Administrative Law
Expertise with Cannabis and Hemp Administrators
Administrative action from state and local authorities can threaten licenses, assets, and even personal liberty. The firm represents cannabis and hemp stakeholders in investigations, enforcement actions, and administrative proceedings before the Department of Cannabis Control and California cities and counties.
Matters have included defending landlords facing seven‑figure municipal penalty assessments for alleged unpermitted commercial cannabis activity; negotiating remediation plans and revised use structures to avoid criminal exposure; and guiding owners through ownership‑transfer reviews triggered by changes in control or capital structure. The practice also handles hearings and appeals connected to license conditions, fines, and local enforcement orders, often in parallel with corporate restructurings or transactions.
When regulators reinterpret existing rules mid‑stream, the firm works directly with agency staff and counsel to reconcile deal structures with regulatory expectations, preserving transactions that might otherwise be blocked or unwound.
The heavily regulated cannabis space brings challenges every day, not just from changing laws and rules but also from changing gubernatorial and local government administrations. Whether you are launching a startup, or acquiring an established cannabis or hemp operation in California, regulators will scrutinize your business operations and transactions to ensure adherence to the letter and spirit of the cannabis laws and regulations in California.
The Law Office of Shay Aaron Gilmore provides each of our clients with the specialized legal knowledge and resources necessary to stay ahead of these rules and regulations, in partnership with the government agencies enforcing them. Some of the firm’s legal services include:
- Administrative and regulatory investigations
- Issue advocacy
- Agency interactions
- Law enforcement contacts
- Enforcement actions
- Investigations
- Government applications
- Fines and penalty assessments
- Administrative hearings
- License suspension and revocation proceedings
- Regulator negotiations
- Product recalls
- Preventative measures, reporting and compliance plans
What Advice Do You Have for Cannabis Businesses in Dealing With Administrators?
From Shay’s interview for the Master’s series on ReelLawyers.com
For cannabis businesses dealing with regulators, I strongly advise working with a knowledgeable lawyer and ensuring that, as an operator, you have a robust compliance program in place. It’s also important to maintain good relationships with regulators by responding promptly and communicating openly.
One area that many operators in the cannabis and hemp space tend to overlook is strong recordkeeping practices. Good recordkeeping can speak volumes about your commitment to following both the letter and spirit of the regulations.
Related cannabis and hemp business services: Regulatory Compliance, Real Estate & Land Use, Corporate Law, Commercial Contracts, Employment & Labor Law, Intellectual Property Law, Venture Capital Counsel.
Enforcement Actions and Administrative Hearings: Cannabis vs. Industrial Hemp
Cannabis and industrial hemp operators in California face enforcement through entirely separate administrative systems — with different agencies, different penalty structures, and different hearing processes. For cannabis businesses, the Department of Cannabis Control can issue citations with administrative fines of up to $5,000 per violation for licensees and up to $30,000 per violation for unlicensed persons. Violations are classified as Minor, Moderate, or Serious, and Serious violations can result in license suspension or revocation. When the DCC issues a citation, the licensee has a right to request an informal conference under 4 CCR section 17803, but an informal conference does not start or extend the formal appeals clock. To formally contest a citation, license denial, disciplinary action, or emergency decision, the licensee must request an administrative hearing before an Administrative Law Judge at the Office of Administrative Hearings, where both sides present evidence and testimony in a proceeding that resembles a bench trial. The ALJ issues a proposed decision, but the DCC Director retains authority to adopt, reject, or modify that decision before it becomes final — meaning the agency, not the judge, has the last word at the administrative level.
Industrial hemp enforcement works differently at every level. Hemp is regulated by the CDFA and enforced on the ground by county agricultural commissioners. When a commissioner finds a negligent violation — such as failing to register before cultivating, failing to provide a legal description of cultivation land, or producing a crop that tests above the acceptable THC level — the commissioner issues a notice of violation and requires a corrective action plan under 3 CCR section 4951. The penalties are structured around crop destruction and registration consequences rather than monetary fines: a failed THC test means the crop cannot be harvested and must be destroyed within 45 days, and three negligent violations within five years triggers a five-year ban from hemp registration under Food and Agricultural Code section 81012. Hemp operators who want to contest a notice of violation must first request a hearing before the county agricultural commissioner within 30 days, and if that hearing is unsuccessful, may appeal to the CDFA Secretary’s Legal Office of Hearings and Appeals under 3 CCR section 4952 — a process entirely separate from the OAH proceedings that govern cannabis disputes. The firm represents cannabis and hemp operators at every stage of these distinct enforcement processes, from informal conferences and corrective action plans through formal hearings and agency-level appeals.r
Focused on Compliant Cannabis and Hemp Businesses
California administrative law refers to the law created by the California governor and California administrative agencies, including: regulations, guidance, administrative decisions, and executive orders and proclamations. By far the most important state regulators for the California cannabis and hemp markets are: the Department of Cannabis Control, which is the state regulator for cannabis in California, and its sister departments, the Department of Food and Agriculture (which regulates hemp cultivation and testing), and the Department of Public Health (which regulates hemp manufacturing and distribution).
The Department of Cannabis Control (DCC) proposes and adopts regulations, issues guidance, and decides administrative hearings to enforce cannabis legislation or issue disciplinary action against an operator. When adverse to operators, these decisions can be reached on a number of grounds, including but not limited to:
- Failure to comply with the provisions of any DCC regulation
- Failure to comply with licensing conditions or operating procedures
- Conduct that constitutes grounds for denial of licensure
- Failure to comply with local ordinance regulating commercial cannabis activity
For hemp, the Department of Food and Agriculture administers the California Industrial Hemp Program under the California Industrial Hemp Law and Regulations, and the Department of Public Health regulates hemp manufacturing and distribution under AB 45 (2021) and its implementing regulations under Health & Safety Code Sections 111920 et seq. and Cal. Code Regs. Tit. 17, § 23010.
Administrative law issues can be incredibly challenging for any cannabis business, sometimes beginning with an inquiry or investigation from a state or local regulator and then devolving into formal proceedings, invariably accompanied by large fines. The Law Office of Shay Aaron Gilmore stays current with all proposed and enacted legislation and agency rulemaking relevant to the cannabis and hemp markets, proactively advising clients of their rights and the legal solutions that will allow them to move forward adhering to the letter and spirit of the law profitably.
Representative matters
- Represented a commercial landlord in an administrative proceeding where a California city sought more than USD 1 million in penalties tied to alleged unpermitted cannabis activity, developing remedial measures and negotiating to forestall enforcement and criminal exposure.
- Advised multiple buyers and sellers in ownership‑change transactions where the state regulator reassessed its interpretation of change‑of‑control regulations, engaging directly with the agency to secure approval for closings.
What Experience Do You Have Dealing With Cannabis and Hemp Administrators?
From Shay’s interview for the Master’s series on ReelLawyers.com
In my law practice, I routinely work with cannabis and hemp operators on administrative law matters, including enforcement actions, appeals, and negotiations with regulators. This work often involves helping clients navigate the complex web of state and local regulations to ensure compliance.
Appeals Beyond the Agency: CCAP, Writs of Mandate, and the Cannabis–Hemp Divergence
When administrative hearings at the agency level are unsuccessful, cannabis and hemp operators follow divergent paths to judicial review — and understanding which path applies is critical to preserving appeal rights and meeting tight statutory deadlines. Cannabis licensees who receive an unfavorable final decision from the DCC Director can appeal to the Cannabis Control Appeals Panel, an independent five-member body (three Governor appointees, one Senate appointee, one Assembly appointee) that reviews the administrative record and can affirm, reverse, dismiss, or remand the DCC’s decision. Filing a notice of appeal with CCAP triggers an automatic stay of the DCC decision — meaning the enforcement action is paused while the appeal is pending — and CCAP must issue its decision within 90 days after the hearing concludes. If the CCAP outcome is still unfavorable, the licensee or the DCC can seek judicial review by filing with a California District Court of Appeal or the California Supreme Court within 30 days of the CCAP decision. This multi-layered appeal structure — ALJ to DCC Director to CCAP to Court of Appeal — is unique to cannabis and does not exist for any other California licensing regime.
Industrial hemp operators have no equivalent to CCAP. After exhausting the county agricultural commissioner hearing and the CDFA Secretary’s informal hearing under 3 CCR section 4952, the hearing officer’s decision is final and not further appealable within the agency. The hemp operator’s sole remaining remedy is to file a petition for writ of administrative mandamus in superior court under Code of Civil Procedure section 1094.5, asking the court to review whether the agency exceeded its authority, followed proper procedure, and reached a decision supported by the evidence. For registration denials, suspensions, or revocations, the hearing is conducted as a formal proceeding under the California Administrative Procedure Act (Government Code section 11500 et seq.), with the CDFA bearing the burden of proof by a preponderance of the evidence. The firm advises cannabis and hemp clients on selecting the right appellate strategy at each stage — whether that means pursuing CCAP review, petitioning for a writ, or negotiating a resolution before an appeal becomes necessary — and ensures that statutory deadlines for each track are identified and preserved from the outset.
The provides Administrative Law services to cannabis and hemp operators and investors in: