The federal government and the city of Anaheim—deploying a strategy used throughout the state—are trying to take a $1.5 million commercial building away from its owner because he allowed a legal medical marijuana dispensary to operate within its premises.

The irony of this duplicity is that last month Anaheim Convention Center hosted Kush Expo, billed as the “World’s Biggest Marijuana Festival.” Thousands attended without incident even as Tony Jalai and his attorneys fought to resist a move by the U.S. Attorneys office to seize his property.  

California legalized medical marijuana in 1996 and authorized nonprofit cooperatives as dispensaries in 2004. But federal law criminalizes possession and sale of pot. The U.S. Attorneys office has aggressively pursued dispensaries since late 2011 despite statements from the Department of Justice in 2009 that it would not do that.

Jalai, a software engineer who emigrated from Iran in 1978, rented one of the 12 spaces in his two-story building to a pot dispensary, which operated legally under California law. He bought the property in 2003.

Although Jalai has not been accused of committing a crime, Anaheim and the feds are using a legal strategy known as civil forfeiture to seize his property. If successful, the federal government would share proceeds from sale of the building with Anaheim law enforcement.  

Civil forfeiture has been used by federal authorities since the 1980s and has been mainly deployed against organized crime and to deny convicted drug dealers, embezzlers and other offenders from keeping property obtained with tainted money. Unlike a typical approach to pursuing criminals, where the authorities catch ‘em, charge ‘em and try ‘em in court, civil forfeiture aims to confiscate assets before any criminality has been proved.

In 2000, federal officials seized $500 million in forfeitures. By 2012, that amount rose to $4.2 billion, an eightfold increase. The success of the program has prompted detractors to call it “policing for profit.”

California law (pdf) prohibits seizing assets this way unless the owner has been convicted of a crime.

U.S. Attorneys have sent letters to more than 1,000 property owners in California, Washington, Colorado and other states where marijuana has been sanctioned under state law threatening them with civil forfeiture. More than two dozen cases have been actively pursued in Southern California this year.    

Jalai is represented by the Institute for Justice, a Virginia-based law firm, in the U.S. District Court for the Central District of California in Santa Ana.

–Ken Broder

To Learn More:

Federal & Local Law Enforcement Agencies Team Up to Profit by Subverting California State Law (Institute for Justice)

Feds, Anaheim Try to Seize $1.5M Building  . . . with No Charges against the Owner (by John Kramer, Institute for Justice)

In Marijuana Policy, the Confusing Smoke Signals Continue to Burn (by Steve Lopez, Los Angeles Times)

Landlord Challenges Feds in Calif. Medical Pot Case (Associated Press)

Calif. Civil Forfeiture Battle Pits Property Owners and State Law against City of Anaheim and Federal Government (by John Kramer, Institute for Justice)

Seizing Citizens’ Property as a Revenue Source for Law Enforcement (by Noel Brinkerhoff and Danny Biederman, AllGov)