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Bankruptcy Issues in the Cannabis Industry: Strategies Under State and Federal Law for Marijuana, CBD, and Hemp

State-Appointed and Private Receiverships, Alternative Restructurings, Assignments for the Benefit of Creditors, Latest Cases

Recording of a 90-minute CLE webinar with Q&A

This program is included with the Strafford CLE Pass. Click for more information.
This program is included with the Strafford All-Access Pass. Click for more information.

Conducted on Wednesday, November 13, 2019

Recorded event now available

or call 1-800-926-7926

This CLE course will examine bankruptcy and insolvency issues presented by the conflict between the legalized use of marijuana in many states and its treatment as an illegal controlled substance under federal law, and provide practical guidance on counseling clients in Cannabidiol (CBD), hemp, and marijuana-related businesses. The panel will review how different courts have ruled--such as the recent 9th Circuit decision in Garvin v. Cook Investments, explain the available federal and state options for distressed companies, and provide innovative strategies and best practices in advising cannabis industry clients.


The expansion of marijuana's legal status across states nationwide has positioned the cannabis industry for massive growth and fueled a surge in cannabis-related business opportunities for marijuana, hemp, and CBD related business. But like any industry, some businesses thrive while others fail. And many of these struggles are heightened because of the unique regulatory challenges. When cannabis related businesses struggle or fail, many seek protection under the Bankruptcy Code.

Most bankruptcy courts that have considered the question refuse to grant bankruptcy relief to those operating in or around the cannabis industry. Underlying these courts' decisions is the tension between state laws legalizing or decriminalizing marijuana and the federal government's treatment of marijuana as an illegal Schedule I controlled substance. Despite the general refusal by courts to grant relief under the Bankruptcy Code, innovative solutions exist for struggling cannabis related businesses. These include assignments for the benefit of creditors, receiverships, creditor compositions, out-of-court sales, and other tools.

Listen as our panel of experienced bankruptcy practitioners reviews how different courts have ruled, discusses trending tactics, explains the available federal and state options for distressed companies, and provides innovative strategies and best practices in advising cannabis industry clients.



  1. Overview
  2. Bankruptcy Code
  3. Caselaw on whether cannabis businesses can obtain relief in federal bankruptcy courts
  4. Differences between the federal treatment of CBD, hemp, and marijuana related businesses
  5. Innovative and alternative strategies for relief
  6. Case studies
  7. Conclusion


The panel will review these and other high priority issues:

  • What are the practical implications of federal and state law conflicts?
  • What are the primary marijuana related bankruptcy issues?
  • What are the specific techniques counsel should employ when advising a distressed marijuana, hemp, or CBD business?
  • What concerns should counsel for cannabis businesses have regarding bankruptcy given the illegal nature of the subject matter under federal law?


Barnes, David
David M. Barnes, Jr.

Nelson Mullins Riley & Scarborough

Mr. Barnes is a member of the firm's Banking, Bankruptcy, & Creditor’s Rights group.

 |  Read More
Riela, Michael
Michael J. Riela

Tannenbaum Helpern Syracuse & Hirschtritt

With more than 15 years of experience, Mr. Riela advises companies on complex restructuring, distressed M&A, loan...  |  Read More

Rosell, Jason
Jason Rosell

Pachulski Stang Ziehl & Jones

Mr. Rosell represents debtors and creditors in chapter 11 cases with an emphasis on technology. Prior to joining the...  |  Read More

Salzberg, Mark
Mark A. Salzberg

Squire Patton Boggs

Mr. Salzberg focuses his practice on bankruptcy litigation, creditors’ rights, debtor reorganizations...  |  Read More

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