A marijuana harvester examines buds going through a trimming machine near Corvallis, Ore, in this 2016 file photo. (The Associated Press)

A marijuana harvester examines buds going through a trimming machine near Corvallis, Ore, in this 2016 file photo. (The Associated Press)

Federal judge: Oregon pot racketeering lawsuit can proceed

  • By Gillian Flaccus The Associated Press
  • Monday, September 9, 2019 2:36pm
  • News

By Gillian Flaccus

The Associated Press

PORTLAND, Ore. — A judge has ruled that a racketeering lawsuit brought by a vineyard against a neighbouring marijuana operation can go forward despite attempts to have it dismissed — a ruling that could increase the odds for vineyards and other agricultural businesses that have fought the presence of cannabis farms in their backyards with limited success.

U.S. District Court Judge Anna J. Brown found in the Aug. 27 ruling that there was enough evidence the plaintiff, Momtazi Vineyard, had suffered a financial loss from the neighboring marijuana operation to take the case to trial.

At least two previous racketeering lawsuits filed in Oregon over the smell from marijuana farms have been dismissed, making this ruling notable, said Jesse Mondry, an attorney at the law firm Harris Bricken, which specializes in cannabis-related legal matters. Mondry is not involved in the case.

“It changes the playing field in that the court has shown a pathway to bring racketeering claims against marijuana farms,” he said. “I don’t know that this is going to open the floodgates. At least they know now what they need to do to survive a motion to dismiss.”

The case highlights the tension between vintners and marijuana businesses over land, water, odor and aesthetics in the fertile areas of Oregon and California where both wine grapes and state-legal cannabis flourish. The current case involves a vineyard in the heart of a federally designated viticulture area in Oregon’s Yamhill County, where wine tourism is booming.

It also fits into a pattern of federal racketeering lawsuits targeting marijuana businesses.

One of the first was in Colorado, which legalized marijuana in 2012. By 2016, cannabis companies in Oregon were getting sued, said Matt Goldberg, one of the attorneys representing the defendants.

So far, about half-a-dozen similar lawsuits have been filed in Oregon, he said, and each one has gotten a step closer to meeting the basic legal thresholds required to be heard by the federal courts.

“With each sort of experience and each individual case, they sort of retool their methodology and go at it again and see if they have enough now to survive a motion to dismiss,” Goldberg said.

“Maybe they lose one motion here or one motion there, but they’re in the fight,” he said.

Goldberg said he’s confident his clients will prevail.

The attorney for the plaintiff, Rachel Kosmal McCart, declined to comment.

In this case, Momtazi Vineyard sued in April over allegations that a neighboring cannabis-growing operation caused it to lose money because of the “notoriously pungent stench” of marijuana.

According to the lawsuit, a repeat customer canceled a six-ton order of grapes because they were from a section of the vineyard abutting the cannabis operation and the buyer was worried the grapes could be contaminated with the smell.

“A vineyard’s real property value is heavily dependent upon the marketability of the grapes grown on that vineyard property … and the marketability of the grapes grown on Momtazi property has declined,” court papers said.

Previous lawsuits in Oregon against cannabis grows that alleged the presence of marijuana caused “diminished use or enjoyment” of their property or increased security costs have been tossed, but the judge in the latest case wrote that because the Momtazi complaint cited a specific loss, it could proceed.

“Here, it was that they had actually lost an order of six tons of grapes,” Mondry said.

Defendants Mary, Steven and Richard Wagner and their company, Yamhill Naturals, had argued for the lawsuit’s dismissal, saying that the vineyard could not prove an actual financial loss.

They also alleged that Momtazi’s lawsuit contained outright lies: there was no commercial marijuana operation on the property at all, but just a small grow for personal medical purposes.

A new court filing asking the judge to dismiss the case entirely on those grounds is pending.

McCart did not reply to a follow-up email asking her about those allegations.

More in News

Work begins on sewer project

Intermittent closures planned in Port Hadlock

Clallam commissioners interested in section of forest for ODT

Clallam County commissioners plan to send a letter to… Continue reading

Deputy Mayor Navarra Carr accepts a Live United Award on behalf of the city of Port Angeles.
Port Angeles honored with Live United award

The city of Port Angeles was honored with a Live… Continue reading

Smoke vents from the rear car deck doors as firefighters battle a vehicle fire aboard the ferry MV Coho upon its afternoon arrival in Port Angeles on Thursday. (Keith Thorpe/Peninsula Daily News)
Crews evaluated after RV fire on Coho ferry

Combined training helped during incident, deputy chief says

Staff favors denial for rezone

Proposal would pave way for Dollar General Plus

Clallam Transit considering proposal for Narcan at Gateway center

Board members want time for more discussion before next meeting

Turns restricted during roundabout construction

Drivers at the intersection of state highways 104 and 19… Continue reading

Bridge closures canceled for May 17, May 18

Hood Canal bridge closures originally scheduled for this weekend have… Continue reading

Roxanne Pfiefer-Fisher, a volunteer with a team from Walmart, sorts through sections of what will become a slide during Wednesday’s opening day of a community rebuild of the Dream Playground at Erickson Playfield in Port Angeles. (Keith Thorpe/Peninsula Daily News)
Volunteers flock to Dream Playground to start build

Group effort reminds organizers of efforts in 2021, 2002

Lawsuit over pool ban is planned

Lawyers say they’re suing city of Port Townsend, YMCA

Peninsula Behavioral Health adds 3 programs

Services help those experiencing psychosis, provide housing