The Department of Justice will no longer target firms in the legal marijuana business—cannabusinesses—if they are in states that legalize and regulate the drug. A recent DOJ memo says that even though the drug remains illegal under federal law, the agency will not prosecute recreational and medical marijuana dispensaries in states that implement strict and effective controls. Some see this as a major step toward ending the prohibition against marijuana.

Still some conflict: “Prior to this guidance there appeared to be a conflict between federal and state marijuana laws,” Jim Marty (Jim Marty and Associates, LLC) tells BVWire.  “Now, that conflict appears to be resolved, at least in terms of this guide to the exercise of investigative and prosecutorial discretion.  The conflict now is now between two branches of the federal government: the DOJ, which finds state regulations on legal marijuana helpful in meeting its priorities, and the Department of the Treasury, which still considers state legal marijuana sales to be drug trafficking.”

What it means:  In terms of valuation, this new development, which follows the recent legalization of cannabis in Colorado and Washington, has triggered opportunities, challenges, and obstacles—but has prompted many questions. For instance, how can an appraiser assign value in a newly legalized marketplace? Can previously black-market transactions be comparable, let alone admissible?  How do you quantify the risks associated with a product in a hazy and challenging regulatory environment?

Marty and Ronald Seigneur (Seigneur Gustafson LLP), two Colorado-based financial experts, will address these issues in depth in an upcoming webinar, Valuing Marijuana Dispensaries, on October 24. It’s a rare chance to learn the dangers of valuing sellers and dispensaries of medicinal and newly legalized cannabis.