On Jan. 25, Sweet Leaf owners Anthony Sauro, Christian Johnson and Matthew Aiken accepted a plea deal with the Denver District Attorney to serve one year in prison and face a year of parole and a one year probationary sentence to run concurrently for drug and racketeering charges. City officials have stated this is the first local prosecution of a legal pot enterprise in the U.S.
Sweet Leaf was known as one of Colorado’s largest marijuana companies, with eleven dispensaries at one point, until a yearlong investigation was conducted by the Denver Police Department that was centered on “looping,” the act in which a customer purchases the maximum amount of marijuana that Colorado permits (28 grams) and repeatedly returns to the same retailer to purchase more on the same day. On Dec. 14, 2017, multiple locations were forced to close across the Denver Metro Area after the Denver Police Department issued search and arrest warrants. Sweet Leaf’s cultivation, processing and dispensary licenses were then suspended by the Excise and Licenses Department.
Prosecutors stated that Sauro, Johnson and Aiken were aware of the looping committed and stated that it led to nearly 2.5 pounds of marijuana entering the black market in Colorado and other states. The case began after a tip the DPD received, and budtenders were caught selling an ounce of marijuana to undercover DPD officers multiple times per day. However, charges against at least eighteen budtenders arrested in connection to the investigation were dropped. Former Sweet Leaf Vice President Nicole West and Retail Operations Manager Ashley Goldstein also pleaded guilty to felony marijuana distribution charges and served thirty days in jail in November 2018.
The investigation and Sweet Leaf case have prompted Colorado regulators to clarify the law limiting how much marijuana an individual customer can buy per day. In May 2017, Colorado’s Marijuana Enforcement Division sent a memo to marijuana business license owners to explain the law prohibited that customers could not buy more than 28 grams of marijuana per day, not per transaction.
Colorado regulators reached a settlement with Sauro, Johnson and Aiken to surrender their state-issued business license. The former owners will also be banned from working in the Colorado marijuana industry for 15 years.
