Category Archives: General

Success at CCEA!

Jeff Cohen and Jefferson Allen of Cohen Cooper Estep & Allen, LLC, were interviewed by WSB Atlanta about their client, a tax preparer.  Messrs. Cohen and Allen obtained a successful result for the client.   You can see the broadcast here.  Below the line is a press release by Jeff Cohen about this story, printed here with permission.

In early March, the Georgia Department of Revenue (DOR) tried and failed to shut down a family-owned tax return preparation business that prepares thousands of tax returns for Georgians every year. Despite the fact that B&B Accounting & Tax Service, Inc. and its owner, Ruth Barr, have been in business for over 40 years, the Department of Revenue used a very small sampling of tax returns to come to their own conclusion that B&B was intentionally understating the tax liability of thousands of Georgians. Ruling upon the DOR’s application for a Temporary Restraining Order, the Fulton County Superior Court disagreed.

Tax Attorney Jeffrey Cohen, of the law firm Cohen, Cooper, Estep & Allen, LLC, was critical of the lack of evidence presented by the DOR. Cohen contended that the scant number of tax returns presented in court by the DOR misrepresented the facts. If the DOR had been awarded its Temporary Restraining Order, it would have forced Ms. Barr and her employees out of business. Mr. Cohen, who represents taxpayers and return preparers before both the State and the Internal Revenue Service, had not previously heard of the DOR ever attempting to shut down a legitimate tax preparer. His partner, Jefferson Allen, argued to the Court that the State required a substantial amount of evidence to prove its case, and that it failed. The Court agreed with B&B that the evidence presented by the State was inadmissible and unsubstantiated hearsay.

Soon after the Court’s ruling, the Department of Revenue dismissed the case against Ms. Barr and B&B.

Dazed and Confused

Twenty-eight states and Washington, D.C. legalized marijuana to varying degrees under their respective laws.  As you have heard, though, marijuana remains illegal under federal law. The marijuana sector boomed when the Obama Administration decided to place a low priority on enforcing the federal marijuana laws vis-a-vis marijuana activities under state law.

The federal government still has a hammer in the federal drug laws that could shatter the marijuana industry.  The Trump Administration made statements recently that it may use that hammer on part of that industry.  We will see what happens.

The possible shift in how the federal government handles marijuana highlights that anyone looking to get into, or stay in, the marijuana business must be ready.  The breadth of the federal drug and racketeering laws means that those doing business with or assisting those in the marijuana business could be at risk.  Landlords, suppliers, financiers, and professionals, to name a few, should assess their risks if federal law enforcement changes its priorities.  Ignorance rarely, if ever, works as a defense.

The standard advice stands – go into any business with your eyes open.  Know the regulations and the risks.  Speak with your lawyer, CPA, insurance agent, and others to get the advice you need.  Call us and see how we can help you.

This post provides general information only.  This post is not intended to create an attorney-client relationship or to be legal advice about your situation.  A blog post is not a substitute for legal advice that fits your situation.  Laws change and your situation may be different.  You should consult with a licensed attorney for legal advice specific to your circumstances.

© 2017 Matthew D. Macy

Dude, Pass the Chips 2


Last April, I wrote the post, “Dude, Pass the Chips,” that mentioned a Colorado Court of Appeals decision holding that an employee does not have a claim against his employer for being fired for medical marijuana use. On June 15, 2015, the Colorado Supreme Court issued its decision affirming the Colorado Court of Appeals. You can read the Colorado Supreme Court’s decision  the Colorado Bar website

We now join the conversation in progress between Q and A from “Dude, Pass the Chips.”

 Q:        The Colorado Supreme Court is a buzz kill, man. Why can we be fired for using legal marijuana?

A:        Marijuana may be legal in some contexts under Colorado law, but it remains illegal under federal law. The Colorado Supreme Court said that an employee who uses marijuana in compliance with state law does not have a wrongful termination claim under Colorado’s lawful activities statute, because marijuana use remains illegal under federal law.

Q:        “Lawful activities” statute?

A:        Colorado has a statute that an employer generally cannot fire an employee for the employee’s lawful activities done outside of work hours and not on the employer’s property. There are exceptions, of course.

 Q:        But Colorado legalized medical marijuana and recreational marijuana!

 A:        Again, federal law prohibits any marijuana use outside of a narrow exception for federally approved studies. Colorado’s lawful activities statute does not limit the definition of “lawful activities” to activities deemed lawful under state law. Since federal law criminalizes marijuana use, its use is not a “lawful activity” under the Colorado statute. Some states with medical marijuana or similar laws included employee protections, but Colorado did not.

 Q:        But other states, even Georgia, are legalizing some form of medical marijuana. Doesn’t that count for something?

A:        It means public attitudes are changing.  Even so, federal law still classifies the use of medical marijuana and recreational marijuana as crimes. What is that smell?

Q:        I made brownies. Want one?

A:        What is in it?

Q:        Are you a cop? 

A:        I will pass, thank you.

This post provides general information only and is not intended to create an attorney-client relationship or to be legal advice about a specific situation.  Laws change and your situation may be different.  You should consult with a licensed attorney for legal advice specific to your situation.



Marijuana Legalization is Growing Like Kudzu

Georgia is set to join the 23 states and the District of Columbia that legalized what is called medical marijuana. The Georgia Assembly passed Haliegh’s Hope Act near the end of its recent session. Haliegh’s Hope Act legalized under state law the use and possession of “low THC oil” to treat certain conditions and for medical research. The Act is on the Governor’s desk and the Governor is expected to sign it into law.

The fight over marijuana legalization invokes images, such as:

pot combo 1

Spin set aside, legalization at the state level creates a conflict with federal law because federal law still criminalizes marijuana regardless of the intended use. The fuel for the legalization movement came in 2009, when the federal government took a hands-off approach to medical marijuana used under state law.  The feds loaded its announcement with caveats that the feds still can enforce the federal laws that criminalize marijuana.

Existing case law is that federal drug laws trumps state laws legalizing medical marijuana. As a result, banks, for example, resist knowingly doing business with them because of federal drug, money laundering, and RICO laws. Anyone else who does business with the marijuana operations faces similar risks, regardless of the state law.

The spreading of legalization has spurred new court challenges over the conflict between federal law barring marijuana and state laws permitting marijuana use.  The states of Oklahoma and Nebraska sued Colorado over its marijuana legalization in late 2014. A group of sheriffs from Colorado, Nebraska, and Kansas filed a separate suit in 2015 against Colorado over the state laws permitting marijuana.

Individuals are getting into the act, too.  Debtors who filed for bankruptcy in Colorado had their case tossed because the debtors wanted to use their medical marijuana business to fund the bankruptcy plan. The bankruptcy court rejected the case because the bankruptcy trustee cannot use illegal income to fund a plan, and a medical marijuana business remains illegal under federal law. The debtors appealed their case to the 10th Circuit Court of Appeals, arguing that the feds hands-off approach means the trustee can use the medical marijuana income to fund a bankruptcy plan. That case remains pending.

An earlier blog post (Dude, Pass the Chips) discussed a case pending in Colorado over whether an employee can sue his employer for wrongful termination after the employee failed a drug test because the employee used medical marijuana as allowed by state law. The Colorado Court of Appeals answered “no” and the employee took the case to the Colorado Supreme Court. The Colorado Supreme Court has not issued a ruling as of this post.

Also in 2015, a bipartisan trio of U.S. Senators made a proposal to move marijuana from Schedule 1 to Schedule 2 under the federal Controlled Substance Act, among other changes. A Schedule 2 substance can be prescribed after it meets certain standards, but a Schedule 1 substance generally cannot be prescribed legally at all. Testing whether marijuana actually has medical benefits makes sense. If it works, let doctors prescribe it as with any other drug.

Will we see marijuana sitting on pharmacy shelves along with narcotics, antibiotics, and other drugs? Will marijuana join alcohol and tobacco (Marl-bud? Camel Green?) on store shelves, or will the growing legalization movement be snuffed out? Grab some chips and brownies; it will be an interesting show, dude.

This post provides general information only and is not intended to create an attorney-client relationship or to be legal advice about a specific situation. Laws change and your situation may be different. You should consult with a licensed attorney for legal advice specific to your circumstances.