Operation Limelight

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O PERATION L IMELIGHT HOW A FEARSOME, FAST-TALKING UNION BOSS HELPED LEGALIZE POT, TOOK KICKBACKS AND ENDED UP IN PRISON Story by Jason Fagone Illustrations by John Blanchard Produced in partnership with Epic magazine

Section One

TAKING ON SUPERMAN Forrest Anderson was nervous. The Oakland weed activist was about to walk into the last place a weed activist ever wants to be. But something dark was bubbling in the local marijuana community, something that threatened not just his livelihood but the very future of the movement, and the only people who could stop it were the traditional enemies of marijuana lovers everywhere. ¶ He had to go to the FBI. He had to tell them about Superman. lowing sales to patients but offering Superman wasn’t like anyone he had no protection against the U.S. governever met, and Forrest, who was 32, had ment, which applied the same severe spent a decade in the cannabis indusABOUT restrictions to pot as it did to heroin. try. His family had long believed in the THIS STORY At any moment, federal cops could medicinal powers of marijuana, smokThis is the first kick down a dispensary’s doors, arrest ing together and spreading the good installment of a the proprietors and prosecute the word. His stepmother, Minnie Watson, two-part series. The landlords for hosting an illegal busia former legal secretary and an activist story will continue in ness. The family thought it was worth on domestic violence issues, founded next Sunday’s the risk. They rented a 2,200-squareprograms in several prisons to mentor Chronicle. Or you foot building on West Grand Avenue victims of abuse. She saw marijuana as can read the full in north Oakland. Watson applied for a healing force that could make comreport anytime at a city dispensary license, an all-immunities stronger. Forrest’s father, Carl, sfchronicle.com/ portant piece of paper required to a 58-year-old Army veteran and paralelimelight. operate, and became one of only four gal, became a midlife convert when he license holders in the city. discovered that pot alleviated his glauINSIDE The doors of the dispensary opened coma symptoms, and Forrest used it to How we reported in 2001, and for the next five years, the manage pain from an old injury. this story activist family lived their dream, run“We believe in it,” Carl said. PAGE A14 ning a marijuana store in the United “Believing in the plant,” Forrest States of America. They developed a chimed in. “That’s what it was.” loyal clientele of almost 7,000 patients, they say, Forrest and Carl had the same blue-green and sold millions of dollars’ worth of pot a year. eyes and a similar style of beard, though Carl’s But money wasn’t the focus, Carl said. was grayer. When they spoke, they traded lines “It was the spirit of helping people,” he reof dialogue, finishing each other’s sentences, called. One block away was a care facility for and their shared passion for the plant spurred AIDS patients, and some became regulars at the them to open one of the earliest retail dispensadispensary; they would enter in obvious discomries in Oakland. In 1996, California became the first state to legalize medical marijuana, alLimelight continues on A14


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O P E RAT I O N L I M E L I G H T Limelight from page A13

HOW THIS STORY WAS REPORTED In early 2018, staff writer Jason Fagone reached out to Dan Rush and the people who investigated him, wanting to understand how the prominent union organizer and cannabis booster ended up in prison. He reported the story over the course of two years. Fagone exchanged dozens of email messages with Rush through CorrLinks, the prison email system, and conducted three lengthy interviews with the FBI agent who led the federal probe. He also spoke with witnesses who gathered evidence during “Operation Limelight” and reviewed thousands of pages of documents, including emails, text messages, extended transcripts of audio conversations, images of checks, cannabis licensing applications, campaign finance records and 750 pages of testimony generated during a 2019 State Bar Court hearing on the professional conduct of lawyer Marc TerBeek.

“IT WAS THE SPIRIT OF HELPING PEOPLE.” CARL ANDERSON

fort and smoke right in the store, relaxing as pain melted away. If a patient couldn’t afford his dose on a particular day, he got it for free. The Andersons tried to be good neighbors, creating a “soup wagon” program that delivered groceries to low-income seniors. “We paid people’s dental bills,” Forrest said. “We paid people’s power bills. We took care of our patients.” In 2004, a dispute over building and fire code violations put the family’s dream on hold. An inspection of their space turned up some illegal plumbing and mechanical work, according to a memo by the city administrator’s office. The violations weren’t lifethreatening, and the Andersons promised to fix them, but they ended up losing their lease in the dispute. It was a serious setback, because few landlords in Oakland were willing to host a pot club, and without a space to sell pot, the Andersons had to surrender their precious dispensary license. The family spent the next several years trying to regain access to the building, finally obtaining a new lease in 2009 and pouring money into renovations. Now all they needed to restart the dispensary was a new license. But by that point, everything in cannabis had changed. Pot was starting to go mainstream. Economists predicted that if California voters took the next step beyond medical marijuana and legalized pot for recreational use, it would spawn a multibillion-dollar industry in the state. Unapologetic capitalists were charging into the market, starting cannabis companies with Wall Street money. And at the center of the action, cutting deals left and right, stood the guy who called himself Superman: a burly labor organizer who was reputed to be close with the Hells Angels. He rode around Oakland on a big black motorcycle with a Superman decal on the front, the iconic red-and-yellow shield, and his name, Dan Rush, written beneath in large blue letters. Rush was cannabis director for the United Food and Commercial Workers, a powerful international labor union with 1.3 million members and close ties to the Democratic Party. Lately he’d become a major face of the legal pot movement in California and beyond, giving quotes to national media outlets and lobbying politicians to pass cannabis-friendly laws. The Andersons, though, had seen another side of Dan Rush. Forrest found him scarier than even the FBI. And so, one morning in the fall of 2012, Forrest and Carl drove over the Bay Bridge into San Francisco to speak with an FBI agent. Reaching the waterfront, they stopped for a few minutes near Pier 70 and shared a joint. Then they continued west, to the Phillip Burton Federal Building and U.S. Courthouse. Several agencies that busted and prosecuted marijuana dealers kept offices here, including the FBI, the Drug Enforcement Administration and the U.S. attorney. The top federal prosecutor in the region, Melinda Haag, was a notorious hard-liner when it came to marijuana, saying that the state’s medical pot law was being “hijacked” by criminals and profiteers. FBI Special Agent Roahn Wynar met the Andersons in the lobby. For Wynar, this was also an unexpected moment. The FBI didn’t typically arrange friendly meetings with cannabis dealers; it busted them. But the Andersons had promised to share information about a nest of white-collar crime linked to the cannabis industry, and that happened to be of deep interest to Wynar, who specialized in probing fraud and public corruption. Forrest could feel his heart beating faster than normal. He didn’t know it yet, but he and Carl were about to set in motion one of the most surprising federal investigations in Bay Area history — one that would last three years, lead to a 15-count indictment against union official Rush, and ultimately redefine the landscape of cannabis in the region. Wynar showed the Andersons to an elevator and pushed 10 for the U.S. attorney’s floor. As they rode up, the agent noticed a powerful smell of weed.

Section Two

BECOMING DAN RUSH In 2018, The Chronicle emailed Dan Rush at the prison where he was incarcerated and asked whether he would talk about how he got there. “I’m an open book,” Rush typed back. “In fact I WANT this story told … and like I have said, many times … I committed a crime … and buddy, I am no Angel … in fact, I am the guy that gets the Job DONE … read my Wikipedia page.”

“I AM NO ANGEL … I AM THE GUY THAT GETS THE JOB DONE.” DAN RUSH

To assemble the following account, The Chronicle pulled from evidence generated by the FBI probe of Rush and his associate, including emails, text messages, audio transcripts, court filings and records of testimony. In addition, the newspaper interviewed agent Wynar, witnesses who cooperated with the FBI, Rush’s friends and Rush himself, who has exchanged dozens of energetic emails with the newspaper over the past two years. In some of these messages, Rush admitted mistakes and expressed remorse. But he also accused the government of abusing its power, saying that he drew a target on his back “because I was so successful in bringing cannabis as a topic to the mainstream.” Rush said that for the first 49 years of his life, he hardly smoked marijuana and didn’t have any particular concern for people who did. Born in 1960 to Irish-Catholic parents in Oakland, he grew up in a compound of three adjacent homes owned by his extended family since the 19th century. Rush’s grandmother belonged to the Retail Clerks union, a forerunner of the United Food and Commercial Workers, and his father, James “Jimmy” Rush, was a local Teamsters official specializing in political strategy. Dinner-table discussions revolved around what everyone had done for the labor movement that day, and instead of playing catch with his son, Jimmy brought Dan to picket lines and precinct walks around the Bay Area, sparking what would become a lifelong obsession with politics. According to Rush, his childhood was shaped as much by the Bay Area radical scene of the late 1960s and 1970s as it was by his family’s union lore. He says

he lived near a violent street corner, West MacArthur Boulevard and Telegraph Avenue, populated by drug dealers and hookers. This made him, by his own description, “an addiction-level drug abuser since I was 10 years old”: cocaine, meth, alcohol, LSD. And because he was large for his age, with freckles and red hair, he gained access to some very adult subcultures. He says he dropped acid with the Merry Pranksters. He met famous Black Panthers including Bobby Seale and Angela Davis, who were amused, he says, by the weird white kid who kept appearing at their events asking about the politics of black liberation. “Had a great time, learned a lot about community organizing,” Rush emailed. He hung out with the Hells Angels, too. He says he bought his first motorcycle at 16, the same year he dropped out of high school and joined the Teamsters. Working as a “lumper,” carrying hundredpound sacks of sugar and chewing “a lot of meth,” his muscles bulked up, and according to his friends, he gained access to the Angels’ imposing brick clubhouse in Oakland. By all accounts, Rush never became an official club member, and he declined to discuss anything about the Angels. But it’s clear that he did grow close to them. In future years, photos of Angels would adorn the walls of his home, and he would speak with pride about “a very special community” of Oakland motorcyclists. Despite his chaotic youth, Rush wanted to one day become a Teamsters official like his father. But in 1978, when he was 18, during a scuffle at a strike, Rush used a slingshot to fling a .44-caliber pellet toward a “jack booted strike breaking thug.” The pellet hit a cop in the eye instead, and Rush spent the next year in a jail cell for assault. Worse for him, as part of an eventual plea deal, he says, he was banned from the Teamsters for 10 years. He eventually found his way back into Big Labor through the United Food and Commercial Workers, hanging out at the union’s local chapter in Oakland and talking so much about politics that the union put him in charge of monitoring legislation and gave him a cool-sounding title: special operations director. The role was unpaid at first, but Rush made the most of it, becoming an expert in the language of ballot measures and forging relationships with up-and-coming politicians. He first met Gavin Newsom, now governor of California, when Newsom was a parking commissioner; Rush helped with his first supervisor campaign in 1998. Similarly, Rush got to know future California attorney general Bill Lockyer when Lockyer was a state legislator in the 1990s. One day, according to Lockyer, Rush said he knew Sonny Barger, the Hells Angels founder. “Oh, I believe he’s a constituent,” Lockyer replied. Before long, Rush surprised Lockyer by presenting him with a motorcycle helmet autographed by Barger. Rush was eventually hired part time to run political strategy for UFCW Local 5, which represents 30,000 food workers across Northern California. In the meantime, he seemed to be assembling all the pieces of adult success. To augment his modest union income, he built his own company, a private investigation firm. He married and had a daughter and later a son. And he got sober for the first time since he was a kid, joining 12-step groups and becoming a fixture in Bay Area recovery circles, showing up to meetings on his Superman bike. The Superman fixation went back to his childhood, he says, when a friend gave him a toy model of the Man of Steel and he grew so obsessed with it that other kids started to call him Superman. Sobriety seemed to deepen his embrace of that identity: In the crucible of the 12-step rooms, Rush was transforming himself, gaining new powers. For years, he says, he had used prescription opioids to manage pain from an old weightlifting injury, growing dependent on those drugs. Now he not only kicked his own habit, he started mentoring other addicts, connecting them with programs and counseling, he says. “He’s one of the most dynamic, caring people I’ve ever met,” said Margaret Black, an optician in Hayward who credits Rush with saving the lives of her two addicted sons. Sometimes the recovery side of Rush’s life intersected with the political side: When Lockyer’s


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wife, Nadia, later struggled with meth abuse in an ordeal that became public, Rush “tried to be a helpful counselor during some of those months,” Lockyer recalled. “I appreciated his empathy.” A Type 1 diabetic, Rush required daily insulin to manage his blood sugar, but as a recovering addict, Rush had to be careful with anything else he put into his body. He avoided medical marijuana and believed that using it would constitute a breach of his sobriety, a hard-line position that other recovering addicts did not share. Instead of pot, he chainsmoked unfiltered Lucky Strike cigarettes at a rate that horrified his friends. “Those things are like coffin nails,” said Rush confidant Troy Duffy, the writer-director of the “Boondock Saints” movies. But then, one Thanksgiving, Rush had an epiphany. The way he tells it, he was poring over a list of upcoming ballot measures in the fall of 2009 when one caught his eye: Proposition 19, a statewide measure to legalize pot for recreational purposes, as opposed to just medical use. It would be up for a vote the next year. Rush pondered it. How would the world change if any adult could buy pot in the open? Just like alcohol? Just like alcohol. That was the phrase that caromed through his skull, and in that moment, he recognized a massive opportunity for unions like his. Unions increase their power by adding new members, and they add new members by organizing workers. Rush saw that if pot were treated like liquor — taxed, regulated, sold by corporations instead of outlaws — a new industry would rise up, creating hundreds of thousands of new jobs. And those jobs could be union jobs. There could be union budtenders. Union builders of hydroponic greenhouses. Union infusers of cannabis into chocolates. Years before the political mainstream started to embrace legal cannabis in bits and pieces, Rush was already imagining a scenario of almost limitless potential. In his lifetime, union-busting laws and the collapse of the manufacturing sector had shrunk the size and power of Big Labor. Legal pot, he realized, was a chance to rebuild the movement and breathe new life into struggling towns that depend on union jobs. He visualized a typical nuclear family making a living in weed: Mom works at the local dispensary, dad makes edibles at the production facility, and the tax revenues from those businesses fund schools for their kids and hospitals for their community. Weed wasn’t just a plant. It was a life raft for the drowning American middle class. “It was kinda like getting hit by lightning,” he recalled. He wasn’t sure whether his colleagues in labor would see it the same way. The UFCW, originally formed in a merger between meat cutters, butchers and retail clerks, is a large institution with traditional values, and at first, he says, his union brothers either laughed at him or warned him not to bring “that drug-dealer s—” into the fold. But Rush argued that if the UFCW didn’t try to organize weed workers, a competing union like the Teamsters would. The president of Local 5 at the time, Ron Lind, was willing to give it a shot. “He’s relentless,” Lind said of Rush, “and he’s a pretty good charmer.”

“IT’S HARD TO SEPARATE FACT FROM FICTION WITH HIM A LOT OF THE TIME.” DOUG LINNEY

“HE’S RELENTLESS, AND HE’S A PRETTY GOOD CHARMER.” RON LIND

Section Three

WEED’S WILD WEST MOMENT Outlaw businesses in America tend to get squashed by cops and rescued by capitalists. Every era has its examples. Dingy gambling dens become Las Vegas hotels. Music-pirating apps give way to Apple Music and Spotify. Investors and politicians notice that a black market can be lifted into the light, and then it is tamed and taxed and generally made safe for cities and states and corporate empires to benefit.

SFChronicle.com | Sunday, March 29, 2020 |

Yet there is often a Wild West moment in the middle, when the rules are still shifting, vast fortunes can be seeded or squandered, and everyone with a stake is scrambling for position: lawmakers, entrepreneurs, cops. This was the kind of moment catalyzed by California’s Prop. 19. The measure was the brainchild of Richard Lee, then one of the nation’s most outspoken marijuana advocates. A paraplegic who depended on pot to manage pain, he had built an important Bay Area institution — Oaksterdam University, a school for cannabis growers — that made him a hero to reformers nationwide and helped establish Oakland as America’s capital of cannabis. Yet no major California politicians supported his vision. “They looked at our issue as the electric rail on a BART train,” recalled Jeff Jones, a leader of the Prop. 19 campaign and the founder of one of the state’s earliest dispensaries. “You don’t touch the f—in’ third rail, ever. We were a pariah.” The main cause of that fear was the U.S. government, which had opposed California’s medical pot law from the start. The Drug Enforcement Agency staged raids and sent agents to cut down plants; the Internal Revenue Service investigated the finances of dispensary owners; the Department of Justice asked federal judges to stop dispensaries from selling pot, even to cancer patients. Though 12 states had followed California’s example and legalized medical pot, U.S. Attorney General Eric Holder maintained that “drug traffickers” were exploiting medical marijuana laws to commit serious federal crimes. In such an uncertain atmosphere, California elected officials and even their aides refused to meet with Prop. 19 campaigners. Newsom, who’d become San Francisco’s mayor, didn’t support the measure (“I’m just not there yet,” he told a reporter); Kamala Harris, then the city’s district attorney, vigorously attacked it. Then Dan Rush showed up. At first, the activists didn’t know what to make of him: a large, loud, friendly dude in a Superman jacket, cursing and slapping backs and telling fantastical stories about his adventures on picket lines and motorcycle rides. “Oh my gosh, he’s quite a character,” said Doug Linney, a veteran East Bay political consultant who worked on Prop. 19. “It’s hard to separate fact from fiction with him a lot of the time.” Rush sowed confusion by smoking Lucky Strikes instead of joints, according to Dale Sky Jones, Prop. 19’s spokeswoman and Jeff Jones’ spouse. Rush confided to her that he was still “struggling morally with cannabis,” she recalled, “trying to understand, is this medicine, or is this just another drug to be run by the gangs?” Among a ragtag army of true believers, he was a mercenary, using the movement for his own ends — to build union power. Yet in that goal he seemed completely sincere, and he quickly proved useful to the underdog campaign, lending it the halo of the UFCW brand. He convinced the union to endorse Prop. 19 and started arranging meetings with legislators, lobbyists and faith leaders. “What other national organization was affiliated with marijuana? NORML? High Times? This was like having the Girl Scouts or the National Guard,” said Brian Webster, a close friend of Rush’s and a Bay Area community organizer who promotes hemp-related events. Rush also connected the Prop. 19 activists with a more secret world of power. In the summer of 2010, Dale Sky Jones said, he arranged a clandestine meeting with the Hells Angels. He brought the Joneses and Lee to the Angels clubhouse in Oakland, where they were met by three bikers, including Elliott “Cisco” Valderrama, the now-deceased president of the club’s Oakland chapter. The activists’ goal was to show respect toward the Angels as their Oakland neighbors. Outlaw gangs make money by selling drugs, among other things; no one wanted the Angels to think the ballot measure might threaten their business. Pitching Prop. 19 to the bikers, the weed activists framed it as an effort to restore fairness: If the campaign succeeded, they argued, police would have one less weapon to target minority groups, whether those minorities are people of color or bikers. The Angels, Sky Jones recalled, “basically gave us their blessing and left us alone.” Oddly, the bikers didn’t seem as scary to her as some of the state’s elected officials. The very next day, Sky Jones said, a Prop. 19 group sat down with a state senator in Sacramento, and he seemed to be sizing up the campaign’s pocketbooks. She got a funny sense that the official wanted a donation or a bribe. After the meeting, she asked Rush about it. “Yes, he had his hand out,” he replied, like he had seen it before. When he wasn’t flexing his political muscles on the campaign, Rush was thinking about how to leverage cannabis to rebuild the labor movement — his big vision. The UFCW’s lobbying power was the key. He believed that if the union applied enough political pressure, fighting to liberalize cannabis laws, the nascent industry would realize that Big Labor was its friend, and cannabis companies would gladly let the union represent their workers. All he needed to get started was a test case, an employer willing to take the plunge. He found one in Carl and Forrest Anderson. The father and son first met Rush in early 2010, introduced through a mutual friend. The Andersons explained their plight: They were marijuana crusaders who used to run a mom-and-pop dispensary in Oakland, spreading the gospel of the plant. Their dream was to reopen the club, and they needed a new license to do it. Rush said he could help them. For years, Oakland’s marijuana industry had been frozen in place, capped at four dispensaries by the City Council. By using the union to lobby the council, Rush could persuade Oakland to reopen the licensing process and expand the size of the market. Then, if the Andersons signed a labor deal with the UFCW, agreeing to pay union dues once they were up and running, the union would support their license bid, giving them an edge. Father and son were encouraged. Rush seemed excited too. He said it would be easy to champion them because they believed so deeply in the cause. “They were pioneers of trying to offer safe access to early patients in Oakland,” recalled Dale Sky Jones. “Dan loved them. He spoke so highly of them.” Their company was called AMCD Inc., for American Medical Cannabis Dispensary; Minnie Watson Limelight continues on A16

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KEY CHARACTERS Dan Rush: An Oaklandborn union official known to friends and colleagues as “Superman.” He dreamed of rebuilding the might of Big Labor by legalizing weed and turning workers in the growing industry into union members, but would face felony charges of abusing his power to enrich himself. Carl and Forrest Anderson: Father-and-son cannabis activists in Oakland who believed Rush was corrupt and would take their evidence to the FBI, sparking an unprecedented federal investigation. Roahn Wynar: A veteran FBI agent and physics expert who led “Operation Limelight,” the federal probe of public corruption in Oakland that ultimately netted Dan Rush and his friend and partner, attorney Marc TerBeek. Marc TerBeek: A Berkeley attorney and longtime confidant of Dan Rush who would become enmeshed in a kickback scheme with Rush before “flipping” and helping the FBI. Martin Kaufman and Derek Peterson: Cannabis entrepreneurs who became “victimwitnesses” for the FBI, secretly recording their conversations with Dan Rush and Marc TerBeek and gathering evidence of their illicit activities. Melinda Haag: The U.S. Attorney for Northern California from 2010 to 2016 who said the state’s medical marijuana law was being “hijacked” by profiteers and embarked on a campaign that targeted dispensaries and public officials backing drug reform. Brian Webster and Troy Duffy: Friends and supporters of Dan Rush who believe he is a victim of the federal war on drugs, unfairly targeted for his outspoken advocacy of legal cannabis.


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O P E RAT I O N L I M E L I G H T “HE’D INSIST ON LOVE: ‘I LOVE YOU, BROTHER.’ ” FORREST ANDERSON

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served as president, Carl was executive director, and Forrest was board director. After the family agreed to unionize AMCD, Rush praised them in a news conference and told a reporter they were “decent, hardworking people.” Carl said in the same article, “We’re 100% union. It brings credibility to what we are doing.” To spread the union message, Carl filmed a promotional video with Watson, who called herself “a proud member” of the UFCW. Rush mainly dealt with the father and son. When he saw them, he wrapped them in a bear hug. “Oh, he seemed straight up,” Carl remembered. “He wanted to call you ‘brother’ all the time.” “He’d insist on love,” Forrest said. “‘I love you, brother.’ And he’d insist on hearing it back.” “ ‘You love me, don’t ya?’ That’s what he’d say,” Carl said. Then, they said, he started to ask for money. MARC TERBEEK

Section Four

FRIENDS AND CONSPIRATORS It wasn’t much at first: $2,500 one day, $5,000 another. According to the Andersons, Rush said he needed the money to make campaign contributions: He was lobbying Oakland politicians to expand the city’s cannabis market and secure the family a license.

“HE SEEMED TO KNOW EVERYONE IN THE WORLD.” MARC TERBEEK

Credits Jason Fagone Reporter John Blanchard Graphic Artist Alex K. Fong Designer Danielle Mollette-Parks Art Director Warren Pederson Copy Editor Michael Gray Managing Editor, Enterprise & Investigations Audrey Cooper Editor in Chief Produced in partnership with Epic magazine (epicmagazine.com).

Rush has vigorously disputed the Andersons’ account of their dealings. “The amount of LIES / MISCHARACTERIZATIONS that they told you and everyone all along are just preposterous,” Rush emailed, and in a court filing, his attorneys called Carl’s allegations “unfounded” and false. But several of the Andersons’ key claims have been corroborated by documents and court testimony, and the FBI considers the Andersons to be “very credible” witnesses, Wynar said. (The agent wrote in an affidavit that Carl “is a regular marijuana user, though I have not observed any impairment of his memory or cognitive abilities.”) The Andersons say that in spring 2010, Rush began to show up at their building on West Grand accompanied by prominent local officials. “He was showing us he had the connections,” Forrest recalled. Vice Mayor and former City Council President Ignacio De La Fuente appeared one day with Rush; Rebecca Kaplan, the veteran councilwoman and perennial mayoral candidate, also paid a visit. Kaplan ended up holding two fundraisers in the Andersons’ space, and public records show that Forrest, Rush and others close to them donated a total of $4,200 to her campaign committee in May and June 2010. De La Fuente said he doesn’t remember being introduced to the Andersons, but he had known Rush for years before that, seeing him on picket lines and motorcycle rides: “I’m a biker too,” he said. Kaplan did not return requests for comment. Rush also told the Andersons he was “best of friends” with Gavin Newsom, then campaigning for lieutenant governor. Once Rush showed Forrest a special ID card, signed by Newsom, that granted access to the state Capitol building. Through his spokesman, Newsom did not respond to repeated requests to comment on his relationship with Rush. The Andersons had no reason to doubt Rush’s political power, especially because he seemed to be delivering on his promise: Before long, the city announced it would double the number of dispensaries from four to eight. Not only that, the new application process would favor unionized companies like the Andersons’. According to Carl, Rush took credit for these developments. He had gained so much influence over the process, he said, that his best friend, an attorney named Marc TerBeek, was helping to write the city’s licensing rules. TerBeek lived in Berkeley and worked from a law office in Oakland. Forty-nine years old, with a slight build and a soft voice, he had a knack for turning Rush’s misspelled emails and spontaneous brainstorms into documents that made the ideas stick. Whenever Rush needed a legal brief or contract to advance the cause, TerBeek wrote it. He ended up providing cannabis guidance to city officials in both Oakland and Berkeley on an informal basis, and the Andersons would later retain him as their own attorney. TerBeek had moved to the Bay Area from Grand Rapids, Mich., in the early 1980s. As a young man with liberal views, he’d volunteered for environmental causes until he realized there was no money in it and ended up in law school. After a few unremarkable jobs at plaintiffs’ firms, he struck out on his own in 2001, launching a new firm with a partner in Walnut Creek, handling insurance disputes and property spats between neighbors. In 2002, when he befriended Dan Rush, TerBeek was getting most of his clients from an ad in the Yellow Pages. They met at a San Francisco labor event honoring Teamsters President James P. Hoffa, son of Jimmy Hoffa. TerBeek perked up when he learned that Rush worked for the UFCW: An attorney who knows people in unions can receive steady legal work. Soon the two men were regularly meeting at a Vietnamese pho shop in Oakland, chatting about the struggles of working people as they slurped bowls of soup. They began helping each other professionally. Through his law firm, TerBeek hired Rush’s private investigation company to handle a few odd jobs, while Rush drummed up clients for TerBeek. Rush “seemed to know everyone in the world,” TerBeek recalled. One day the attorney found himself talking on the phone with Sonny Barger, the Hells Angels founder, who hired TerBeek to represent his wife in a small legal matter; another day he was invited to coffee with Bill Lockyer, by then the state’s attorney general, who gossiped with Rush as if they were old pals. TerBeek also leaned on his new friend for support during a rough period in his personal life. In 2007, the attorney and his wife divorced and he became depressed. His drinking spiraled out of control; Rush noticed and urged him to enter Alcoholics Anonymous. In 2008 they started going to AA meetings together every day in Alameda, and Rush soon became TerBeek’s sponsor. During TerBeek’s difficult early months of sobriety, Rush was “my rock,” the person who guided him

“YOUR SUCCESS NOW IS BECAUSE OF ME.” DAN RUSH

through the program’s 12 steps and even made sure he had an income. TerBeek’s law firm had recently collapsed because of an employee’s embezzlement, so he decided to start fresh, opening a new solo firm in Oakland, and Rush steered business his way. The lawyer “was broke and in dire straights emotionally / financially / spiritually,” Rush emailed from prison. “The fact was that we both had survived our personal nightmares, and like brothers / survivors of a shipwreck as we used to say... we set out to build our ‘working Man’s best friend FULL SERVICE law firm / progressive politics consulting firm.’ ” This is the moment when their personal and financial relations started to become deeply and intricately enmeshed. Ultimately, it would lead both men to ruin. Rush was involved with the Instituto Laboral de la Raza, a San Francisco nonprofit that advocates for migrant laborers and files workers’ compensation claims on their behalf. As the organization’s treasurer and a board member, Rush was able to redirect those cases to TerBeek, bringing him $240,000 in fees each year. Similarly, Rush started referring cannabis clients to TerBeek, hooking him up with companies and officials who needed help navigating weed regulations. These consultations and associated legal tasks would ultimately earn TerBeek $350,000 in total revenue over four years. By the end of 2009, the alcoholic attorney had salvaged his life and career. He even fell in love again, with a woman he had met at Café Gratitude, a vegan hangout in Berkeley where the names of the dishes on the menu all began with an affirmation. Jasmine Brown was a fundraiser for nonprofits. She and TerBeek moved in together that year and began the process of adopting an infant daughter. In 2011, Rush would attend their wedding. TerBeek knew he had Rush to thank for his resurrection. But it was strange: The better he felt, the colder his sponsor became. Rush griped with increasing frequency about his finances, saying he was broke and couldn’t put food on the table for his family. He asked TerBeek for money. It turned out that Rush had gotten into debt trouble. TerBeek learned that he had taken out a $420,000 loan from a private lender, putting up one of the Rush family properties in Oakland as collateral. Today Rush says he borrowed the money to turn a piece of his family’s property into an assisted living care center; FBI Special Agent Wynar says there is no evidence that Rush took any steps to develop that real estate project. In any case, the money was now gone, and the loan was about to come due. Rush stood to lose his family’s house. For the first time in their friendship, but not the last, Rush and TerBeek argued about money. According to TerBeek, Rush pressured him for funds, claiming that the lawyer owed him hundreds of thousands of dollars from private investigation jobs that Rush supposedly performed for TerBeek’s firm. (Wynar says there is no evidence to support this claim, and TerBeek denies it.) Rush accused TerBeek of ingratitude. “I got you to sobriety,” Rush told him once, according to TerBeek. “Your success now is because of me.” The lawyer didn’t like being pressured. Still, his sponsor had a point: Without Rush’s mentorship in AA, and without the clients he kept referring, TerBeek had no idea where he would be. He didn’t want to jeopardize their relationship at a delicate moment in his recovery. Besides, they were starting to explore their most exciting venture yet: building the cannabis movement. Rush needed a detail-oriented person to craft legal arguments and contracts, and TerBeek was all in. He viewed pot the way Rush did: not as a lifestyle but as a political weapon, a hammer for smashing America into a lovelier shape. As the parent of an adopted African American daughter from his previous marriage, TerBeek worried about racist policing. Decriminalizing cannabis would make the country fairer, he reasoned, and it might be good for his law practice too: If he developed a reputation as a cannabis attorney, he could attract big-time weed companies as clients. To keep his new life on track and set himself up for the future, TerBeek somehow needed to come up with almost half a million dollars to retire Rush’s huge personal debt.

Section Five

THE BAG OF CASH Just then, around December 2009, TerBeek heard from a young man in the cannabis world. Quick-thinking, ambitious and only 26, Martin Kaufman was a weed prodigy. Born to Austrian parents and fluent in German, he’d grown up in Marin County and started selling pot in middle school. After college in Santa Barbara, he moved


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back to the Bay Area and founded a string of construction and security companies that catered to state-approved medical collectives. Kaufman specialized in building large grow facilities, designing everything from the layout to the electrical and HVAC systems. His work straddled the line between the old outlaw industry and the new legal one: Although his own businesses were licensed and paid taxes, his grower clients were technically flouting federal drug laws — and they paid Kaufman in cash. But for a while now, he had hoped to move more fully into the light, branching into the retail side of cannabis. He wanted to own a dispensary in Oakland. His office was located across the street from Oaksterdam University, the stronghold of the Prop. 19 effort, and as the campaign unfolded in late 2009 and early 2010, Kaufman started to worry that he would be locked out of the market. He noticed a stream of “deep-pocketed suits trying to get rich quick off cannabis” pouring into the city. Montel Williams, the talk-show host, was rumored to desire a dispensary. Another hopeful was Derek Peterson, a 36-year-old financial analyst who had left a job at Morgan Stanley to seek his fortune in legal weed. Peterson had founded Terra Tech, a publicly traded company headquartered in Irvine that supplied cannabis agriculture products and was looking to expand into distribution and retail. “Cannabis is becoming more legitimate, right?” Peterson explained in “Marijuana Gold Rush,” a 2011 documentary. “So, traditional legitimate business practices are now entering the arena. And that is: cutthroat, backstabbing, stepping on, and trying to grab market share.” Wondering how he could compete, Kaufman took stock of his finances. Money wasn’t an issue; he had done well enough already to buy a house in Marin County. The problem was documentation. Cities usually require dispensary applicants to demonstrate access to startup capital; he would need to show bank statements. But he dealt in cash. Sometimes lots of cash. One recent construction job for a grower had netted him $500,000. Was it possible to place that much cash into a bank account? What were the tax implications? He decided to get a professional opinion. He had never dealt with TerBeek before but knew that the lawyer had touted his financial expertise, so Kaufman approached TerBeek with his questions. TerBeek could hardly believe it: Suddenly, here was the promise of more than enough money to bail Rush out of debt. He came up with a plan. TerBeek offered to hold the cash in his firm’s trust accounts, where he said it would be secure, and within the next few weeks, he, Kaufman and Rush worked out a deal. Kaufman would loan the $500,000 to Rush for his project to develop an assisted living complex in Oakland. In return, Rush would pay Kaufman $3,000 a month as interest and eventually repay the full half million. TerBeek promised to handle all the details. He would cloak the origin of the cash by drawing up a phony agreement that disguised the interest payments as “consulting” fees. In January 2010, Kaufman showed up at the lawyer’s office with a brown double paper bag from either Safeway or Trader Joe’s. (He says he doesn’t remember which, but he is certain the bag wasn’t from Whole Foods; he prided himself on frugality.) Inside the bag were stacks of crisp, rubber-banded $100 bills — $410,000 worth, Kaufman recalled. A subsequent delivery of cash brought the total to $500,000. At that point, TerBeek took custody of the half million and did something that felt “oily,” he later admitted. Over a period of two months, the lawyer made dozens of deposits in Bay Area banks, $9,000 or $9,500 at a time, to avoid raising suspicion. This is a method known as “structuring,” and banking regulations forbid it. Then he withdrew $420,000 and wrote a check to pay Rush’s existing debt, TerBeek later said in a federal court declaration; Rush kept the remaining $80,000. Soon after, Rush failed to make the required $3,000 interest payments, upsetting Kaufman — and TerBeek paid them out of his law firm’s account, according to the declaration. Why take such risks to bail Rush out of debt? Two reasons, TerBeek says: fear and hope. He feared angering his friend and sponsor, who, according to TerBeek, pressured him to take the cash and structure it, barraging him with “verbal and emotional abuse as well as threats of violence,” TerBeek said in his declaration. Rush denies this, saying he “never understood the deal that much” and it was purely TerBeek’s idea; Rush says he thought the money was an investment in his real estate project, not a loan to be repaid. “He’s the ultimate predator,” TerBeek says today. “He manipulated weak and vulnerable people. I was one.” At the time, TerBeek also rationalized the financial sleight of hand by telling himself it was for a higher cause. Cannabis. The movement. It needed hard-driving people like Rush and Kaufman, especially in 2010, and the need was becoming more

THE NEW CANNABIS INDUSTRY IS “CUTTHROAT, BACKSTABBING, STEPPING ON, TRYING TO GRAB MARKET SHARE.” DEREK PETERSON

MELINDA HAAG

“I NEVER UNDERSTOOD THE DEAL THAT MUCH.” DAN RUSH

SFChronicle.com | Sunday, March 29, 2020 |

urgent throughout 2010, as the enemies of legalization seemed to grow bolder. In mid-October, two weeks before the vote on Prop. 19, U.S. Attorney General Eric Holder released a letter promising to “vigorously enforce” the federal marijuana ban regardless of what California voters decided. “The Department of Justice strongly opposes Proposition 19,” Holder wrote. His comments raised the specter of messy legal battles, and Prop. 19 was defeated by a slim seven percentage points. Then, starting in 2011, the top federal prosecutor in Northern California, Melinda Haag, leveraged a range of powers to make life difficult for growers, retailers and public officials backing reform. She threatened to seize and prosecute a small cannabis cooperative in the Tenderloin, contending it was too close to a playground, although a porn theater, a strip club and four liquor shops were closer. She filed a forfeiture lawsuit against Harborside in Oakland, the largest dispensary on the West Coast. Meanwhile, in April 2012, DEA and IRS agents raided Oaksterdam University, purportedly looking for evidence against Richard Lee. Although he was never charged with any crime, the raid struck at the citadel of Bay Area cannabis and forced Lee into silence. Together, these events sent a chilling message, and the effect was devastating: Hundreds of dispensaries either left California in 2011 or closed, while public officials across the state put new cannabis regulations on hold. Outgunned and in retreat, the young industry seemed to be facing an existential threat. With his huge debt no longer dragging him down, Rush made his boldest move yet. At a Los Angeles drug-reform conference in November 2011, he took the podium, planning to speak about the role of organized labor in the marijuana movement. Wearing a black windbreaker with the UFCW logo, he began with a joke: “Hi, I’m Dan, I’m an alcohol—” He cut himself off, smiling — “oh, wrong meeting” — and started talking in blunt terms about the federal government’s drug war. “I don’t want my kids and my grandkids growing up in a war,” he said, “in laws and societies that make absolutely no sense.” He said cannabis activists were in a tough spot, but there was hope, because they could unite with labor and fight back with weapons provided by the UFCW. “You’re David,” he told the assembled, “and Goliath has shown up.” Then he leaned into the microphone, his smoker’s growl roaring through the ballroom: “We’re gonna rise up,” he said, the audience whooping, “and we’re gonna kick their asses.” He pounded his fist on the podium. To hear Rush and his friends tell it, this is how his legal troubles really started: He vowed to kick the DOJ’s ass, and then, against all odds, actually did. Over the next year, he lobbied for bills that would protect medical marijuana patients and providers and crisscrossed California making speeches. At one rally, outside the U.S. courthouse in Sacramento, Rush accused Haag and her colleagues of harassing cancer patients while leaving the real bad guys alone. “You’re supporting the cartels!” he roared. Duffy, the filmmaker, remembers that around this time, Rush invited him to tour the sprawling marijuana greenhouse at Oaksterdam University. A couple of high-ranking Hells Angels were hanging out with Rush — guys Duffy had read books about — and Rush seemed more intense than usual. “He said, I’m gonna legalize this stuff,” Duffy recalled. “I was like, yeah, right.” Rush continued to extend his influence over the politics and business of cannabis, locally and even nationally. In the Bay Area, he became a member of the Berkeley Medical Cannabis Commission, giving him some power to approve or deny pot licenses in that city. And he leveled up in the union hierarchy, too, after making a pitch to UFCW leaders based in Washington, D.C. Rush urged them to pump more resources into cannabis organizing, and the bosses decided to hire him full time, at a salary of $100,000. With their permission, Rush started referring to himself as the union’s director of medical cannabis and hemp. By mid-2012 he was promoting his vision across the country, traveling thousands of miles a week with his friend Brian Webster, who was hired as a part-time organizer for the union. Together they flew to states including Minnesota, Nevada, Colorado, Washington and Oregon, trying to grow the UFCW cannabis division from seedling to empire. If they could lay the groundwork for unionizing 50,000 to 100,000 workers, “for us, that would change the United States,” Webster recalled. Everywhere they went, people came up to them, wanting advice on starting cannabis businesses, getting licenses, writing ballot measures, running campaigns. Webster says they weren’t sure whom to trust, so they often gave people TerBeek’s phone number and kept moving, counting on the lawyer to handle details of various contracts and relationships. Today, Rush says this is one of his chief regrets: He didn’t pay closer attention to TerBeek, he says, letting the lawyer cut deals that Rush didn’t fully understand and would come back to haunt him. Even so, Rush admits he was “a rule bender and breaker” out of zeal for the union cause. “I always EMBRACED being a Robin Hood and an Outlaw for my members (against the system and corporations),” he emailed from prison. “That is the problem with the Labor Movement now. Everyone is too comfy.” The UFCW wasn’t militant enough for his taste, and he viewed some of his own colleagues as threats. Once, before a trip to Las Vegas, Rush warned Webster to be on his best behavior, because “this is where they nailed Hoffa. We’re going to be watched by the feds, we’re going to be watched by our own union.” Because of Rush’s penchant for exaggeration, it’s hard to know exactly how successful he was as a political operator or a union organizer. He bragged that he turned 4,000 cannabis workers into UFCW members; Webster says the real number was closer to 600, but even that figure may be inflated. Rush said he signed 90 union agreements with cannabis companies; the FBI says many of those were sham deals, the contracts never forwarded to union headquarters. Rush says he drafted the language of both Amendment 64 and Initiative 502, the historic campaigns that legalized recreational pot in 2012 in Colorado and Washington state, respectively, but it’s hard to find proof of it. Still, Rush certainly left traces of his influence, pressing his thumbs into the wet clay of media coverage and shaping the policy views of sympathetic politicians. “You looked and sounded great on TV last night,” Oakland Councilwoman Rebecca Kaplan eLimelight continues on A18

A17

“HE MANIPULATED WEAK AND VULNERABLE PEOPLE. I WAS ONE.” MARC TERBEEK

“I ALWAYS EMBRACED BEING A ROBIN HOOD.” DAN RUSH

“I’M NOT SAYING HE’S A SAINT. HE’S NO F—IN’ SAINT.” BRIAN WEBSTER


A18 | Sunday, March 29, 2020 | SFChronicle.com

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O P E RAT I O N L I M E L I G H T Limelight from page A17

mailed him in 2011 after one of his many press conferences made local news. (The FBI would later overhear Rush bragging that he could throw “24-7 f—ing press conferences” because the “media loves it: unionizing marijuana.”) He thrived as a storyteller, able to frame the stakes of the cannabis movement in a way that fired dreams and ambitions and got him quoted in the New York Times, the Associated Press, the Chicago Tribune and the New Republic. And he played a role in persuading at least one major elected official to embrace the decriminalization of pot: Gavin Newsom. Rush claims, credibly, that he is the one who persuaded Newsom to “be the Cannabis Gov,” arguing that Newsom could do with cannabis what he had famously done with same-sex marriage — take a bold progressive position that would do a lot of good and raise his national profile. In 2012, Newsom became one of the first major politicians to call for full legalization, helping inject the idea into the zeitgeist. While he didn’t respond to requests for comment for this story, in 2014 Newsom filmed a video praising Rush for “his leadership” on “real cannabis reform,” saying, “I think it’s a remarkable thing that Dan’s been out there working as hard as he has all across the country.” The more time Rush and Webster spent on the road, the more momentum they felt. The trips were grueling, though, the motion and blur of planes and hotels. Superman’s blood sugar spiked on junk food and three packs a day of Lucky Strikes, and he often complained to Webster about money, griping that his six-figure union salary was less than what he once earned as a private investigator. And he fretted about surveillance. Had his name pinged across the radar of some federal agent? Was he being watched? “Dan was not Jim Hoffa,” Webster said. “Dan was a working-class guy who took a pay cut to organize an industry, and was targeted, and entrapped.” He added, “I’m not saying he’s a saint. He’s no f—in’ saint.”

“IT JUST DIDN’T SMELL RIGHT TO ME.” FORREST ANDERSON

Section Six

‘SCOUNDRELOUS THINGS’ This next part of the Dan Rush story is a little tricky to tell. Everyone involved has his own wildly different version, and trying to figure out what happened is like tracing the origin of a mysterious explosion by sorting through its field of debris.

“HE BETRAYED US. HE WAS A CROOK.” CARL ANDERSON

The ingredients of the blast came together in Oakland between 2011 and early 2012, while the city was selecting four cannabis dispensaries to receive new licenses. It was a challenging process, involving public hearings and long paper applications scored on a point system, and looming above it was the specter of the federal crackdown. That pressure shrank the applicant pool; only 12 groups dared to try. The Andersons were among them, and for a while it seemed they were on track to win one of the four golden tickets. Their personal attorney, Marc TerBeek, helped them craft a persuasive application, and their bid remained alive as the city winnowed the field, first from 12 applicants to 10, then to a provisional four. The Andersons were ranked No. 4 by points, thanks in part to the “bonus points” conferred by their unionized status. The application states they were endorsed by cannabis advocate Richard Lee

and Alice Huffman, president of the state NAACP, who praised Minnie Watson for her commitment to “transforming underprivileged and underrepresented neighborhoods of color.” Unless something pretty weird happened, they would finally get their dispensary back. Then again, the whole process felt weird to the father and son, and it was getting weirder by the week. Dan Rush. They couldn’t understand him. Lately, instead of offering his usual bear hugs, he was growing meaner. He got irritated when they medicated themselves with pot, implying that they were too blazed to understand anything about business. And he kept raising the price for his lobbying services, the Andersons recalled, regularly demanding $5,000 and $10,000 in cash payments. “I was completely disheartened,” Forrest remembered. “It just didn’t smell right to me.” But when the father and son went to City Council meetings, they saw Rush talking and joking with important officials, demonstrating his power, so they kept trying to come up with the money. (The FBI would say later in an affidavit that Rush accepted $50,000 in payments from them, plus $51,000 of stock in their company; the Andersons say the true amount of payments was higher. Rush denies this, saying that he charged the Andersons $10,000 for his consulting services “before the union was involved in cannabis” and all other payments were used to make campaign contributions.) Meanwhile, as the Andersons struggled to determine where they really stood, the top point scorer in Oakland was having no such trouble — a dispensary that was initially dubbed Oakland Community Collective and would eventually be called Blüm Oakland. Blüm was the creation of Salwa Ibrahim, an entrepreneur in her late 20s. A native of Egypt who went to high school in Oakland, she had worked for Lee at Oaksterdam during the Prop. 19 campaign and was well connected in nonprofit and political circles. She was also the romantic partner of Martin Kaufman, who was impressed with her poise and found her stunning, and as they talked about cannabis together and tried to predict the future of the market, Ibrahim decided to apply for a dispensary license. She developed the application package mostly on her own, she says, with some coaching from Kaufman and a 12.5% investment from Derek Peterson, the Terra Tech CEO, whom she and Kaufman had recently gotten to know. Kaufman owned part of the new dispensary company too. The Blüm group had little in common with the Andersons. For one thing, Blüm was indifferent to unionization; Ibrahim had avoided signing a deal with the UFCW, feeling that Rush was shady and disliking his constant cloud of Lucky Strike smoke. And both she and Kaufman prided themselves on their business savvy. They doubted the Andersons’ ability to run a successful modern dispensary. “They really meant well, I think,” Kaufman recalled. “But they were woefully underfunded and struggled at interpreting building code, regulations and cultivation.” For the Andersons, the real trouble began with a small patch of weed that Carl decided to grow in a back building at their vacant dispensary. He figured he could sell some of it to replenish his dwindling funds while he waited for the license. The city didn’t necessarily care, as long as he paid taxes on the grow. According to Carl, Rush told him not to pay the taxes because no one was looking, so he didn’t. (Rush says he never told Carl not to pay taxes and that Carl made the decision not to pay them on his own.) That’s when everything started falling apart. To Carl’s surprise, the city started asking pointed questions about excessive electricity consumption — often a sign of weed cultivation — at his West Grand storefront. Nervous, he sought legal advice from TerBeek, who told him to blame his high electrical bills on leaky refrigerator seals, Carl says. During a crucial January 2012 city hearing on

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AMCD’s application, Oakland officials asked Carl about the electricity; he gave the leaky-fridge excuse. But when a city inspector paid an unexpected visit to Carl’s space, he went straight to the back building where Carl had been growing weed. The Andersons were busted, and in March, the city disqualified their license application, saying they had been dishonest. All they had left now was their rented storefront on West Grand Avenue. But without a license, they lost their grip on it. One of their successful competitors, Blüm, now angled to take over the space, with the city’s support, and Carl, broke and defeated, accepted an offer from Blüm to buy out the lease. “At the end,” Carl recalled, “I lost it. I hollered and I yelled. I am a passionate man.” Kaufman says when he visited the space to accept the keys on Blüm’s behalf, he saw Carl sitting in his car, weeping. Blüm opened to customers in November 2012 and became a quick success; by 2016 it would rack up $14 million in annual sales. That year an accountant would estimate that Blüm’s dispensary license alone was worth $10.3 million. There are multiple accounts of what happened here. Rush and TerBeek say that Carl acted erratically and made a series of poor decisions that led to his demise. But Carl was now convinced that the two men had screwed him over. “It was a setup,” he recalled later. He didn’t understand exactly how they had accomplished their goal, but he sensed that Rush and TerBeek had shifted their loyalties to the deep-pocketed Blüm group behind the scenes, manipulating Carl and his family out of their license and their space to make room for a richer competitor. In essence, Carl believed he was the victim of a conspiracy — and the FBI would eventually find persuasive evidence to support Carl’s version of the story. The Andersons were angriest at Rush. They didn’t blame the competitors who took over their space — it was just business. (The FBI would ultimately find that the Blüm partners did nothing wrong; they won their license fairly and were unaware of any behind-the-scenes maneuvering.) But with Rush, the wound was personal. He said he was their friend. “And he betrayed us,” Carl recalled. “He was a crook.” Said Forrest: “It was a con.” The episode left them consumed with guilt and regret. Forrest feared that if they didn’t do something to stop Rush, he would prey on other cannabis purveyors and harm the community. Carl couldn’t bear to even look at his old store, detouring away from that block of West Grand altogether. He pictured all the money he had given to Rush for no benefit at all. Stewing, he complained to friends and associates about Oakland’s licensing process, saying it was corrupt and crooked. After one such outburst, Carl received an unexpected message from FBI agent Wynar. Carl, curious, called him back. The agent explained that one of his sources had overheard Carl talking about corruption — would he like to discuss further? And that is how Forrest and Carl found themselves on the 10th floor of the San Francisco federal building in fall 2012, face to face with Wynar. He didn’t look like an FBI agent. His black hair was long and fell to his shoulders. His beard was gray, and he wore glasses that gave him the air of a scientist or a professor. Wynar, it turned out, had followed a unique path to the bureau. As a young man he spent seven years as a Marine Corps officer, flying helicopters. Then he studied atomic, molecular and optical physics, earning a doctorate at the University of Texas at Austin and building lasers to study an exotic quantum phenomenon called Bose-Einstein condensation. After reading some true-crime books about La Cosa Nostra, he noticed that the FBI was looking for technical-minded people. He applied and became an agent in 2003, ending up in Oakland, where he was assigned to investigate public corruption, civil rights abuses and complex financial fraud. “The triumvirate of white-collar crime,” Wynar called it during the

“THEIR GOAL IS HEADLINES: ‘WE GOT THIS TRUSTED PUBLIC SERVANT DOING THESE SCOUNDRELOUS THINGS.’ ” DAN RUSH

SFChronicle.com | Sunday, March 29, 2020 |

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first of multiple interviews at the FBI’s San Francisco headquarters. It’s not typical for the bureau to speak so extensively, but when the newspaper initially asked for comment, an FBI spokesman agreed to make Wynar available, saying, “You caught us at a good time.” Rush, it seemed, had recently vented about his case on a podcast, accusing the government of fabricating evidence. He invented a new word to describe his skepticism of their motives — an inspired blend of “scoundrel” and “scandalous.” “Their real goal,” he’d said, “is headlines: ‘We got this trusted public servant doing these scoundrelous things.’ ” Apparently this had not escaped the FBI’s notice, and so, three times in 2018 and 2019, at The Chronicle’s request, Wynar answered a reporter’s questions in person, in a room with the bureau’s seal on the wall. During one interview the agent was joined by a supervisor in the public corruption division, and each time a FBI spokesman observed. Wynar has a friendly, self-effacing conversational style. He’s extremely polite and doesn’t speak in police jargon. These qualities, combined with his long hair, make for a disorienting experience; sit with him for a few minutes, avoid glancing at the gun on his hip, and you can almost forget he’s a cop. This is more or less what happened with the Andersons: Soon after they got to talking with Wynar, their initial nervousness turned to a sort of relief. Over three hours, they described a painful experience. The promise of a license. Meetings with politicians, contributions to their campaigns. The increasing demands for money from Rush. Then the betrayal by Superman and his lawyer partner. Not holding back, the Andersons admitted they had been growing pot. They admitted to suspecting that some of their money was used for bribes, though they weren’t certain. They admitted that, yes, at that moment, they were high, which had been obvious to Wynar the moment they got in the elevator and it reeked so strongly of pot that he wondered whether he might “fail my next piss test” just from contact, Wynar recalled. “But that was the end of it. I told them they can't be like that anymore and they were entirely squared away from that point forward.” At first, Wynar didn’t know what to make of their claims. If they were telling the truth, Rush was flagrantly violating the Taft-Hartley Act, a 1947 law that curbs the power of unions. Though the labor movement has long resented Taft-Hartley, viewing it as an attack on working people, the law includes a provision meant to keep union officials honest, barring them from accepting things of value from companies that employ their members. If Rush was taking cash from the Andersons, he was committing potentially serious felonies. Stranger still were the Andersons’ allegations against TerBeek, the lawyer. The FBI agent was skeptical: Lawyers who commit crimes or work against the interest of their clients can end up disbarred, and for that reason, it was rare to find one who was an actual crook. Wynar wondered whether the pot-smoking witnesses were simply paranoid, or whether they were telling lies as part of a revenge scheme, hoping the FBI would investigate their enemies. “It was a while before they believed us,” Carl said. Still, Wynar was struck by the level of detail they provided about money and power in Oakland. The Andersons weren’t sophisticated enough to know what they claimed to know, or to beat back the corruption they were describing. Wynar was also impressed that they were willing to talk at all. “People in the cannabis industry have an extremely conspiratorial view of the Department of Justice, right?” he explained later. “It’s just a — it’s a very bad trust relationship.” He wondered: What could provoke a couple of pioneering weed dealers to walk into a building packed to the gills with cops and dish about corruption in their world? How bad must it be out there?

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