Dustin Walsh
Due to the result of the case in Cass County, experts believe a horde of new lawsuits will crop up as cannabis operators look to shrink their tax bills as profits remain fickle due to low prices across the state’s industry.
StaffSeptember 15, 2023
This story was reprinted with permission from Crain’s Detroit and written by Dave Eggert.
Among the bribes paid to top marijuana regulator Rick Johnson was $2,000 so he could have sex with a sex worker multiple times, federal prosecutors said Thursday as they requested that he be sentenced to a minimum of nearly six years in prison.
Johnson, 70, was a lobbyist and a former Republican House speaker before being appointed to the since-disbanded Michigan Medical Marijuana Licensing Board. He has pleaded guilty to accepting at least $110,200 in bribes from lobbyists and companies seeking licenses when he chaired the board from 2017 to 2019. He will be sentenced Sept. 28.
“This bribery scheme resembled a well-orchestrated organized crime operation: Johnson used a second ‘burner phone’ registered in the name of a limited liability company; bribe payers used an alias (‘Batman’) when referring to Johnson in messages; bribe payments were laundered through multiple limited liability companies controlled by Johnson to help conceal their purpose; and Johnson and others devised false cover stories involving Johnson’s wife should anyone discover and inquire about the payments,” the U.S. attorneys wrote in a sentencing memorandum to District Judge Jane Beckering in Grand Rapids. “Although ultimately laid bare, these machinations served to conceal Johnson’s corruption long enough for the damage to be done, giving at least two companies a head start in Michigan’s new and lucrative marijuana industry.”
They said Johnson, a LeRoy resident who was a lobbyist for a dozen years after leaving office, made it known to others that he was angling for an appointment to the board. In May 2017, then-Gov. Rick Snyder appointed him and made him chair. He had been nominated by Republican former Senate Majority Leader Arlan Meekhof.
“Johnson and others used his past and current political connections as leverage to obtain nearly $2 million in payments for his lobbying services from individual entities related to the medical marijuana industry prior to his appointment to the MMLB,” prosecutors wrote while recommending a sentence of at least 71 months.
They said Johnson accepted no fewer than 38 cash bribes over a period of 21 months. At Johnson’s request, one of the two lobbyists who has pleaded guilty — Brian Pierce of Midland — paid $2,000 to a woman who had sex with Johnson, according to the government. It said Johnson’s repeated use of the sex worker who was paid by businessmen seeking his help and licenses is “abhorrent behavior.”
Johnson solicited regular cash payments from Pierce and another lobbyist, Vincent Brown of Midland, using payment streams from medical marijuana clients, prosecutors said. The cover story for those payments was that Johnson’s wife, Janice, would do accounting work for their lobbying firms, Philip Alan Brown Consulting and Michigan Growers Consultants.
“If anyone ever asked, they would say that Johnson’s wife was their accountant — even though they used an outside accounting firm. Johnson had regular contact with Pierce and Brown while he was MMLB Chair, including at meetings with applicants who sought state licenses from the MMLB where Johnson was present. He even shared office space with them.”
The government has agreed not to prosecute Janice Johnson as part of her husband’s plea agreement.
Prosecutors filed the memo the same day that another of the three other defendants who have pleaded guilty, businessman John Dawood Dalaly, was sentenced to 28 months in prison for bribing Johnson. Pierce and Brown will be sentenced Oct. 18.
