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United States v. Richard Marino (2004-2012, Sacramento, CA)

posted Jan 28, 2013, 3:25 AM by The Editor   [ updated Feb 25, 2013, 3:34 AM ]
In January 2004, Richard Marino opened a medical marijuana dispensary called “Capitol Compassionate Care,” located in a town near Sacramento, CA.  Marino's dispensary, which was located in a storefront in historic Roseville, provided an alternative for local medical marijuana patients who didn’t want to travel to the San Francisco Bay Area. Federal agents were aware of “Capitol Compassionate Care” almost immediately, due in part to Marino’s press release advertising the dispensary’s opening.

On September 3, 2004, the Drug Enforcement Administration raided the dispensary and a 250-plant grow at Marino’s home in Newcastle. A 19-count federal indictment followed in January 2006, but a plea deal eventually whittled the charges down to just two: conspiracy to distribute marijuana and money laundering. In spite of substantial cooperation with the U.S. Attorney, Marino was sentenced to 51 months in prison and 48 months of supervised release on July 22nd, 2008. In addition, forfeiture proceedings claimed Marino’s five-acre home and approximately $100,000 in cash seized during the raid. He was also left with a bill from the government for the $2.7 million that the dispensary allegedly generated during its eight months of operation. Marino served out his sentence at a federal prison facility in Oregon, then returned to California to enter a halfway house in 2011.  He was released on April 2, 2012.

Last updated January 31, 2013.


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Roseville Dispensary Owner Richard Marino Sentenced to 51 Months in Prison
by Vanessa Nelson  
Wednesday, 23 July 2008

SACRAMENTO, CA -- Former medical marijuana dispensary operator Richard Marino was taken into custody immediately after a receiving a 51-month prison sentence in federal court yesterday.

The sentencing was the culmination of an investigation of Marino’s Roseville dispensary, Capitol Compassionate Care, which was raided in September 2004 by the Drug Enforcement Administration and the Internal Revenue Service. Marino has been a compliant defendant in the meantime, submitting to the civil forfeiture proceedings that claimed his five-acre home in Newcastle as well as a significant sum of cash. He also provided the government with enough information towards other criminal investigations to qualify for a sizeable sentence reduction. It seems safe to assume that these past four years have been challenging for Marino. The waiting looks to have worn on him, graying his hair and seeming to soften the glint of his dark eyes. But, if so, the friction has had a smoothing effect, polishing him like a tumbled stone. Gone were the beard, the Hawaiian shirt and the righteous sneer that marked his photography sessions with the mainstream media after the raid. Instead, clean-shaven and dressed in drab tones, Marino was the image of plain-faced composure in the courtroom yesterday.

Judge Lawrence Karlton, by contrast, was quite befuddled. He confessed that he needed to take some time to read over the crucial information in the case, creating a suspenseful pause before the beginning of the sentencing. As the judge read the documents, his mannerisms slowly transformed from those of buoyant cheerfulness to those of agonized indecision.

When the judge spoke, his phases were halting, their concepts either stunted or untamed. The trouble, he soon revealed, came from the essential conflict of the case – how to balance consideration of state law that allows medical marijuana and federal law that prohibits it. Such a situation could lead to a great deal of legal confusion, he said grimly, and this created a problem with “how the federal court should treat the compassionate marijuana act passed by the state of California.”

Judge Karlton looked back down at the papers in front of him, and his tone wavered. “Nonetheless, this was a sophisticated operation,” he mused. It was a conclusion that called for a review of the details in the case.

In January 2004, Marino opened Capitol Compassionate Care as a storefront in Roseville’s quaint historic section. At the time, most dispensaries in northern California were concentrated in the San Francisco Bay Area, and travel-weary medical marijuana patients welcomed the convenience of the CCC when it opened. The dispensary was soon doing a brisk business, according to Marino, and expanded to include twenty employees.

The federal government did not give Marino’s dispensary such a warm reception, however. “They should not be surprised if one day we show up with a warrant at their door,” DEA spokesman Richard Meyer said in response to the CCC’s well-publicized opening.

The sense of conflict accelerated during the summer, when Marino purchased a large house in Newcastle and promptly planted a 250-plant marijuana crop on the property. He planned to use the yield to supply his dispensary, but his neighbors were dismayed. Some complained about the garden’s security, saying it included 24-hour guards, barbed wire and bright lights. Others feared the grow would cause a rise in crime and a decline in property values. A few even protested to the smell.

The community took its concerns to local elected officials, but found that Marino was protected by state law and by the agricultural zoning of his land. Undeterred, the neighbors pressed on with a letter-writing campaign to their legislators, and by the end of the summer their plight hit the mainstream press. In the meantime, Marino contemplated an expansion of his business, and made tentative plans to open dispensaries in Marin and Sacramento.

It’s possible that federal agents may have temporarily hindered Marino’s entrepreneurial spirit when they raided his home and his dispensary on September 3rd, 2004, but they certainly didn’t kill it. In fact, Marino re-opened the CCC just days later and welcomed local television newscameras over for interviews. This renaissance didn’t last long, though. It withered soon after the government filed a civil complaint calling for the forfeiture of Marino’s property.

Over the next year and a half, federal prosecutors and investigators reviewed the evidence. With regard to the medical files that were seized, Marino assured his patients they would be kept private and sealed. As for the rest of the confiscated items, the government had plenty to review: computer equipment, financial records, over $100,000 in currency, a dozen pounds of processed marijuana, and several hundred marijuana plants.

In January 2006, the public saw the fruits of this investigation. The U.S. Attorney for the Eastern District of California announced that a grand jury had returned a 19-count indictment against Marino, who had since moved to Fort Bragg. He was charged with a variety of marijuana cultivation and distribution counts, as well as counts involving conspiracy and money laundering. Forfeiture claims again reared their head, with the government seeking over $2.7 million from Marino – the total funds the CCC made during its eight months of operation, according to the indictment. DEA Assistant Special Agent-in-Charge Gordon Taylor piped up in a press release on the indictment, saying, “In a matter of months, [Marino] transformed his marijuana distribution center into a multi-million dollar money laundering and drug trafficking empire.”

By May 2008, there were no remaining traces of an empire. Marino compromised, accepting a deal that required him to plead guilty on just two counts: conspiracy to distribute marijuana and money laundering. This move simplified matters immensely; however, the issue of money generated by the CCC was still a relevant point of debate, even up to the very end.

“He lost money in [CCC],” defense attorney John Duree Jr. proclaimed during the sentencing hearing, eliciting an expression of disbelief from the judge.

Marino threw in his perspective without hesitation. “It all went back into the business,” he said of the money generated by the CCC. He then began listing the business-related expenses that ate up the income. His biggest claim appeared to be a throng of twenty employees who earned at least $15 per hour and were voracious at mealtime – Marino was set back, he said, by providing his workers with lunch everyday and dinners on the nights that they would go to meetings for the city council or planning commission.

In addition to lunch money, the government claimed that the CCC funds had been used to pay for Marino’s credit card payments, dry cleaning bills, the rental of an apartment, housekeeping services, and the purchase of the property in Newcastle. Duree disputed these allegations, but gave the real estate purchase the best spin he could. Since it was used for supplying the business, its purchase was exactly what Marino had described – a re-investment in his business.

This matter appeared to be the least significant of the day’s debates, and in light of the defense’s arguments, Judge Karlton easily lowered the fines in the case from $15,000 to $2500. The more engrossing problem, it appeared, was the judge’s initial dilemma over the conflict between state and federal law.

Judge Karlton rubbed his forehead in distress. “There has got to be some confusion out there from some people,” he surmised. “That should cause some concern about what the appropriate sentence should be.”

Duree seized on the opportunity to emphasize the point. From his experience on the legal committee for the National Organization for the Reform of Marijuana Laws (NORML), Duree said that he could confirm there was “tremendous confusion” about the legality of medical marijuana. As if to verify the proliferation of this confusion, Duree suggested that the judge look at a public website that lists forty medical marijuana dispensaries operating in the Eastern District of California. Hidden in this proposal was an assumption that these forty dispensaries wouldn’t exist if their operators were fully cognizant of federal law and its consequences.

Assistant U.S. Attorney William Wong then informed the judge that the government could present a video of a news interview shot before the bust, in which Marino stated that he knew his conduct was illegal under federal law but was continuing nonetheless. This seemed to be a compelling revelation, and after conferring with Marino, Duree’s comeback was pale. The video was shot only a week before the bust, the defense attorney asserted, and his client had the legal knowledge only because it had been told to him right before the interview was taped. Wong was armed for a full attack, and he shot back with another allegation – information recovered from Marino’s computer demonstrated that he had knowledge of federal law.

Duree, however, stuck to the idea that Marino believed his conduct was legal. What he lacked in countering Wong’s claims, he made up for with insistence and imagery. “Here is an individual who was in contact with federal authorities, state authorities,” said Duree, presenting Marino. “This was not someone who was trying to poke the federal government in the eye and say, ‘I can defy your laws with impunity!’”

Reluctant to referee these contradictions, Judge Karlton turned instead to philosophizing about federalism. It could be seen, he quipped, as “an excuse for doing the worst we can to people.” Then, he reminded the attorneys, “We forget the state is a sovereign.”

After a few reflections, however, the judge was once again stymied by the same conflict. “This is more troubling than it ought to be,” he said with a grave expression. Looking unsettled, he concluded, “We could spend all day worrying about it and I’m not sure it will make any difference.”

With that mindset, Judge Karlton attempted a mad dash to the finish line. He had already uttered the 51-month sentence and was closing in on the term of supervised release when he finally got halted. Quite gingerly, Assistant U.S. Attorney Matthew Segal interrupted to point out that the judge had failed to offer the defendant the requisite opportunity to make a personal statement. Judge Karlton conceded and immediately yielded the floor to Marino, but it wasn’t long before the judge cut in awkwardly.

Saying that he thought he had done everything in a legal fashion, Marino began his speech by soberly listing the organizations with which he had consulted before opening his business: the district attorney, the IRS, Bank of America –

“Indian chiefs,” Judge Karlton suddenly inserted.

It was surely a piece of the judge’s lighthearted humor, but the interruption had a disabling effect. It threw the defendant off, and he looked up from his written notes in confusion. “What?” Marino asked back.

Judge Karlton merely waved him on, dismissing the oddly-placed joke as if it had been just an unruly emission of trapped air. Obediently, Marino continued. He said that his business had benefited many people, and even though “not everyone had serious conditions,” there were hundreds who had diseases like cancer and multiple sclerosis. It was still his belief that he had helped these people, in spite of all that has happened.

Standing up very straight beside his attorney, Marino delivered his finale. “I feel I’m a victim of federal laws that are backwards, irrational and unfairly applied,” he declared.

From the judge’s pained expressions, it would be easy to assume that he agreed. Without further commentary, however, Judge Karlton hurried along to fill in the blank spots of the hearing. After designating a 48-month term of supervised release to follow the incarceration, he granted Marino’s requests to be put in a prison drug program that would reduce his sentence and to formally recommend he serve his time in Sheridan, Oregon. This had the mood of a gameshow loser collecting consolation prizes, but the freshly-sentenced man gathered up his parting gifts with dignity.

When he asked to be allowed to self-surrender, however, Marino was quickly and suddenly denied. Duree began urging the judge to reconsider, but the decision was too firm to budge. “It is the order of the court that the defendant is remanded to the custody of the United States Marshals,” Judge Karlton said with formality, inspiring a scattering of low cries across the gallery as family and friends absorbed the meaning. Unruffled, Marino turned to give his onlookers a serene smile as he was escorted in a gentle flow through the courtroom’s side door and into a holding cell.

“The court stands in recess,” the judge said as soon as the door had closed, hastening down from the bench and disappearing into his chambers.

It was, according to Sacramento Bee archives, the first time that Judge Karlton was faced with sentencing a medical marijuana defendant. Due to the composition of his current court calendar, however, it may not be long before he’s put in the position where he must do it again. Given that likelihood, observers are left to wonder what tactics he will develop to deal with such occurrences in the future, and how he will arrange the weights to balance their inherent conflicts.

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Originally published on July 23, 2008 by Vanessa Nelson at www.medicalmarijuanaofamerica.com (now defunct).
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