Victoria's Cannabis Buyers Club fined $3.2 million $CA

The Victoria Cannabis Buyers Club (VCBC), one of the Canada's oldest compassion clubs, was fined $3.2 million by the province of British Columbia.

This fine, received in July following a hearing and appeal and disclosed by StratCann, is likely to mark a turning point in the ongoing battle between unlicensed cannabis retailers and regulatory authorities.

Unlicensed dispensary and patient access

The VCBC is one of Canada's oldest and longest continuously operating cannabis dispensaries, but has never been able to obtain a license. Founded in 1996 by Ted Smith, the club has been at the forefront of the fight for access to medical cannabis. This commitment resulted in a landmark court decision legalizing flower-free products such as « edibles »and oils to be ingested for medical use.

Despite fines and raids, VCBC remains determined. Its founder, Ted Smith, insists that Canada's cannabis laws have always prohibited stores like his from having a storefront. He points to several reasons why patients continue to put their trust in VCBC. low THC limits in edible products, restrictions on consumption areas, high prices and the lack of information on the medical uses of cannabis products in recreational stores.

The Community Safety Unit (CSU) is responsible for enforcing the Cannabis Control and Licensing Act (Cannabis Control and Licensing Act). Actions taken against unlicensed cannabis retailers range from inspections and ticketing, to obtaining warrants, making seizures and recommending prosecution. The CSU's efforts are part of a broader strategy to regulate the cannabis market and ensure compliance with provincial laws.

Legal challenge

VCBC's convictions have led it to defy the CSU and reopen after each raid, including a third in March 2023, with a broader legal and advocacy strategy. Lawyers Kirk Tousaw and Jack Lloyd are actively challenging the compliance order issued by the province, filing lawsuits and injunctions against the provincial and federal governments.

The fine received corresponds to twice the retail value of the cannabis sold or held by the company. According to the deputy director of the provincial government, VCBC's sales and possession for sale were valued at 1,617,732.87 $, determined following searches in 2019 and 2020. This heavy fine must be paid by September 6, 2024, with VCBC having the option of appealing the decision.

VCBC isn't the only one facing hefty fines. In January, Kit Warren, another Victoria cannabis store operator, was fined 156,125.50 $. In addition, two people linked to another unlicensed cannabis store were fined over $1 million and had their appeals rejected in January.

VCBC's future remains uncertain. The CSU plans to hold another hearing to determine whether the VCBC directors will be personally liable for the $3.2 million fine. This procedure follows the precedent set in other cases involving unlicensed store operators.

The VCBC's legal team of Kirk Tousaw and Jack Lloyd, meanwhile, is preparing to challenge the compliance order and the broader regulatory framework that restricts access to medical cannabis. Ted Smith and his team argue that current regulations do not adequately address the needs of medical cannabis patients.