Can Cannabis be Advertised in California?

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Can Cannabis be Advertised in California?

  • By: Kelsey Walsh

In November 2016, California voters adopted Proposition 64, the Medicinal and Adult Use Cannabis Regulation and Safety Act (MAUCRSA), permitting the legalization of Cannabis use. Among the regulations contained within Proposition 64 is Business and Professions Code section 26152(d), also known as the “Advertising Placement Statute.” This statute provides that a licensee shall not advertise or market on a billboard or similar advertising device located on an Interstate Highway or on a State Highway which crosses the California border. Concurrently, Business and Professions Code section 26013(a) furnishes the Bureau of Cannabis Control with the authority to make reasonable regulations under the MAUCRSA, provided the regulations are consistent with the purpose and intent of Proposition 64. 

Subsequently, the Bureau of Cannabis Control exercised its power under Business and Professions Code section 26013(a) to enact California Code of Regulations, Title 16, section 5040(b)(3). This statute provides that all outdoor signs, including billboards, advertising or marketing cannabis and cannabis products shall not be located within a 15-mile radius of the California border on an Interstate Highway or on a State Highway that crosses the California border. 

In 2019, Petitioner, Matthew Farmer, brought an action against the Bureau of Cannabis Control challenging the Bureau’s Advertising Placement Regulation on the grounds that it is inconsistent with the Advertising Placement Statute. The Superior Court in San Luis Obispo County agreed with Farmer. 

The Bureau argued that it acted under its authority by enacting the regulation. However, Business and Professions Code section 26013(a) allows the Bureau to make and prescribe reasonable rules and regulations necessary to implement, administer, and enforce their respective duties under MAUCRSA. These rules and regulations must consistent with the purposes and intent of Proposition 64. “Administrative regulations that alter or amend the statute or enlarge or impair its scope are void and courts not only may, but it is their obligation to strike down such regulations” (Littoral Development Co. v. San Francisco Bay Conservation etc. Com. (1994) 24 Cal.App.4th 1050, 1058; see also In re Edwards (2018) 26 Cal.Ap.5th 1181, 1189.; Ruling On Petition For Writ Of Mandate And Complaint For Injunctive And Declaratory Relief, 19CV-0597)

The Superior Court found that the Bureau exceeded its authority in promulgating the Advertising Placement Regulation. The Regulation is inconsistent with the Advertising Placement Statute and expands the scope of permissible advertising to most of California’s State and Interstate Highways in direct contravention of the statute. The Superior Court cited Carmel Valley Fire Protection District v. State (2001) 25 Cal.4th 287, 300, in its Ruling on Petition for Writ of Mandate and Complaint for Injunctive and Declarative Relief. “[R]egulations that later or amend the statute or enlarge or impair its scope are void.” The Superior Court of California County of San Luis Obispo granted Plaintiff’s Petition, invalidating the Advertising Placement Regulation adopted by the Bureau. 

Licensees must stop advertising Cannabis on roads that cross state borders. Licensees who continue to advertise Cannabis on roads that cross state borders are in direct contravention of the statute. A First Amendment claim restricting speech is not at issue in this case. While Cannabis is legal in California, advertising it is illegal pursuant to the statute and remains illegal federally.