The Washington State Legislature recently wrapped up its 2019 legislative session on April 28.  Before adjourning, the Legislature passed a number of cannabis bills.  Those bills included:

HB 1792: (Pending Governor’s signature.) Adds new crime. It would be a gross misdemeanor for a cannabis retail employee to knowingly sell cannabis products to a person under the age of 21 in the course of their employment. Existing law requires charging the employee with a felony or dismissing the charges.

HB 1794: (Pending Governor’s signature.) Expands permitted activities of a cannabis licensee to include licensing arrangements for trademarks protected by any state or foreign law. Current law is limited to trademarks protected by federal law or Washington State law.

The bill also expands permitted terms for IP licenses to include:

  1. Flat rates if the fee does not exceed 10 percent of the business’s gross sales of licensed products;
  2. Flat rates calculated based on time or milestones;
  3. Exclusivity or qualified exclusivity of the IP;
  4. Quality control and oversight provisions necessary to protect the IP;
  5. Enforcement obligations of the licensee;
  6. Covenants to use the IP; and
  7. Assignments of IP improvements made by the licensee to the licensor

IP arrangements that exclusively contain permitted provisions are exempt from the requirement that the licensor qualify for a cannabis business license, but such agreements must meet applicable regulatory recordkeeping requirements.

HB 2052: (Pending Governor’s signature.). Establishes cannabis science task force to consider lab standards and report to the Legislature no later than July 1, 2020. Clarifies testing lab accreditation requirements and delegates rulemaking authority to the LCB.  Shifts responsibility for lab accreditation requirements from the LCB to the Department of Ecology (starting in 2024). Gives the Department of Ecology authority to assess and collect fees to cover costs.

SB 5298(Pending Governor’s signature.) Labeling changes. Requires LCB to establish new labeling rules and criteria effective January 1, 2020. Requires labeling cannabis products with the disclaimer that certain claims or statements regarding the use of such cannabis product have “not been evaluated by the State of Washington. This product is not intended to diagnose, treat, cure, or prevent any disease.”

SB 5318: (Pending Governor’s signature.) Reforms compliance and enforcement of cannabis licensees.  Gives authority to the LCB to issue a “notice of correction” license compliance matters that have no direct or immediate threat to public safety.  Requires LCB to adopt and expand current compliance education programs.  Requires LCB to give substantial consideration, for purposes of mitigating any penalty, where a licensee develops training programs, internal controls that are designed to prevent such violations giving rise to the penalty, and the licensee has not ignored the violation or other similar violations in the past.  Gives administrative law judges authority to consider mitigating and aggravating factors when hearing contested cases, and gives them the authority to deviate from any penalty proscribed by rule.

HB 1094: (Signed into law.) Compassionate care for medical patients.  Permits remote medical examinations for medical cannabis patients meeting certain requirements.

HB 1095: (Signed into law.) Requires school districts to permit students that are medical cannabis patients to consume cannabis-infused products on school grounds, on school buses, or while attending school-sponsored events.  School policy must:

  1. Require the patient’s parent or guardian to administer the medical cannabis;
  2. Establish protocols for verifying student’s medical patient status, and
  3. Identify locations on school grounds where parents or guardians may administer medical cannabis.

Permits state superintendent of public instruction and schools to suspend implementation if implementation may reasonably jeopardize future federal education funding.