Former Michigan marijuana board chair, others face federal bribery charges

• Federal officials say Rick Johnson accepted more than $100,000 in bribes while chairing state’s medical marijuana board
• He and three others face bribery-related charges, investigation is ongoing
• All four defendants have reached plea agreements, officials said Thursday

April 25: Ex-head of Michigan marijuana board pleads guilty to taking $110K in bribes

Former Michigan House Speaker Rick Johnson and three others face public corruption charges for bribery related to state marijuana licensing requests, federal officials announced Thursday. All four have already reached plea agreements with the government. 

At a press conference in Lansing, U.S. Attorney for the Western District Mark Totten announced that Johnson was charged with accepting bribes for taking more than $100,000 in cash payments and other benefits from multiple sources while chairing the state’s now-defunct medical marijuana licensing board. 

Federal officials allege Johnson knowingly accepted benefits in return for giving certain businesses preferential treatment in the medical marijuana licensing process.

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Also charged in connection with the case were John Dawood Dalaly of West Bloomfield, charged with paying bribes for giving Johnson at least $68,000 in cash payments and providing him with private chartered flights, and lobbyists Brian Pierce and Vincent Brown. 

Pierce and Brown were charged with conspiracy to commit bribery for arranging to bribe Johnson through various entities. 

All four have reached plea agreements on the charges and are cooperating with the U.S. Attorney’s Office and FBI on the ongoing investigation, Totten said. The agreements were filed Thursday afternoon, and court hearings are expected in the coming weeks. 

In his plea agreement, Johnson agreed to pay $110,200 to the federal government representing the estimated amount of bribes he took. 

The agreement states that Johnson “acted with the intent to be influenced or rewarded in connection” with marijuana board licensing activities and arranged for the bribes to be paid to limited liability companies he controlled in an effort to hide the payments.

Per Dalaly’s plea agreement, Dalaly gave at least $68,200 in cash payments and other benefits through his two companies, one of which was actively seeking licensing approval from the board at the time. Johnson also gave Dalaly “valuable non-public information” about the board’s operation and assistance with license application.

Brown and Pierce lobbied on behalf of various businesses seeking licenses from the board, and agreed to give Johnson at least $42,000 in cash payments and other benefits to influence him while their clients sought licenses from the board, according to their respective plea agreements. 

Whether Johnson and others associated with the charges face jail time is a decision for the courts to make, Totten said, noting the maximum sentence for Johnson and Dalaly is 10 years and five years for Pierce and Brown. The defendants’ plea agreements sought reduced penalties in exchange for cooperation, although the U.S. Attorney’s office in the plea agreement reserved the right to object if they don’t provide “full, complete, and truthful interviews and testimony.”  

Johnson — who served in the Michigan House from 1999-2004, was House Speaker from 2001-2004 and worked as a lobbyist after leaving the Legislature — was appointed by then-Gov. Rick Snyder to chair the Medical Marihuana Licensing Board in May 2017. 

The board was disbanded in April 2019, a few months after Michigan voters approved the legalization of recreational marijuana. The state’s Cannabis Regulatory Agency now handles licensing for the marijuana industry.

As chair, Johnson played an outsize role in determining what companies obtained licenses to grow, process and distribute medical marijuana legally — a situation federal officials say he knowingly took advantage of. 

“The marijuana industry has been likened to a modern-day gold rush, where participants can stake their claim and just maybe return big rewards,” Totten said. “One of its key leaders and those with power and influence around him acted corruptly, and did so at a moment that matters.” 

The investigation started as early as December 2017 and remains ongoing, and involved multiple search warrants, Totten said. He and FBI special agent James Tarasca encouraged members of the public to contact their offices if they have relevant information to share.