Happenings:

• Investment firm Merida Capital is raising $250M for a new fund. Managing partner Mitch Baruchowitz recently predicted cannabis would have a $1 Trillion economic impact by 2027.
  Insider 
• California growers prep for fire season as Washington state growers worry about competition from Delta 8 THC.
  MJBiz
• New York magazine asked New York City’s mayoral candidates how often they smoke weed and then edited it into an Instagram video.
• Politico finds that the Mormon church has been a quiet MED advocate in deep red states.
• With legalization, Virginia is retiring drug sniffing police dogs.
  AP
• REC legalization has stalled again in Mexico, but seems to be moving forward in Brazil.
  Canna Law Blog
• CLIO is opening to entries for its 2021 cannabis marketing awards. 
• The New York Times calls Symone, the RuPaul Drag Race champ and spokes-queen for infused beverage Cann, “a love letter to Blackness and queerness.” 
• A guy named Greg Welch, who sculpts promotional images out of weed, extracts and accessories, called the biggest MSOs “fucking gross.” “Don’t buy their products. Don’t work there. Don’t click their paid for PR,” he wrote.
• Fellow LinkedIn activist Brett Puffenbarger called for a truce between legacy operators and MBAs. “It takes both things: A passion for the plant, and a solid business mind to succeed in #cannabis these days.”

Connecticut House Speaker Matt Ritter (D) and Gov. Ned Lamont (D) said lawmakers would take up REC legalization in a special session this June, and predicted it would pass.

It had looked like a bill might pass in the normal session, which ended Wednesday. 
Hartford Courant

• Republicans feel left out of the legislative process and had cold feet before the normal session ended. House GOP leader Vincent Candelora called the bill “tainted” and called for an investigation on account of language in the bill that would have benefitted one entity. That language has been stripped from the bill.  
  NBC, Fox
• The special session is necessary for a separate budget bill which Democrats say could now pass on the same day as REC.
• Connecticut would be the second east coast “domino” to fall after New Jersey voters legalized last election day. The affluent state has companies salivating.
• Marijuana Moment has more details.

Related: The Delaware House delayed a REC vote.
Delaware Public Media 

Quick Hit

1. REC delivery is underway in Massachusetts. For the first three years, licenses will only be available to equity businesses.
   Boston Globe

Despite what you may have heard, it’s not illegal for federally licensed banks to serve cannabis companies. The truth is that these relationships are legal, but they create sufficient regulatory and operational risk, and require such onerous compliance work, that most banks decide the industry isn’t worth the trouble. Dama Financial’s product and service suite enables FDIC-insured banks to serve cannabis companies. 

“Everyone should have access to transparent and compliant banking,” Dama Chief Revenue Officer Eric Kaufman says. “That should be a commodity.” Companies with bank accounts are more likely to pay their taxes and operate in accordance with the law. But at the moment, cannabis companies can only work with the banks that make the “risk-based decision,” to work with them. And the banks that do need guidance for how to serve the industry in a responsible way…  

Read the WeedWeek spotlight.

**Sponsored content**

Both chambers of Colorado’s legislature passed a bill that would tighten the rules governing MED and concentrates. The bill, which passed with overwhelming bipartisan support, would impose stricter packaging requirements on concentrates, tighten rules for 18-20 year olds’ to obtain MED cards and limit, to 8 grams, the amount of concentrates a person can buy in a day.
Westword, Denver Post

The much amended bill does not include potency limits and other measures favored by some legalization critics. Nonetheless, it is as sweeping a measure of concern about potential dangers associated with high-potency products as has passed the legislature in any state.

That it happened in Colorado, the first state to open a legal REC market, suggests similar backlashes could arise elsewhere.

• Gov. Jared Polis (D), an industry ally, declined to comment to the Denver Post on whether he would sign the bill. A few weeks ago he signed a bill to double possession limits in the state.
  Marijuana Moment
• Industry group United States Cannabis Council declined to comment on the bill. The National Cannabis Industry Association did not respond to a request for comment.
• Tracking individuals’ daily purchases has raised privacy concerns.
  Colorado Sun
• Cannabis Wire looks at who lobbied for and against the bill.

Related: A new study from the federal government’s National Center for Education Studies found the number of students in grades 9-12 who had used marijuana in the past 30 days had barely changed between 2009 and 2019.

Doings:

• Here are five non-gummie edible brands to watch, according to data firm BDSA. 
• After a Connecticut REC bill passed the state Senate, House Republicans want to wait before legalizing. This raises the possibility of a special session or a delay until next year. 
• MSO Curaleaf launched a brand in partnership with Rolling Stone magazine.
• Big California distributor Herbl acquired distributor and tech company Blackbird  for an undisclosed amount.
• Defunct media start-up Civilized is relaunching as Live Civilized. The company says it hopes to pay back freelancers and employees to whom it owes money.
  Business Insider
• Canna Law Blog answers your top six questions about ketamine clinics.
• WeedWeek contributor Jackie Bryant has a great story about whether stoned lobsters are less distressed when they’re boiled to death.
  Cannabitch
• Washington state will give a free joint to adults who get vaccinated.
  CBS
• On Instagram, a clever variation of wake and bake.

A new report from Key Investment Partners examines why bubbles burst in emerging industries like cannabis, crypto and psychedelics. 

• The paper asks why investors over-value and then undervalue companies in emerging sectors despite increasing consumer acceptance and interest. 
• It notes that cannabis capital markets are heavily affected by regulatory milestones and “comprehensibility,” even though “there is frequently a disconnect between the capital markets performance of publicly-listed cannabis companies and the actual growth of the cannabis consumer markets.”
• In cannabis, it identifies three and a half boom and bust cycles since 2014, when REC went on sales in Colorado (see above graph.)

Quick Hit

1. MJBiz looks at how operators use technology to get direct customer feedback.

Connecticut lawmakers said they had reached a deal with Gov. Ned Lamont (D) to legalize REC. Voting has to take place before the legislative deadline on Wednesday.

While the nearly 300 page bill isn’t public, equity activists pushed back at some of the details which emerged.
Marijuana Moment

• The language at issue, first reported in CT Post,  requires equity businesses to partner with existing MED license holders to learn the business. Participating MED businesses would receive advantages in the REC market, such as lower fees, for participating in the program.
• The Minority Cannabis Business Association is calling on lawmakers to reject the bill. “You cannot repair the damage done to minority communities by erecting a regulatory regime that hands the industry over to corporate monopolies,” the group said in an email.
• A progressive lawmaker said a special legislative session focused on legalization is on the table, though Gov. Lamont and top lawmakers oppose holding one.

Quick Hits

1. Cultivation accounts for about 10% of industrial electricity use in Massachusetts. (MJBiz suggests “playing in the carbon markets” can have benefits for hemp farmers.)
   Worcester Business Journal
2. The clock is ticking for New York towns seeking to opt out of pot sales.
   WSKG

Amazon’s announcement this week that it would stop testing some employees for cannabis, and would lobby for federal legalization, led to a flood of speculation about what the e-commerce giant plans for the industry.
CNBC

“The idea of Amazon Prime drones dropping weed on America’s front porches doesn’t just scare old-time prohibitionists,” Bruce Barcott writes at Leafly. “It sends shivers through cannabis retailers, too.”

He argues, Amazon won’t kill pot retail for the same reasons it hasn’t killed liquor retail.

• Legalization activists and the cannabiz generally applauded the announcement, especially since other companies are likely to follow its example.
  MJBiz
• In March, a New York man sued Amazon for rescinding his warehouse job offer after he tested hot.
  AP
• CNN asked if Amazon would catalyze pot stocks upward. (It hasn’t yet.)

Quick Hit

1. Arizona banks are warming to cannabis clients.
   Phoenix New Times

What else is happening:

• President Joe Biden’s budget maintains the ban on legal REC sales in Washington D.C. District residents voted to legalize in 2014. The New Republic calls his position “shameful.”
  The Verge
• With the compound more widely available, sales of CBD-only products are falling at dispensaries.
  MJBiz
• Nevada approved consumption lounges, with the first ones likely to open late this year.
  Eater
• Motley Fool calls these three pot stocks “better buys than dogecoin.”
• San Francisco-based SPARC said it would acquire California-brand besito for an undisclosed amount.
• An equity license applicant sued the city of Los Angeles over the delay in her application.
  Spectrum News 1
• The Parent Company named LA-brand Josephine & Billie’s as its first equity investment. It didn’t disclose the terms of the deal. 
• Canadian giant Canopy Growth ended its joint venture with hip-hop star Drake.
  BNN Bloomberg
• Evercannabis lists “iconic duos” in cannabis culture, starting with Cheech & Chong.
• The UCLA Cannaclub is starting a joint rolling team to compete against rival schools. DM Ace High to find out about tryout kits.

Industry group U.S. Cannabis Council (USCC) is calling for tighter restrictions on sales of Delta-8 THC; the intoxicating hemp derivative has become popular in states without legal REC.
Bloomberg

While the federal legality of Delta-8 remains murky, and some states have taken steps to crack down, the unregulated product is available in many smoke shops and gas stations. In April, sales were up 144% year over year according to data firm Headset.

• USCC interim CEO Steve Hawkins is calling on the FDA and DEA to end unregulated sales of Delta-8. The group tested 16 Delta-8 products and says all but one exceeded legal THC limits, while seven exceeded limits on metals such as copper, chromium and nickel. 
• At the same time, USCC member Curaleaf plans to release Delta-8 products and its MSO competitor Trulieve already sells them.
• Some producers apparently make bootleg Delta-8 by mixing CBD with battery acid, a situation reminiscent of the unregulated market which led to 2019’s vape crisis. 
• Poison control is seeing more incidents related to Delta-8.
• The lesser known Delta-10 THC exists in a similar legal gray area.
  Westword 

Quick Hit

1. China’s drug regulator banned the use of CBD in cosmetics.
   South China Morning Post