Victoria Cannabis Buyers Club to Challenge $3.2 Million Fine for Selling Illegal Pot

Victoria, BC — The Victoria Cannabis Buyers Club (VCBC) is gearing up for a legal battle against a hefty $3.2 million fine imposed by British Columbia’s Community Safety Unit (CSU) for selling cannabis without a license. Ted Smith, the founder and executive director of the club, has stated that the organization “doesn’t have anything like” the amount required to pay the fine.

Background on the Compliance Order

The CSU began investigating VCBC in April 2019 after receiving information about the club’s lack of a provincial license to sell cannabis at its former location on Johnson Street. The investigation led to multiple visits by CSU officers, who seized cannabis from the store in November 2019 and again in July 2020.

In 2022, penalties were issued against both the VCBC and Smith under the Cannabis Control and Licensing Act. The fines were calculated based on the retail value of the seized cannabis, which was estimated at $1.6 million. The CSU director decided to impose fines totaling just over $3.2 million on the club and Smith, effectively doubling the value of the seized cannabis.

Legal Options and Arguments

Smith and the club had the opportunity to reduce their fines to $1.6 million each by admitting contraventions of the act and signing a waiver. However, they chose not to take this route, opting instead for a hearing where Smith defended the club’s practices. He argued that VCBC provided high-quality medical cannabis at affordable prices and criticized the existing regulations for not meeting the needs of medical marijuana users.

Smith pointed out the limitations of legal cannabis products, including restrictions on THC levels in edibles, high prices, and inadequate information on medical cannabis in recreational stores.

Recent Developments

Following the hearing, Meghan Oberg, deputy director of the CSU, determined that VCBC was operating a substantial illegal cannabis retail store and issued a $3.2 million fine against the club alone. Oberg clarified that Smith was not personally fined, but did not rule out potential liability for Smith or other club officials in future proceedings.

Smith expressed concerns about the possibility of the CSU pursuing board members for the fine and lamented the restriction that prevents the club from addressing constitutional issues related to the Charter of Rights and Freedoms. In November 2022, the B.C. legislature amended the Cannabis Control and Licensing Act, excluding the safety unit director’s jurisdiction over constitutional questions.

Ongoing Legal Challenges

The club, which has since relocated to the 1600-block of Quadra Street, faced another raid in the spring of 2023. During this raid, CSU officers seized cash and additional products, although no new fines have been imposed yet. The club’s legal team has already filed court challenges related to this recent raid.

As the deadline to apply for reconsideration of the compliance order approaches on September 6, the VCBC remains determined to contest the fine and defend its operations. The outcome of this legal battle could have significant implications for the club and its future in providing medical cannabis to its clientele.