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Victoria Cannabis Buyers Club fined $6.5 million, accused of illegally selling cannabis

Province's fine follows an inspection in May 2019 and two raids, in November 2019 and July 2020
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The Victoria Cannabis Buyers Club Society and its founder Ted Smith have been fined $6.5 million by B.C.'s Community Safety Unit for selling cannabis in contravention of the Cannabis Control and Licensing Act at its Johnson Street location. The fines follow raids of the store in November 2019 and July 2020. ADRIAN LAM, TIMES COLONIST

The Victoria Cannabis Buyers Club Society and its founder Ted Smith have been fined a total of $6.5 million for selling marijuana illegally at the club’s Johnson Street location.

The fine follows an inspection in May 2019 and two raids at the unlicensed, non-profit dispensary in November 2019 and July 2020.

Canada’s oldest compassion club has openly sold cannabis products since 1996. Its campaign for marijuana-law reform resulted in a landmark 2015 decision by the B.C. Supreme Court that allowed oils and edibles to be used as medicine. Smith has long argued that despite legalization, cannabis regulations still don’t meet the needs of those who rely on medical marijuana. In January 2020, Victoria city council passed a motion supporting the club’s request for an exemption from the province’s cannabis regulations while it advocates for changes to the rules governing the production and sale of medical marijuana.

In a Jan. 24 letter from B.C.’s Community Safety Unit, which is responsible for enforcing cannabis regulations, director Jamie Lipp states that the fine is equal to two times the retail value of the cannabis sold, possessed or produced by the society.

Lipp determined that the retail value of the cannabis seized during the two raids totalled $168,068.44 and that the retail value of the cannabis sold by the society between November 2019 and July 2020 was $1,449,664.43. This totals $1,617,732.

“Therefore, I propose to impose an administrative monetary penalty of $3,235,465.74 on the society,” Lipp wrote.

B.C.’s cannabis regulations state that if a corporation is liable for a fine, a director who authorizes or allows the contravention is also liable for the penalty.

Lipp said he has also proposed to fine Smith $3,235,465.74.

On Wednesday, Smith said that although he received the letter a few weeks ago, he didn’t want to go public with it right away.

“I wanted to have a good idea of how we are proceeding to fight it because clearly we’re not going to pay something like that. Typically, when we’ve been raided in the past, we’ve been given the opportunity to fight in court. It was frustrating being raided and not having legal recourse to argue our charter rights, so this is actually going to open the door to those arguments,” said Smith.

The club is preparing to file several court applications and is seeking an injunction. A GoFundMe campaign has been started to raise $50,000 to help the club pay for legal expenses.

Smith didn’t realize on first read that he was also being fined $3.2 million.

“It was kind of funny because I found out earlier in the day the fines had come through. We happened to have a board meeting that very same day and I was reading it to the board and I said ‘Wait a minute, I have my own $3.2 million fine,’ ” he laughed. “Ironically, it doesn’t upset us more because whether it’s $3.2 million or $6.5 million, it’s just a ridiculous number we’re not paying anyway. It just made what the government is doing that much more outrageous. They are the ones that are going to look foolish here.”

Smith believes the Community Safety Unit wants to make an example out of him.

“I sort of joke that they must have read the letter of support from the mayor and decided to double-down on me. Because it’s just bizarre. I don’t think they’ve done that in any other circumstance,” said Smith.

The medical marijuana crusader said he has helped sick people his whole life.

“For them to make an example out of me when they’ve done such a terrible job of the medical marijuana system is just ridiculous,” he said.

ldickson@timescolonist.com

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