California pot entrepreneur sentenced to five years in prison

January 21, 2014

legalize-marijuana-california-environmentA Central Valley medical marijuana entrepreneur, who once applied to set up a dispensary in San Luis Obispo, has received a five-year-federal prison sentence. [Modesto Bee]

Stockton businessman Matthew Davies, an MBA graduate, restaurateur and owner of a property management company, operated a $10 million medical marijuana enterprise in the Central Valley. Last year, Davies pled guilty to conspiracy, manufacturing and sales of marijuana, despite previously launching a media campaign claiming he was the target of wrongful prosecution.

“If California had the gumption to remove ambiguities of our law, there is no way a federal prosecutor would have been able to prosecute me,” Davies said.

Davies operated seven dispensaries in the Stockton and Sacramento areas, as well as a 30,000 square foot cultivation center in a Stockton warehouse. He gained a reputation for taking over and renovating failing dispensaries, often equipping them with holistic health services, such as chiropractic care, massage therapy and acupuncture.

In 2011, Davies submitted a business license application to the city of San Luis Obispo for a proposed dispensary. The city rejected the application, citing a lack of zoning for medical marijuana.

Though a moratorium on dispensaries in San Luis Obispo had expired, Davies chose not to appeal the decision. He told CalCoastNews that there was no hope for opening a dispensary in the city.

Federal investigators claim Davies wrote $117,000 in checks from dispensaries he owned to pay down debts for his upscale French restaurant and a mobile home park he operated.

Davies ran his medical marijuana venture as a nonprofit and was supposed to only receive a modest salary. Feds also accuse Davies of using hundreds of thousands of dollars in profits to acquire other dispensaries.

While facing prosecution, Davies hired former Clinton administration official Chris Lehane to run a media campaign aimed at keeping the businessman out of prison. Lehane launched a website,, and gained coverage in the New York Times and Huffington Post.

Davies, a father of two daughters, ages 2 and 1, will begin his sentence on March 3.


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But this is the system that most of us bought into when good ol’ Nixon called for the “War on Drugs”, remember? Then California called out to “shorten” that war by not going after the manufacturers, suppliers or growers but the end users, i.e. no demand no need. Now we have over 4,000 people in California prisons for simple possession for personal use of a controlled substance other than pot (where’s the victim in that?) costing the tax payers over $200,000,000 a YEAR!

In 2013 SB649 was introduced and supported by state legislators, which aimed to give judges and District Attorneys the discretion to charge possession of small amounts of illicit drugs for personal use as a felony or a misdemeanor as the case warrants. Gov. Brown vetoed it.

I’ve always felt that if we had a deduction section on our paychecks that was headed “Prison Costs” we’d be a lot more vocal on prison reform in this state. For the fiscal year of 2013-2014 California Department of Corrections budget is over $9,000,000,000.00 dollars (used all those zeros to make a point)!

Just sayin’…

not to mention the union for correctional officers, very tough savvy in fighters with a lots of do re me

Zaphod: You raise a good point, but you border on the edge of a “blame the unions for everything that ills society” mentality; please be careful. Unions are NOT the bane of our existence- BUT (capitalized to show it is a big but) in the case of Governor Brown issuing this veto, I do believe you are spot-on. To the bigger question of legalizing recreational cannabis; the huge amounts of money to thrown against this will come from the alcoholic beverage industry, law enforcement agencies AND law enforcement unions, including the correctional officers. None of these groups are “evil”, they will just be investing in protecting their current “way of life”; wrongheaded for sure, but still their legal right to do so. I just hope the majority of voters can see through the propaganda to realize that Colorado hasn’t fallen into total depravity due to their legalizing cannabis for personal consumption.

I forgot to mention “big pharma” as another industry that will fight the legalization of cannabis next time it comes up for a vote here in California.

bob, it is good to see that you can recognize that sometimes unions act in “wrongheaded” ways. While I also think that there is a place for unions in the social landscape, I am more inclined to think that public employee unions should be much more severely limited in what they are allowed to do. This is the second most important reason why and in think that you underestimate how negative the effect is upon our government. (The most important reason is that they almost always fight terminations and harsh discipline for employees who abuse their power or act with gross negligence /incompetence — the “thin blue line” mentality which is not limited to police.)

All groups of people, unions, associations and even corporations can act in wrongheaded ways; being groups of people, flaws are just part of our nature.

I can agree that public employee unions should have some of their clout reduced, if it can be done without taking away anyone’s rights.

One of the primary reasons unions used to be so successful was the ability to fight against unjust terminations; in the culture of “at will” employment, pissing off a boss was a good way to get fired, even if you did your job very well and were otherwise a real asset to the company. Unfortunately, in some cases, people who should have been fired did get their jobs back or were not fired because the unions were so successful at fighting terminations. (Again, groups of people will sometimes do less than perfect things)

In the discussion about public employee unions and their power, being able to fight unjustified terminations is one basic right that they should be able to keep, IMO. The area where I think most of us, regardless of political beliefs can agree on though, is when discussing the ability of public safety employees being able to fight against terminations; when talking about police departments, fire departments and so on, when an employee violates the public trust, the public should have an input on determining that employee’s fate. An oversight committee, made up of interested citizens who are sworn to protect the privacy of such public safety employees should have the ability to make determinations about questionable individuals who have had complaints lodged against them, with the ability to enforce their findings over the possible objections of the head of any such agency, like the fire chief, the police chief and the sheriff.

Having such an oversight committee should go a long way in giving the citizens a say in how parts of our government is supposed to work, since many times an agency head isn’t elected directly.

you forgot the private prison lobby, unspeakable evil

Agreed; and amended: The private for profit prison lobby; designed and engineered to make money off of the suffering of those who are caught up in laws of questionable value to society, but laws on the books none the less. And what good is a law if you can’t find someone who is violating it to throw that book at them?

Stupid Feds. I am sick and tired of watching our country waste money on the pot war. You have corruption at all levels just trying to keep jobs for private prisons, big alcohol and pharma lobbying millions against pot. Screw the bought out polititions all the way down to our local city council’s who pass these stupid bans. We need to start taking these votes to the people and tell our local leaders to eat shit.

But can you tell us how you really feel?

Don’t forget that even taking votes to the people is meaningless as some appointed judge becomes the final arbiter a la prop 8. look at all of the money fools on both sides of that issue spent only to have one judge say thumbs up or thumbs down.

Federal law trumps state and Anyone participating in purchase, sale, manufacture of pot in a marijuana legal state can easily be arrested for committing a federal crime and should not be surprised if their door is kicked in by jack booted federal thugs one night.

Sounds more like he’s being incarcerated for misuse of nonprofit funds rather than for distribution of marijuana. Substitute “homeless” for “marijuana” and people would be for hanging the guy.

Not quite. Replace “NO CHOICE” with “total choice” and then you might be on to something. Homeless do not have much in the way of choice when dealing with available agencies and charities. They take whatever they are offered, generally.

Medical Pot is a luxury and a choice. Heck, there are even different dispensaries and/or sources. Total choice.

If this guy was operating a “you have no choice but to use me” business and was scamming it (and the people w/o a choice), then you’d be correct: we’d want to hang the guy (figuratively; at least in my case).

People mistook my meaning, as a Libertarian I think all drugs should be legal (and the penalties for hurting someone while under the influence should be severe), I was just commenting on the “non-profit” part of the problem.

Not everyone in law enforcement has a void between the ears.


P.S. Who do you think has the most to lose if personal pot use it allowed?

Hint: They make lots of cash from selling inebriating beverages.

So who would you rather have living next to you. A murderer, rapist, pedophile, or this guy? Yea five years for a guy that is not a threat to society in my opinion.

Cory Pierce: wears a narcotics officers badge, steals from the evidence locker, robs people at gunpoint, has fellow junkies selling opiates for him,submits police reports full of lies, he gets 18 months.

This guy, in accordance with California law, with business licences from the cities he operates in, 5 years. SLOtown happiest place on earth, if you have a badge.

I don’t smoke anything and not pro-pot but the gov luv for spending is very draining on our good health. Tax them for using it not us for job security.

What a rip off of our rights. While major crooks remain free or go free this guy gets the shaft. Our legal system is a piece of shit. There is no justice.

Five years in prison?! Seems excessive.

Please! He “PROFITED” and probably hired people. That’s seems to be a HUGE No-No in California lately.

I can think of TONS of “non-profits” that re-invest in the businesses. His real crime was the $117,000 towards his other, non-profits. He could have just as easily claimed that as salary and be done. Not like we’ve not seen a MULTITUDE of six-figure-salaried “non-profits”

I’m sure the efficient system has spent nowhere near the $117,000 to “get” this guy.

meant to say “towards his other, for-profits.”

It is all a part of the Obama way of doing business. Just last week, he said that he thought pot was worse that alcohol. In his usual smoke screen sort of way, he says one thing and does just the opposite. So, the most transparent administration means, catch me if you can.