From The Industry Lawyer:
While New Yorkers eagerly await the state’s recreational marijuana laws to pass, a few entrepreneurial attorneys are preparing for the opportunities and challenges that doing so will bring to the big apple.
Daniel Johnston, a former criminal prosecutor, launched his own law firm in November, 2018. He initially focused his practice fully on criminal defense cases taking place throughout Long Island, Queens and Brooklyn, NY. His firm has more recently been helping small businesses litigate their way out of potential disasters.
Now he’s positioning himself to be one of the go-to cannabis industry lawyers in New York.
In the middle of phone calls related to a case he is working on for a cannabis industry company in litigation with a financier, Dan sat down to talk about his practice, his thoughts on entrepreneurship and advice to those who are launching companies in emerging industries.
“I started my career in law as a prosecutor and then joined a large firm doing civil litigation in New York City. Throughout my early years I always knew that one day I’d open my own firm. I’m driven by the idea that there’s always a way, that every problem has a solution. It’s up to me to figure it out and make it happen. “
“The decision to launch Johnston Law had a lot to do with timing. On the personal side I’m ready to start a family and there was no better time than now to get started.“ His firm, Johnston Law, headquartered in Mineola NY, still handles criminal defense cases, but is focusing more on helping small businesses, handling civil litigation, and advising companies on navigating the treacherous waters of emerging industries.
One of the industries Johnston has been paying close attention to is the cannabis industry, “I was one of a handful of lawyers to fully read through and break down the recreational marijuana legislation that was being proposed in New York into actionable information for businesses.”
With CovID-19 plaguing the city and state of New York, the state lawmakers’ focus on recreational marijuana legislation has taken a backseat. But he’s closely watching the progress and believes that soon the doors will open for entrepreneurs looking to join the green rush.
I asked Dan what kind of legal services he is providing to companies who operate in New York’s cannabis industry: “I’m here to help businesses with any litigation services they might need. I’m handling business disputes for them. Also, playing the role as an advisor. I’m passionate about helping local small businesses succeed and doing what I can to help them avoid getting tangled up with state or federal regulations if they do run afoul. In emerging industries like cannabis, compliance needs to be a priority from the outset.”
He, like others in the space, does see a great opportunity ahead with the eventual passing of recreational marijuana in New York, but Johnston offers more cautious advice to cannabusinesses in the region, especially those who are looking to get started through investor funding.
“Companies in the emerging cannabis industry should be very cautious with financing, through debt, equity, or otherwise. As traditional lenders are hesitant to enter the space, a cottage industry of private financing has emerged. It’s so important to do your due diligence before entering into an agreement with another company who says they can help you out. The earlier you can get an attorney by your side to help navigate the process, the better.”
“If you are looking for financing or partners, don’t just look at the company’s website and take their word at face value. Take considerable time to dig deeper: research the owners, get to know their history and track record of success. Have a professional assist you with due diligence. A little money on the front end can save you a ton of money (and time) on the back end.”