At Davos, Acreage Holdings CEO Kevin Murphy said the US will legalize cannabis in 2019. Here’s why he’s wrong.
Acreage Holdings (OTCMKTS:ACRGF) CEO Kevin Murphy told CNBC's Karen Tso at the World Economic Forum at Davos that the U.S. would legalize cannabis this year through passage of the much-ballyhooed STATES Act, the bipartisan legislation introduced into Congress by Democratic Sen. Elizabeth Warren and her Republican counterpart Cory Gardner.
The legislation takes a states’ rights approach to the cannabis issue, allowing states with legalized cannabis to operate free from federal interference while giving cannabis businesses access to bank accounts and the stock market.
"I believe 2019 is going to be the year," said Murphy. "I believe that it's going to take place through the STATES Act."
"From our vantage point it's very straightforward and we couldn't be more pleased to be leading as the largest player in the United States," he added.
Murphy also told Tso that the U.S. was “woefully behind” Canada when it came to the cannabis industry. He said that while the country’s northern neighbor led the way in cannabis legalization, the U.S. continued to lead the world in "overdoses of opiates," a problem he believes can be solved through compassionate use of marijuana.
In fact, Acreage Holdings made headlines earlier this week when the company had a proposed Superbowl ad rejected by CBS. The ad aimed to show the benefits of medical marijuana, including how it could help with the ongoing opioid epidemic.
An inside track on legislation?
Acreage Holdings had a big coup last year when they brought the likes of former House Speaker John Boehner and former Canadian Primer minister Brian Mulroney into the fold to join their Board.
In the case of Boehner at least, many thought his connections to Congress would help stir the pot, helping to move federal legalization forward.
But to date, Boehner’s influence has yet to be felt. Gardner attempted to bring the STATES Act up for a vote at the tail end of last year, and the results were anemic at best. Although Gardner said the legislation had the votes to pass, Sen. Chuck Grassley of Iowa, then-Chairman of the Judiciary Committee objected to Gardner’s motion, essentially killing the bill.
“This amendment at this time recognizes that you shouldn’t go to federal prison for following state law,” Gardner said on the Senate floor at the time. “That in its essence is sentencing reform. If we had a chance to vote on this amendment today the amendment would be germane, it would be a 50 vote threshold, simple majority up or down, and I know that this bill — this amendment has the support from this body on both sides of the aisle to fix this conflict and allow the states to make their own decisions without the heavy hand of Washington telling them what to do.”
Acreage Holding's rejected Superbowl Ad
All show and no substance
Since the beginning, Acreage Holdings has been all show and no substance. The company has relied on high-profile hires such as Boehner, Mulroney and former Massachusetts Gov. Bill Weld to make headlines while adding little of value to the industry.
Even this week’s Superbowl ad fiasco was more of a stunt than anything else.
If CEO Kevin Murphy wants to see cannabis legislation move forward, he would stop promoting dead legislation such as the STATES Act, and start lobbying Congress to take action on tangible federal legislation.
As he told CNBC this week at Davos, "We don't begrudge CBS, we understand that it remains federally illegal in the United States."
He just continues to ignore what’s right in front of his eyes.