Sonoma County agencies coordinate raids on cannabis oil labs
JULIE JOHNSON THE PRESS DEMOCRAT | June 15, 2016
Sonoma County law enforcement officers raided five properties Wednesday morning associated with two well-known local cannabis product brands, halting work and seizing equipment at a Santa Rosa laboratory used to make therapeutic cannabis products used by patients throughout the state.
Authorities arrested a Rohnert Park man with a history of evading arrest who they said is an owner behind the brands Absolute Xtracts and Care By Design. Santa Rosa police officials said Dennis Franklin Hunter, 43, ran an extensive concentrated cannabis oil production operation that appeared to use illegal and hazardous production methods and was in violation of a variety of city codes.
Hunter was being held on $5 million bail Wednesday at the Sonoma County Jail on suspicion of felony manufacturing a controlled substance — a high bail because of his history of evading police, Lt. Mike Lazzarini said, including a four-year stint on the lam on an illegal pot production charge.
But Nick Caston, a spokesman for the Care By Design line of medical marijuana oil-infused sprays and gel caps and Absolute Xtracts cannabis oil cartridges for electronic cigarettes, said they are legal businesses and do not use volatile chemicals banned by state law in the cannabis oil extraction process.
“We produce medicine as determined by the voters in the 1990s, and we do it with the best practices of any company in the state,” said Caston.
The family of brands was founded in 2014 under a cooperative called CBD Guild, which stands for cannabidiol, which like its better known counterpart THC is one of many active ingredients in cannabis. The CBD Guild provides products for “thousands” of patients “at dispensaries in every major town in the state, from San Diego north,” said Caston.
Caston has worked as a political consultant and said he serves as volunteer CEO of the Leadership Institute for Ecology and the Economy. He was formerly married to current Santa Rosa City Councilwoman Erin Carlstrom.
Caston declined to share information about its finances because it operates as a collective and is technically owned by the patients.
Hunter was arrested on a federal warrant in 2002 for illegal pot production — a 12,000-plant farm in Humboldt County, which local officials at the time said was the county’s largest — after spending four years on the run.
He was handed a 5½-year federal prison term, which he served. In 2013, he was again the center of a manhunt, this time in Arkansas after U.S. Homeland Security officials asked local deputies to detain him at Little Rock airport because they suspected he had drugs on the private plane. But, he escaped in the plane after refueling with deputies approaching. He eventually turned himself in.
Caston characterized Hunter’s past as an element of being among pioneers in California’s marijuana industry as it continues to move toward increased legality.
“They’re the folks that have been leading the way, breaking down the stigma, breaking down the misconceptions,” he said. “He’s really a visionary, along with the other folks in our company, trying to bring practices that are safe. This (law enforcement) action is very surprising.”
A primary legal question is whether the lab workers were using butane gas to produce concentrated cannabis oil — a practice strictly banned in California.
Caston was emphatic they did not use butane gas.
CBD Guild’s current laboratory is in a 34,000-square-foot space at an upscale business park on Circadian Way in west Santa Rosa. It uses specially designed high-pressured carbon dioxide devices to extract oil from marijuana, Caston said.
He said several 4-foot-high cannisters police found in warehouses on Chestnut Street near Olive Park and on Standish Avenue just outside the city limits were left over from an abandoned “R&D project” from at least two years ago.
“It was abandoned for all the concerns we’re all aware of,” Caston said.
He was referring to the volatile nature of butane gas, which can be used to extract oil from cannabis. But the gas is highly flammable and has caused a spate of house fires across Santa Rosa and the country, mostly with makeshift “Breaking Bad”-style labs.
Lazzarini said officers will investigate how the cannisters of butane gas were being used. He said the process used at the main laboratory, which Caston claims is legal, is not lawful.
“This is one of those areas where the courts are going to have to decide,” Lazzarini said. “From a law enforcement standpoint this is not a legal process when it involves processes that are dangerous.”
Santa Rosa attorney Joe Rogoway, who represents the guild, said police were mischaracterizing the nature of the business, which he said was transparent and lawful cannabis oil production.
“They weren’t using butane, they use a process that includes CO2 which is a flame retardant; CO2 is what’s in fire extinguishers,” Rogoway said. “It’s not criminalized in California law.”
Rogoway said the guild suspects a disgruntled former employee made false claims to law enforcement after he left the organization, and that led to the raids.
Rogoway said the guild received a zoning permit from the city in January spelling out that the laboratory would include carbon dioxide extractors “and other extraction methods.” But the zoning clearance paperwork from the city dated Jan. 28, 2016 and viewed by a reporter does not mention medical marijuana or concentrated cannabis.
Clare Hartman, deputy director of the city’s planning department, said while the zoning permit allowed the organization to manufacture essential oils using carbon dioxide extraction, the city’s code currently explicitly excludes any manufacturing of marijuana. The city is currently seeking to draft an ordinance that would allow it, but that hasn’t been done.
“If we are going to permit the processing of marijuana we will be explicit about that,” she said. “This permit does not grant them that right.”
Hartman said the applicants were supposed to request a building inspection before production began, but no request was on record with the city and no inspection was done.
Santa Rosa Fire Marshal Scott Moon said he spent hours Wednesday evaluating the Circadian Way laboratory and found many code problems, including improper storage of hazardous materials such as ethanol and accumulation of hazardous waste.
Santa Rosa police teamed up with Sonoma County Sheriff’s deputies and U.S. Drug Enforcement Administration agents to conduct coordinated searches of five properties in the city and county affiliated with the group, Lazzarini said.
About 100 law enforcement officers broke into teams Wednesday morning and searched various properties associated with the organization, including the laboratory on Circadian Way, warehouses on Chestnut Street and Standish Avenue, a rural property with several greenhouses on Irwin Lane and Hunter’s residence on Golf Course Drive in Rohnert Park, where he was arrested. Lazzarini said Hunter cooperated and didn’t try to flee.
Only two other people were arrested at the properties Wednesday, and both were cited and released for misdemeanor cocaine possession. Caston said cocaine possession violates the organization’s code of conduct.
Rogoway said medical marijuana advocates plan a rally in support of the guild at 11 a.m. Thursday outside the Sonoma County Superior Courthouse.