Longform

The Fake-Pot Industry Is Coming Down From a Three-Year High

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Two months later, in May of 2012, Mr. Nice Guy's warehouse exploded, and again, the feds made no arrests. The DEA still had to exercise patience. It wasn't entirely clear whether the analog law and temporary ban on five cannabinoids would be enough to mount a federal case against Mr. Nice Guy. Though politicians in Congress had begun to understand the potential dangers of herbal incense and had even proposed a permanent federal ban, U.S. Sen. Rand Paul of Kentucky kept blocking the bill with libertarian objections. The DEA opted to wait until Congress could push through the legislation.

On July 9, the agency finally got what it was waiting for when President Obama signed the Food and Drug Administration Safety and Innovation Act. Buried at the bottom of the legislation is a subsection known as the Synthetic Drug Abuse Prevention Act of 2012, which permanently adds a host of synthetic cannabinoids, their analogs, and various chemical compositions to the Controlled Substance Act.

With the legislation signed into law, an undercover buy completed, confidential informants in the wings, and a charred warehouse, the DEA thought it was set to take down the men behind Mr. Nice Guy.


On July 26, two weeks after Obama signed the federal ban, the phones of Siegel Siegel & Wright exploded with calls.

"Everyone was wondering what was going on," Wright recalls. "Word was spreading like a wildfire."

Earlier that morning, dozens of well-armed federal agents, some wearing knit ski masks and sunglasses, scattered through a sprawling parking lot of a West Palm Beach industrial complex, located just ten minutes north of the warehouse that had exploded. The target: a single office at the back of the lot with black plastic garbage bags covering its glass front door — Mr. Nice Guy's new center of operations.

The small army busted into the building and was greeted by the overwhelming stench of acetone and "literally tons" of Mr. Nice Guy product, as a deputy with the Palm Beach Sheriff's Office told TV cameras later that day. The feds finally had the men behind one of the "country's largest distributors" of herbal incense in custody.

Dylan Harrison and John Shealy were arrested and charged with three crimes: unlawful distribution of controlled substance analogs, creating a substance with risk of harm to human life while manufacturing a controlled substance analog, and misbranding drugs with intent to defraud and mislead. Michael Bryant, who delivered the 15,000 packets, was also arrested.

Mr. Nice Guy wasn't the only target that day, though. The DEA was in the midst of Operation Log Jam, a one-day tactical takedown of synthetic-drug manufacturers, distributors, and retailers across more than 30 states.

"I was at home at the time and got a call from a client that Mr. Nice Guy had been raided," Wright says. "It was only an hour or so later that the phones started ringing off the hook from both existing and prospective clients nationwide."

The numbers put out by the feds after the raid are staggering: more than 90 people arrested, nearly $40 million in cash seized, and 5 million packets of finished herbal incense confiscated. In Florida alone, the DEA hauled in 3,346 kilograms of raw synthetic cannabinoids.

Wright sees the raid as an expensive attack on small businesses that were trying to operate legally.

"On day two, we even got a couple of calls from clients who were essentially 'trapped' in their place of business. What I mean is they were in the process of packing up products to have them destroyed or to turn over to law enforcement," he says. "They realized from the news that the DEA was arresting people, and they wanted to dispose of products that were now being considered illegal. There was no opportunity for them to even turn things into law enforcement if they wanted to... The products may have been unpopular, but there was never any intent to break the law."

Now, as the Mr. Nice Guy cases wind their way through court, some experts say Shealy and Harrison were not in fact breaking the law. In the months leading up to the raid, the men changed their cannabinoid formulation to two chemicals known as UR-144 and 5-fluoro-ur-144. The DEA contends that these chemicals are analogs of JWH-018 that were meant for human consumption and thus are illegal under the Synthetic Drug Abuse Prevention Act of 2012.

Not everyone agrees, including Kevin Shanks, the expert toxicologist whose company has been contracted by law enforcement agencies over the years for herbal-incense examinations.

"UR-144 is one of those compounds that is enough structurally different that it would be very, very difficult to prosecute somebody on an analog law," he contends. "If someone is trying to make the case that UR-144 was chemically similar or substantially similar to JWH-018 or AM-2201 or any of the banned compounds, I would think that would be a very difficult task.

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Chris Sweeney