As the federal government prepares to legalize marijuana, questions are being raised about a former Liberal minister’s role in shaping that legislation while working for a prominent law firm poised to capitalize on the lucrative new industry.
The new bill being unveiled Thursday in Ottawa relies heavily upon the recommendations of a federal task force chaired by former Liberal deputy prime minister Anne McLellan, a senior adviser at Bennett Jones LLP. In addition to promoting itself as the “go-to” advisory firm in the marijuana sector, Bennett Jones and a dozen of its lawyers are listed on securities documents as being granted stakes in one of the companies positioned to profit from legalization.
In recent weeks, since wrapping up her work on the task force in December, Ms. McLellan has been speaking at industry-sponsored events across Canada, where she is touted for her role as an insider on the task force that helped design the new legislation, while also promoting her as a member of the law firm.
Ms. McLellan says she sees no problem with her dual role working for a firm that both advises – and invests in – the burgeoning commercial marijuana industry while also speaking about her past work chairing the federal panel that guided Ottawa in its push to legalize cannabis.
“When I do these speaking engagements, I do so in my role as the former chair of the task force. I’m not there as senior adviser at the law firm of Bennett Jones LLP,” she said. “It cuts both ways, I suppose, in that it’s absolutely fair for people to know where I am employed, and with whom.”
But the dual role is drawing criticism from people inside and outside the industry, who question whether it is appropriate. This is particularly the case, critics say, because key recommendations of the task force place the legalized recreational cannabis industry, expected to be worth billions of dollars, in the hands of a few dozen medical marijuana producers – including companies her firm may advise.
Securities documents list Bennett Jones and at least 15 of its employees as having been issued several hundred thousand shares last summer in Supreme Pharmaceuticals, a company the firm has also advised.
“When selecting its task-force chair, our government would have done well not to provide fuel for this reasonable concern,” said Michael DeVillaer, a drug-policy expert at McMaster University, in a recent report on marijuana legalization.
“That fuel was provided when government selected someone whose employer was not only intimately tied to the cannabis industry, and had identified that industry as a premium growth opportunity, but was also positioned to benefit financially from that industry’s success.”
Brent Zettl, president of CanniMed Therapeutics, one of roughly 40 licensed producers in Canada, said even if the government knew about Ms. McLellan’s interest, the public should be made more aware of the issue.
“Clearly it’s in the grey area,” he said of the situation.
Ms. McLellan, who is not listed as a shareholder in the securities documents, said the potential conflict of her role was properly disclosed at the outset of the task force and care was taken to ensure there were no issues. She said she had no knowledge of her firm investing in any cannabis companies.
On Wednesday, a spokesperson for Health Canada issued a statement that said Ms. McLellan and the other eight task-force volunteers declared their interests and affiliations and signed confidentiality agreements that stipulated they could not release government material without permission. The statement thanked Ms. McLellan and the task-force members for their work, which ended with the Dec. 13 submission of their final report.
Ms. McLellan said she has handed out Bennett Jones business cards while meeting with companies as the chair of the independent panel last fall, but only as “a matter of convenience – not promotion of the law firm.”
“I am very sensitive when I do these things to not wanting to be seen to be promoting Bennett Jones. So it is a fine balance that one walks here.”
The Bennett Jones partner who spearheads the firm’s work in the cannabis sector was unavailable for comment Wednesday. However, Peter Zvanitajs, senior media adviser at Bennett Jones said: “If you talked to Anne, then she provided the [company’s] comment.”
Supreme Pharmaceuticals said it had no comment and referred The Globe and Mail to the company’s filings with Canada’s securities regulator.
The federally licensed producers stand to be the big winners as the government is expected to unveil a bill that ramps up production from these companies to supply demand for recreational cannabis.
Arthur Caplan, head of medical ethics at New York University’s school of medicine, said Ms. McLellan can better manage the issue by disclosing at speaking events that she works for a company heavily involved in the marijuana sector.
“It’s not that she can’t be truthful or say something important, but you have to have a certain skepticism about her comments,” he said.
Mr. DeVillaer said simply disclosing the conflict of interest is not enough.
“The financial interest was property declared, but that makes it no less of an interest,” Mr. DeVillaer said. “The purpose of declaring the interest is to expose it to public consideration as to whether it constitutes a conflict of interest.”
His report concludes the dual role is “an unacceptable conflict that is incompatible with the protection of the public’s health.”
Mr. DeVillaer said this week that the speaking events Ms. McLellan has conducted since wrapping up the task-force work also deserve scrutiny since the line between the law firm and the government task force in promotional material promoting the events is unclear.