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High Drama Over Fate of Milpas Street Medical Marijuana Dispensary

Santa Barbara city officials investigate license revocation; dispensary's founder blames former attorney for errors

Pete Dal Bello opposes the medical marijuana dispensary on Milpas Street in Santa Barbara, The city is considering revoking the operating permit of the owner, Ryan Howe. Click to view larger
Pete Dal Bello opposes the medical marijuana dispensary on Milpas Street in Santa Barbara, The city is considering revoking the operating permit of the owner, Ryan Howe. ( Noozhawk file photo)

The future of a medical marijuana dispensary on Milpas Street in Santa Barbara remained in limbo after a hearing Wednesday to decide whether to revoke the organization’s permit.

After listening to about an hour of testimony, staff hearing officer Susan Reardon said she would make a decision in writing within 30 days about whether to yank the permit.

Wednesday’s meeting offered a window, albeit a blurry one, into the behind-the-scenes maneuverings of the dispensary and the subsequent fallout that could cost the owner its license to operate at that spot in Santa Barbara.

The Santa Barbara Staff Hearing Officer is investigating whether to pull the permit after the dispensary attempted to change corporate officers without approval from the city.

Dispensary Owner Ryan Howe said he did not authorize, nor have any knowledge of, any attempt to change the corporate officers of the Canopy Club, 118 N. Milpas St.

Although Howe was supposed to be the only management and corporate officer in the operating plan, as approved in the original articles of incorporation, two attempts to add the names of Thomas Martin and Daniel Winkler as secretary were made in May and July of 2017.

Howe claims a clerk for his former attorney, Joe Allen, filed the paperwork with the secretary of state to change the statements of information.

The city, however, must approve any change in the corporate officers because it requires background checks and other vetting of individuals who will be managing the marijuana products.

Howe brought to the hearing his latest attorney, Peter Candy, who took the lead, at one point even asking Howe a series of softball questions as though they were in a courtroom.

Candy asked the city if Howe needed to be sworn-in before talking.

After the self-questioning, Howe eventually blamed Allen, who was not present at the meeting.

“The man forgets things,” Howe told Reardon. “He has gone through a series of horrible cancer surgeries. His current behavior and his behavior over the past few years is a direct result of his cancer treatment.”

Howe earlier in the meeting also said it is possible that “his assistant may have gotten confused and may have made some changes to mine.”

Allen, a longtime Santa Barbara attorney, was the CFO and CEO of the Santa Barbara Patients Collective and Healing Center at 3617 State St.

The dispensary never opened its doors, however, because the city revoked the license in 2015 after Allen attempted to switch around the management officers without notifying the city first.

Howe also claimed that he had no corporate records of his Canopy Club because Allen lost them when he was moving his office.

“Along with my corporate records, a lot got lost,” Howe said.

Allen is no longer eligible to practice law in California. His license was suspended in the summer of 2016.

According to the state bar of California, Allen failed to complete work on behalf of some of his clients, including filing a civil action prior to the expiration of the statute of limitations, and failed to file an opposition to a defense motion to stay or dismiss.

Allen in September of 2017 failed to pay annual attorney fees.

"Mr. Allen was introduced to me four and a half years ago by several members of the City Council,” Howe said. “At the time he was the only cannabis attorney in town.”

Howe insisted that he only hired Allen as his attorney, and that he was not authorized to change the articles of incorporation .

“These were misfilings and mistakes made by unfortunately a bad attorney that I hired,” Howe said.

But Reardon pressed Howe about why he doesn't keep a better accounting of his own business, and have his own records.

“Sometimes I do, a lot of times I don’t because I move so much,” Howe said.

Reardon wasn’t impressed.

“Records are important to show information, and you don’t have them,” Reardon said.

In response, Howe said: “Moving forward now, I understand how important it is.”

Reardon asked Howe when he notified the city that Allen was no longer his attorney.

“I am not sure there was ever an official notification,” Howe said. “I think we just stopped working together.”

Howe also said that he has owned 22 companies over his 25 year career, and that “I have never checked the statements of information on any of my companies.”

Assistant City Attorney Tava Ostrenger noted during the meeting that Howe didn’t have any physical proof to verify much of his statements.

Reardon at one point read from the dispensary’s operating plan from November 2015.

“The organization is represented by Joseph Allen and will act in full compliance of the law, regulations and conditions setforth by the ordinance,” Reardon said. “It gives him the authority to represent you.”

Howe countered: “That is is not the way it was intended to be written.”

“It was written that way,” Reardon responded, fighting back interruption by attorney Candy, forcing her to add "Let me finish, let me finish.”

Pete Dal Bello, who owns two properties near the dispensary, called for the city to revoke Howe’s license. He has served as a longtime thorn Howe's side. 

“It really concerns me, Mr. Howe’s ignorance of nonprofit law, especially someone who claims to be a businessman,” Dal Bello said. “The fact that Mr. Howe doesn’t even look at what is being presented to a state office even for a simple review is a careless lack of leadership.”

Dal Bello said following nonprofit law is “not a cafeteria where we can pick and choose. The law is the law.”

Noozhawk staff writer Joshua Molina can be reached at .(JavaScript must be enabled to view this email address). Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.

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