As the cannabis industry grows so will the need for IP protection. Often startup companies don’t realize the need to protect their brand. Furthermore, people think it’s impossible to provide IP protection to something that’s considered illegal under Federal Law. In this episode we interview Hannah Stitt, an attorney at Tectonic Law. Hannah helps entrepreneurs navigate the legal landscape for cannabis companies.
Cannabis companies should look at patent and trade secret rights from both an offensive and defensive position to ensure that they are securing protection for their own innovations while avoiding the growing minefield of patent rights of their competitors. It’s possible to accidentally infringe on IP rights of another cannabis company and you don’t even know it. This is why it’s important to find a competent cannabis IP attorney who can help provide the solutions you’ll need to be successful.
Listen to our interview to learn more about Cannabis IP Law….
About Hannah Stitt, Esquire
Hannah Stitt is an attorney based in San Francisco, California. She represents individuals and companies in trademark litigation and brand disputes across the state.
Currently, Hannah sits on the Ethics Committee for the International Cannabis Bar Association, as well as both the Barrister’s Cannabis, Alcohol and Regulated Industries committee and Intellectual Property committee for the Bar Association of San Francisco.
Ms. Stitt attended U.C. Davis for her undergraduate education, earning degrees in both Religious Studies and Film Studies. She graduated from U.C. Hastings College of the Law in 2015 with a concentration in intellectual property law.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Ronjini Joshua (00:11):
I have a great opportunity to sit down with
Hannah Stitt, Esquire, the cofounder of tectonic law. She's
been a litigation attorney forthe cannabis industry since
2018. She talks about some ofthe most common litigation
issues in the cannabis industryas well as how important it is
to have IP in the growingcannabis industry. Now, join us
(00:33):
for this interview in the greenroom.
Hi, today we are talking toHannah Stitt . She's the
principal at techtonic law. Andyou work in the cannabis
industry. Obviously, this isyour first time at mjbizcon. Is
that right? Yes. So what a lotof people have a lot different
(00:53):
feelings because it's postpandemic also. So how are you
feeling about the emerging fromyour house, and then also your
first show
Hannah Stitt (01:05):
lots and lots of feelings. I recently launched my
law firm. So I've been in heavybusiness development mode and a
lot of virtual meetings. So I'mreally excited to be here to be
able to meet people in personthat I've been talking to, like
on the phone or in zoommeetings, yet things zoom B's
together. And so that'ssomething that I was really
drawn to it wanted to come hereto just meet people who are in
(01:28):
the industry that I knew buthadn't met in person. And it is
my first time here. So somethingI'm really excited about is just
seeing the level ofsophistication in the people who
have exhibits on the floor. Likelooking at these big companies,
it's nice to see people who areall like, they're just getting
their business off the ground.
But there's also some operatorshere who have been a space for a
while, since before we reallyhad any kind of properly
(01:49):
legalized medical market and tosee them out here and to see
their equipment. And like howsophisticated This is gone. It's
it's pretty exciting to see thatthe industry is no longer just
like a little tiny. Hush, hush,little baby. Yeah, exactly.
That's
Ronjini Joshua (02:04):
really cool. And yet you have a very different
perspective, I would love tohear a little bit more about
yourself and how you got intothe industry.
Hannah Stitt (02:14):
Well, stop me, if I take too long my story Oh, b
t when I was in college I inn California, which is where
I also practice, and I wento college at UC Davis
n California, in 2010, I beliee it was there was a prop to 1
. And this was essentially jut like a voter initiative to g
t some sort of market created. Ad I was pretty surprised if I kn
(02:39):
w that the people that I ws buying my weed from who's a
l black market, were nt interested in their indust
y becoming a legitimate industr. Yeah. And that was just an e
e opener for me, becauseI couldn't really see why y
u wouldn't want it toe legitimate where you could ha
e less fear for federal civl asset forfeiture or going
o prison things differentl. Right. Like, life and libert
(03:02):
. And so that was just an ee opener. And I was like, Oh, wo
. And it had me starting to thik about the, the cannabis. Like
t the time I wasn't the you kno, as even as an industry, it w
s just like, you know, whereo you get your drugs? Yeah, b
t looking at that as an actul marketplace. That's was an e
e opener for me. So when I endd up going into, into law schoo
(03:23):
, and actually something elseI had learned right at the sa
e time, in 2010, I had a reall, really close friend who h
d chosen to go to the militay instead of going to pris
n because he and his best fried had been selling like, pills
o their friends, you know, jut boy kind of behavior. And not
o make light of it. That is a tht is a crime. It is important n
t to like, you know, yeah, ina ring of drug dealers, but I
(03:48):
m seeing him make that choie where he went to the militar
. And then after the military ws at UC Davis, who was where I m
t him. It just got me thinkig also about not only is it
n industry, but it's realy related to, like, the war
n povert
Ronjini Joshua (04:02):
Yeah. socio economic. Exactly. Yeah. To
choose military versus jail.
Hannah Stitt (04:06):
Yeah, yeah. Right.
And like even to be given thatopportunity, because he's a
white person. And like, lots ofpeople of color aren't even
given that option, you know,just straight into juvenile. And
so being becoming aware of thesetypes of issues at the same time
that I was becoming a lawyer,like in law school, learning how
the system works, really got meinterested in this industry and
why it would be better for us tohave regulate space for people
(04:31):
to use these kinds of products.
Especially since, you know, someare not nearly as dangerous as
other kinds of scheduled drugslike heroin that yeah, not
compare. Yeah. So that's how Igot interested in it. And then
when I was in law school therewere starting to be some
political organizing inCalifornia because Oregon and
(04:51):
Colorado and Alaska in 2014, hadlegalized their medical markets.
So people in California werelike, oh, This, this could be
the year at that time, there wasa sentiment that for the last 40
years, people had been goinglike, this is the year you know,
okay. And the next year I'd belike, oh, there's there's been
(05:12):
no change. There's been nopolitical movement, there's been
no change in how people feelabout the moral culpability of
using cannabis. That just everyyear no progress, and then all
of a sudden in 2013 2014 I waslike, oh, no, this could be the
time like this could be reallyYeah. Like, like the the Oh,
geez that are around me. They'resaying like, it's now like, I
can I we it they might be rightnow. It's yeah, I got interested
(05:34):
in well, what are the kinds oflegal services that this
industry is going to meet? Andat the time, that was
transactional work, compliancework. Just basic, basic needs,
like getting your entity formedand the right, the right type of
entity in California at the timethere was a lot of collectives,
(05:55):
a collective is an actualstatutory type of entity. Other
kinds of loose affiliations ofpeople having to figure out how
to fit into the system, but alsoplay by the rules, because you
weren't allowed to make aprofit. It had to be in it
wasn't that
Ronjini Joshua (06:09):
collective couldn't make a profit. Yeah.
Okay. Oh, yeah. Like, oh,because it has to be like
distributed or something likethat. Right?
Hannah Stitt (06:14):
Yeah, it was like the regulations were like, Okay,
you can, you can have thisindustry start to grow up, but
we don't want you to be makingmoney off of it. So there was
this really strange moment intime, where a ton of people in
California had to deal with thefact that they could finally
have the benefit of having anentity in place, which is
limitation of liability for theowners, and really desirable for
(06:36):
people to be able to want toinvest in your company so you
can grow it. And a lot of peoplewere actually setting themselves
up as limited liabilitycompanies, which would normally
be a for profit entity, unlike,for example, a nonprofit
corporation, which is a strictcorporation with an election at
the tax level to be nonprofit.
So they're like, how do we be inthis space where we're a company
but we don't make any money? Sothere was all these? Not for
(06:58):
profit? Not a nonprofit, but uh,not I don't cry.
Ronjini Joshua (07:03):
That was the same thing.
Hannah Stitt (07:04):
No, that's, uh, that's where like, the lawyers
come in. Right? And they'relike, Okay, how do we do this?
Damn, yeah, like nonprofit withthe like, no and hyphen profit.
That's an actual, like, legalcharity. Yes, yes. And it has a
legal meaning and the code inCalifornia as well as in the
federal tax regulations. Okay.
But the word not for profit, orsorry, phrase, that's a that's
(07:25):
nothing that's a it's it's justa made up cut. People are just
writing this into their missionstatements so that they could
try to be in this gray spacewhere you're trying to be more
grown up in sophistication levelwith having an entity, but you
really can't participate fullybecause you are getting these
regulations from California andyou can't make any profits off
(07:47):
of your off of your income.
Exactly. Your business. But youalso aren't able to be a
nonprofit because a nonprofit isa federal tax election. And you
can't get that benefit from thegovernment
Ronjini Joshua (08:01):
or those not for profits are those that
collective
Hannah Stitt (08:05):
so collectives.
Yeah, well,
Ronjini Joshua (08:07):
different guys.
Hannah Stitt (08:09):
Yeah, like, sorry, if we're getting to hold me
back, you know, like, I'm like,gonna get nerdy about it. A lot
of the collectives I like acollective is real is it is an
actual type of entity inCalifornia, like, you can
register as a collective. Okay.
And so those collectives wouldhave mission statements that
say, We're doing this for thebenefit of the members. Okay, so
we're not trying to make aprofit from off of our members,
(08:31):
we're just trying to make enoughmoney that we can kind of re pay
for everything. Yeah, like, youknow, be able to continue to
grow a little bit, but not therewas no, like, you weren't gonna
get picked up or acquired,right, as a collective. And so
that was where we were in, like,2015 2016. And then when we had
the medical market, when thoseregulations came out, then the
(08:52):
corporate entities became, Ilike they became on the radar of
the of the legislature, and thelegislature was like, Okay,
well, we have this problem wherelike, people can't operate for
profit, and they can't benonprofits. So we need to figure
out what to do here. So the nextiteration of regulations that
came out, especially with therecreational market being
(09:14):
legalized in 2018, there's now astatutory provision that says
you can be a for profitcorporation in California. So
that kind of like, Oh,
Ronjini Joshua (09:23):
if you okay.
Yeah. And do they do that? Imean, you do just practicing
California. Yes. So do they dothat? I mean, you might know if
they do that in other states tojust for that state.
Hannah Stitt (09:34):
Yes, exactly. And I think that the nice thing
about the markets that arecoming online now is that they
can look at what happened inCalifornia and Nevada. Yeah, and
they can be like okay, well, wedon't have to do it exactly the
same way right. Like we can justjump right into having in our,
in our whichever way thelegalization is happening, like
be it by ballot initiative or bylegislature. Those people are
(09:57):
now like, oh, okay, part of ourproposition are part of our
going to be this year, it'sgoing to have that protection in
it, because we learned fromCalifornia, Nevada that that was
kind of a headache for them todeal with for a few years. So
we'll just start off havinglearned that lesson, right,
which is really useful. And so,back to how I got back to the
industry. So in in thebeginning, it was like, Okay,
how do we answer these kinds ofquestions, yeah, to figure out
(10:19):
how to get people to be actuallyable to make enough money or
have investments that can grow.
And at the time, there was noability for a for a cannabis
company to sue anybody else,whether it was a regular company
or, or another cannabis entitycompany. And this has to do with
and again, stop me if I get tobreak this. Okay. This is an
area of the law called standing.
(10:43):
In California, we call it tobeing the person in interest in
general, this is something thatevery single state has this
requirement, every as far as Iknow, every, every jurisdiction
in the world will have some sortof like standing requirement.
And what it means is that thethe person who's bringing a
lawsuit, they're the one thatwas harmed, and they think that
the court has the power to fixthat has the power to do
(11:06):
something about that. So I'm inCalifornia, we didn't get the
right to sue until 2017. So Ialready been in practice for a
little bit. And in law school,it was like, Okay, well, I I
like litigation, I'm, I'm kindof a high high energy and
passionate. So I knew I wantedto do that eventually,
Ronjini Joshua (11:25):
like to argue ideally.
Hannah Stitt (11:27):
Right. And so, so I, there wasn't really any
opportunity to do that, becausenobody had standing. But then in
2017, the legislature created astatutory code. And it said that
the lawful purpose of a contractcan be a cannabis plant, and it
as long as the operator iscompliant with state law. So
(11:48):
that created a space wherepeople were actually able to use
the benefits of legal system,because if you don't have
standing, then you know, yourcontract isn't really worth a
whole lot. Because why do we getinto contracts? We get into
contracts to make yourselfExactly, yeah. And if you can't
go into court to enforce thoseterms, then what's the point of
even having the writtendocument, right? So my practice
is kind of, it's grown with theneeds of the industry. And now
(12:12):
that we're in 2021, there arepeople out there who are there,
there are businesses out therewho are mature enough to the
point that they do have branddisputes with other people in
the industry. They do havecontract disputes, they can
afford litigation, litigation isvery expensive. So that's
another reason people weren'tlitigating a whole lot. There
was not a lot of capital. Yeah.
So um, it's funny when you lookat my resume, I think a lot of a
(12:35):
lot of like traditional largerlaw firms, the people who are
hiring, they're looking at myresume, they're like, oh, this
person has worked here for alittle while and here for a
little while, and they're, andit's hard for them to see the
thread but someone from thecannabis industry can look at my
resume and be like, Oh,cannabis, cannabis, cannabis,
you know, so it's like, it's aninteresting thread that has, you
(12:56):
know, gone through about eachchoice I've had in my career and
now that I have my own law firm,I'm tending to specialize in
intellectual propertylitigation. I do a lot of
trademark disputes. And I have alot of experience and other
types of disputes as well. Butintellectual properties like my
my nerdy lawyer, passion, yeah.
(13:19):
So now I'm merging it with mylike, industry passion. So
hopefully doing intellectualproperty for cannabis companies
will will be a path I cancontinue to go down
Ronjini Joshua (13:27):
and what is what does that mean for the cannabis
industry? What is theintellectual property in that
case?
Hannah Stitt (13:31):
Yes. So intellectual property is, it's
going to be non tangibles,right. It's going to be
something like your name andyour product packaging. The
kinds of like, a trademark isactually the the term that we
use to assign value to like thegoodwill that the consumers have
(13:51):
in your product. Okay, so areally easy example for me is
like Nordstrom. Like, I loveNordstrom. I know that you know,
if I get it, I literally rippeda shirt this morning that I just
bought last month, and I knowwe're gonna return it exactly.
I'm not gonna take it back andprobably take it back. If I've
been wearing it for three years.
I don't know why they have thatpolicy, but it's a good policy.
Yes, like consumer, the faithand gets you to keep coming back
(14:13):
to Nordstrom. So that kind ofthat intangible goodwill value
that people are able to generateby you know, Hirata name,
exactly. That's what the IP is,is really about. And the nice
thing for the cannabis industryis that at the end of the day,
and I will say like, otherattorneys may have different
(14:33):
opinions about this, I think ifyou asked 15 attorney to get 15
different answers, but no onecan come in and rip up your
trademark rights. Like nobodycan burn your trademark rights,
right? Like if there's any kindof like raid on your property,
and you end up losing a crop ornatural disaster, right? Like
those kinds of things cannotactually affect your intangible
(14:54):
intellectual property rights. Soit can be a very, very valuable
asset for a company to have,especially from an investor
perspective, because, okay,where it's hard for an investor
to really, or it's hard for acompany to prove to investors
like how profitable they are,because you know, we don't have
to ad election, to be able tohave write offs and things like
(15:15):
that. So having some investmentin your trademarking, or if
you're able to patent if youhave a technology that would
lend itself to a patent, ormaybe if you're an artist, or a
part of your branding is likeworking with a special artist,
you can have copyrights relatedto those kinds of, like assets
or whatever, exactly. And it canmake you more more attractive to
investment to have these kindsof things,
Ronjini Joshua (15:38):
building your brand equity as well. Right,
exactly. Yeah. I mean, itbecause it's building it from a
business standpoint, obviously,you'd have it with a consumer
standpoint, but then not builtbuilds it on the business side.
So this is I mean, do you whatis your kind of like case for
people? Like why should theyhave an IP? Should they have an
IP? Should everybody have an IP?
Like, how how do you answer thatquestion?
Hannah Stitt (16:01):
So yes, I think everybody should consider
protecting their intellectualproperty rights. To be a little
bit more granular, yourintellectual property rights,
depending on what they are,like, if it's a trademark or a
brand, right, or also forcopyrights, you can have rights
occurring under common law thatare not protected. So you still
(16:23):
have some rights, right? Like,
Ronjini Joshua (16:24):
you've been using something for a really
long time. Exactly. Operatingunder that.
Hannah Stitt (16:28):
Yeah. So like, you still have rights, they're just
not as strong if you don't tryto go through the process of
getting them like brand.
Trademarks is a really goodexample. If you don't go through
the process of trying to get aCalifornia registered trademark,
or you don't try to go to the tothe Federal Registered
Trademark, then the presumptionif the other party has those
marks,
Ronjini Joshua (16:49):
is that their first? Exactly? Yeah, I had this
problem once. Yeah.
Hannah Stitt (16:53):
Yeah. And it can be expensive to go through this
process, especially if abusiness is really really in the
startup phase, and it doesn'thave like an extra. I'm gonna
throw out there. Like, probably,if you you've hosted about at
least 3000 to get one.
Ronjini Joshua (17:09):
Yeah, right. I thought you were gonna say
million. I was like, no,
Hannah Stitt (17:13):
no, no, no, no, that would be way too much. If
someone's charging 3 million foryour trademark, you need to just
run away. Yeah. Just don't talkto that person ever. But like
one trademark, if you could getthat registered at the federal
level for like three to 5000,the California level, I don't
actually know the price off ofmy head, I think it's a couple
$100 to get it registered. Butthis will these kinds of rights,
(17:37):
you can protect them on yourown, you don't have to go
through an attorney. But I dothink it is more cost effective
to work with attorneys. Becauseif you are just learning this
yourself, and don't have anawareness of all the pitfalls
that the the examination processinvolves, then you might end up
spending more time or more moneydown the line. Yeah. Whereas if
you just hired somebody who thisis what they do, and it's their
(17:59):
bread and butter, like they can,they can be more efficient in
it. So even though that thesticker price might be like a
little bit higher in thebeginning, I think it is
worthwhile to work with peoplewho are professionals in that
area.
Ronjini Joshua (18:10):
I mean, I think that's kind of like standard
practice, like for anything likeyou can probably do your own
accounting, but do you reallywant to write like, do you want
to do your own taxes and misssomething? Yeah, that's like, I
feel like that's a you know, youhave to pay for experience and
quality and getting it doneright the first time. And I know
(18:30):
that a lot of businesses, youespecially in the cannabis space
have this capital problem,right, like of like, spending
money and or not being able tospend money but like, it sounds
like an IP, trademark copyright,whatever those things are, like
might be something that is kindof like the fundamental thing if
you're going to become a longterm
Hannah Stitt (18:49):
rep. Yeah.
Especially if you're if you're abrand really takes off. Yeah,
like and I mean, I was justlooking on LinkedIn, you know,
when you came down the stairs toget me and somebody at the
conference had taken a pictureof a an exhibitor, I don't, I
don't even know who it was, butit was like a Chips Ahoy, kind
of a knockoff. So like, it'sthese branding issues are kind
of coming to a head with likethe the increased sophistication
(19:13):
of the people in the market.
Yeah. So it used to be fine thatyou could kind of say, like,
wink, wink, nudge, nudge, like,this is a throwback, what it
looks like. Exactly, yeah. Andthat was a lot more acceptable.
And it actually made sense.
Because when you're in anindustry that is having to
operate in the dark because offederal prohibition, like maybe
you don't want to have the mostunique brands like maybe you
(19:35):
want to have the word green oryou want to have a cross in your
logo or you want to have amarijuana leaf in your logo to
kind of hint to the consumer.
Hey, come into my story. This iswhere you can purchase this
product right but as the moralculpability of using this plant
is diminished culturally, andthe laws are opening up for
(19:59):
people to be able to be Youknow, medically using
recreational using, then itmakes more sense to lean into
the intellectual property. Iguess we've got a paradigm or
standards in the US and globallyand start using the protections
that you have available to you,as well as trying to really be
unique. Like, it's lessimportant for you to have that
(20:20):
that Greenleaf logo or cross andless important to have the word
can your brand, you know what Imean? So, because there's more
people out there who it's justit's not a problem, like people
are not as worried aboutattracting consumers to them,
because it just can be more opennow.
Ben Michaels (20:37):
Yeah, did you get so when, when California went
from, because I noticed this wasvery big in California, when
they went from, you know,medical only to, you know, rec,
a lot of brands, and a lot ofbrands that spent a lot of time
establishing that theirtrademarks and their names just
disappeared, like my favorite, Ithink it was like a good nali
(20:59):
joint, it was the most amazingthing in the world, I would go
out of my way to get it fromanywhere, and then boom, gone.
And I wonder if like some ofthese brands, you know, tried to
approach you, and did you noticea lot of that? And why maybe
they they folded underneaththat, that changing of the
guard,
Hannah Stitt (21:14):
um, approached me of like, specific like
Ben Michaels (21:18):
your company, you know, trying to help, you know,
solidify their brand awarenessof their trademarks and utilize
that because it seemed like theymaybe they weren't getting
enough money, you know, to keepup with the new regulations. I
just, I saw all these namebrands that I love to just
disappear and never come back.
Because so I'm wondering if likethey were you if you had a lot
of people reaching out to youand like, help us, you know,
(21:41):
when this transition?
Hannah Stitt (21:43):
Yeah, I think we did. A lot of the times, it's
actually interesting to see whohas kind of gobbled up the
companies. It's like those thosethose larger companies who were
able to get the capitalinfusions, they really did start
going after the small providers.
And in some ways, it makes a lotof sense that the smaller
companies were willing to sellthemselves because, you know, it
is a slog to be in the trenches,right. Like, it's hard, it's
(22:06):
expensive, and it's just it'sdraining, you know, to be even
if you're not truly worriedabout the federal illegality
issues, you know, it's still abackburner anxiety.
Ronjini Joshua (22:18):
Yeah. So I mean, it's still real. Yeah,
Hannah Stitt (22:21):
I mean, fortunately, I haven't heard of
anybody going to jail this year.
But like, but you know, it alsojust, I don't know, everything
that happens, right? Yeah. isstill hot? Like, I
Ronjini Joshua (22:32):
don't tell you every time right.
Hannah Stitt (22:33):
Like, we know, hey, another person got eaten up
on the system. But I'm sobrutal. But yes, there was a lot
of need to start having moresophisticated relationships and
end transactions between thesethese players. Because when you
are able to get a trademark,right, be it California or other
(22:55):
state, a lot of a lot of statesoffer state trademark. It's
available. It's a process perstate. But because generally,
and I don't know if you guysknow this, but intellectual
property rights in the US aregenerally a federal legal
system.
Ronjini Joshua (23:13):
Right. As I was asked, I was gonna ask that
actually is does it like, carryover to everywhere? Like, yeah,
nationally or globally? Or is it
Hannah Stitt (23:21):
the so if you have a registration of the US Patent
and Trademark Office, that'sgoing to be a registration that
is the whole United Statesgeography as well as certain of
our protectorates? There'sanother system called WIPO the
world international patentoffice, okay. And so you can get
(23:44):
different levels ofinternational registrations as
well. And that's definitelysomething that global companies
with global reach are going tobe really important to them but
in the state by state levelthese these processes have all
been around for you know,however long the states have
been around but because thefederal Avenue is so much
(24:06):
broader of rights like it nobodywho just no business model that
I know of, except for sex workand cannabis industry, are even
bothering with stateregistrations, right? Because,
like, why would you do that?
Like yeah, should you may aswell just just get it the whole
nation? Yeah. And so, earlier, Imentioned that you can accrue
rights, a common law. Common Lawis what we call the the body of
(24:29):
law created by courts. Eachstate has its own common law,
there is no federal common lawexcept for two categories, which
don't matter so much for ustoday. And like this, this
common law, these rights arethere, they're just harder to
prove that you know, you havethe definitive first use or the
right things like that. Yeah.
Ronjini Joshua (24:50):
So and I've I mean, we've I think we've all
probably come across some brandsthat had like no, I had this
first No, I had those first and,and I've been in tech so like in
technology That happens all thetime. You know, they thought
they didn't have the money to dothe patent early on. They didn't
do it. And then they waited andthen they got screwed. Yeah.
Then there's a fight. Right?
Yeah. So like, Yeah, I think Imean, what you're saying makes
(25:11):
sense. And at the price pointthat you're talking about, as
far as it being, like, around$3,000, or, you know, even
anything under $10,000, I thinkit's worth do it. Yeah, I think
it's definitely worth doing.
Especially when establishing abusiness is like so much more
than
Hannah Stitt (25:29):
that. Yes, yes.
And I think, like 3000 isprobably like, the kind of like,
like, my recent marks that Idid, right? Because like, I'm
not having to, I'm not actuallycannabis plant touching. So that
was an easier process. If yourcompany is actually cannabis
touching, then it might take alittle bit more attorney time to
get that registration through.
(25:50):
So it would be, you know,incrementally more expensive.
Um, it kind of depends, ifyou're a ancillary product, or a
plant touching product. Yeah, ifyou're not plant touching, then
you're good to go for it at thefederal level, like what's
holding you back, you know, ifyou're plant touching, then
absolutely go for it in yourstate jurisdiction. And if you
can have parts of your business,trademarked that, you know,
(26:11):
you're legitimately using acommerce that are not related to
the plant, then go for that aswell. And at least
Ronjini Joshua (26:17):
it shows some kind of benchmark or milestone
where you've done some workExactly, yeah. As
Hannah Stitt (26:21):
it is attractive to the venture capitalists to
have like it is an asset. Andthe with the, if you're, if
you're just operating yourrights are going to accrue
geographically. So if you areonly really a dispensary, and
you're only located in onecounty, like San Francisco
County, then that's where you'llhave your your rights accruing.
(26:42):
But you know, why not go for thewhole state, even though you're
not going to have dispensariesin every county, you can have
rights for the whole state tomake sure that somebody in LA or
San Diego or maybe in Tulare, ifthey ever opened up their
council to have some likelicenses there. wouldn't be able
to use your name or causeconfusion in the marketplace.
Right? And since especially
Ronjini Joshua (27:02):
online, Yes, everything's online. Yeah,
exactly. Like
Hannah Stitt (27:05):
I've the internet is an interesting jurisdictional
problem for attorneys. I thinkwe're just like, pretending it's
not a problem. But thatdefinitely needs to be
addressed. So
Ronjini Joshua (27:16):
yeah, like, how would you even I guess, I guess
you could do by like, IPaddress. Yeah.
Hannah Stitt (27:20):
We're like figuring out like, where, yeah,
where your consumers are comingfrom? I don't know.
Ronjini Joshua (27:25):
Yeah. But then it's like, uh, yeah, it seems
like a very convoluted way offiguring out how to
Hannah Stitt (27:30):
totally people.
Yeah, totally. And then like, ifyou're really sophisticated on
the tech side, and you know,your IP is like, your, your,
your IP address is, like,pinging across different
drivers. It's like, okay, well,that wasn't really useful
information. Yeah. All of asudden, this person's in
England. And then, you know, twohours later, they're in
Colombia. It's like, Yeah, thatwasn't helpful. So. So yeah, the
hacking that could be done.
(27:52):
Exactly. Yeah. So it just makessense for people, if you do have
a bit of wiggle room in thecapital, and if you are going to
be seeking investment, then it'ssomething to at least look into
whether or not you can get yourstate level or the federal level
or, you know, beyond.
Ronjini Joshua (28:07):
Yeah, you know, it's funny, because I talked to
someone, I want to say they'relike an HR person a long time
ago. And they had mentioned,like, the first thing that you
need, when you start a cannabisbusiness is a like, CPA or like
accounting or finance person,and a lawyer, like, you cannot
(28:27):
not have a lawyer, if you're inthe business, and like, what are
your feelings around? Like, youknow, they're I think there's a
lot of scrappy people andstartups that are emerging in
this space. And I can't believethat they all have legal
representation.
Hannah Stitt (28:42):
Oh, they absolutely don't. And it's,
it's, it's a problem that legalservices are so expensive,
right? Yeah, it's similar to theproblems that are happening in
the healthcare system, whereit's like, why are doctors $300
an hour? Yeah, you know, andlike, why won't the insurance
cover it? So there's not a lotof insurance plans that are
useful to get you legal servicesunless you, you know, been sued,
(29:05):
then your insurer is going tohook you up with an insurance
defense. But that's a prettynarrow spot, right? Like, yeah,
people do want insurance or notsorry, insurance and legal
service for compliance andentity formation and
intellectual property licensing,those kinds of things. So to
answer your question,eventually, I think that you're
right. A lot of people do nothave access to legal services.
(29:27):
Part of it is that they perceiveit to be too high of a cost. And
it's an immediate cost. Like,when I talk to people who are
deciding to open up a company, Iknow they don't like to hear it,
but I tell them, like you needto have a legal budget and it
should probably be $5,000.
Hopefully, you won't getanywhere near that, you know,
but it would not be unusual. Ifyou did in order to get yourself
(29:48):
set up with business to businesscontracts, get some IP licensing
agreements in place after you'vegone and gotten those
registrations, all differentkinds of stuff. It's useful to
have a like You said the HRperson, like it's useful to have
an analysis from an attorney whoworks in employment or labor,
and can say, you know, your,your relationships that you've
got with your employees, itlooks like you're calling it an
(30:10):
independent contractorrelationship. But this is
actually an employmentrelationship under the law. So
if you're independent contractorkind of gets hurt on the job, or
decides that they're beingpoorly treated by you, then, you
know, this independentcontractor relationship is it's
not going to hold up, right?
Like if they go to theCalifornia Employment, if they
Ronjini Joshua (30:32):
want to complain, they're gonna get
favored. Exactly. Yeah.
Hannah Stitt (30:35):
Yeah. So I was thinking of this industry, and
also the lawyers who service iton a on a like, risk tolerance
scale. I feel like
Ronjini Joshua (30:45):
how high is your risk? Yeah. Cuz most attorneys
Hannah Stitt (30:49):
are not risk tolerant. Yeah, right. Like,
we're like, Oh, my God,
Ronjini Joshua (30:52):
dirt your attorneys you're following?
Hannah Stitt (30:54):
Exactly. Yeah. Or at least we want to know what
all the rules are. Yeah. When westep across the line, we're
like, Okay, I did it. Yeah, thatwould notice, you know, so, um,
whereas people who I think areoperators in the industry are
they're really risk tolerant.
Right. They're like, Okay, thisis like,
Ronjini Joshua (31:10):
so risk tolerant that they don't need an
attorney. Exactly.
Hannah Stitt (31:13):
Yeah. So so having them come together. It's, it's
interesting. And I feel likethere's a lot of a lot of
growing up right now in theindustry, where it's like,
people are bringing their legacycultivator knowledge, and
they're, they're partnering upwith major investors who expect
a certain kind of sophisticationfrom the people that are, you
(31:34):
know, infusing the capital. Andso in his learning process, I
think lawyers are becoming moreacceptable, especially, is
expensive, you know, like,you're not going to get away
with a small bill. And, youknow, I have lawyers that I hire
for my personal life, and I'mnever happy to see that. Never.
And like, so I so you helps mewhen I'm, you know, doing bills
(31:57):
myself, I'm like, Okay, let meexplain what this is. So that
the person on the other endisn't like, Oh, God, why did you
feel a bit less upset? Yeah.
Right. Like, at least they knowwhat I did for that two and a
half hour time period. Yeah. Andso this, I'm hoping that legal
services themselves become lessexpensive over time, which has
nothing to do with the cannabisindustry in particular, it's
(32:17):
just the Yeah, yeah, a lot of ithas to do with, you know,
student debt, right. Like a lotof lawyers feel like they have
to charge a certain amountbecause they have to pay off
their debt. Exactly. It's crazy.
So it's like, these are not goodincentives. Like, yeah, like,
like, this is like if the if thenational approach and strategy
(32:37):
for like, reducing student debtand reducing like medical debt,
these things would be huge. AndI think we would see a lot of
other benefits just across allsectors to see that these people
with highly, highly trainedpeople are able to get that
training for a lot lessexpensive, they're able to
provide services for a lot lessmakes a lot of sense. Yeah. And,
(32:58):
you know, some firms, that's notwhat they're in it for, they're
in for the money. But I think alot of people out there would
really like to be able to chargeless in order to run the
business and provide servicesand hopefully, incentivize
people who are not as excited towork with lawyers to be like,
Okay, well, you know, $100 anhour is a lot more palatable
than 650. Yeah, right. Yeah. Soyou know,
Ben Michaels (33:18):
but it's not one of the goals is to get and this
sounds amazing. And you soundlike, so sweet and great for not
wanting to charge, right?
Ronjini Joshua (33:27):
Because that makes I do charge though.
Ben Michaels (33:29):
Yeah. Yeah, but it's, but it's, uh, I mean, it
seems like you know, you'reyou're investing the time and
energy, you're getting an A, insuch a perfect time, that you're
going to get such a specialtythat you can charge, you know,
that higher rate, and peoplewould be willing to pay it. But
you're saying, even with thatextra experience and everything
you still would want overall tocharge less?
Hannah Stitt (33:51):
Yeah, I mean, like, I would love it if I felt
comfortable charging $1,000 anhour. But you know, I've been
practicing law since I joinedthe bar in 2016. So I'm, I'm
certainly not green, but I'm notI'm not 30 years. Veteran. Yeah,
right. Yeah. Like, yeah, like, Ithink a lot of the attorneys
that are able to feelcomfortable charging in excess
(34:13):
of $600 an hour. They, they theybring to the table that, you
know, 30 years of experience indeal making, or deals falling
apart. So So I think that Iwould like to find that balance
where it's like I can, I canhave a respectable rates. And
also, you know, there's alwaysthe possibility of reducing it,
because I could have my standardnumber and then yeah, someone
(34:34):
and think like, oh, you know,there's reasons like equity
reasons, or Yeah, like you're awoman run business or something
that would maybe offer adiscount, but yeah, like it
would be nice to find thatbalance where people are really
respecting the
Ronjini Joshua (34:48):
worst thing to do. And yeah, I mean, I think
that's really important. I mean,that's like an industry
conversation, right? That'slike, it's like, how much do
people value these certain setsof skills? How long it took you
to get there, how muchexperience you've had to acquire
to do it the correct way. Andthen for you, you're litigating.
So you're winning and losing. Sohow much are you winning? How
(35:09):
much are you losing? Like,that's what they're paying for.
So I yeah, I mean, I don't likethe cost of law. But I agree
that like, you know, you kind ofhave to figure out, you're going
to be more on the premium side,or you're going to be because
that's gonna like, kind of,like, gives you the respect you
kind of need. So peopleunderstand where you stand.
(35:30):
Yeah,
Hannah Stitt (35:31):
absolutely. And I always like to think about the
question of whether to hire alawyer from the business side of
things, right? On the legal sideof things. My answer is, yes.
Hire lawyer. Yeah. But from thebusiness side, you know, what
are you looking at here are yougonna hook yourself up with an
attorney who knows what they'redoing is trustworthy, and is
good, is good at their job. Andthere may be a caveat should be
(35:53):
made here with that risktolerance. Yeah, scale that I
was talking about. The attorneyswho are providing services and
have been writing services forthe last, you know, however,
many years, 1520 years, andlonger. They are very risk
tolerant attorneys. So the waythat they approach problem
resolution and contract draftingmight be a little different than
(36:16):
the perspective you would get anattorney at a large law firm is
not really open to takingcannabis clients. So that's
something to think about whenyou're hiring an attorney like,
like, are they reputable. If youknow an attorney that could help
you make that assessment, that'sprobably a good idea. But like,
just because they're inexpensiveor expensive, that doesn't
necessarily mean that they'regoing to give you great
(36:37):
services. So important, you'rereally like, just like any other
person that you're going to hireas a service provider for your
business, to be reallychallenging the marketing that
you might be getting from thatperson.
Ronjini Joshua (36:50):
So this actually segues in the perfect way to
close this. So we like to givepit tips out. And so like, what
are those like, things thatmaybe three or four things that
we should be looking at, when wedecide to select an attorney?
Like what how can you choosethat properly?
Hannah Stitt (37:10):
So one important thing was a four things, okay,
so we'll be
Ronjini Joshua (37:13):
it could be whatever. Okay,
Hannah Stitt (37:17):
the the first thing that I think is important
for the cannabis industry, butnot necessarily important for
other kinds of industries, is tohire an attorney who at least
has, if they're not local to youin your county, at least they
can explain to you like, I'veworked with XYZ customer, or
clients, who are also located inyour region, because having that
(37:40):
understanding of how theregulations work on a county by
county level is really importantin the cannabis industry.
Doesn't matter if you're ahairdresser doesn't matter if
you sell flowers like this isnot a problem. So that's one,
one thing to think about is likehow local to you and your
business? Is this the legalservice provider? The next thing
after that is to have a reallycandid conversation with them
(38:04):
about how comfortable they arebeing wrong. Because risk
tolerance being a problem amongattorneys. attorneys don't want
to say, I don't know, I'm reallycomfortable saying I don't know.
And sometimes clients are like,well, I don't want to hire you.
Because you just said, Oh, Idon't know. Right. But you're
not hiring because I mean,because I know all the answers,
you're hiring me because I knowhow to articulate a question,
(38:26):
translate that question into howwe ask questions in legal terms,
and then go through the steps ofmaking sure that I am checking
off all the possible areas oflaw that could touch that
question. So like, I'm notselling to you the information I
have in my head, I'm selling toyou my processes in how to solve
(38:50):
legal problems. Okay, so if theattorney you're talking to is
talking about how, Oh, I've gotso many Canis business clients,
or cancellation clients, and I,you know, I did this deal and
that deal and that deal. That tome is like, Well, did you
actually tell me that you know,how to, like, I have a unique
question to my business, that Idon't think you've answered
(39:12):
before for anyone else, like,can you be creative and helping
me solve this problem andactually, like giving a risk
assessment? And if they're notcomfortable saying, I don't
know, then you're probably nothiring an attorney. That's good
for you as a cannabis businessoperator? Because there are lots
of things we don't know. Yeah,because there's no regulations
and PS knew there's no one toask. There's no right change,
(39:33):
right. Yeah. And like in a lotof areas of law, like in the
American body of law isinherited from England. So our
property laws come from Williamthe Conqueror, that's over 2000
years that we've been developingwhat it means to hold a legal
equity illegal and equitableinterests in peace property,
(39:55):
right. So like, okay, 2000 plusyears is an area where lots have
attorneys feel comfortableworking in a case law? There's
lots of people to ask. But youknow, this is cannabis. So
there's that's just doesn'texist. Yeah, your attorney is
not willing to start makingrelationships with regulators or
city council members or justother attorneys that they can
ask questions to, then that'sprobably somebody that is not
(40:17):
going to give you the most bangfor your buck. Got it. And
that's the kind of thing I wouldreally like, I would encourage
everyone to really challengelike, Challenge Challenge
Challenge Challenge. Pleasedon't be the kind of the kind of
client that doesn't listen, oncethe analysis has been presented.
All the citations had beenprovided. Definitely listen
after that work has happened.
But in the in the consultationinterview, like if they're just
like, wildly confident thatthey're going to be able to
(40:39):
answer every question, thatindividual doesn't have enough
experience in the candidate.
You're
Ronjini Joshua (40:44):
like, no, yeah, no, yeah.
Hannah Stitt (40:47):
Like those of us that have been serving the
industry for a long time, arecomfortable saying, you know,
we're gonna have to get back toyou about that, like, I'm going
to have to make some phonecalls. And my initial instinct
is XYZ, but I want to make sureit's not ABC. Yeah. So
Ronjini Joshua (41:01):
I think it's really important to know like
that, that the the lift attorneythat you're hiring for an
industry, that's not likestandardize should have
questions. Yes. And you know,should be eager to learn them,
the answers to them. I like thatthe part that you mentioned,
it's really, really purchasingthe process, the way of like
figuring out how to solve theproblem instead of already
(41:23):
knowing the answer, right?
Because otherwise,
Hannah Stitt (41:25):
you just go to legal Legal Zoom. Right? Yeah.
You know, and I can't tell youhow many times I've gotten Legal
Zoom entities. And I'm like,What the? Yeah, and I've seen
some contracts where I'm like,alright, well, it was really
great that your criminalattorney took an operating
agreement from an LLC, and abylaws from a corporation. And
like a whatever we're gonna callthis from a collective from
2015. merged, it said it wasn'ta contract, but you did have to
(41:49):
sign it. So it's like, you know,this kind of like, it doesn't
make it doesn't make any sense.
Yeah. So like, like aFrankenstein? Exactly. Yeah. So
it's like, if you're, you know,just challenged someone being
overly confident, right, like,they should be a little more
cautious. They should have alittle, they should be burned a
few times. But like, I'vedefinitely given advice to a
client that in 2015, or 2016,that was the best advice that
(42:10):
they could get out there. But in2018, I'm not giving that same
advice. Right, of course, right.
Like, like, it's not a long timeperiod in between, like for
lawyers, like a lot of times,you know, three years. That's
nothing. That's nothing like youcan I sometimes like cite cases
from 1997. Like, yeah, stillgood law. Right. Yeah. So it's
(42:33):
just really different to provideservices industry. And so yeah,
definitely be cautious andChallenge Challenge Challenge
Challenge.
Ronjini Joshua (42:39):
I love it like this is I could ask you so many
questions that will lie so and Ithink law is so mysterious to so
many people, which is terrible.
Yeah,
Hannah Stitt (42:47):
it's terrible. It should be reachable. It should
be all of us have rights. All ofus should know how to navigate
it. Yeah. And it's it is it'sesoteric. It's shouldn't be that
way. But I'm not the queen ofthe world. So I can't change it
right now. But
Ronjini Joshua (42:58):
they could contact you to find out. Yeah,
yes. So we will make sure tohave all your information in the
show notes. But like, Do youhave a website? Yeah, sure.
Sure.
Hannah Stitt (43:06):
Yes, yes. It's techtonic law.com. So Tecton I
see La w.com.
Ronjini Joshua (43:13):
Okay, and you guys. So are you a firm of what
are you a firm of money, are youWe're
Hannah Stitt (43:18):
rolling. We're real new. We I've you know, been
litigating for a while but Ijust opened I just launched this
firm with my business partnerand law partner, Paige Pembroke.
She also specializes in electroof intellectual property and has
a lot of background in thecannabis industry. So we we
haven't even officially launchedit like we only had our party.
Yeah,
Ronjini Joshua (43:37):
we just call that because we've been, uh, you
know, we've been in the past.
Yeah, have a party, right. I
Hannah Stitt (43:42):
know. It's like a group of 10 Whoo hoo. Even
that's like pushing it.
Ronjini Joshua (43:47):
Yeah. Yeah.
Well, that's awesome. Thank youso much for sharing your
information with us. Like, thisis like yeah, I love this
information. Like I think thisis like pertinent things people
should know that they're scaredabout also, you know, it's a
really big source of fear. So
Hannah Stitt (44:03):
yeah, absolutely.
I had a great time talking toyou. So you know, if you want to
hear more about the law, let meknow. Yeah,
Ronjini Joshua (44:08):
absolutely.
Thank you. Yeah. The Green Roompodcast is brought to life by
green seed PR, the cannabisgreen tech focus PR agency, and
a dedicated production team ofeditors mixers and show
Booker's. A huge thank you tothe vessel team for providing
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Don't forget to subscribe andshare the green room podcast
(44:28):
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Awesome. Submit your guests atGreen CPR comm slash the hyphen
(44:52):
green hyphen room. Thanks forlistening and be well
I have a great opportunity to sit down with
Hannah Stitt, Esquire, the cofounder of tectonic law. She's
been a litigation attorney forthe cannabis industry since
2018. She talks about some ofthe most common litigation
issues in the cannabis industryas well as how important it is
to have IP in the growingcannabis industry. Now, join us
(00:33):
for this interview in the greenroom.
Hi, today we are talking toHannah Stitt . She's the
principal at techtonic law. Andyou work in the cannabis
industry. Obviously, this isyour first time at mjbizcon. Is
that right? Yes. So what a lotof people have a lot different
(00:53):
feelings because it's postpandemic also. So how are you
feeling about the emerging fromyour house, and then also your
first show
Hannah Stitt (01:05):
lots and lots of feelings. I recently launched my
law firm. So I've been in heavybusiness development mode and a
lot of virtual meetings. So I'mreally excited to be here to be
able to meet people in personthat I've been talking to, like
on the phone or in zoommeetings, yet things zoom B's
together. And so that'ssomething that I was really
drawn to it wanted to come hereto just meet people who are in
(01:28):
the industry that I knew buthadn't met in person. And it is
my first time here. So somethingI'm really excited about is just
seeing the level ofsophistication in the people who
have exhibits on the floor. Likelooking at these big companies,
it's nice to see people who areall like, they're just getting
their business off the ground.
But there's also some operatorshere who have been a space for a
while, since before we reallyhad any kind of properly
(01:49):
legalized medical market and tosee them out here and to see
their equipment. And like howsophisticated This is gone. It's
it's pretty exciting to see thatthe industry is no longer just
like a little tiny. Hush, hush,little baby. Yeah, exactly.
That's
Ronjini Joshua (02:04):
really cool. And yet you have a very different
perspective, I would love tohear a little bit more about
yourself and how you got intothe industry.
Hannah Stitt (02:14):
Well, stop me, if I take too long my story Oh, b
t when I was in college I inn California, which is where
I also practice, and I wento college at UC Davis
n California, in 2010, I beliee it was there was a prop to 1
. And this was essentially jut like a voter initiative to g
t some sort of market created. Ad I was pretty surprised if I kn
(02:39):
w that the people that I ws buying my weed from who's a
l black market, were nt interested in their indust
y becoming a legitimate industr. Yeah. And that was just an e
e opener for me, becauseI couldn't really see why y
u wouldn't want it toe legitimate where you could ha
e less fear for federal civl asset forfeiture or going
o prison things differentl. Right. Like, life and libert
(03:02):
. And so that was just an ee opener. And I was like, Oh, wo
. And it had me starting to thik about the, the cannabis. Like
t the time I wasn't the you kno, as even as an industry, it w
s just like, you know, whereo you get your drugs? Yeah, b
t looking at that as an actul marketplace. That's was an e
e opener for me. So when I endd up going into, into law schoo
(03:23):
, and actually something elseI had learned right at the sa
e time, in 2010, I had a reall, really close friend who h
d chosen to go to the militay instead of going to pris
n because he and his best fried had been selling like, pills
o their friends, you know, jut boy kind of behavior. And not
o make light of it. That is a tht is a crime. It is important n
t to like, you know, yeah, ina ring of drug dealers, but I
(03:48):
m seeing him make that choie where he went to the militar
. And then after the military ws at UC Davis, who was where I m
t him. It just got me thinkig also about not only is it
n industry, but it's realy related to, like, the war
n povert
Ronjini Joshua (04:02):
Yeah. socio economic. Exactly. Yeah. To
choose military versus jail.
Hannah Stitt (04:06):
Yeah, yeah. Right.
And like even to be given thatopportunity, because he's a
white person. And like, lots ofpeople of color aren't even
given that option, you know,just straight into juvenile. And
so being becoming aware of thesetypes of issues at the same time
that I was becoming a lawyer,like in law school, learning how
the system works, really got meinterested in this industry and
why it would be better for us tohave regulate space for people
(04:31):
to use these kinds of products.
Especially since, you know, someare not nearly as dangerous as
other kinds of scheduled drugslike heroin that yeah, not
compare. Yeah. So that's how Igot interested in it. And then
when I was in law school therewere starting to be some
political organizing inCalifornia because Oregon and
(04:51):
Colorado and Alaska in 2014, hadlegalized their medical markets.
So people in California werelike, oh, This, this could be
the year at that time, there wasa sentiment that for the last 40
years, people had been goinglike, this is the year you know,
okay. And the next year I'd belike, oh, there's there's been
(05:12):
no change. There's been nopolitical movement, there's been
no change in how people feelabout the moral culpability of
using cannabis. That just everyyear no progress, and then all
of a sudden in 2013 2014 I waslike, oh, no, this could be the
time like this could be reallyYeah. Like, like the the Oh,
geez that are around me. They'resaying like, it's now like, I
can I we it they might be rightnow. It's yeah, I got interested
(05:34):
in well, what are the kinds oflegal services that this
industry is going to meet? Andat the time, that was
transactional work, compliancework. Just basic, basic needs,
like getting your entity formedand the right, the right type of
entity in California at the timethere was a lot of collectives,
(05:55):
a collective is an actualstatutory type of entity. Other
kinds of loose affiliations ofpeople having to figure out how
to fit into the system, but alsoplay by the rules, because you
weren't allowed to make aprofit. It had to be in it
wasn't that
Ronjini Joshua (06:09):
collective couldn't make a profit. Yeah.
Okay. Oh, yeah. Like, oh,because it has to be like
distributed or something likethat. Right?
Hannah Stitt (06:14):
Yeah, it was like the regulations were like, Okay,
you can, you can have thisindustry start to grow up, but
we don't want you to be makingmoney off of it. So there was
this really strange moment intime, where a ton of people in
California had to deal with thefact that they could finally
have the benefit of having anentity in place, which is
limitation of liability for theowners, and really desirable for
(06:36):
people to be able to want toinvest in your company so you
can grow it. And a lot of peoplewere actually setting themselves
up as limited liabilitycompanies, which would normally
be a for profit entity, unlike,for example, a nonprofit
corporation, which is a strictcorporation with an election at
the tax level to be nonprofit.
So they're like, how do we be inthis space where we're a company
but we don't make any money? Sothere was all these? Not for
(06:58):
profit? Not a nonprofit, but uh,not I don't cry.
Ronjini Joshua (07:03):
That was the same thing.
Hannah Stitt (07:04):
No, that's, uh, that's where like, the lawyers
come in. Right? And they'relike, Okay, how do we do this?
Damn, yeah, like nonprofit withthe like, no and hyphen profit.
That's an actual, like, legalcharity. Yes, yes. And it has a
legal meaning and the code inCalifornia as well as in the
federal tax regulations. Okay.
But the word not for profit, orsorry, phrase, that's a that's
(07:25):
nothing that's a it's it's justa made up cut. People are just
writing this into their missionstatements so that they could
try to be in this gray spacewhere you're trying to be more
grown up in sophistication levelwith having an entity, but you
really can't participate fullybecause you are getting these
regulations from California andyou can't make any profits off
(07:47):
of your off of your income.
Exactly. Your business. But youalso aren't able to be a
nonprofit because a nonprofit isa federal tax election. And you
can't get that benefit from thegovernment
Ronjini Joshua (08:01):
or those not for profits are those that
collective
Hannah Stitt (08:05):
so collectives.
Yeah, well,
Ronjini Joshua (08:07):
different guys.
Hannah Stitt (08:09):
Yeah, like, sorry, if we're getting to hold me
back, you know, like, I'm like,gonna get nerdy about it. A lot
of the collectives I like acollective is real is it is an
actual type of entity inCalifornia, like, you can
register as a collective. Okay.
And so those collectives wouldhave mission statements that
say, We're doing this for thebenefit of the members. Okay, so
we're not trying to make aprofit from off of our members,
(08:31):
we're just trying to make enoughmoney that we can kind of re pay
for everything. Yeah, like, youknow, be able to continue to
grow a little bit, but not therewas no, like, you weren't gonna
get picked up or acquired,right, as a collective. And so
that was where we were in, like,2015 2016. And then when we had
the medical market, when thoseregulations came out, then the
(08:52):
corporate entities became, Ilike they became on the radar of
the of the legislature, and thelegislature was like, Okay,
well, we have this problem wherelike, people can't operate for
profit, and they can't benonprofits. So we need to figure
out what to do here. So the nextiteration of regulations that
came out, especially with therecreational market being
(09:14):
legalized in 2018, there's now astatutory provision that says
you can be a for profitcorporation in California. So
that kind of like, Oh,
Ronjini Joshua (09:23):
if you okay.
Yeah. And do they do that? Imean, you do just practicing
California. Yes. So do they dothat? I mean, you might know if
they do that in other states tojust for that state.
Hannah Stitt (09:34):
Yes, exactly. And I think that the nice thing
about the markets that arecoming online now is that they
can look at what happened inCalifornia and Nevada. Yeah, and
they can be like okay, well, wedon't have to do it exactly the
same way right. Like we can justjump right into having in our,
in our whichever way thelegalization is happening, like
be it by ballot initiative or bylegislature. Those people are
(09:57):
now like, oh, okay, part of ourproposition are part of our
going to be this year, it'sgoing to have that protection in
it, because we learned fromCalifornia, Nevada that that was
kind of a headache for them todeal with for a few years. So
we'll just start off havinglearned that lesson, right,
which is really useful. And so,back to how I got back to the
industry. So in in thebeginning, it was like, Okay,
how do we answer these kinds ofquestions, yeah, to figure out
(10:19):
how to get people to be actuallyable to make enough money or
have investments that can grow.
And at the time, there was noability for a for a cannabis
company to sue anybody else,whether it was a regular company
or, or another cannabis entitycompany. And this has to do with
and again, stop me if I get tobreak this. Okay. This is an
area of the law called standing.
(10:43):
In California, we call it tobeing the person in interest in
general, this is something thatevery single state has this
requirement, every as far as Iknow, every, every jurisdiction
in the world will have some sortof like standing requirement.
And what it means is that thethe person who's bringing a
lawsuit, they're the one thatwas harmed, and they think that
the court has the power to fixthat has the power to do
(11:06):
something about that. So I'm inCalifornia, we didn't get the
right to sue until 2017. So Ialready been in practice for a
little bit. And in law school,it was like, Okay, well, I I
like litigation, I'm, I'm kindof a high high energy and
passionate. So I knew I wantedto do that eventually,
Ronjini Joshua (11:25):
like to argue ideally.
Hannah Stitt (11:27):
Right. And so, so I, there wasn't really any
opportunity to do that, becausenobody had standing. But then in
2017, the legislature created astatutory code. And it said that
the lawful purpose of a contractcan be a cannabis plant, and it
as long as the operator iscompliant with state law. So
(11:48):
that created a space wherepeople were actually able to use
the benefits of legal system,because if you don't have
standing, then you know, yourcontract isn't really worth a
whole lot. Because why do we getinto contracts? We get into
contracts to make yourselfExactly, yeah. And if you can't
go into court to enforce thoseterms, then what's the point of
even having the writtendocument, right? So my practice
is kind of, it's grown with theneeds of the industry. And now
(12:12):
that we're in 2021, there arepeople out there who are there,
there are businesses out therewho are mature enough to the
point that they do have branddisputes with other people in
the industry. They do havecontract disputes, they can
afford litigation, litigation isvery expensive. So that's
another reason people weren'tlitigating a whole lot. There
was not a lot of capital. Yeah.
So um, it's funny when you lookat my resume, I think a lot of a
(12:35):
lot of like traditional largerlaw firms, the people who are
hiring, they're looking at myresume, they're like, oh, this
person has worked here for alittle while and here for a
little while, and they're, andit's hard for them to see the
thread but someone from thecannabis industry can look at my
resume and be like, Oh,cannabis, cannabis, cannabis,
you know, so it's like, it's aninteresting thread that has, you
(12:56):
know, gone through about eachchoice I've had in my career and
now that I have my own law firm,I'm tending to specialize in
intellectual propertylitigation. I do a lot of
trademark disputes. And I have alot of experience and other
types of disputes as well. Butintellectual properties like my
my nerdy lawyer, passion, yeah.
(13:19):
So now I'm merging it with mylike, industry passion. So
hopefully doing intellectualproperty for cannabis companies
will will be a path I cancontinue to go down
Ronjini Joshua (13:27):
and what is what does that mean for the cannabis
industry? What is theintellectual property in that
case?
Hannah Stitt (13:31):
Yes. So intellectual property is, it's
going to be non tangibles,right. It's going to be
something like your name andyour product packaging. The
kinds of like, a trademark isactually the the term that we
use to assign value to like thegoodwill that the consumers have
(13:51):
in your product. Okay, so areally easy example for me is
like Nordstrom. Like, I loveNordstrom. I know that you know,
if I get it, I literally rippeda shirt this morning that I just
bought last month, and I knowwe're gonna return it exactly.
I'm not gonna take it back andprobably take it back. If I've
been wearing it for three years.
I don't know why they have thatpolicy, but it's a good policy.
Yes, like consumer, the faithand gets you to keep coming back
(14:13):
to Nordstrom. So that kind ofthat intangible goodwill value
that people are able to generateby you know, Hirata name,
exactly. That's what the IP is,is really about. And the nice
thing for the cannabis industryis that at the end of the day,
and I will say like, otherattorneys may have different
(14:33):
opinions about this, I think ifyou asked 15 attorney to get 15
different answers, but no onecan come in and rip up your
trademark rights. Like nobodycan burn your trademark rights,
right? Like if there's any kindof like raid on your property,
and you end up losing a crop ornatural disaster, right? Like
those kinds of things cannotactually affect your intangible
(14:54):
intellectual property rights. Soit can be a very, very valuable
asset for a company to have,especially from an investor
perspective, because, okay,where it's hard for an investor
to really, or it's hard for acompany to prove to investors
like how profitable they are,because you know, we don't have
to ad election, to be able tohave write offs and things like
(15:15):
that. So having some investmentin your trademarking, or if
you're able to patent if youhave a technology that would
lend itself to a patent, ormaybe if you're an artist, or a
part of your branding is likeworking with a special artist,
you can have copyrights relatedto those kinds of, like assets
or whatever, exactly. And it canmake you more more attractive to
investment to have these kindsof things,
Ronjini Joshua (15:38):
building your brand equity as well. Right,
exactly. Yeah. I mean, itbecause it's building it from a
business standpoint, obviously,you'd have it with a consumer
standpoint, but then not builtbuilds it on the business side.
So this is I mean, do you whatis your kind of like case for
people? Like why should theyhave an IP? Should they have an
IP? Should everybody have an IP?
Like, how how do you answer thatquestion?
Hannah Stitt (16:01):
So yes, I think everybody should consider
protecting their intellectualproperty rights. To be a little
bit more granular, yourintellectual property rights,
depending on what they are,like, if it's a trademark or a
brand, right, or also forcopyrights, you can have rights
occurring under common law thatare not protected. So you still
(16:23):
have some rights, right? Like,
Ronjini Joshua (16:24):
you've been using something for a really
long time. Exactly. Operatingunder that.
Hannah Stitt (16:28):
Yeah. So like, you still have rights, they're just
not as strong if you don't tryto go through the process of
getting them like brand.
Trademarks is a really goodexample. If you don't go through
the process of trying to get aCalifornia registered trademark,
or you don't try to go to the tothe Federal Registered
Trademark, then the presumptionif the other party has those
marks,
Ronjini Joshua (16:49):
is that their first? Exactly? Yeah, I had this
problem once. Yeah.
Hannah Stitt (16:53):
Yeah. And it can be expensive to go through this
process, especially if abusiness is really really in the
startup phase, and it doesn'thave like an extra. I'm gonna
throw out there. Like, probably,if you you've hosted about at
least 3000 to get one.
Ronjini Joshua (17:09):
Yeah, right. I thought you were gonna say
million. I was like, no,
Hannah Stitt (17:13):
no, no, no, no, that would be way too much. If
someone's charging 3 million foryour trademark, you need to just
run away. Yeah. Just don't talkto that person ever. But like
one trademark, if you could getthat registered at the federal
level for like three to 5000,the California level, I don't
actually know the price off ofmy head, I think it's a couple
$100 to get it registered. Butthis will these kinds of rights,
(17:37):
you can protect them on yourown, you don't have to go
through an attorney. But I dothink it is more cost effective
to work with attorneys. Becauseif you are just learning this
yourself, and don't have anawareness of all the pitfalls
that the the examination processinvolves, then you might end up
spending more time or more moneydown the line. Yeah. Whereas if
you just hired somebody who thisis what they do, and it's their
(17:59):
bread and butter, like they can,they can be more efficient in
it. So even though that thesticker price might be like a
little bit higher in thebeginning, I think it is
worthwhile to work with peoplewho are professionals in that
area.
Ronjini Joshua (18:10):
I mean, I think that's kind of like standard
practice, like for anything likeyou can probably do your own
accounting, but do you reallywant to write like, do you want
to do your own taxes and misssomething? Yeah, that's like, I
feel like that's a you know, youhave to pay for experience and
quality and getting it doneright the first time. And I know
(18:30):
that a lot of businesses, youespecially in the cannabis space
have this capital problem,right, like of like, spending
money and or not being able tospend money but like, it sounds
like an IP, trademark copyright,whatever those things are, like
might be something that is kindof like the fundamental thing if
you're going to become a longterm
Hannah Stitt (18:49):
rep. Yeah.
Especially if you're if you're abrand really takes off. Yeah,
like and I mean, I was justlooking on LinkedIn, you know,
when you came down the stairs toget me and somebody at the
conference had taken a pictureof a an exhibitor, I don't, I
don't even know who it was, butit was like a Chips Ahoy, kind
of a knockoff. So like, it'sthese branding issues are kind
of coming to a head with likethe the increased sophistication
(19:13):
of the people in the market.
Yeah. So it used to be fine thatyou could kind of say, like,
wink, wink, nudge, nudge, like,this is a throwback, what it
looks like. Exactly, yeah. Andthat was a lot more acceptable.
And it actually made sense.
Because when you're in anindustry that is having to
operate in the dark because offederal prohibition, like maybe
you don't want to have the mostunique brands like maybe you
(19:35):
want to have the word green oryou want to have a cross in your
logo or you want to have amarijuana leaf in your logo to
kind of hint to the consumer.
Hey, come into my story. This iswhere you can purchase this
product right but as the moralculpability of using this plant
is diminished culturally, andthe laws are opening up for
(19:59):
people to be able to be Youknow, medically using
recreational using, then itmakes more sense to lean into
the intellectual property. Iguess we've got a paradigm or
standards in the US and globallyand start using the protections
that you have available to you,as well as trying to really be
unique. Like, it's lessimportant for you to have that
(20:20):
that Greenleaf logo or cross andless important to have the word
can your brand, you know what Imean? So, because there's more
people out there who it's justit's not a problem, like people
are not as worried aboutattracting consumers to them,
because it just can be more opennow.
Ben Michaels (20:37):
Yeah, did you get so when, when California went
from, because I noticed this wasvery big in California, when
they went from, you know,medical only to, you know, rec,
a lot of brands, and a lot ofbrands that spent a lot of time
establishing that theirtrademarks and their names just
disappeared, like my favorite, Ithink it was like a good nali
(20:59):
joint, it was the most amazingthing in the world, I would go
out of my way to get it fromanywhere, and then boom, gone.
And I wonder if like some ofthese brands, you know, tried to
approach you, and did you noticea lot of that? And why maybe
they they folded underneaththat, that changing of the
guard,
Hannah Stitt (21:14):
um, approached me of like, specific like
Ben Michaels (21:18):
your company, you know, trying to help, you know,
solidify their brand awarenessof their trademarks and utilize
that because it seemed like theymaybe they weren't getting
enough money, you know, to keepup with the new regulations. I
just, I saw all these namebrands that I love to just
disappear and never come back.
Because so I'm wondering if likethey were you if you had a lot
of people reaching out to youand like, help us, you know,
(21:41):
when this transition?
Hannah Stitt (21:43):
Yeah, I think we did. A lot of the times, it's
actually interesting to see whohas kind of gobbled up the
companies. It's like those thosethose larger companies who were
able to get the capitalinfusions, they really did start
going after the small providers.
And in some ways, it makes a lotof sense that the smaller
companies were willing to sellthemselves because, you know, it
is a slog to be in the trenches,right. Like, it's hard, it's
(22:06):
expensive, and it's just it'sdraining, you know, to be even
if you're not truly worriedabout the federal illegality
issues, you know, it's still abackburner anxiety.
Ronjini Joshua (22:18):
Yeah. So I mean, it's still real. Yeah,
Hannah Stitt (22:21):
I mean, fortunately, I haven't heard of
anybody going to jail this year.
But like, but you know, it alsojust, I don't know, everything
that happens, right? Yeah. isstill hot? Like, I
Ronjini Joshua (22:32):
don't tell you every time right.
Hannah Stitt (22:33):
Like, we know, hey, another person got eaten up
on the system. But I'm sobrutal. But yes, there was a lot
of need to start having moresophisticated relationships and
end transactions between thesethese players. Because when you
are able to get a trademark,right, be it California or other
(22:55):
state, a lot of a lot of statesoffer state trademark. It's
available. It's a process perstate. But because generally,
and I don't know if you guysknow this, but intellectual
property rights in the US aregenerally a federal legal
system.
Ronjini Joshua (23:13):
Right. As I was asked, I was gonna ask that
actually is does it like, carryover to everywhere? Like, yeah,
nationally or globally? Or is it
Hannah Stitt (23:21):
the so if you have a registration of the US Patent
and Trademark Office, that'sgoing to be a registration that
is the whole United Statesgeography as well as certain of
our protectorates? There'sanother system called WIPO the
world international patentoffice, okay. And so you can get
(23:44):
different levels ofinternational registrations as
well. And that's definitelysomething that global companies
with global reach are going tobe really important to them but
in the state by state levelthese these processes have all
been around for you know,however long the states have
been around but because thefederal Avenue is so much
(24:06):
broader of rights like it nobodywho just no business model that
I know of, except for sex workand cannabis industry, are even
bothering with stateregistrations, right? Because,
like, why would you do that?
Like yeah, should you may aswell just just get it the whole
nation? Yeah. And so, earlier, Imentioned that you can accrue
rights, a common law. Common Lawis what we call the the body of
(24:29):
law created by courts. Eachstate has its own common law,
there is no federal common lawexcept for two categories, which
don't matter so much for ustoday. And like this, this
common law, these rights arethere, they're just harder to
prove that you know, you havethe definitive first use or the
right things like that. Yeah.
Ronjini Joshua (24:50):
So and I've I mean, we've I think we've all
probably come across some brandsthat had like no, I had this
first No, I had those first and,and I've been in tech so like in
technology That happens all thetime. You know, they thought
they didn't have the money to dothe patent early on. They didn't
do it. And then they waited andthen they got screwed. Yeah.
Then there's a fight. Right?
Yeah. So like, Yeah, I think Imean, what you're saying makes
(25:11):
sense. And at the price pointthat you're talking about, as
far as it being, like, around$3,000, or, you know, even
anything under $10,000, I thinkit's worth do it. Yeah, I think
it's definitely worth doing.
Especially when establishing abusiness is like so much more
than
Hannah Stitt (25:29):
that. Yes, yes.
And I think, like 3000 isprobably like, the kind of like,
like, my recent marks that Idid, right? Because like, I'm
not having to, I'm not actuallycannabis plant touching. So that
was an easier process. If yourcompany is actually cannabis
touching, then it might take alittle bit more attorney time to
get that registration through.
(25:50):
So it would be, you know,incrementally more expensive.
Um, it kind of depends, ifyou're a ancillary product, or a
plant touching product. Yeah, ifyou're not plant touching, then
you're good to go for it at thefederal level, like what's
holding you back, you know, ifyou're plant touching, then
absolutely go for it in yourstate jurisdiction. And if you
can have parts of your business,trademarked that, you know,
(26:11):
you're legitimately using acommerce that are not related to
the plant, then go for that aswell. And at least
Ronjini Joshua (26:17):
it shows some kind of benchmark or milestone
where you've done some workExactly, yeah. As
Hannah Stitt (26:21):
it is attractive to the venture capitalists to
have like it is an asset. Andthe with the, if you're, if
you're just operating yourrights are going to accrue
geographically. So if you areonly really a dispensary, and
you're only located in onecounty, like San Francisco
County, then that's where you'llhave your your rights accruing.
(26:42):
But you know, why not go for thewhole state, even though you're
not going to have dispensariesin every county, you can have
rights for the whole state tomake sure that somebody in LA or
San Diego or maybe in Tulare, ifthey ever opened up their
council to have some likelicenses there. wouldn't be able
to use your name or causeconfusion in the marketplace.
Right? And since especially
Ronjini Joshua (27:02):
online, Yes, everything's online. Yeah,
exactly. Like
Hannah Stitt (27:05):
I've the internet is an interesting jurisdictional
problem for attorneys. I thinkwe're just like, pretending it's
not a problem. But thatdefinitely needs to be
addressed. So
Ronjini Joshua (27:16):
yeah, like, how would you even I guess, I guess
you could do by like, IPaddress. Yeah.
Hannah Stitt (27:20):
We're like figuring out like, where, yeah,
where your consumers are comingfrom? I don't know.
Ronjini Joshua (27:25):
Yeah. But then it's like, uh, yeah, it seems
like a very convoluted way offiguring out how to
Hannah Stitt (27:30):
totally people.
Yeah, totally. And then like, ifyou're really sophisticated on
the tech side, and you know,your IP is like, your, your,
your IP address is, like,pinging across different
drivers. It's like, okay, well,that wasn't really useful
information. Yeah. All of asudden, this person's in
England. And then, you know, twohours later, they're in
Colombia. It's like, Yeah, thatwasn't helpful. So. So yeah, the
hacking that could be done.
(27:52):
Exactly. Yeah. So it just makessense for people, if you do have
a bit of wiggle room in thecapital, and if you are going to
be seeking investment, then it'ssomething to at least look into
whether or not you can get yourstate level or the federal level
or, you know, beyond.
Ronjini Joshua (28:07):
Yeah, you know, it's funny, because I talked to
someone, I want to say they'relike an HR person a long time
ago. And they had mentioned,like, the first thing that you
need, when you start a cannabisbusiness is a like, CPA or like
accounting or finance person,and a lawyer, like, you cannot
(28:27):
not have a lawyer, if you're inthe business, and like, what are
your feelings around? Like, youknow, they're I think there's a
lot of scrappy people andstartups that are emerging in
this space. And I can't believethat they all have legal
representation.
Hannah Stitt (28:42):
Oh, they absolutely don't. And it's,
it's, it's a problem that legalservices are so expensive,
right? Yeah, it's similar to theproblems that are happening in
the healthcare system, whereit's like, why are doctors $300
an hour? Yeah, you know, andlike, why won't the insurance
cover it? So there's not a lotof insurance plans that are
useful to get you legal servicesunless you, you know, been sued,
(29:05):
then your insurer is going tohook you up with an insurance
defense. But that's a prettynarrow spot, right? Like, yeah,
people do want insurance or notsorry, insurance and legal
service for compliance andentity formation and
intellectual property licensing,those kinds of things. So to
answer your question,eventually, I think that you're
right. A lot of people do nothave access to legal services.
(29:27):
Part of it is that they perceiveit to be too high of a cost. And
it's an immediate cost. Like,when I talk to people who are
deciding to open up a company, Iknow they don't like to hear it,
but I tell them, like you needto have a legal budget and it
should probably be $5,000.
Hopefully, you won't getanywhere near that, you know,
but it would not be unusual. Ifyou did in order to get yourself
(29:48):
set up with business to businesscontracts, get some IP licensing
agreements in place after you'vegone and gotten those
registrations, all differentkinds of stuff. It's useful to
have a like You said the HRperson, like it's useful to have
an analysis from an attorney whoworks in employment or labor,
and can say, you know, your,your relationships that you've
got with your employees, itlooks like you're calling it an
(30:10):
independent contractorrelationship. But this is
actually an employmentrelationship under the law. So
if you're independent contractorkind of gets hurt on the job, or
decides that they're beingpoorly treated by you, then, you
know, this independentcontractor relationship is it's
not going to hold up, right?
Like if they go to theCalifornia Employment, if they
Ronjini Joshua (30:32):
want to complain, they're gonna get
favored. Exactly. Yeah.
Hannah Stitt (30:35):
Yeah. So I was thinking of this industry, and
also the lawyers who service iton a on a like, risk tolerance
scale. I feel like
Ronjini Joshua (30:45):
how high is your risk? Yeah. Cuz most attorneys
Hannah Stitt (30:49):
are not risk tolerant. Yeah, right. Like,
we're like, Oh, my God,
Ronjini Joshua (30:52):
dirt your attorneys you're following?
Hannah Stitt (30:54):
Exactly. Yeah. Or at least we want to know what
all the rules are. Yeah. When westep across the line, we're
like, Okay, I did it. Yeah, thatwould notice, you know, so, um,
whereas people who I think areoperators in the industry are
they're really risk tolerant.
Right. They're like, Okay, thisis like,
Ronjini Joshua (31:10):
so risk tolerant that they don't need an
attorney. Exactly.
Hannah Stitt (31:13):
Yeah. So so having them come together. It's, it's
interesting. And I feel likethere's a lot of a lot of
growing up right now in theindustry, where it's like,
people are bringing their legacycultivator knowledge, and
they're, they're partnering upwith major investors who expect
a certain kind of sophisticationfrom the people that are, you
(31:34):
know, infusing the capital. Andso in his learning process, I
think lawyers are becoming moreacceptable, especially, is
expensive, you know, like,you're not going to get away
with a small bill. And, youknow, I have lawyers that I hire
for my personal life, and I'mnever happy to see that. Never.
And like, so I so you helps mewhen I'm, you know, doing bills
(31:57):
myself, I'm like, Okay, let meexplain what this is. So that
the person on the other endisn't like, Oh, God, why did you
feel a bit less upset? Yeah.
Right. Like, at least they knowwhat I did for that two and a
half hour time period. Yeah. Andso this, I'm hoping that legal
services themselves become lessexpensive over time, which has
nothing to do with the cannabisindustry in particular, it's
(32:17):
just the Yeah, yeah, a lot of ithas to do with, you know,
student debt, right. Like a lotof lawyers feel like they have
to charge a certain amountbecause they have to pay off
their debt. Exactly. It's crazy.
So it's like, these are not goodincentives. Like, yeah, like,
like, this is like if the if thenational approach and strategy
(32:37):
for like, reducing student debtand reducing like medical debt,
these things would be huge. AndI think we would see a lot of
other benefits just across allsectors to see that these people
with highly, highly trainedpeople are able to get that
training for a lot lessexpensive, they're able to
provide services for a lot lessmakes a lot of sense. Yeah. And,
(32:58):
you know, some firms, that's notwhat they're in it for, they're
in for the money. But I think alot of people out there would
really like to be able to chargeless in order to run the
business and provide servicesand hopefully, incentivize
people who are not as excited towork with lawyers to be like,
Okay, well, you know, $100 anhour is a lot more palatable
than 650. Yeah, right. Yeah. Soyou know,
Ben Michaels (33:18):
but it's not one of the goals is to get and this
sounds amazing. And you soundlike, so sweet and great for not
wanting to charge, right?
Ronjini Joshua (33:27):
Because that makes I do charge though.
Ben Michaels (33:29):
Yeah. Yeah, but it's, but it's, uh, I mean, it
seems like you know, you'reyou're investing the time and
energy, you're getting an A, insuch a perfect time, that you're
going to get such a specialtythat you can charge, you know,
that higher rate, and peoplewould be willing to pay it. But
you're saying, even with thatextra experience and everything
you still would want overall tocharge less?
Hannah Stitt (33:51):
Yeah, I mean, like, I would love it if I felt
comfortable charging $1,000 anhour. But you know, I've been
practicing law since I joinedthe bar in 2016. So I'm, I'm
certainly not green, but I'm notI'm not 30 years. Veteran. Yeah,
right. Yeah. Like, yeah, like, Ithink a lot of the attorneys
that are able to feelcomfortable charging in excess
(34:13):
of $600 an hour. They, they theybring to the table that, you
know, 30 years of experience indeal making, or deals falling
apart. So So I think that Iwould like to find that balance
where it's like I can, I canhave a respectable rates. And
also, you know, there's alwaysthe possibility of reducing it,
because I could have my standardnumber and then yeah, someone
(34:34):
and think like, oh, you know,there's reasons like equity
reasons, or Yeah, like you're awoman run business or something
that would maybe offer adiscount, but yeah, like it
would be nice to find thatbalance where people are really
respecting the
Ronjini Joshua (34:48):
worst thing to do. And yeah, I mean, I think
that's really important. I mean,that's like an industry
conversation, right? That'slike, it's like, how much do
people value these certain setsof skills? How long it took you
to get there, how muchexperience you've had to acquire
to do it the correct way. Andthen for you, you're litigating.
So you're winning and losing. Sohow much are you winning? How
(35:09):
much are you losing? Like,that's what they're paying for.
So I yeah, I mean, I don't likethe cost of law. But I agree
that like, you know, you kind ofhave to figure out, you're going
to be more on the premium side,or you're going to be because
that's gonna like, kind of,like, gives you the respect you
kind of need. So peopleunderstand where you stand.
(35:30):
Yeah,
Hannah Stitt (35:31):
absolutely. And I always like to think about the
question of whether to hire alawyer from the business side of
things, right? On the legal sideof things. My answer is, yes.
Hire lawyer. Yeah. But from thebusiness side, you know, what
are you looking at here are yougonna hook yourself up with an
attorney who knows what they'redoing is trustworthy, and is
good, is good at their job. Andthere may be a caveat should be
(35:53):
made here with that risktolerance. Yeah, scale that I
was talking about. The attorneyswho are providing services and
have been writing services forthe last, you know, however,
many years, 1520 years, andlonger. They are very risk
tolerant attorneys. So the waythat they approach problem
resolution and contract draftingmight be a little different than
(36:16):
the perspective you would get anattorney at a large law firm is
not really open to takingcannabis clients. So that's
something to think about whenyou're hiring an attorney like,
like, are they reputable. If youknow an attorney that could help
you make that assessment, that'sprobably a good idea. But like,
just because they're inexpensiveor expensive, that doesn't
necessarily mean that they'regoing to give you great
(36:37):
services. So important, you'rereally like, just like any other
person that you're going to hireas a service provider for your
business, to be reallychallenging the marketing that
you might be getting from thatperson.
Ronjini Joshua (36:50):
So this actually segues in the perfect way to
close this. So we like to givepit tips out. And so like, what
are those like, things thatmaybe three or four things that
we should be looking at, when wedecide to select an attorney?
Like what how can you choosethat properly?
Hannah Stitt (37:10):
So one important thing was a four things, okay,
so we'll be
Ronjini Joshua (37:13):
it could be whatever. Okay,
Hannah Stitt (37:17):
the the first thing that I think is important
for the cannabis industry, butnot necessarily important for
other kinds of industries, is tohire an attorney who at least
has, if they're not local to youin your county, at least they
can explain to you like, I'veworked with XYZ customer, or
clients, who are also located inyour region, because having that
(37:40):
understanding of how theregulations work on a county by
county level is really importantin the cannabis industry.
Doesn't matter if you're ahairdresser doesn't matter if
you sell flowers like this isnot a problem. So that's one,
one thing to think about is likehow local to you and your
business? Is this the legalservice provider? The next thing
after that is to have a reallycandid conversation with them
(38:04):
about how comfortable they arebeing wrong. Because risk
tolerance being a problem amongattorneys. attorneys don't want
to say, I don't know, I'm reallycomfortable saying I don't know.
And sometimes clients are like,well, I don't want to hire you.
Because you just said, Oh, Idon't know. Right. But you're
not hiring because I mean,because I know all the answers,
you're hiring me because I knowhow to articulate a question,
(38:26):
translate that question into howwe ask questions in legal terms,
and then go through the steps ofmaking sure that I am checking
off all the possible areas oflaw that could touch that
question. So like, I'm notselling to you the information I
have in my head, I'm selling toyou my processes in how to solve
(38:50):
legal problems. Okay, so if theattorney you're talking to is
talking about how, Oh, I've gotso many Canis business clients,
or cancellation clients, and I,you know, I did this deal and
that deal and that deal. That tome is like, Well, did you
actually tell me that you know,how to, like, I have a unique
question to my business, that Idon't think you've answered
(39:12):
before for anyone else, like,can you be creative and helping
me solve this problem andactually, like giving a risk
assessment? And if they're notcomfortable saying, I don't
know, then you're probably nothiring an attorney. That's good
for you as a cannabis businessoperator? Because there are lots
of things we don't know. Yeah,because there's no regulations
and PS knew there's no one toask. There's no right change,
(39:33):
right. Yeah. And like in a lotof areas of law, like in the
American body of law isinherited from England. So our
property laws come from Williamthe Conqueror, that's over 2000
years that we've been developingwhat it means to hold a legal
equity illegal and equitableinterests in peace property,
(39:55):
right. So like, okay, 2000 plusyears is an area where lots have
attorneys feel comfortableworking in a case law? There's
lots of people to ask. But youknow, this is cannabis. So
there's that's just doesn'texist. Yeah, your attorney is
not willing to start makingrelationships with regulators or
city council members or justother attorneys that they can
ask questions to, then that'sprobably somebody that is not
(40:17):
going to give you the most bangfor your buck. Got it. And
that's the kind of thing I wouldreally like, I would encourage
everyone to really challengelike, Challenge Challenge
Challenge Challenge. Pleasedon't be the kind of the kind of
client that doesn't listen, oncethe analysis has been presented.
All the citations had beenprovided. Definitely listen
after that work has happened.
But in the in the consultationinterview, like if they're just
like, wildly confident thatthey're going to be able to
(40:39):
answer every question, thatindividual doesn't have enough
experience in the candidate.
You're
Ronjini Joshua (40:44):
like, no, yeah, no, yeah.
Hannah Stitt (40:47):
Like those of us that have been serving the
industry for a long time, arecomfortable saying, you know,
we're gonna have to get back toyou about that, like, I'm going
to have to make some phonecalls. And my initial instinct
is XYZ, but I want to make sureit's not ABC. Yeah. So
Ronjini Joshua (41:01):
I think it's really important to know like
that, that the the lift attorneythat you're hiring for an
industry, that's not likestandardize should have
questions. Yes. And you know,should be eager to learn them,
the answers to them. I like thatthe part that you mentioned,
it's really, really purchasingthe process, the way of like
figuring out how to solve theproblem instead of already
(41:23):
knowing the answer, right?
Because otherwise,
Hannah Stitt (41:25):
you just go to legal Legal Zoom. Right? Yeah.
You know, and I can't tell youhow many times I've gotten Legal
Zoom entities. And I'm like,What the? Yeah, and I've seen
some contracts where I'm like,alright, well, it was really
great that your criminalattorney took an operating
agreement from an LLC, and abylaws from a corporation. And
like a whatever we're gonna callthis from a collective from
2015. merged, it said it wasn'ta contract, but you did have to
(41:49):
sign it. So it's like, you know,this kind of like, it doesn't
make it doesn't make any sense.
Yeah. So like, like aFrankenstein? Exactly. Yeah. So
it's like, if you're, you know,just challenged someone being
overly confident, right, like,they should be a little more
cautious. They should have alittle, they should be burned a
few times. But like, I'vedefinitely given advice to a
client that in 2015, or 2016,that was the best advice that
(42:10):
they could get out there. But in2018, I'm not giving that same
advice. Right, of course, right.
Like, like, it's not a long timeperiod in between, like for
lawyers, like a lot of times,you know, three years. That's
nothing. That's nothing like youcan I sometimes like cite cases
from 1997. Like, yeah, stillgood law. Right. Yeah. So it's
(42:33):
just really different to provideservices industry. And so yeah,
definitely be cautious andChallenge Challenge Challenge
Challenge.
Ronjini Joshua (42:39):
I love it like this is I could ask you so many
questions that will lie so and Ithink law is so mysterious to so
many people, which is terrible.
Yeah,
Hannah Stitt (42:47):
it's terrible. It should be reachable. It should
be all of us have rights. All ofus should know how to navigate
it. Yeah. And it's it is it'sesoteric. It's shouldn't be that
way. But I'm not the queen ofthe world. So I can't change it
right now. But
Ronjini Joshua (42:58):
they could contact you to find out. Yeah,
yes. So we will make sure tohave all your information in the
show notes. But like, Do youhave a website? Yeah, sure.
Sure.
Hannah Stitt (43:06):
Yes, yes. It's techtonic law.com. So Tecton I
see La w.com.
Ronjini Joshua (43:13):
Okay, and you guys. So are you a firm of what
are you a firm of money, are youWe're
Hannah Stitt (43:18):
rolling. We're real new. We I've you know, been
litigating for a while but Ijust opened I just launched this
firm with my business partnerand law partner, Paige Pembroke.
She also specializes in electroof intellectual property and has
a lot of background in thecannabis industry. So we we
haven't even officially launchedit like we only had our party.
Yeah,
Ronjini Joshua (43:37):
we just call that because we've been, uh, you
know, we've been in the past.
Yeah, have a party, right. I
Hannah Stitt (43:42):
know. It's like a group of 10 Whoo hoo. Even
that's like pushing it.
Ronjini Joshua (43:47):
Yeah. Yeah.
Well, that's awesome. Thank youso much for sharing your
information with us. Like, thisis like yeah, I love this
information. Like I think thisis like pertinent things people
should know that they're scaredabout also, you know, it's a
really big source of fear. So
Hannah Stitt (44:03):
yeah, absolutely.
I had a great time talking toyou. So you know, if you want to
hear more about the law, let meknow. Yeah,
Ronjini Joshua (44:08):
absolutely.
Thank you. Yeah. The Green Roompodcast is brought to life by
green seed PR, the cannabisgreen tech focus PR agency, and
a dedicated production team ofeditors mixers and show
Booker's. A huge thank you tothe vessel team for providing
their studio for our recordings.
Don't forget to subscribe andshare the green room podcast
(44:28):
with friends, colleagues, andfamily. That way you'll never
miss an episode and we keep thelights on. If you're feeling
extra generous, please leave usa review on your favorite
podcast listening platform. Youcan also find us on Instagram at
Green TPR answered live videoversions of all of our podcasts
on YouTube. Would you like to beon the guests on the show? Or do
you have a great guest referral?
Awesome. Submit your guests atGreen CPR comm slash the hyphen
(44:52):
green hyphen room. Thanks forlistening and be well
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