Smoke Shop Lawyers Butt Heads With Hayward

During the June 25th Hayward Planning Commission meeting, two lawyers representing owners of two different smoke shops butted heads with the City of Hayward over revoking the Tobacco Retailer License (TRL). Both lawyers took issues with the revocation and hearing process, with allegations ranging from sloppy paperwork to lying inspectors to denied constitutional rights. Despite the allegations, the attorney representing the City of Hayward insisted that the process was lawful and was confident they'd win in court.

Regardless of whether or not the smoke shops take the city to court, the Planning Commission voted to revoke the licenses for the smoke shops. The lawyers refused to engage with whether or not there were circumstances warranting a lesser penalty, which was the purpose of the hearings. This brings the number of revocations to 10 this year, leaving 94 tobacco retailers throughout the City of Hayward.

Three Strikes And You're Out

Hayward's Tobacco Ordinance says that any retailer which violates the ordinance three or more times within five years should have their license revoked. The violations range from having an expired license, not displaying a license, to selling illegal products such as flavored tobacco and vape products. However, it was pointed out by a lawyer for the City of Hayward that code enforcement has historically lax, since each instance of an illegal product could constitute a violation--having two flavored products on the shelves at once could count as two violations, though code enforcement typically counts all instances during a single inspection as one violation.

Throughout the hearings, it became clear that things in Hayward are more strict than throughout the state. Products like imitation psilocybin mushrooms, for example, are legal in California but prohibited by Hayward's ordinance, according to business owners. By the same token, Inspector Jesse Prins said that any product with the word "Sweet" on the front is considered a flavored product. This includes products like Swisher Sweets which, as the owner of Smokey's pointed out, is just the name of the normal product, not an indication of flavor.

The crux of the issue is, "Lack of knowledge is not a defense to violations of the Tobacco Retail Ordinance," said Inspector Prins. "The responsibility to understand and comply with all applicable tobacco regulations rest with the [license] holder." He continued, saying that lack of knowledge is "not a defense to revocation, it is evidence supporting it. Business owners have a duty to ensure their businesses operate lawfully and are charged with protecting the community."

The four businesses which had hearings at this meeting were:

• Mobile/Hayward Gas and Food (391 W A St) - Selling vape devices and flavored products, and selling to minors
• Smokey's Smoke Shop and Gifts (25088 Hesperian Blvd) - selling flavored tobacco products, vape products, and hemp and CBD products
• Master Shell (22810 Foothill Blvd) - Repeatedly having an expired or not posted license
• Gr8 Smoke Shop (1090 La Playa Dr) - Concealed storage containing illicit products, including pre-rolled cannabis joints, selling flavored tobacco products, and expired/not posted licenses

Smokey's Gets Some Sympathy

The lawyer for Smokey's Smoke Shop and Gifts James Anthony, who was speaking remotely via Zoom, repeatedly spoke during public comment to take issue with the process. He alleged, among other things, that the revocation hearing was impinging on a constitutional right, that any Commissioner with any issues with tobacco should be recused from the hearing due to conflict of interest, that all violations from 2022 should be disregarded (there were three), and that paperwork was confusing and not handled properly.

"I am challenging your jurisdiction to proceed without proper due process," he said during his eight minutes of comment. The owner of Smokey's pled ignorance during his time. "I did not know [that] was going to lead to a revocation," he said. He said he cooperated with Code Enforcement for five years while they figured out the regulatory landscape together.

The owner of Smokey's said that part of the problem is how he orders products and the more restrictive regulations in Hayward. He said that he orders batches of products from a supplier in California who does not necessarily know what is allowed and not in Hayward. This, he said, was how products legal in California but not in Hayward wound up on shelves--he did not check them before putting them out.

Despite Code Inspectors making an effort share a database of California-compliant products available to the owner, products like wrappers are not listed so it can be difficult to tell what is allowed and not, the owner said. "Only tobacco [is listed]," he said, "not papers."

While the Commission seemed sympathetic to the owner attempting to do the right thing, most Commissioners felt the need to be consistent with enforcement. "I think we need to be consistent," Commissioner Robert Stevens said, "There's a rule... the stores violated it. There's definitely consequences if we make mistakes." Commissioner Briggitte Lowe understood that it was a big decision, despite supporting consistency. "There's nothing easy about this decision at all," she said.

Commissioner Ron Meyers was the only one who supported a more lenient penalty, after admitting that he is a patron of the establishment. "I'm all for rule of law," he said, "I just feel like four years ago we had some bad judgement calls... but since then, it seems he's been pretty darn close." The Planning Commission voted to revoke the license, with Meyers the only No vote.

Adversarial Lawyer Angers Commission

The lawyer for Gr8 Smoke Shop took an even more adversarial tone than the previous lawyer, frequently talking out of turn and over commissioners--including Chair Carla Goodbody. During his eight-minute presentation, the attorney took a similar angle as the previous attorney by attacking the process. "We'll let the courts decide what due process actually means," he said.

The attorney alleged, among other things, that the process is unlawful, that the inspector lied to the owner, that what counted as a violation was unclear, and that enforcement was uneven and arbitrary. He pushed for the hearing to be delayed and have all the trappings of a court hearing, despite the ordinance being approved by a Superior Court judge, according to the attorney for the city.

Like the other attorney, he focused on process over the violations. When one of the Commissioners asked about the hidden compartment full of cannabis products which was locked and only accessible with an unmarked RFID card behind the counter, he alleged it could have been used for anything. He later hinted that the photographs could have been faked or of a different location.

During Commissioner questions and deliberations, the attorney spoke over Commissioners, interjected commentary out of turn, and treated the Commission and city staff as hostile or ignorant. Despite the attorney alleging that the Commission did not have the right to revoke the license, Commissioners Robert Stevens and Vasko Yorgov took to Municipal Code to confirm their authority. Commissioner Stevens read that a Tobacco Retail License "conveys a limited conditional privilege and nothing more."

The behavior did not impress Commissioners. Commissioner Yorgov said that the attorney was doing his client a disservice by his behavior. "You're making an argument on behalf of your client and you're going to berate the people making the decision?" he asked. "If you acted like this in a courtroom with a judge, if you spoke with the disrespect you did to the Chair and the other commissioners here, that would be unacceptable."

Commissioner Anika Hardy also took issue with the behavior. "I'm very concerned with how these types of violations affect especially the youth in our community," she said. "So to suggest that we don't care about the residents of Hayward because this affects business owners is very disappointing and hurtful."

The behavior did not appear to pay off, as the Planning Commission voted unanimously to revoke the license of Gr8 Smoke Shop. The business may appeal the decision within 10 days, but the attorney for the city did not appear worried. "We are comfortable that a Superior Court will uphold the process that Code Enforcement used."

Editor's Note: A section was clarified around the legality of imitation mushroom products as it was alleged to be legal in California, but that claim was not verified independently.