenses.' [Citation.]" (Id. at
pp. 1010-1011.)
In determining a
marijuana collective or cooperative is a nonprofit enterprise, the size of its
membership and its operating procedures are relevant. (People
v. Jackson
and any financial records are also relevant, "including in particular any
processes or procedures by which the enterprise makes itself accountable to its
membership. An operator's testimony as
to the nonprofit nature of the enterprise is of course also relevant. [¶]
However, by the same token the absence of fairly complete financial
records and any accountability to members will also be relevant, especially
when combined with a large number of members and evidence of a high volume of
business. In the latter circumstance a trier of fact could reasonably conclude
that, notwithstanding an operator's testimony, a large membership, high volume
enterprise was in fact operated for profit." (Id.
at p. 539, fn. omitted, italics added.)
Here, substantial
evidence supports the trier of fact's finding that appellants' evidence failed
to raise a reasonable doubt whether THC was a cooperative or collective as
contemplated by the MMP.
name="_ftnref4" title="">[4] Indeed, the evidence was lacking on virtually
every point. THC was not registered as a
nonprofit. Although the police found
various sales and purchase receipts, the financial records were not complete and
there was no accounting of THC's total income and expenses. Solis merely offered that he bought about a
pound of marijuana every week for some unspecified price and sold it for double
what he paid. He also admitted receiving
about $80,000 in personal "income" from THC in the past year, no accounting or other record of which
was ever produced. He further admitted
he had purchased marijuana from two vendors for whom there were no membership
records, and that he knew other vendors had given false names. This evidence is insufficient to raise a
reasonable doubt whether THC either operated for profit or otherwise qualified
as a collective or cooperative under the MMP.
Appellants claim it is
improper to consider Solis's $80,000 "income" as evidence that THC
operated for profit because nonprofit organizations are entitled to have paid
staff. (See Holistic Health, supra, 213 Cal.App.4th at p. 1033 [quoting Food
& Agr. Code, § 54147, for the proposition that "'[a]n association
may provide a fair remuneration' for 'time . . . actually spent . . . in its
service'"].) The MMP guidelines
make clear, however, that "[a]ny monetary reimbursement that members
provide to the collective or cooperative should only be an amount necessary to
cover overhead costs and operating expenses." (Jackson,
supra, 210 Cal.App.4th at pp. 535-536.)
Even if Solis's claimed income could be construed as either "fair
renumeration" or part of the organization's "operating
expenses," Solis never claimed that he merely received a salary commensurate
with his efforts that was a component of THC's reasonable expenditures. Instead, he admitted that he simply took all
of THC's profits and spent them on himself and his family. It is also undisputed that THC had no
accountability whatsoever to its members, who paid for the marijuana from which
the profits were derived. Under the
circumstances, any inference that Solis paid himself a "salary" of
$80,000 as reasonable compensation for services he actually rendered would be
insufficient to raise a reasonable doubt whether THC sold marijuana for
profit. (Id. at p. 539.)
Appellants' citations to
recent case law are unavailing. In
opening briefs were filed, the Court of Appeal reversed the appellant's jury
trial convictions for selling and possessing marijuana on the ground that the
trial court had erroneously prevented him from offering evidence to establish
he was entitled to an MMP defense and had refused to instruct the jury on the
defense. The trial court based its
ruling on the fact that only a few of the collective's 1,600 or so members had
actually participated in the cultivation of marijuana. The court also found that it lacked
sufficient information to determine whether the collective operated for profit,
and thus did not rely on that factor in reaching its decision. (Jackson,
supra, 210 Cal.App.4th at p. 532.)
In reversing, the Court
of Appeal rejected the People's argument that the MMP defense does not apply
unless there is evidence that all of a collective's members actively
participated in the cultivation of marijuana.
The court reasoned that "[s]uch a strict limitation" was
inconsistent with both the MMP and the guidelines. (Jackson,
supra, 210 Cal.App.4th at p. 537.)
The court went on to state that while "the relatively large size of
a collective or cooperative will not per
se take it outside the scope of section 11362.775, in any given case the
size of an enterprise may nonetheless be quite relevant
>
in
determining whether a defendant's participation is protected . . . ." (Id.
at p. 538.) As we have previously noted,
the court also reasoned that "the absence of fairly complete financial
records and any accountability to members" could lead a trier of fact to
reasonably conclude that "a large membership, high volume enterprise was
in fact operated for profit." (
Holistic Health, which was decided after all the briefs were filed,
is similarly unavailing. In that case,
the court reversed a summary judgment in favor of the city of Dana
Point in its action against a medical marijuana collective for nuisance
abatement and illegal business practices.
The court reasoned that the collective presented sufficient evidence to
create a triable issue of fact whether the collective operated as a nonprofit
such that the MMP defense applied. That
evidence included proof that the collective was incorporated as a nonprofit,
articles in incorporation identifying the collective as such, and filed tax returns
showing net negative income. (
at p. 1027.) Appellants presented no
such evidence.
In Colvin, the defendant was arrested while transporting about a pound
of marijuana and was subsequently convicted by court trial of transporting
marijuana and other offenses. The trial
court found that although the defendant was operating a lawful marijuana
collective, the MMP defense did not apply "because 'the transportation . .
. had nothing to do with the cultivation process.'" (Colvin,
supra, 203 Cal.App.4th at p. 1036.)
In reversing, the Court of Appeal rejected the implication that the
defendant's collective, "with its 5,000 members and 14 growers, is simply
too big to allow any 'meaningful' participation in the cooperative
process" such that it could not be deemed a "collective" or
"cooperative" as contemplated by the MMP. (Id. at
p. 1039.) The court reasoned that
"this interpretation of section 11362.775 would impose on medical
marijuana cooperatives requirements not imposed on other cooperatives. A grocery cooperative, for example, may have
members who grow and sell the food and run a store out of which the
cooperative's products are sold. But not
everyone who pays a fee to become a member participates in the cooperative
other than to shop at it." (
The court went on to note that the defendant's collective had complied
with virtually all of the guidelines (e.g., it was registered as a nonprofit
and maintained complete financial and membership records) and the defendant had
taken steps to comply with the local ordinances. (Id. at
pp. 1040-1041.)
As we have explained,
appellants offered no evidence that THC was registered as a nonprofit. Moreover, their records are woefully
incomplete and Solis admitted purchasing marijuana from vendors who were not
THC members. He also admitted that he
spent all of THC's profits on himself and his family. In light of this evidence, the court reasonably
found beyond a reasonable doubt that THC operated for profit and did not
otherwise qualify as a collective or cooperative under the MMP. (Jackson,
supra, 210 Cal.App.4th at p. 539.)
The judgments are
affirmed.
NOT TO BE PUBLISHED.
PERREN,
J.
We concur:
GILBERT, P. J.
YEGAN, J.
Frank
J. Ochoa, Judge
Superior
Court County
of Santa Barbara
______________________________
Law Office of Joseph D.
Allen, Joseph D. Allen and Alan Karow for Defendant and Appellant Juan Carlos
Solis.
Law Office of Alan
Karow, Alan Karow; Law Office of Joseph D. Allen, Joseph D. Allen, for
Defendant and Appellant Sinthia Alba Martinez.
Esparza Law Group and
Luis Esparza for Defendant and Appellant Rudy Aragon Lopez.
Kamala D. Harris,
Attorney General, Dane R. Gillette, Chief Assistant Attorney General, Lance E.
Winters, Senior Assistant Attorney General, Michael R. Johnsen, Supervising
Deputy Attorney General, William H. Shin, Deputy Attorney General, for
Plaintiff and Respondent.
seq.) All further undesignated statutory
references are to the Health and Safety Code.
Legislature's directive that "the Attorney General shall develop and adopt
appropriate guidelines to ensure the security and nondiversion of marijuana
grown for medical use by patients qualified under the [CUA]." (§ 11362.81, subd. (d).) While we are not bound by these guidelines,
we give them considerable weight. (
Cal.App.4th 997, 1011 (Hochanadel),
quoting Freedom Newspapers, Inc. v.
Orange County Employees Retirement System (1993) 6 Cal.4th 821, 829.)
