A new report warned that cannabis growers have no access to federal bankruptcy protection, thue ‘undermining’ the industry’s potential. This is because marijuana is still classified by federal law as an illicit substance.
According to the Cannabis Law Journal, the fact that cannabis remains a Schedule 1 drug allows the Controlled Substance Act (CSA) to block bankruptcy relief to businesses that sell the product, acting as “the boogeyman of bankruptcy jurisprudence,” stated the report, written by Travis Stewart, a law student at the University of Nevada, Las Vegas.
As long as the plant remains illegal at the federal level, cannabis-related debtors (CDRs) cannot receive bankruptcy relief, resulting in totally disparate treatment of them.
– Read the entire article at Benzinga.
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