Inside a Top MSO with Jushi’s EVP of Legal Affairs Matt Leeth

07/16/24 • 35 min

There are now dozens of multistate operators (MSOs) in the U.S. cannabis industry. Since 2010, the concept of MSOs has carried many connotations, good and bad. At times, MSOs are considered the ultimate form of “Big Marijuana,” and at other times, they’re considered indispensable to the democratic experiment that is state-by-state legalization. Rarely do we get to peek into the daily inner workings of these MSOs, even though the overwhelming majority are publicly traded. In this episode, Husch Blackwell’s Hilary Bricken and Jushi’s Executive Vice President of Legal Affairs Matt Leeth discuss Jushi’s day-to-day happenings as well as long-term vision. Currently, Jushi operates 38 retail facilities and maintains roughly 1,200 employees throughout the U.S., while offering numerous cannabis brands to both patients and adult-use consumers. During this episode, Matt dishes on the challenges of scaling, regulatory differences from state to state, keeping investors happy, and what Schedule III will mean for Jushi and other MSOs.

Previous Episode

What’s Next for Schedule III Marijuana

In October 2022, President Biden asked the Department of Health and Human Services (HHS) and the U.S. Attorney General to review how marijuana is scheduled under federal law. In August 2023, the HHS marijuana recommendation went to the Drug Enforcement Administration (DEA) for its consideration. On May 16, 2024, the DEA published its 92-page notice of proposed rulemaking (NPRM) to move marijuana from Schedule I on the CSA to Schedule III. We are currently in a 60-day public comment period that is part of the DEA’s rescheduling process and NPRM. Rulemaking is a complicated and drawn-out process with many twists, turns, and administrative nuances. In this episode, John Hudak, the Director of the Maine Office of Cannabis Policy and former Deputy Director of the Center for Effective Public Management (who was also a Senior Fellow in Governance Studies at the Brookings Institution where he led Brookings’ research into cannabis policy, regulation, implementation, and politics for over 10 years), takes the audience through this historic rulemaking effort by the DEA and what to expect next from federal and state governments. John covers timelines, rulemaking technicalities, the politics behind the NPRM, and the possibility of a bifurcated system for marijuana between pharmaceuticals and state-licensed markets.

Next Episode

Cannabis Companies and the Corporate Transparency Act

The Corporate Transparency Act (CTA) seeks to increase corporate transparency and combat financial crimes in the U.S. such as money laundering and terrorist financing. Enacted in January 2021 as part of the National Defense Authorization Act, the CTA requires certain business entities to disclose their beneficial owners—individuals who ultimately own or control the company. Namely, corporations, limited liability companies, and similar entities must report their beneficial owners to the Financial Crimes Enforcement Network. Some entities, such as large operating companies, regulated entities (banks, insurance companies, etc.), and entities already subject to extensive federal regulation, are exempt from these reporting requirements. There are steep penalties for non-compliance or falsifying information, including fines and possible imprisonment. Even though cannabis companies are federally illegal, they are not exempt from reporting under the CTA. In this episode host Hilary Bricken, and Yuefan Wang, corporate, M&A, and securities partner at Husch Blackwell, discuss the mechanics of the CTA and how and when cannabis companies must comply, including consequences to cannabis companies if they fail to report.