Denver Lawyer Loses Liability Insurance over Mmedical-marijuana Clients

5/13/2012 By John Ingold The Denver Post

In what appears to be a first-of-its-kind event nationwide, a Denver lawyer has lost her liability insurance because part of her practice involves representing medical-marijuana businesses.

Ann Toney’s insurance company told her last month that it will not renew her malpractice coverage. In its terse notice, the Hanover Insurance Group explained that Toney’s practice “does not meet current underwriting guidelines because of the following risk factors: Area of practice involving medical marijuana.”

Toney, a former prosecutor who has taught classes on medical-marijuana law for the Colorado Bar Association, said she was surprised. Most of her work representing medical-marijuana businesses came one or two years ago, when the state’s laws for such businesses were in flux.

She said she has always advised clients that marijuana sales remain illegal federally and made sure her clients are in compliance with state medical-marijuana law.

“You represent people under the laws of Colorado,” she said. “What’s the alternative? No one’s going to get any help following the law in Colorado?”

Allen St. Pierre, executive director of the National Organization for the Reform of Marijuana Laws, said he knows of no other lawyer to lose insurance because of work with medical-marijuana businesses.

“We’re certainly afraid we’re going to start seeing more now,” St. Pierre said.

He said 625 lawyers nationwide are members of NORML.

Toney’s nonrenewal started brewing earlier this year, when she asked to add a new lawyer to her firm’s coverage. The insurance company asked for more information about Toney’s work in the medical-marijuana field. T

oney replied that 70 percent of her practice involves drunken- and drugged-driving cases, with the remaining 30 percent consisting of criminal defense and medical-marijuana business representation.

Hanover’s nonrenewal notice followed Toney’s response.

Toney said her insurance broker has told her that she will have a hard time getting new insurance because she was dropped by a previous carrier.

Still, Toney said she is confident she can find another carrier willing to take her business.

“I’ll find coverage,” she said. “My only question is, How much more is it going to cost me?”

John Ingold: 303-954-1068 or jingold@denverpost.com