Insiders jostling for Ill. medical pot business

2014-06-14T12:15:00Z 2014-06-15T01:25:05Z Insiders jostling for Ill. medical pot businessKurt Erickson Lee Springfield Bureau nwitimes.com
June 14, 2014 12:15 pm  • 

SPRINGFIELD | In a sign Illinois' new medical marijuana law could be a gold mine for investors, a politically connected Glenview attorney is hoarding pot-related company names in hopes of cashing in if the business takes off.

Sam Borek, a former college roommate of the lawmaker who sponsored the state's new law, says he reserved the company names in order to either sell them to others or to start his own companies.

Included in his list of at least three dozen potential corporations and limited liability companies are Illinois Medical Marijuana Sales Inc., Illinois Cannabis Realty Inc. and Cannabis Medical Centers of Illinois Inc.

Just as political insiders cashed in when Illinois legalized casino gambling in 1990, Borek's maneuvers offer a behind-the-scenes look at the jockeying underway to grab a piece of the newly legalized medical pot business.

Take David Rosen, of Chicago, as an example. He helped Gov. Pat Quinn get elected in 2010, serving as the Democrat's chief fundraiser. Rosen also has raised campaign cash for Hillary Clinton and Al Gore.

In April, Rosen filed paperwork to open a medical marijuana establishment in Nevada. In a sign he wants to be a player here too, the company name — Waveseer — also has been registered in Illinois.

Rosen did not return multiple telephone messages left at his Chicago office. But, Nevada records show a number of Illinoisans who've invested money in Waveseer's venture in Nevada, including:

-- River Forest attorney Kevin Conway, who has contributed more than $7,300 to Quinn in the past year;

-- Marcia Rayman. of Big Rock, who gave Quinn $5,000 in September. Her husband, businessman Steven Rayman, has given Quinn $40,000 over the past five years.

-- A trust controlled by retired businessman Howard Gottlieb. of Evanston, who gave Quinn $40,000 in the 2010 election cycle.

-- And, Francesca Cooper, the wife of wealthy Edwardsville attorney Jeff Cooper, who helped bankroll a cancer treatment center at the Southern Illinois University School of Medicine in Springfield.

Although the actual implementation of Illinois' new law is still months away, various companies are in talks with communities to try and win the right to grow and dispense the drug.

Under the rules being written to regulate medical marijuana, companies applying to grow the product and sell the product must meet a lengthy list of guidelines, including showing they have the capital to support one of the enterprises.

The applications will then be scored, with the highest score being awarded a franchise. There will be 22 marijuana growing centers and 60 pot dispensaries.

In McLean County, an unnamed company approached LeRoy officials last month about starting a growing facility in the town. Similar entreaties have been made in Tazewell, St. Clair, Warren and Jersey counties.

Some firms have hired lobbyists to help them move forward in becoming one of the limited number of growing facilities and dispensaries. Jack Lavin, who was Gov. Pat Quinn's chief of staff, is now lobbying on behalf of a medical marijuana business owned by Effingham attorney Matt Hortenstine and Springfield lobbyist Christopher Stone.

Salveo Health & Wellness, a company pursuing a growing operation in Warren County, has enlisted Gov. Jim Edgar's former chief of staff, Mark Boozell, as its lobbyist.

Borek, too, has political connections. In 2012, the Chicago Tribune reported he was a college roommate of state Rep. Lou Lang, D-Skokie, who was the sponsor of the landmark medical marijuana legislation. Records show Borek has given Lang's campaign fund $15,000 over the past 20 years.

Each of the company names he's registered typically contains some reference to the drug that eventually will be made available to Illinoisans who have certain medical conditions.

Based on standard state filing fees, Borek has spent at least $2,300 to reserve the various names for up to 90 days. If he wants to extend the time period, he would have to pay a similar amount for all of the possible companies.

But just as there are no guarantees any of the entities will win the right to run a dispensary or growing operation, there are other pitfalls for investors.

In an interview, Borek said he recently tried to open checking accounts but was turned down because the banks are worried about being penalized under federal law if they deal with marijuana growers and sellers.

"We've got some checks to invest from investors and we can't deposit them," Borek said.

Under one scenario, he said he potentially could remove the words "marijuana" or "cannabis" from his proposed companies in order to appease the banks.

"We're looking at some names now. We've got some good alternatives," Borek said.

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