Cannabis lawyersJust about whenever Attorney General Jeff Sessions speaks, the cannabis industry panics. Stop it people.

This week Jeff Sessions gave an interview where he was asked about possibly using the federal Racketeer Influenced and Corrupt Organizations (RICO) Act to tackle legal marijuana. The media (the cannabis media in particular) have covered that interview as though it sets forth a roadmap for federal cannabis policy. And since that interview, probably every single cannabis lawyer at my law firm (in California, Washington and Oregon) has received at least one client call seeking an opinion on it.

Stop it everyone. Just stop it. Really. Sessions didn’t do anything in this interview but muse about a seldom used federal statute.

In this interview, Sessions hinted that he might be open to using RICO to pursue cannabis businesses in cannabis legal states:

INTERVIEWER: One RICO prosecution against one marijuana retailer in one state that has so-called legalization ends this façade and this flaunting of the Supremacy Clause. Will you be bringing such a case?

SESSIONS: We will, marijuana is against federal law, and that applies in states where they may have repealed their own anti-marijuana laws. So yes, we will enforce law in an appropriate way nationwide. It’s not possible for the federal government, of course, to take over everything the local police used to do in a state that’s legalized it. And I’m not in favor of legalization of marijuana. I think it’s a more dangerous drug than a lot of people realize. I don’t think we’re going to be a better community if marijuana is sold in every corner grocery store.

Of course he might be open to using RICO to pursue federal criminal law violations by cannabis businesses. I actually do not believe Attorney Generals Holder and Lynch, who were the Attorney Generals during the Obama Administration) would have answered this question substantively much differently. You are not going to get an Attorney General to say, “yes, we have this really important law on the books, but nobody worry because we will never enforce it. Just go ahead and violate it.” Really?

And if you listen to the entire interview here, you will hear Sessions poo-poo the benefits of bringing a RICO action against state-legal cannabis businesses:

INTERVIEWER: [I]t would literally take one racketeering influence corrupt organization prosecution to take all the money from one retailer, and the message would be sent. I mean, if you want to send that message, you can send it. Do you think you’re going to send it?

SESSIONS: Well, we’ll be evaluating how we want to handle that. I think it’s a little more complicated than one RICO case, I’ve got to tell you. This — places like Colorado — it’s just sprung up a lot of different independent entities that are moving marijuana. And it’s also being moved interstate, not just in the home state.

RICO was designed to pursue the mafia and other organized crime groups. RICO provides powerful criminal and civil penalties against people who engage in a “pattern of racketeering activity” and have a relationship to an “enterprise.” “Racketeering activity” includes roughly a hundred different offenses, including violations of the Controlled Substances Act. A “pattern” is established when an offense occurs more than one time in a given statutorily defined time period. An “enterprise” includes any individual, partnership, corporation, association, or other legal entity, and any group of individuals associated together even if they are not in a formal business relationship.

The broad interpretation of “enterprise” means that on a technical legal basis, RICO could pose a significant risk to cannabis businesses. The production and sale of cannabis is prohibited by the CSA and, therefore, regular sales of cannabis could serve as the predicate offense for a RICO charge and all those involved with legal cannabis sales, including vendors, contractors, landlords, lawyers, accountants, and even state officials could arguably be in an enterprise engaging in illegal activity.

But nobody should panic about this, not even close. RICO is a powerful but seldom used tool and that is because both prosecutors and judges view it as a very powerful weapon that should only be used in limited circumstances. The RICO statute has been around since 1970 and I cannot recall a single cannabis case having been brought under it. I am not saying there has never been such a case, but I am saying that it has been used sparingly in dealing with cannabis, if at all, including during Nixon’s “War on Drugs” and Reagan’s “Just Say No” administrations. In this same interview Sessions noted that the federal government has limited resources and it cannot simply commandeer local police forces to pursue RICO charges against cannabis users. RICO cases take a massive amount of effort to prosecute criminally and apparently not even Jeff (“good people don’t smoke cannabis“) Sessions deems this would be money and time well spent.

It also bears mentioning that a few years ago, some private citizens brought RICO claims against marijuana businesses and non-cannabis businesses alleged to have been operating in concert to sell cannabis. As we wrote here, the federal court dismissed those claims.

There is though one important thing cannabis businesses should take from this interview. Sessions is concerned about cannabis businesses that move marijuana from state to state. Note how he brings this up when he says: “it’s also being moved interstate, not just in the home state.” This IS important. The states are mostly in charge of prosecuting criminal activities that happen entirely within their own state borders. A robber in Portland or Seattle or San Francisco will almost certainly be prosecuted by state-city prosecutors; but a robber who brings stolen goods from Seattle to San Francisco could very well be prosecuted federally. The same has always been true of illegal drugs, including cannabis. If you are caught with weed in Newton, Iowa, you risk city or state prosecution. But if you are caught transporting cannabis from Iowa to Illinois, you risk federal prosecution.

So if you want to panic based on this Jeff Sessions interview, you should if you are planning to transport cannabis across state lines. The federal government has never liked interstate cannabis transport and it has always made this clear, as have we, in the following posts:

In Marijuana Law Myths. Not Everything Changes With Legalization, in Myth #2, we explain why it is so dangerous to fall for the myth that you can legally transport cannabis from one legal state to another and why this myth is so dangerous:

2. Now that marijuana is legal in Washington, Oregon, and Alaska, it is legal to sell Washington-grown marijuana in all three states. We hear this one ALL the time, mostly from marijuana businesses that intend to do this, believing it to be legal. It isn’t and please, please do not do this, unless you want to go to federal prison. The same holds true for Washington D.C., where marijuana was just legalized. You cannot just take your “legal” marijuana there and start selling it.

Taking legal pot across ANY state borders by boat or by car or by air is a big deal as it amounts to unlawful interstate drug trafficking.

More importantly, taking marijuana from one marijuana legal state to another is a federal crime. Marijuana is still a Schedule I Controlled Substance. The U.S. Constitution gives the federal government the authority to regulate interstate commerce. This means that it can (and does) prosecute people for transporting marijuana across state lines, even if the transport is from one marijuana legal state jurisdiction to another.

We are not saying that you should expect FBI agents to be sitting at the borders waiting to arrest people for going from one state to another with marijuana, but this is to say that traveling from state to state with marijuana is not advised, particularly by boat or by airplane. More importantly, a business plan that assumes this is legal is a business plan that will set you up to fail, especially if you publicly reveal that your business does this.

This is also a good time to remind you that if you are going to drive from state to state, clear out your cars, your boats, your airplanes, your clothes and your luggage before going from a cannabis legal state to one that is not. State troopers in states like Nebraska, Kansas, and Idaho (and even Nevada where cannabis is legal for medical us but not recreational) love making easy money by arresting and fining people entering with marijuana from Colorado and Washington.

Transporting a Schedule I Controlled Substance, including marijuana, across any state line is a federal felony. This is the case even if your medical marijuana patient card is honored in the next state over, and even if you are moving between jurisdictions that have legalized recreational marijuana. Keep and consume your cannabis in the state where you purchased it, or you run the risk of federal criminal charges for transporting a controlled substance.

So yeah, moving cannabis across state lines (yes, even from one cannabis legal state to another) is a really bad idea.

Oh, and one more thing, many (even some in the cannabis industry) are acting as though one RICO case would do what this interviewer says and “send the message” to all those in the cannabis industry to terminate all their employees and shut down their state-legal cannabis businesses. In other words, many are acting as though one RICO claim would be “lights out” for legalized cannabis all across the country.

This is absurd. The federal government has been trying to shut down cannabis for more than one hundred years, and for much of that time, it had overwhelming popular support for doing so. Today though, the majority of Americans favor legalization and those numbers keep getting better. Were the federal government to pursue “just one” RICO claim, it would likely be against a really large cannabis business that transported cannabis across state lines and I do not believe such a lawsuit would lead to a single state-legal cannabis business shutting down. If anything, it would be more likely to galvanize our country to legalize cannabis once and for all.

So please, nobody panic.

  • Mitchell E. Sahn

    After having reviewed Mr. Shortt’s posting, I feel that a both a broader perspective and deeper analysis would add a different set of perspectives to the analysis of the AG’s recent statements.

    Unlike the author, I am not an advocate (nor am I a detractor). I am a retired Hedge and Private Equity fund manager who now works with sector participants in crafting their funding strategies, business plans, financial projections and offering documents.

    I also have a significant Drug Policy background which spans elected and appointed offices at the Federal and State levels.

    Let me start with a policy perspective.

    I believe we all can agree that the Attorney Generals comments constitute a major shift in drug law enforcement policy.

    The Obama era Cole Memo is out. The AG told us in no uncertain terms that marijuana cultivation, distribution, and sale are against federal law and that while states may decriminalize possession of marijuana, they may not issue licenses to sell it or commercialize it. The Cole memo left this matter of compliance with State laws to the States. Now the AG will use Federal resources to enforce Federal statutes under the Supremacy Clause.

    Sessions has also stated that the federal government is not locking up people for smoking marijuana, and that state employees are not going to be arrested, but that the Department of Justice fully expects states to not permit commercialized marijuana production and sale.

    I’m not sure where anyone sees a rainbow in those affirmations of policy.

    By stating that “Sessions is concerned about cannabis businesses that move marijuana from state to state….. “ “Note how he brings this up when he says: “it’s also being moved interstate, not just in the home state. This IS important. The states are mostly in charge of prosecuting criminal activities that happen entirely within their own state borders. ” is minimizing the impact.

    To parse the above statement to conclude that the AG is only or primarily concerned with interstate commerce is not supported by the totality of his Statement as he specifically mentions licensing by states.

    Therefore, to speculate that only a certain type of case (interstate commerce) would be initiated is irresponsible and adds to ‘the it will be fine” mirage the post tries to craft. Why not large multiple license holders in States where vertical integration is legal? My strategy would be to strike at the entire supply chain in one blow, rather than just go after a single type of license engaged in interstate commerce.

    Additionally, by stating that States are responsible for enforcing State Laws is both obvious and irrelevant. The laws being enforced are Federal Laws which do not require State acquiescence. The implied conclusion that just because States are not required to prosecute Federal Laws, the DOJ will not, is both a flawed and dangerous conclusion.

    I would draw the reader’s attention to the operating model recently utilized by the DHS in targeting undocumented workers, as it should be the one the Marijuana Industry takes notice of.

    The similarities are compelling First, there was an articulated policy shift announced. Second, only Federal agencies were used during raids and third, they occurred where states have established sanctuary cities ( basically a decision not to enforce Federal laws). These three steps will mirror the ones used to enforce Federal Controlled Substances Statutes.

    Another assumption made in stating “The fact that the government has been attempting to shut down the Cannabis business for 100 years and had public support but still failed”, implies that because public opinion in some states has changed regarding legalization many polls do not differentiate between medical and recreational) that this shift present a significant check on Federal enforcement.

    The reality is legalization is far from a priority of American Voters in Federal Elections. In fact, Pew Research reported in 2016, that legalization was not in the top 17 issues listed as very important. Therefore, I cannot see how public opinion matters in the slightest at the Federal level. It is far more impactful at the State level, but that’s not the issue here.

    Finally, if one looks at the make-up of Congress and the Executive Branch, I do not see a progressive agenda being espoused. Actually, just the opposite. If one combines the well documented voter priorities in the 2016 Federal elections with the results of the election I do not see how a small number of people who view this as a priority can influence a conservative government.

    Additionally, we should remember that Federal oversight is not limited to DOJ. Another large player who can make life exceedingly challenging is the Treasury Department. Just wait until they start looking at all that cash and the potential of money laundering, income tax evasion, false reporting and Patriot Act Compliance. That alone will create added expenses for operating companies for accounting and legal fees to meet increased scrutiny.

    In short, he AG said the laws on the books will be enforced. We can toss around the ubiquitous “Keep Calm and Carry On” but when you are managing investors’ money the slogan is ” Wise men say only fools rush in”.

    The investors perspective has multiple implications.

    No matter how you view the AG’s statement, we can all agree that it adds uncertainty to the market.

    Investors loath uncertainty as they find it hard to quantify. Therefore, when we project DCF or ROI we now need to factor in a higher risk premium. That translates into a far higher cost of capital as well as a decrease in allocation size. There also might be asset reallocation into industrial hemp (CBD’s) as a few of my clients have because the ROI is as high or higher with far less risk.

    To say that the sector should not over act to the shift in policy does not mean that investors will. The sector should not discount these changes, I would be creating a contingency plan because Federal enforcement is a franchise risk.

    In attempting to minimize this risk the author references the use of civil RICO provisions. First, the suits were civil not criminal and one of the matters involved a settlement prior to trial. Second, the remaining suits were dismissed because the plaintiff was unable to prove standing for civil RICO which is far different threshold for than criminal suits. The implication I drew from your analysis was that these matters were decided on the merits, which they were not. These cases prove nothing and should not provide the handhold as the author suggests.

    Rest assured if the AG brings RICO charges it will be criminal and the full weight and resources of the government will be brought to bear.

    The thing to keep in mind is that the risk is far greater than the author articulates, that the risk is not easy to quantify and the political environment at the Federal level is not one which is sympathetic to the industry.

  • Mitchell E. Sahn

    After having reviewed Mr. Shortt’s posting, I feel that a both a broader perspective and deeper analysis would add a different set of perspectives to the analysis of the AG’s recent statements.

    Unlike the author, I am not an advocate (nor am I a detractor). I am a retired Hedge and Private Equity fund manager who now works with sector participants in crafting their funding strategies, business plans, financial projections and offering documents.

    I also have a significant Drug Policy background which spans elected and appointed offices at the Federal and State levels.

    Let me start with a policy perspective.

    I believe we all can agree that the Attorney Generals comments constitute a major shift in drug law enforcement policy.

    The Obama era Cole Memo is out. The AG told us in no uncertain terms that marijuana cultivation, distribution, and sale are against federal law and that while states may decriminalize possession of marijuana, they may not issue licenses to sell it or commercialize it. The Cole memo left this matter of compliance with State laws to the States. Now the AG will use Federal resources to enforce Federal statutes under the Supremacy Clause.

    Sessions has also stated that the federal government is not locking up people for smoking marijuana, and that state employees are not going to be arrested, but that the Department of Justice fully expects states to not permit commercialized marijuana production and sale.

    I’m not sure where anyone sees a rainbow in those affirmations of policy.

    By stating that “Sessions is concerned about cannabis businesses that move marijuana from state to state….. “ “Note how he brings this up when he says: “it’s also being moved interstate, not just in the home state. This IS important. The states are mostly in charge of prosecuting criminal activities that happen entirely within their own state borders. ” is minimizing the impact.

    To parse the above statement to conclude that the AG is only or primarily concerned with interstate commerce is not supported by the totality of his Statement as he specifically mentions licensing by states.

    Therefore, to speculate that only a certain type of case (interstate commerce) would be initiated is irresponsible and adds to ‘the it will be fine” mirage the post tries to craft. Why not large multiple license holders in States where vertical integration is legal? My strategy would be to strike at the entire supply chain in one blow, rather than just go after a single type of license engaged in interstate commerce.

    Additionally, by stating that States are responsible for enforcing State Laws is both obvious and irrelevant. The laws being enforced are Federal Laws which do not require State acquiescence. The implied conclusion that just because States are not required to prosecute Federal Laws, the DOJ will not, is both a flawed and dangerous conclusion.

    I would draw the reader’s attention to the operating model recently utilized by the DHS in targeting undocumented workers, as it should be the one the Marijuana Industry takes notice of.

    The similarities are compelling First, there was an articulated policy shift announced. Second, only Federal agencies were used during raids and third, they occurred where states have established sanctuary cities ( basically a decision not to enforce Federal laws). These three steps will mirror the ones used to enforce Federal Controlled Substances Statutes.

    Another assumption made in stating “The fact that the government has been attempting to shut down the Cannabis business for 100 years and had public support but still failed”, implies that because public opinion in some states has changed regarding legalization many polls do not differentiate between medical and recreational) that this shift present a significant check on Federal enforcement.

    The reality is legalization is far from a priority of American Voters in Federal Elections. In fact, Pew Research reported in 2016, that legalization was not in the top 17 issues listed as very important. Therefore, I cannot see how public opinion matters in the slightest at the Federal level. It is far more impactful at the State level, but that’s not the issue here.

    Finally, if one looks at the make-up of Congress and the Executive Branch, I do not see a progressive agenda being espoused. Actually, just the opposite. If one combines the well documented voter priorities in the 2016 Federal elections with the results of the election I do not see how a small number of people who view this as a priority can influence a conservative government.

    Additionally, we should remember that Federal oversight is not limited to DOJ. Another large player who can make life exceedingly challenging is the Treasury Department. Just wait until they start looking at all that cash and the potential of money laundering, income tax evasion, false reporting and Patriot Act Compliance. That alone will create added expenses for operating companies for accounting and legal fees to meet increased scrutiny.

    In short, he AG said the laws on the books will be enforced. We can toss around the ubiquitous “Keep Calm and Carry On” but when you are managing investors’ money the slogan is ” Wise men say only fools rush in”.

    The investors perspective has multiple implications.

    No matter how you view the AG’s statement, we can all agree that it adds uncertainty to the market.

    Investors loath uncertainty as they find it hard to quantify. Therefore, when we project DCF or ROI we now need to factor in a higher risk premium. That translates into a far higher cost of capital as well as a decrease in allocation size. There also might be asset reallocation into industrial hemp (CBD’s) as a few of my clients have because the ROI is as high or higher with far less risk.

    To say that the sector should not over act to the shift in policy does not mean that investors will. The sector should not discount these changes, I would be creating a contingency plan because Federal enforcement is a franchise risk.

    In attempting to minimize this risk the author references the use of civil RICO provisions. First, the suits were civil not criminal and one of the matters involved a settlement prior to trial. Second, the remaining suits were dismissed because the plaintiff was unable to prove standing for civil RICO which is far different threshold for than criminal suits. The implication I drew from your analysis was that these matters were decided on the merits, which they were not. These cases prove nothing and should not provide the handhold as the author suggests.

    Rest assured if the AG brings RICO charges it will be criminal and the full weight and resources of the government will be brought to bear.

    The thing to keep in mind is that the risk is far greater than the author articulates, that the risk is not easy to quantify and the political environment at the Federal level is not one which is sympathetic to the industry.

  • NABNYC

    Exactly. We don’t know what this administration will do. But many of the comments to date by Sessions suggests that they might follow the Constitution — radical concept — and acknowledge that states are given the sole and exclusive authority to regulate marijuana inside the states, since the use, cultivation and sale inside the state is a health and safety issue. The federal government quite simply has no authority or jurisdiction under the constitution to involve itself in a state’s laws regulating marijuana. Except, of course, the federal government is authorized to intervene in cases of any drug being imported into the country from a foreign country, or being distributed from one state to another, both of which would fall under federal jurisdiction. The decision by Clarence Thomas which held that the federal government has the authority to go into an individual’s back yard and rip up a marijuana plant based on some bizarre extension of the commerce clause, as applied during wartime, is not authority for anything except extremely weak reasoning by the court. These republicans claim to be all about states’ rights. We need to encourage them to apply that doctrine where it legitimately belongs, which includes the issue of exclusive state regulation for all health and safety issues including those related to marijuana.

    • Daniel Bashers

      I think its fair to say we can’t trust anything Session says. If he will lie to congress about meeting with Russians he will certainly lie to the public. I think (hope) Sessions will be more bark then bite. I just wish Trump would reign him in because his barking will only stifle the creation of legitimate jobs in the cannabis industry through scaring off entrepreneurs and investors. If Trump wants to be “The Jobs President” he needs to muzzle his lackies.

  • Emmanuel Goldstein

    Mr. Shortt, has your opinion changed after his interview yesterday (3/15)? Also, with the DEA recently clarifying that all interstate and international CBD trade within the US is unequivocally in direct violation of the CSA, do you not feel the private prison and big pharma pressure being felt?

  • Mitchell E. Sahn

    After having reviewed Mr. Shortt’s posting, I feel that a both a broader perspective and deeper analysis would add a different set of perspectives to the analysis of the AG’s recent statements.

    Unlike the author, I am not an advocate (nor am I a detractor). I am a retired Hedge and Private Equity fund manager who now works with sector participants in crafting their funding strategies, business plans, financial projections and offering documents.

    I also have a significant Drug Policy background which spans elected and appointed offices at the Federal and State levels.

    Let me start with a policy perspective.

    I believe we all can agree that the Attorney Generals comments constitute a major shift in drug law enforcement policy.

    The Obama era Cole Memo is now only partially operative.

    The key elements which remain intact are that the federal government is not lock up people for smoking marijuana, and that state employees are not going to be arrested that operate regulatory regimes. The federal governments focus would be on interstate commerce, sales to minors, money laundering to name a few.

    The parts of the memo that were made moot in no uncertain terms are that marijuana cultivation, distribution, and sale are against federal law and that while states may decriminalize possession of marijuana, they may not issue licenses to sell it or commercialize it. Basically, that the Department of Justice fully expects states to not permit commercialized marijuana production and sale.

    Another change is that under the Cole memo the matter of compliance was left to the States which had a regulation regime. The new policy is far more aggressive namely, that the AG will use Federal resources to enforce Federal statutes utilizing the Supremacy Clause.

    I’m not sure where anyone sees a rainbow in a significant change of policy.

    The author then states, “Sessions is concerned about cannabis businesses that move marijuana from state to state…. “, which is nothing new and was articulated under Cole. The author continues, “Note how he brings this up when he says: “it’s also being moved interstate, not just in the home state. This IS important. The states are mostly in charge of prosecuting criminal activities that happen entirely within their own state borders. ” I agree, but we are discussing Federal Statutes which the States are not responsible for enforcing.

    Therefore, to conclude that interstate commerce is the priority focus the industry should be concerned about (as measured by the amount of space dedicated to explaining the issue) is irresponsible and adds to ‘the it will be fine, just don’t cross State lines” mirage the post tries to craft. The concern should mirror the change in policy that being States licensing various type of marihuana related activity.

    As far as RICO goes, the authors analysis is again over optimistic. The civil RICO cases were not victories. One was settled out of court, the other two were dismissed, not on the merits but due to standing issues. To imply that these civil matters have bearing for what the industry faces when there is absolutely no precedent here to rely on is taking the position of a policy advocate

    Rest assured if the AG brings RICO charges it will be criminal and the full weight and resources of the government will be brought to bear.

    If I were AG, and wanted to start with enforcement, I would target large multiple level license holders in States where vertical integration is legal. That strategy would target the entire supply chain in one blow, rather than just go after a single type of license engaged in interstate commerce. This would make for a compelling RICO indictment.

    To see how this would be rolled out I would draw the reader’s attention to the operating model recently utilized by the DHS in targeting undocumented workers.

    The similarities are compelling. First, there was an articulated policy shift announced. Second, only Federal agencies were used during raids and third, they occurred where states have established sanctuary cities (basically a decision not to ignore Federal Law). These three steps will mirror the ones used to enforce Federal Controlled Substances Statutes.

    Additionally, we should remember that Federal oversight is not limited to DOJ. Another large player who can make life exceedingly challenging is the Treasury Department. Just wait until they start looking at all that cash and the potential of money laundering, income tax evasion, false reporting and Patriot Act Compliance. That alone will create added expenses for operating companies for accounting and legal fees to meet increased scrutiny.

    The author then proceeds to raise the impact of public opinion on enforcement. “The fact that the government has been attempting to shut down the Cannabis business for 100 years and had public support but still failed”, implies just that.

    The reality is legalization is far from a priority of American Voters in Federal Elections. In fact, Pew Research reported in 2016, that legalization was not in the top 17 issues listed as very important. Therefore, I cannot see how public opinion matters in the slightest at the Federal level. It is far more impactful at the State level, but that’s not the issue here.

    Finally, if one looks at the make-up of Congress and the Executive Branch, I do not see a progressive agenda being espoused. Actually, just the opposite. If one combines the well documented voter priorities in the 2016 Federal elections with the results of the election I do not see how a small number of people who view this as a priority can influence a conservative government.

    In short, he AG said the laws on the books will be enforced. We can toss around the ubiquitous “Keep Calm and Carry On” but when you are managing investors’ money the slogan is ” Wise men say only fools rush in”.

    The investors perspective has multiple implications.

    No matter how you view the AG’s statement, we can all agree that it adds uncertainty to the market.

    Investors loath uncertainty as they find it hard to quantify. Therefore, when we project DCF or ROI we now need to factor in a higher risk premium. That translates into a far higher cost of capital as well as a decrease in allocation size. There also might be asset reallocation into industrial hemp (CBD’s) as a few of my clients have because the ROI is as high or higher with far less risk.

    To say that the sector should not over act to the shift in policy does not mean that investors will. The sector should not discount these changes, I would be creating a contingency plan because Federal enforcement is a franchise risk.

    The thing to keep in mind is that the risk is far greater than the author articulates, that the risk is not easy to quantify and the political environment at the Federal level is not one which is sympathetic to the industry.