Marijuana: Ethan Ruby says honest dispensaries can't compete with ones selling to black market
Update: Last week, we reported about Ethan Ruby's plans to open a medical marijuana grow called Theraplant in Connecticut, and his claimed involvement in a Colorado MMJ operation; see our previous coverage below.
From Ethan Ruby's Facebook
After the piece's publication, Ruby responded to our interview requests. He says he was misquoted by other news sources about owning a marijuana business Here's his story, along with information about what we've been able to confirm.
According to Ruby, GrassRoots Health and Wellness (GRHW) is actually owned by Daniel Emmans. He maintains that news outlets such as the Hartford Courant, which quoted him as saying he owned the business, will be making corrections shortly -- although they have not done so at this writing.
"I am an unpaid consultant [for GRHW]," Ruby says. "I didn't have a financial interest; I just had a concern for the business."
Emmans is a college buddy of Ruby's who co-owns a real-estate company with him that at least partially funded the start-up of GRHW three years ago.
"Dan, with my permission, used money ($160,000) from our real estate company to start Grassroots," Ruby says. " I am not on any documents for GrassRoots Health and Wellness."
Since Ruby has not been a Colorado resident for at least two years, he cannot legally be on any documents. He moved to Colorado last August to become a MMJ patient, because cannabis helps him with a spinal-cord injury, he says.
GRHW's application never made it through the entire state application process to become a state certified dispensary. But Department of Revenue representative Daria Serna notes that many MMJ shops that are open remain in licensing limbo due to a large backlog of applications.
The reason that the operation in Colorado was even mentioned in other articles, Ruby says, is because the executive staff for Grassroots, including the owner, managing director and master gardener, are hoping to move to Connecticut to operate Theraplant. However, this plan hinges on the fate of their application with Connecticut's Department of Consumer Protection.
GRHW's application filed in 2010.
As for Grassroots, Ruby concedes that the dispensary ceased operations in Colorado this past March.
"Grass Roots needed to relocate the retail and production operations," he says. "As GRHW poured over the financial and strategies involved, it was decided that it was a much better use of resources, personnel and money to focus 100 percent on Connecticut."
There are several reasons Ruby wants to move the operation out of Colorado.
"We do not choose to skirt laws or come up with caveats to circumvent laws that are put there for a purpose," he says. Grassroots abided by all laws, he continues, while rival dispensaries deal out the back door to other states and break regulations to sell more medicine. "These guys [Grassroots employees] are too by-the-book and too adherent to safety protocols to compete in this marketplace."
He adds that since the passing of Amendment 64, there will be no money left in the medical industry -- and he believes the federal government is a high threat to recreational shops.
Of course, Ruby's claims aren't universally accepted. Owners of medical marijuana dispensaries have long insisted that they are selling cannabis only to licensed patients and reject black-market profit possibilities -- and some MMJ entrepreneurs think the medical industry will remain strong, with patients keeping their red cards in order to avoid paying recreational taxes. In addition, many in the industry are hopeful that federal government will allow states to create and oversee their own marijuana policies.
Ruby already has a $2.5 million warehouse in Connecticut picked out as Theraplant's headquarters. He says he's received $750,000 from investors and has another $7 million waiting for him if the application gets approved.
"We are starting off very slow and very conservative, with a couple hundred pounds a month," Ruby says. "As demand increases we have the ability to ramp up to close to a 1,000 pounds per month."
Ruby did not have a figure for how much the Colorado shop was producing while it was open.
Continue to see our previous coverage on Ruby.