Federal Lawsuit Challenges Mississippi’s Ban On Marijuana Advertising, Citing Free-Speech Rights

December 31, 2023 · Marijuana Moment

Mississippi’s medical cannabis advertising ban is preventing a small dispensary from attracting customers, Tru Source owner Clarence Cocroft is arguing in a federal lawsuit that casts the law as a violation of his free-speech rights.

Though medical marijuana is now legal for Mississippians with qualifying conditions and a medical cannabis card, state law prohibits dispensary owners and cultivators from advertising cannabis products.

“It’s a daunting task to stay in the industry when you can’t advertise,” Cocroft told the Mississippi Free Press on December 8. “And it’s legal. If they allow you to get licensed, they should allow you to promote your business.”

Cocroft owns Tru Source, the state’s first Black-owned medical cannabis dispensary, located in the southeast industrial zoning area of Olive Branch, Mississippi. Cocroft and his dispensary filed a lawsuit on November 14 against the officials in charge of the regulations at the Mississippi State Department of Health, the Mississippi Department of Revenue and the Mississippi Alcohol Beverage Control Bureau.

To open a medical cannabis shop in the state, a person must apply for a dispensary license, register for a sales tax permit and pay thousands of dollars in fees. A person must have a medical cannabis card and be over the age of 21 to enter a dispensary.

“The fight was, ‘OK, we’re paying you all a lot of taxes. We’re abiding by all your rules that you have set forth. All we’re asking is simple: Allow us to advertise. It’s going to increase your tax rate as a state,’” Cocroft said.

Tru Source relies on its website, word of mouth and signs posted on the building for advertising. But Cocroft cannot advertise his dispensary or its website in any other advertising medium. The owner said many customers would not have known about the store if they had not driven by the area.

“It’s not just me in my location that cannot advertise,” he said. “It’s every location in Olive Branch; it’s every dispensary in DeSoto County and all 82 counties,” Cocroft said.

‘A No-Win Situation for the Cannabis Industry’

The Institute for Justice (IJ), a national libertarian nonprofit law firm, is representing Clarence Cocroft in the lawsuit. One of Cocroft’s attorneys, Katrin Marquez, said IJ looks at “commercial speech regulations” and advertising laws through the lens of the First Amendment and how “different regulations on advertising really hamper people’s business.”

“What’s really important here is that Mississippi already regulates things like advertising to children and making false medical claims, so we think those regulations make sense,” she told the Mississippi Free Press on December 8. “The State of Mississippi can keep that; what it can’t do is blatantly say, ‘You can’t advertise at all.’”

When he and his family opened Tru Source, Cocroft bought billboards in north Mississippi to advertise his dispensary, but he had to lease the spaces to other businesses, including a casino, that could legally showcase their products to the public.

The business owner said the lawsuit and subsequent reporting have brought in more new customers each day, but he is still not reaching his fullest potential customer base despite about 30,000 Mississippians having a medical cannabis card. Before the lawsuit, he was seeing about 15 to 20 patients a day—most being returning customers—but now about 20 to 30 people stop by Tru Source each day to pick up their medical cannabis products, Cocroft said.

The medical cannabis advertising ban does not only affect dispensary owners, he said. If dispensaries cannot sell the products on the shelves, then they will not buy as much from cultivators, who in turn will also lose money.

“It’s a no-win situation for the cannabis industry of Mississippi,” Cocroft said.

He said that investing in the Mississippi medical cannabis industry has cost dispensary owners, cultivators and testing companies millions of dollars in the name of helping patients—all while their owners learn how to operate a type of business that is brand new in the state.

“You become your own entrepreneur in a business that has criminalized so many people. And now since it’s legal in the state, why not?” Cocroft said.

‘No State or Federal Law Justifies Censorship’

Congress passed and former President Barack Obama signed the Rohrabacher-Farr amendment in 2014, banning the U.S. Department of Justice from spending federal funds to prosecute medical marijuana operations in states that have medical cannabis programs. The federal government does not enforce national marijuana laws state-by-state, instead letting the states control how their citizens access the plant.

“No state or federal law justifies the censorship in this case,” Marquez said.

One main reason why IJ is defending Clarence Cocroft’s case is because it could set a precedent for other kinds of legal businesses that the government strictly regulates, she added.

“We understand that those businesses can be more harshly regulated than, say, a doughnut shop. We don’t think it makes sense to treat medical marijuana worse than any of those similar businesses,” Marquez said, mentioning the alcohol industry, casinos and strip clubs.

Cocroft also questioned why the alcohol industry, medication companies, casinos and strip clubs can advertise their products and services to the entire state, but he cannot advertise his dispensary or medical cannabis products.

“If you can go in Walgreens and fill a prescription for an opioid and Walgreens can advertise, why can’t Tru Source and the other cannabis dispensaries and cultivators in Mississippi?” he asked.

The Mississippi Free Press asked MSDH for comment on the lawsuit, but an agency spokesperson said the department does not comment on ongoing litigation. The Mississippi Free Press also reached out to the Department of Revenue and the Alcoholic Beverage Control Bureau for comments but did not receive a response by press time. (Full Story)

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