Volume 45 Number 07

War on drugs rages on


By Pamela A. MacLean


The two Norton brothers thought someone was breaking into their Oakland apartment to kill them one pre-dawn day in October 2007. Instead, a couple dozen well-armed and screaming federal drug agents stormed the place, rousted the pair, and dragged them around the apartment before arresting them.

Winslow and Abraham Norton operated one of the most successful medical marijuana dispensaries in the Bay Area, the Compassionate Patients’ Cooperative of California, in Hayward. In just the first six months of 2007, the operation grossed $26 million.

But if they thought facing a federal indictment on charges of conspiracy to possess and distribute more than 1,000 kilos of marijuana and money laundering was their worst nightmare, the Norton brothers just weren’t dreaming big enough.

The pair — with all-American good looks, close-cropped beards, and infectious smiles — finish each other’s sentences when they describe their run-in with the federal justice system.

“We were 11 and 14 when medical marijuana was legalized, and we grew up in Berkeley,” Abraham said “It may be naïve, but we didn’t understand the legality. Now we know federal law a lot better.”

Abraham, 26, and Winslow, 29, played by the rules in California’s fledgling medical marijuana law. In 2005 they got an Alameda County permit to operate from the former Sheriff Charles Plummer, a seller’s permit from the state, paid taxes, and had random inspections by local police.

They even hired security guards to patrol the place to make sure patients felt safe. After abandoning a couple of security companies as “no good,” they hired a tough bunch that had former Navy SEALS, Marines, and cops in their ranks, SEAL-Mar Security. They rotated a crew of 44 different guards who patrolled outside and carried Glocks, Smith & Wessons, Sig Sauers, and Rugers to make sure no one caused trouble.

“We are very proud we were squeaky clean and examined under a microscope,” Winslow said. “We never did a deal out the back door,” Abraham insisted. They sold so much marijuana to legitimate patients “it never made sense and it would have hurt the company” to do any illegal side deals, Winslow said.

But selling marijuana is still a federal crime, and in negotiations the prosecutor insisted the brothers accept five-year minimum prison terms. They refused, offering to plead guilty to conspiracy and let U.S. District Judge D. Lowell Jensen set the sentence. Assistant U.S. Attorney Steve Corrigan balked. Then, according to the Nortons and their lawyers, Corrigan upped the ante, threatening to indict their mother, who helped out in the co-op by opening up for the early shift.

“We had to tell her over a Thanksgiving,” Winslow said. “It was pretty miserable. We didn’t know what to do.”

Then, in February 2009, the government indicted their father instead, along with a coworker, and added a far more serious charge: aiding in the carrying of a firearm to further a drug crime. That charge alone carries up to life in prison, but no less than five years.

The Nortons had no guns. It was the gun-toting security team that was “aiding” in a drug conspiracy.

“It is plain and simple coercion, nothing less than that,” said Harold Rosenthal, Abraham’s attorney.

“When we heard the charge, we said ‘you must be kidding,'” says Doron Weinberg, the high-profile defense lawyer who defended record producer Phil Spector in his 2007 murder trial. “I have never before heard of a person charged with violation of a gun law because they hired a security guard.”

Although there is a new U.S. attorney, Melinda Haag, she isn’t talking. “It is an ongoing case so we have no comment,” said her spokesman Jack Gillund.

Sheriff Plummer, who retired in 2007 after 50 years in law enforcement, said of the weapons charges: “It’s bullshit.”

“While I don’t favor their type of business, it was legal. I wanted to make damn sure they were protected, people were protected, and the building was protected. I told them to hire a security crew,” he said.

Abraham says Plummer assured them during a county Board of Supervisors meeting that if they did everything he required, the feds would leave them alone. “I could have said that,” Plummer said when asked about that assurance.

Although the new charge is “aiding” use of weapons, the security crew was not charged with a crime. It had no effect on the guards or the company, according to Tom Turner, one of SEAL-Mar’s owners.

The indictment of their father, Michael, was no accident. Michael is a patient of the dispensary, but the brothers and his lawyer, Bill Osterhoudt, say Michael had no ownership interest in the co-op.

What Michael Norton does have is a criminal record. In the 1980s, he went to prison for two years in what was known as the Kona coffee caper. He bought low-cost Guatemalan coffee beans and sold them as pricey Hawaiian Kona coffee.

Piled on to the Norton brothers’ legal problems is a tax bill that went unpaid when the federal agents raided their apartment and the business. When the federal agents swept in three years ago, they seized the brothers’ two cars, a house they just bought, more than 300 pounds of marijuana, and an electronic deposit of nearly $340,000 in sales tax sent to the state Board of Equalization, according to Winslow.

“We thought the wire transfer cleared. We had confirmation, but the government still seized it,” Abraham said. “They stole the money,” Winslow said. That debt, with penalties and interest, is now close to $1 million, according to Abraham.

“The feds snatched the sales tax money and left the Nortons liable for it, and now they have liens against them for the money,” Rosenthal said.

The irony for the brothers is that they believe they were the first dispensary to voluntarily pay sales taxes. “We collected them for six months and took a check for $1 million to the BOE,” Abraham said. “They didn’t want to take money from medical marijuana sales and told us to call it something else,” Winslow said. “We refused. They wanted us to lie and say the bags cost $300 and the contents were free. But that would have screwed up our accounting.”

After accepting the initial payment, within a week the board issued letters to all the dispensaries in the state asking for sales tax, according to the brothers.

Judge Jensen rejected defense efforts to get the gun charges thrown out in September. But Jensen, a Republican former prosecutor, signaled he is not happy and ordered both sides to sit down Dec. 9 for formal talks before a magistrate to see if they can resolve the case.

“It’s not enough to say we want the case dropped,” Abraham said. “Our credit is destroyed. We can’t work.”

“Three years later we are still fighting it,” Winslow said. “We’ve been fighting this almost as long as the dispensary existed.”

As for the brothers’ chances to negotiate a resolution with the feds, Rosenthal said, “I’m somehow hoping the clouds are going to part and sanity is going to set in.”

Fighting dirty



One by one, representatives from California local governments who had gone toe-to-toe with Pacific Gas & Electric Co. recounted their war stories. They were weary, fatigued, and uncertain of the future. Their resources had been depleted by hefty legal expenses, and they were forever caught up in the game of trying to undo the damage of misinformation campaigns whipped up against them by PG&E. None had ever suspected that following state law would be so arduous.

At a Nov. 8 hearing of the California Senate Select Committee on Renewable Energy, held in San Rafael, officials from the San Joaquin Valley, Marin County, and San Francisco spoke about challenges they faced trying to initiate community choice aggregation (CCA) programs, which would create alternative electricity providers to PG&E.

In accordance with Assembly Bill 117, which allows local governments to purchase power in bulk and distribute it to a customer base using the infrastructure and billing systems operated by investor-owned utilities, representatives from local government agencies said they pursued CCAs to bolster local economies and benefit the environment — but quickly fell prey to fierce marketing campaigns.

So far, PG&E hasn’t faced any real consequences for trying to derail its competitors using unethical and sometimes illegal tactics, and the director of the California Public Utilities Commission, Paul Clanon, did not commit to imposing fines or sanctions against the company.



Despite a requirement under AB117 that utilities must “cooperate fully” with CCA implementation, agency representatives testified that PG&E consistently tried to obstruct their success. The San Joaquin Valley Joint Power Authority’s CCA effort was suspended after a protracted legal battle, and has yet to be revisited.

At the hearing, Sen. Mark Leno listened attentively and offered sympathetic words of encouragement. “It is a superhuman accomplishment that you are even here with us today,” he jested after Dawn Weisz, interim director of the Marin Energy Authority (MEA), finished describing a litany of tactics the monolithic utility employed against Marin’s CCA.

Marin’s experience may foreshadow what’s in store for San Francisco. CleanPower SF, the city’s CCA program, is picking up steam again after an initial attempt to hire a contractor failed to yield an acceptable agreement. On Nov. 5, the San Francisco Public Utilities Commission (SFPUC) announced it had received four responses to a second RFP for an electricity service provider to administer the city’s CCA.

Already San Francisco has weathered some attacks. Sup. Ross Mirkarimi, who chairs the Local Agency Formation Commission (LAFCo) and has been a key figure in moving CCA forward, characterized Marin and San Francisco as “brothers and sisters in arms,” saying, “We would share what we knew of what we could expect, because we were no strangers to these tactics.”

Weisz noted that early on, PG&E sent lobbyists to meet privately with local elected officials. Soon after, the company upped the ante with a negative marketing campaign, distributing mailers that contained misleading information about the program. Their activity prompted a rebuke — but no fines — from the CPUC. “I sent PG&E a letter to say knock it off,” Clanon said at the hearing.

PG&E also set up a phone-banking operation to dial up every prospective CCA customer in Marin County and encourage them to opt out of the program and used false information to persuade customers to stick with PG&E service, Weisz charged. “Many were led to believe that their lights wouldn’t go on if they didn’t opt out,” she said.

Once the CCA was in operation, PG&E imposed a delay on the billing process that made one month’s bill artificially low and the subsequent bill abnormally high, making it appear that CCA rates were higher than PG&E rates. This gaffe, which the company chalked up as a technical error, amounted to a sleight-of-hand: “Our rates were set to match PG&E rates,” Weisz explained.

PG&E did not return calls seeking comment.

Against all odds, Marin County is forging ahead with a power program that offers a 26.5 percent renewable energy mix, with 78 percent of its power generated without greenhouse gas emissions. State records show that only 14 percent of PG&E’s energy comes for renewable sources, failing to meet a state requirement that utilities get at least 20 percent of their power from such sources.

Charles McGlashan, a Marin County supervisor who chairs the Marin Energy Authority, noted that implementing a CCA was the most effective method the county could have employed to reduce greenhouse gas emissions, yielding an estimated 500,000-ton reduction of greenhouse gas emissions annually.

While the potential exists for other municipalities to follow suit, PG&E smear campaigns will likely discourage similar projects. “This is a powerful opportunity that has been virtually destroyed by the antics of PG&E,” McGlashan said. “It has had an extraordinary chilling effect on the political leaders to even embark on such an enterprise.” Later he added, “I’m only doing it because I’m so hell-bent on answering the children’s questions about climate change.”



Meanwhile, in San Francisco, CCA advocates are getting ready to batten down the hatches. “We’re under no illusion — PG&E will compete fiercely,” San Francisco Public Utilities Commission spokesperson Charles Sheehan told the Guardian. He said the city was taking a proactive approach by conducting early outreach to residents and holding public informational meetings about CleanPower SF.

The SFPUC has received four bids from prospective electricity service providers. The respondents are Constellation Energy Commodities Group, Shell Energy North America, Power Choice Inc. (which was selected during the last RFP process but was unable to secure a binding agreement with the city), and Noble Americas Energy Solutions, formerly known as Sempra Energy Solutions. During the Senate hearing, San Francisco CCA director Mike Campbell noted that the city expected to complete a scoring process and select one of the four by the end of the year. The goal is to be fully operational by 2011, he added.

Leno predicted resistance from PG&E. “It’s like a storm coming in,” he said. “We have no doubt of its arrival. They have endless opportunities for nefarious creativity.” He queried Clanon on why the PUC wouldn’t levy fines or sanctions against the utility for the negative campaigns it waged in Marin, as a way to signal that such activity wouldn’t be tolerated in San Francisco.

Clanon did not commit to taking such an action. “That’s a choice about how you get the right behavior,” he said. He noted that the CPUC issued a decision last May preventing the utility from distributing false or misleading information about CCAs or illegally soliciting opt-outs. Clanon warned that PG&E might not be deterred by “fines and sanctions and specific rules.” Pressed on this point later, Clanon told the Guardian that imposing fines or sanctions “would take a lot of resources by us” at a time when the state agency is consumed with other pressing issues, such as the aftermath of the San Bruno explosion caused by a PG&E gas pipeline rupture. “If you set a rule, more people get around the rule,” he said.

Even if the state regulatory body doesn’t hold PG&E’s feet to the fire, Mirkarimi won’t hold back. “We’re tired of the thuggery. We’re tired of the bullying,” he said. He alluded to the Raker Act, a 1913 act of Congress that allowed San Francisco to build the O’Shaughnessy Dam and draw water from the Hetch Hetchy Reservoir under the condition that no private profit was derived from the development, saying the arrangement had been subverted by PG&E. “We should be able to chart our own energy destiny,” Mirkarimi said.

The perils of unaccountable power


By Saul Bloom

OPINION San Francisco has two redevelopment commissions that together have broad, sweeping authority over land use and development in the city. The Redevelopment Agency Commission and the Treasure Island Development Authority (TIDA) have more power in some respects than the Board of Supervisors — people you actually vote for.

There is no way to overstate the importance of the power of these commissions. The Candlestick Shipyard and Treasure Island projects by themselves account for an area the size of the Presidio. Over the next decade, the commissions will oversee the outcome of the Schlage Lock parcel in Visitacion Valley, the Bayview-Hunters Point Project Area, the Hunters Point Shipyard and Candlestick Point, India Basin, Mission Bay, South of Market, and Treasure and Yerba Buena islands.

Two important questions these commissions raise are: 1) Is It healthy for our city and county to vest so much authority into two essentially unaccountable authorities; and 2) Would it be better to vest this responsibility in the Board of Supervisors — considering that it’s the norm around the state for these local legislatures to also act as redevelopment commissions?

In San Francisco, redevelopment commissioners are appointed by the mayor and confirmed by the Board of Supervisors. The board cannot select its own representatives. The commissions wield the power of independent financial authority, multimillion dollar agency contracts, and the ability to destroy a community near you. This is a substantial amount of authority for an unelected body.

The mayor and six members of the Board of Supervisors are all that is required to allow a commissioner to serve for life. There are no term limits for commissioners. There are no meaningful criteria to judge a commissioner’s appointment. There is no yard stick by which to measure a panel member’s worthiness for reappointment every four years. The board’s confirmation and reappointment process is more a popularity party than a Supreme Court nominee review.

Other than the courts, there is no recourse to a commission decision. During the recent Candlestick Point-Hunters Point Shipyard debate members of the Board of Supervisors learned they actually has to seek the approval of these political appointees to modify an environmental impact report.

As a consequence, the appointment of commissioners is highly political. The power of the two commissions makes appointments prime objectives for influential sectors of the city’s political establishment. Those commissioners who disagree with the Mayor’s Office over important issues are not reappointed.

There’s no need to abolish the redevelopment authorities, which have unique legal benefits, particularly in project financing. But we can modify the way the city oversees the agencies.

In most counties in California the Board of Supervisors also serves as the Redevelopment Commission. While that could be a bit unnerving in a city as complicated as San Francisco, it is difficult to see how the process could become more politicized, less accountable, and less democratic.

Having the board oversee redevelopment would at least ensure that agency plans reflect the needs and interests of all 11 districts — and an elected body could be held accountable for those plans.

San Francisco deserves a dialogue about whether this is the best way to chart our course into a very foggy future. 

Saul Bloom is executive director of Arc Ecology.

Editor’s Notes



Imagine if the next mayor of San Francisco was chosen in public. I don’t mean the supervisors voting in public — they’ll have to do that at some point anyway. I mean the various possible candidates going through a process that allows the public to see who’s on the short list — and where those candidates are on the issues.

Sup. John Avalos, with the backing of his colleagues Chris Daly and David Campos, have started the process by suggesting that the board nominate candidates, soon. The idea, Avalos says, is to get a new mayor chosen early so that person can start on the transition process and get up to speed on leading the city.

But there are further steps here. When the supervisors nominate candidates for less significant offices, the Rules Committee holds a hearing and discusses the nominees. What if the supervisors, meeting as a Committee of the Whole, nominated, say, a half-dozen people for the job of interim mayor — then asked each candidate to appear before the group and answer questions?

The voters just overwhelmingly approved a charter amendment that will require the next mayor to appear at a board meeting once a month. There’s no reason the candidates shouldn’t do the same.

The supervisors have every right to ask someone who wants to be mayor what his or her position is on a long list of policy issues. And the pubic has every right to hear the responses.

I know, I know — the candidates would hate it. Standing in front of 11 people, from Chris Daly to Sean Elsbernd, and submitting to the mother of all job interviews would be unpleasant, perhaps unsettling. Some of the top contenders might bow out at the prospect.

But let’s be serious: In a normal campaign, the voters get to see candidates for mayor speak, take stands on issues, and engage in debates. I can’t see the supervisors choosing a new mayor on good faith alone (well, I’d take Tom Ammiano on good faith, but he doesn’t want the job). And if there aren’t any public discussions or interviews, then the only screening process is going to happen privately, with individual board members contacting individual candidates and (most likely) cutting deals.

I think it’s perfectly fair to say to the potential candidates: You want to be mayor of San Francisco? Spend an hour making the case for yourself and fielding questions from the people who are about to hire you. And let the rest of us watch.

Questions for the next mayor


EDITORIAL The progressives on the Board of Supervisors are a long way from united on a possible mayoral candidate, and if they can’t come together, the person who finishes Gavin Newsom’s term will be a compromise candidate, either a short-term caretaker (not the greatest option) or someone who’s more in the moderate camp but a candidate the left can work with — for 2011 and possibly four years after that.

We’re glad to see the proposal by Sup. John Avalos to begin the mayoral selection process early. Picking a mayor in a mad scramble on the day Newsom steps down is a recipe for chaos — and potentially a bad outcome. And as the process begins, the last thing the city needs is a mayor chosen through a backroom deal.

But it’s entirely appropriate for progressive board members to set some standards and to ask the people who are angling for the job to make clear exactly what their positions would be on key policy issues.

In other words, anyone who wants to be the interim mayor — and possibly mayor for the next five years or longer — should have to answer, directly and without hedging, question like these:

How much new revenue does San Francisco need to solve its budget problems, and where, specifically, should it come from? This is the central issue facing the city, now and for the indefinite future. San Francisco’s budget has a structural deficit of at least $250 million, and it simply can’t be closed by cuts alone. What taxes will you pledge to support — and put political capital and fundraising clout behind when they go on the ballot?

What specific programs ought to be cut? Everyone likes to talk about the city living within its means, but that ends up leading to a series of death-by-1,000-cuts decisions that year after year devastate services to the poor. Don’t tell us you need to look at budget figures and work it out later; the big-ticket items are no secret. What’s on the chopping block — and what isn’t?

Will you work to promote public power? How will you expedite community choice aggregation, and will you support a ballot measure to replace Pacific Gas and Electric Co. with a full-scale municipal electric utility?

What are your law enforcement priorities? If money’s tight, should the San Francisco police be hassling nightclubs, or should more resources go into the homicide division? How important are foot patrols, and which neighborhoods should get them? Will the SFPD and juvenile authorities continue to turn young people over to federal immigration authorities?

Who should pay to fix Muni? Should the burden of paying for the transit system fall primarily on the riders (through fare increases and reduced services) or should big downtown businesses and retailers (the major beneficiaries of the system) pay more? Should car owners pay higher fees (including parking fees and congestion management fees) to subsidize transit? Which specific fees would you be willing to push for?

Who should the city build housing for? Right now, much of the new housing stock is aimed at the very rich — and San Francisco is turning into a bedroom community for Silicon Valley. Would you set housing policy to conform with the city’s General Plan assertion that more than half of all new housing should be below market rate? How would you make that balance happen? Should the city spend a significant amount of money for affordable housing, and who should pay for it?

Do you agree that public sector jobs are as important as private sector jobs in San Francisco? Would you support the tax plan proposed by Sup. David Chiu?

Do you support giving the supervisors appointments to all major commissions?

Do you think the city should be doing more to stop TICs and condo conversions and to preserve existing rental housing?

That’s just the beginning of a long list of questions — but the progressives on the board should make sure they have answers before agreeing to support anyone, as a caretaker or interim mayor.