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San Diego DA Files Felony Charges Over Cannabis Extraction

District Attorney of San Diego County Bonnie Dumanis speaks at a September 2016 news conference in El Cajon, CA. On Wednesday her office announced felony charges against cannabis businessman James Slatic and others. (Denis Poroy/AP)

Sixteen months after authorities used sledgehammers to break down the doors to Med-West Distribution, at one time the largest cannabis distributor in California, San Diego County District Attorney Bonnie Dumanis filed felony charges Wednesday against the former owner and associates.

The criminal complaint targets not only James Slatic, 58, the owner of the erstwhile San Diego business, but also former employees and even Slatic’s attorney, Jessica McElfresh, a well-known San Diego cannabis lawyer. The DA’s office charged 12 counts of criminal conduct, including manufacturing a controlled substance, conspiracy to commit a crime, and money laundering, which allegedly yielded an ill-gotten profit of $3.2 million in 2015.

Filed in San Diego County Superior Court, the complaint alleges that Slatic and his employees used “flammable, volatile and toxic chemicals” to extract cannabis oil and conspired to hide evidence of the process before a visit from city inspectors to Med-West’s property. If convicted on all charges, the defendants could face up to 15 years and 4 months behind bars, according to a San Diego DA press release.

Reached by email, Slatic said his reaction was “Just shock right now.” In recent interviews about the raid and the ensuing legal fight, Slatic told Leafly that he did everything possible to adhere to the law.

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Since agents busted down the doors to Slatic’s business in January 2016, the raid had become notable for the absence of criminal charges. Authorities seized $1.4 million in assets and cash in the aftermath, but earlier this month a San Diego judge ordered Dumanis’s office to return $100,000 seized from personal bank accounts—which belonged to Slatic, his wife, and two stepdaughters—precisely because there was “no indication” that charges would be filed. Separate legal proceedings are underway for $324,000 in cash taken from a safe at Med-West.

“We wanted to be thorough and make sure we got it right,” Dumanis said in a statement. “The year-long, complicated investigation faced delays both in court and out [and] extensive copying and review of computer data was conducted,” added the DA press release.

Search warrants were also served at attorney McElfresh’s home and office on Wednesday, according to the DA press release. McElfresh could not immediately be reached for comment.

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The complaint alleges that McElfresh hid from inspectors that chemical extraction took place on site and led them to believe that Med-West was only a “packaging and paper company.” The complaint repeatedly uses as evidence an email McElfresh allegedly wrote to Slatic in December 2015 in which she referenced the April 2015 inspection by the San Diego Police Department.

Referring to inspectors, McElfresh allegedly told Slatic that “they’ve been there once and went away, operating under the theory that no actual marijuana is there. We did a really, really good job giving them plausible deniability – and it was clear to them it wasn’t a dispensary. But, I think they suspected it was something else more than paper.”

Again referring to an inspector, McElfresh told Slatic, “I didn’t flirt (wouldn’t have worked), but I just kept focusing on the papers…. I’m convinced they walked away knowing it wasn’t a dispensary in the typical sense … but it probably seemed like something other than just paper. That just wasn’t what they were under mandate to look for, and hey, we did a very good job.”

Here’s a copy of the felony complaint against Slatic and others:

California v. Slatic, criminal complaint by Ben Adlin on Scribd