City wins MediLeaf appeal

Medileaf closes doors in Gilroy

GILROY – More than two years after a Gilroy medical marijuana dispensary was shut down for operating without a business license, a state appellate court has ruled that city officials were in the right by declaring it a “public nuisance” despite prolonged objections by the club’s owners.
In a 36-page opinion filed Tuesday by California’s Sixth District Court of Appeals, Associate Justice Wendy Clark Duffy wrote that the City of Gilroy committed no violations when it ordered MediLeaf to close its doors in August 2010.
MediLeaf’s defendants “assert various claims of error, including claims that the use of the property as a medical marijuana dispensary was a permitted use under the local zoning ordinance and that application of the ordinance to prohibit their dispensary operation was unconstitutional,” Duffy wrote. “We reject appellants’ challenges and conclude that the court properly found that Gilroy was entitled to judgment on its public nuisance claim. Accordingly, we will affirm the judgment.”
The city has spent $202,500 in legal bills trying to keep the nonprofit dispensary out of Gilroy, though a final amount has not been tallied.
MediLeaf opened Nov. 9, 2009 without a business license at 1321 First St. It was forced to close Aug. 9, 2010 after Superior Court Judge Kevin McKenney issued an eight-page order on July 20 upholding the city’s claim that MediLeaf was operating illegally following a Gilroy lawsuit.
Attorneys for MediLeaf filed a notice to appeal the prohibitory injunction the day after McKenney’s Santa Clara County court decision and requested the dispensary be allowed to operate during the appeals process. McKenney denied MediLeaf’s request on Sept. 13, 2010.
The dispensary maintains it used a not-for-profit model and therefore did not require a business license.
On Dec. 9, 2010, dozens of undercover law enforcement officers from across Santa Clara County raided eight homes and MediLeaf offices in Gilroy, Morgan Hill and San Jose as part of an eight-month investigation of illegal sales of marijuana and money laundering into the medicinal pot club.
The MediLeaf search warrant obtained by the Dispatch names the six people who law enforcement refused to release at the time of the warrant: founder Goyoko “Batzi” Kuburovich, 50, Patricia Kuburovich, 46, Kristel Kuburovich, 21, Neil Forrest, 58, Bruce Ziegelman, 53, and Kevin Keifer, 54.
City’s battle with MediLeaf
– Nov. 9, 2009: MediLeaf opens at 1321 First St. in Gilroy
– Nov. 16, 2009: City Council approves litigation against MediLeaf in closed session
– Dec. 30, 2009: Council votes 4-3 to publicly approve litigation
– July 20, 2010: Judge upholds city’s claim that MediLeaf was operating without a business license
– Aug. 9, 2010: MediLeaf forced to shut down
– Sept. 13, 2010: MediLeaf’s petition to stay open during appeal denied
– Dec. 9, 2010: MediLeaf offices and homes of its founders are raided by law enforcement officers in Gilroy, Morgan Hill and San Jose
– Feb. 1, 2011: Judge denies MediLeaf’s appeal to stay open during investigation
– Oct. 25, 2011: Appellate court rules in City of Gilroy’s favor

City of Gilroy v. MedliLeaf