Owners Of Medical Marijuana Clinic May Be Charged With Practicing Medicine Without A License

A California Superior Court dismissed criminal charges against two individuals for practicing medicine without a license.  The individuals own a corporation that operates medical marijuana clinics in which licensed physicians issue medical marijuana recommendations to patients.  The Court of Appeal held that the owners of the corporation may be charged with practicing medicine without a license and ordered the trial court to vacate its order dismissing the criminal charges.  (The People v. The Superior Court of Los Angeles County (— Cal.Rptr.3d —-, Cal.App. 2 Dist., July 31, 2013).


Medical Board Investigator Thomas Morris (“Morris”) began investigating Kush Dr. in January 2010.  Kush Dr. is a medical marijuana clinic that operates in two locations in Venice, California.  Sean Cardillo (“Cardillo”) is listed as an agent for service for Kush Dr., LLC, and is the chief operation officers for two other businesses that operate at the same location as one of the Kush Dr. clinics.  One business is Herbalology, which is a medical marijuana dispensary, and the other is Canna Merchant, which is a smoking lounge.

Morris met with physicians working at Kush Dr.  One physician at each location told Morris that they were hired by Andrew Cettei (“Cettei”).  One of the physicians told Morris that Cettei set his hours and he received one-third of the money collected from patients.  The other physician stated that Cettei controlled the practice and paid him from the proceeds of the recommendations he wrote for patients.  The exam rooms at both locations were similar to a closet.  The rooms do not have tables or other equipment needed to conduct an examination, except for a stethoscope and a blood pressure cuff.  Only one room has running water. 

Cettei gave Morris a copy of a lease agreement that provides Dr. Karns is the lessee of one of the premises and Kush Dr. is the lessor.  The agreement provides that Dr. Karns will examine  patients as scheduled by Kush Dr. and that the money collected from the patients will be divided between the Dr. Karns and Kush Dr., with Dr. Karns receiving one-third of the daily profits. 

Three undercover agents went to the clinics and told physicians that he or she had certain symptoms such as headaches from overdrinking, insomnia, and not being able to relax.  After each agent was given a minimal medical examination, he or she received a medical marijuana recommendation.  A dispute over what one agent was charged was settled by Cettei.  Two of the agents were told they could purchase medical marijuana upstairs from one of the clinics. 

The Los Angeles County District Attorney filed a felony complaint alleging, among other things that, Cardillo and Cettei were practicing medicine without a license in violation of Business and Professions Code section 2052.  Cardillo and Cettei sought dismissal of the charges on the ground they did not treat any patients.  A magistrate granted the motion to dismiss the charge of practicing medicines without a license finding that section 2052 only applies to persons who actively treat patients.  The District Attorney filed a motion that included a count for practicing medicine without a license.  The superior court agreed with the magistrate’s interpretation of section 2052 and granted Cardillo’s and Cettei’s motion to dismiss. 


Business and Professions Code section 2052 provides, in part, that “any person who practices or attempts to practice . . .  any system or mode of treating the sick or afflicted in this state, or who diagnoses, treats, operates for, or prescribes for any ailment . . .  or other physical or mental condition of any person” without a valid, unrevoked, or unsuspended certificate is guilty of a public offense.  The District Attorney argued that, because it is illegal for a person without a license to practice “‘any system or mode of treating the sick or afflicted,’” it is illegal to operate “‘medical clinics to treat sick people by exclusively prescribing marijuana and selling it to them.’”  The court of appeal agreed with the District Attorney.  

As co-owners of Kush Dr., Cardillo and Cettei operated the clinics solely for the purpose of providing medical marijuana recommendations.  They controlled the operations of the Kush Dr. “clinics by employing licensed physicians to issue recommendations for medical marijuana, setting the physicians’ hours, soliciting and scheduling patients, collecting fees from the patients, and paying the physicians a percentage of those fees.”  The court concluded that Cardillo and Cettei “set up a system or mode for treating the sick or afflicted in violation of section 2052.”  It found that Cardillo and Cettei were not absolved from liability because they did not examine any patients or prescribe medical marijuana.  The court stated, “Section 2052 clearly prohibits an unlicensed person from either “‘practicing . . . any system or mode of treating the sick or afflicted’ or diagnosing, treating, or prescribing for any disease or ailment.” 

The court concluded the trial court erred by dismissing the count for practicing medicine without a license.  The court of appeal directed the trial court to vacate its order granting the motion to dismiss the count alleging Cardillo and Cettei practiced medicine without a license and to enter a new order denying their motion to dismiss.


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