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Medical marijuna entrepreneur helps people find pot

By Nigel Duara

Associated Press

POSTED:
LAST UPDATED: 10:53 p.m. HST, Jan 01, 2012


PORTLAND, Ore. >> Paul Stanford had lived a life of error, missteps and regrets, one laden with betrayals and failure. Then, on Nov. 3, 1998, Oregon voters approved the medicinal use of marijuana.

And in this way he was saved.

Paul Stanford’s business is medical marijuana, and he is the nation’s leading gateway to the drug. In Oregon, Hawaii, Michigan and three other states where it’s legal, he charges a small fee for access to friendly doctors. People walk in as customers and leave, mostly, as patients.

It’s an idea that has garnered him thousands of dollars — or, depending on who you believe, millions. His Hemp & Cannabis Foundation has established clinics or traveling practices in 20 cities in six states, with plans to expand. In 13 years, Stanford, 50, has climbed out of a hole of debt and into the warm lap of the nation’s medical marijuana community.

Stanford isn’t just a marijuana-license distributor. He’s also a gifted grower whose plants have earned him first-place awards at medical marijuana competitions in the U.S. With such a green thumb, several patients have designated him as their pot grower, and he’s responsible for 80 plants at a warehouse in southeast Portland. 

But there is another side to Stanford. Creditors say he has deceived them, the government says he’s a tax dodger; charged with felonies, he has pleaded down to lesser offenses. He has filed for bankruptcy at least twice. For at least three years, he paid off his personal bills with money from the foundation, and when the feds found out, he simply gave up the foundation’s nonprofit status.

When cornered, time and again, Stanford wriggles his way out. His most recent legal problem, a state court matter that took him to a rainy corner of Oregon in the spring, ended with a deal, too: As punishment for avoiding personal income taxes for two years, he paid more than $10,000 and was sentenced to 160 hours of community service.

For the moment, he has quieted his creditors and worked out a deal with the IRS. He presses onward; he next plans to expand his business into Nevada.

But the questions persist: Is Paul Stanford the beleaguered-yet-sincere advocate for marijuana that he presents himself to be? Or is he something else?

———

Stanford’s eyes flit about a cramped storefront in southeast Portland. He’s surrounded by true believers, the men and women of the pro-cannabis movement who have stood by him and his cause for nearly three decades. If he were a politician, this would be his hard-core base.

Stanford — his bulky, 6-foot-3 frame uncomfortably tucked into a small folding chair — is fronted by a table full of the accoutrements of the medical marijuana trade. There’s no fresh bud, but there’s lots of hemp: hemp oil and hemp lotion and even hemp shampoo. 

The pro-cannabis rally is the site of the launch of the Oregon Cannabis Tax Act, Stanford’s 2012 ballot measure intended to legalize, tax and sell marijuana. The room reeks of pot, the goods in the hands of a few people who likely got their first legal toke after walking out of one of Stanford’s clinics.

Stanford assures them they will be successful in legalizing marijuana in 2012. It won’t be long, he says, before cannabis is sold, taxed and used freely.

“He’s a great man,” said 59-year-old Michael Harris of Portland, dressed in a tattered brown leather jacket, his stringy white hair in an unruly knot. “He’s doing great things.”

Indeed, to some dope enthusiasts, Stanford is something of a savior. It was he who brought the medical marijuana law from theory to practice, the one who went beyond the idea of asking patients’ personal physician for permission to use marijuana and instead, simply brought marijuana-friendly doctors to them.

These are the folks Stanford has inspired in 30 years of marijuana activism. But he’s angered others, among them hopeful venture capitalists left empty-handed, pro-marijuana political donors who feel cheated and fellow medical-marijuana campaigners who insist Stanford’s motives are impure. 

Stanford, a former member of the far-left Youth International Party — the Yippies — started down this road when he drove to a smoke-in on his 18th birthday in Washington, D.C. By 1980, he was in college in Washington state and running legalization drives there. 

He moved to Oregon in the mid-1980s. Here, it’s worth considering how a novice computer science major rose to such a high station among medical marijuana advocates. It began with the boot of a police officer plowing through the lock on his apartment’s front door in 1986. 

Stanford, joint in hand, was caught growing pot. He served five months probation, and forged ahead with plans to legalize marijuana in Oregon.

In 1989, Stanford founded a hemp importation business. It was called Tree Free Ecopaper and it was not successful. Stanford lost a court battle when he broke his probation by traveling out of the country, and served a five-month prison sentence in 1991. 

Upon his release, he returned to the business, but managed to anger investors, and lose lawsuits from people who accused him of taking money while running up debts he has yet to repay. Stanford explains it now as a simple problem of paying his employees too much and not managing expenses. 

His former investors disagree.

In 1993, Stanford called Rich Okada, a Berkeley grad with some cash to invest. A boat with hemp paper was waiting at a Portland dock, but the shippers refused to let anyone near it without a payment.

“He said, ‘Rich, this is a great opportunity, all we need is some (venture capital) just get to the product off the dock,”’ said Okada.

Okada agreed. Stanford took the loan and sold the hemp, but Okada never saw a return. A judge ruled Stanford still owes Okada more than $3,500. It’s one of a series of judgments against Stanford, few of which he has repaid.  

By 1997, Stanford’s hemp-importation company had gone bust. Creditors, and bankruptcy, were closing in.

A year later, 600,000 Oregon voters decided marijuana had a medicinal purpose and, for Stanford, everything changed.

———

Business is now booming for Stanford. In Oregon, 99 percent of applicants get weed, and more applicants go through Stanford than anyone else. At $160 per visit— less for low-income patients — the company grossed $4.2 million in 2009 and $4.9 million in 2010, he said.

Marijuana exists in an odd state of legal limbo in the state. 

The law says patients can grow marijuana, or have it grown for them, but they can’t sell it. Further, there are restrictions on height and maturation, two solid indicators of how much cannabis a plant will yield. 

An example: One and one-half ounces of the strain White Widow in one user’s hands is a legally approved palliative; in another’s hands it’s a maximum sentence of 10 years in prison. A foot-tall Strawberry Cough plant is a producer of medicine, a 13-inch plant is a felony.

Such is the nature of a law that is still evolving, with its detractors promoting bills for narrowing or eliminating it, and a subset of its proponents who are pushing for full legalization.

Of the state’s marijuana patients, more than 90 percent submit their condition as “severe pain” — an admittedly vague explanation that will almost certainly lead to a prescription for cannabis. 

In Oregon, 99 percent of people who ask for marijuana, get it. An Oregon Health Authority spokeswoman said most of those who are rejected failed because of errors in their paperwork. 

The genius behind Stanford’s business model is simple: As long as the state of Oregon and others like it wink and nod at the medical qualifiers of marijuana and legislate it to semi-legal status, Stanford’s business will thrive. 

———

Getting to where he is now required Stanford to step on some toes and edge out some competitors. This is where Stanford is distinguished from others in the medical marijuana game. 

He regards it as a business. Other medical marijuana providers are competitors. Marijuana cards are his supply, and he is operating in a nearly free market system. 

But the people behind the medical marijuana movement don’t see it as a business. It’s medicine, they say, and Stanford is abusing the product. 

Sandee Burbank, executive director of the pro-medical marijuana group Mothers Against Misuse and Abuse and one of the original supporters of the medical marijuana law, says Stanford’s business defies the medicinal intent of the law and is concerned less with getting sick people their medicine than getting people who want weed their drug.

“This guy’s been operating (as a commercial enterprise) for two or three decades,” said Burbank. “I do know from patients that have come to us, they were delighted to have the extra information we gave them, which they obviously had not learned at (Stanford’s foundation).”

Stanford dismisses Burbank as a scorned competitor who couldn’t keep up —Stanford’s organization grew quickly, a startup business in a field of untapped resources, while Burbank’s patient-focused practice has remained more akin to a clinic.

Stanford also says she owes him a debt of less than $1,000 that he said he’s tried to collect from her for years. Stanford said Burbank demanded money for a media campaign and then was unwilling to repay it; Burbank denies it.

Stanford expanded his marijuana-certification empire beyond Oregon’s borders, to Michigan, Montana, Colorado. Each time a state Legislature approves medical marijuana, it’s a safe bet that Stanford will be there. 

Bruce McKinney, an investor and former Microsoft programmer, would warn them to be wary. McKinney made millions in the Seattle tech market and began to donate some of it to marijuana activists. One of them was a bright upstart named Paul Stanford.  

Based on a friend’s referral and an article in a Seattle newspaper, McKinney gave Stanford a loan in 1999. Then, he gave him another one. By 2000, McKinney realized Stanford wasn’t planning to pay him back. 

What followed was a series of suits for more than $38,000. McKinney tried to seize Stanford’s house, his car — anything — to no avail. He has now resigned to the fact that he’ll likely never see the money. 

“Paul doesn’t cheat his enemies,” McKinney said in an email. “He cheats his friends.” 

Stanford replies that McKinney, and indeed almost anyone who has challenged him in court, is envious of his success and bitter about missing the chance to join him. He says he couldn’t afford to pay a lawyer to contest the suits and still can’t afford to pay McKinney back.

The IRS has no fewer than three judgments against Stanford, the largest of which was for $200,751 on Feb. 23, 2009. Stanford refused to comment on the judgment other than to say that he’s on a payment plan.

The state of Oregon, meanwhile, has filed more than $33,000 in tax liens against him, which Stanford said he’s close to paying back.

That does not mean he is repentant. In fact, he blames what he says is a campaign against him that originates in the state’s highest offices.

Let him riff, and he’ll explain: The governor thinks he’s a threat to force the legalization of marijuana in the state. Aided by the Oregon attorney general and the White House Office of Drug Control Policy, the state is trying to put him out of business and in prison.

None of this can be substantiated, of course. But the persecution narrative plays well with the medical marijuana crowd and gives his celebrity a veneer of martyrdom.

Stanford thinks the measure of celebrity he enjoys in the Portland area is a major reason behind his prosecution. He’s been featured weekly on a marijuana-friendly cable access show since 1996, he’s got his famous pothead friends and he’s a go-to quote for newspapers writing about medical marijuana.

Stanford says medicinal use isn’t his only interest in marijuana and hemp cultivation. Stanford thinks hemp seed oil can power our cars and hemp paper can save whole forests. 

For now, most of his publicity comes from his push for legalization. On July 13, an $11,000 donation was delivered to the Oregon Cannabis Tax Act 2012 coffers.

The source? Stanford himself, from a separate campaign account. 

Unfortunately, the check bounced.

“Cash-flow difficulty,” he said. 

“So far, I have made over 98 percent of money raised and spent” in support of the initiative, he said. “I’m a believer. I am trying to get others to donate, too.” 

It would seem that the legalization of marijuana in Oregon would kill Stanford’s business.

But a grow house in southeast Portland, providing for many patients and owned by Stanford, tells a different story. Inside are rows upon rows of towering marijuana plants, organized by strain, standing stock-still at attention like a well-trained rifle brigade. There’s White Widow, AK-47 and Strawberry Cough, all cultivated by Stanford’s expert hand, all ready for the possibility that marijuana is legalized in Oregon. 

It’s all legal now, each set of plants dedicated to a person who is entitled to get it. And if Stanford, medical-marijuana activist, gets legal weed to pass at the ballot box, this grow house could be one of the epicenters of marijuana production in the city, and perhaps the state. 

And Paul Stanford, as always, would stand at the head of the pack. 






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sloturle wrote:
choose life mo bettah
on January 1,2012 | 10:09PM
Kapakahi wrote:

This is one of the most wandering, rambling articles I have read on the S-A site. Was the writer stoned?

Is the point to besmirch the medical marijuana business? Why should we care about this guy's sloppy finances? If we want orderly financial transactions in the medical marijuana trade, let's adopt some rational policies on the subject so straight arrow businesses can enter the field without fear of prosecution. So long as the law is chaotic, entrepreneurs in the business will also be chaotic.

Or let's be completely rational and let adults buys, sell and consume marijuana legally. Tax the thing and make a lot of people happy. AND, take a lot of the profit motive out of the Mexican drug trade so they'll stop chopping off so many heads and killing so many cops, judges and reporters. Or is that too sensible?


on January 1,2012 | 11:01PM
Usagi336 wrote:
So this guy won awards at medical marijuana competitions. I wonder if these competitions were sponsored by High Times magazine? I never knew there were such events.
on January 2,2012 | 09:00AM
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