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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No.: 14-00370 TRANS-HIGH CORPORATION, d.b.a. HIGH TIMES MAGAZINE, and DENVER WESTWORD, LLC, Plaintiffs, v. THE STATE OF COLORADO, BARBARA J. BROHL, in her official capacity as Executive Director of the Colorado Department of Revenue, and JOHN W. HICKENLOOPER, JR., in his official capacity as Governor of Colorado, Defendants. ________________________________________________________________________ MOTION FOR PRELIMINARY INJUNCTION AND SUPPORTING BRIEF ________________________________________________________________________ Plaintiffs, by and through their attorneys David A. Lane, Darold W. Killmer, and Michael P. Fairhurst of KILLMER, LANE & NEWMAN, LLP, hereby submit the following MOTION FOR PRELIMINARY INJUNCTION AND SUPPORTING BRIEF that seeks to enjoin Defendants ongoing violations of the First Amendment to the United States Constitution, and state as follows: 1. Defendants have violated Plaintiffs First Amendment rights by enacting,

enforcing, and defending the rules promulgated by the Colorado Department of Revenue, Marijuana Enforcement Division (MED), codified at 1 CCR 212-2, R1104 (Advertising: Television), R1105 (Advertising: Radio), R1106 (Advertising: Print Media), R1107 (Advertising: Internet), R1108 (Advertising: Targeting Out-of-State Persons Prohibited), and R1111B (Outdoor Advertising Generally Prohibited). Each rule

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at issue places inadequately supported and excessive restrictions on Plaintiffs rights to free speech, to Plaintiffs great detriment. 2. These violations are ongoing. But for injunctive relief, the constitutional

violations alleged herein and in Plaintiffs Complaint against Defendants will continue to occur. Thus, injunctive relief is warranted to prevent future violations. United States v. Oregon State Medical Soc., 343 U.S. 326, 333 (1952) (All it takes to make the cause of action for relief by injunction is a real threat of future violation or a contemporary violation of a nature likely to continue or recur.). 3. Plaintiffs in a First Amendment case must satisfy four conditions to obtain

a preliminary injunction. They must show that: (1) they will suffer irreparable harm unless the injunction issues; (2) there is a substantial likelihood Plaintiffs will ultimately prevail on the merits; (3) the threatened injury to Plaintiffs outweighs any harm the proposed injunction may cause the opposing party; and (4) the injunction would not be contrary to the public interest. American Civil Liberties Union v. Johnson, 194 F.3d 1149, 1155 (10th Cir. 1999). 4. As detailed below, each of the elements necessary to obtain a preliminary

injunction is present in this action. ARGUMENT I. INTRODUCTION AND BACKGROUND

This is a civil rights action for injunctive relief arising under 42 U.S.C. 1983 and 28 U.S.C. 2201, et seq., as well as for attorneys fees pursuant to 42 U.S.C. 1988, based on Defendants current and imminent violations of Plaintiffs rights guaranteed under the First Amendment to the United States Constitution. Plaintiffs seek to enjoin

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Defendants from enforcing the rules promulgated by the MED, codified at 1 CCR 212-2, R1104 (Advertising: Television), R1105 (Advertising: Radio), R1106 (Advertising: Print Media), R1107 (Advertising: Internet), R1108 (Advertising: Targeting Out-of-State Persons Prohibited), and R1111B (Outdoor Advertising Generally Prohibited). The MED regulations at issue unlawfully limit Plaintiffs First Amendment rights to distribute protected commercial speech via television, radio, print media, and the Internet, and unlawfully ban all outdoor advertising and all advertising [t]argeting [o]ut-of-[s]tate [p]ersons. The regulations violate Plaintiffs First Amendment rights because each is more extensive than necessary to serve any cognizable government interest(s), and each fails to directly advance any cognizable government interest(s). The rules at issue state, in pertinent part: R 1104 Advertising: Television A. Television Defined. As used in this rule, the term television means a system for transmitting visual images and sound that are reproduced on screens, and includes broadcast, cable, on-demand, satellite, or internet programming. Television includes any video programming downloaded or streamed via the internet. B. Television Advertising. A Retail Marijuana Establishment shall not utilize television Advertising unless the Retail Marijuana Establishment has reliable evidence that no more than 30 percent of the audience for the program on which the Advertising is to air is reasonably expected to be under the age of 21. R 1105 Advertising: Radio A. Radio Defined. As used in this rule, the term radio means a system for transmitting sound without visual images, and includes broadcast, cable, on-demand, satellite, or internet programming. Radio includes any audio programming downloaded or streamed via the internet.

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B. Radio Advertising. A Retail Marijuana Establishment shall not engage in radio Advertising unless the Retail Marijuana Establishment has reliable evidence that no more than 30 percent of the audience for the program on which the Advertising is to air is reasonably expected to be under the age of 21. R 1106 Advertising: Print Media A Retail Marijuana Establishment shall not engage in Advertising in a print publication unless the Retail Marijuana Establishment has reliable evidence that no more than 30 percent of the publications readership is reasonably expected to be under the age of 21. R 1107 Advertising: Internet A Retail Marijuana Establishment shall not engage in Advertising via the internet unless the Retail Marijuana Establishment has reliable evidence that no more than 30 percent of the audience for the internet web site is reasonably expected to be under the age of 21. See also Rule R 1114 Pop-Up Advertising. R 1108 Advertising: Targeting Out-of-State Persons Prohibited. A Retail Marijuana Establishment shall not engage in Advertising that specifically targets Persons located outside the state of Colorado. R 1111 Signage and Advertising: Outdoor Advertising B. Outdoor Advertising Generally Prohibited. Except as otherwise provided in this rule, it shall be unlawful for any Retail Marijuana Establishment to engage in Advertising that is visible to members of the public from any street, sidewalk, park or other public place, including Advertising utilizing any of the following media: any billboard or other outdoor general Advertising device; any sign mounted on a vehicle, any hand-held or other portable sign; or any handbill, leaflet or flier directly handed to any person in a public place, left upon a motor vehicle, or posted upon any public or private property without the consent of the property owner.

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The MED defines Retail Marijuana Establishment as a Retail Marijuana Store, a Retail Marijuana Cultivation Facility, a Retail Marijuana Products Manufacturing Facility, or a Retail Marijuana Testing Facility. 1 CCR 212-2, R103. The MED defines advertising as: [T]he act of providing consideration for the publication, dissemination, solicitation, or circulation, visual, oral, or written, to induce directly or indirectly any Person to patronize a particular a Retail Marijuana Establishment, or to purchase particular Retail Marijuana or a Retail Marijuana Product. Advertising includes marketing, but does not include packaging and labeling. Advertising proposes a commercial transaction or otherwise constitutes commercial speech. Id. Under state law in Colorado, it is legal to cultivate and distribute marijuana for medical purposes. Colo. Const. art. XVIII, 14; Colo. Rev. Stat. (C.R.S.) 12-43.3101 to-1001. Voters recently took marijuana legalization a step further and passed, by referendum, Amendment 64 to the Colorado Constitution, which legalizes the recreational production and sale of marijuana and possession of up to one ounce of marijuana. Colo. Const. art. XVIII, 16. Although the Colorado Constitution calls for the regulation of marijuana in a manner similar to alcohol, Colo. Const. art. XVIII, 16(1)(b), the MEDs regulations at issue irrationally stigmatize advertisements concerning Retail Marijuana Advertisements by singling them out for unduly burdensome regulations, which are universally unsupported by sufficient evidence.

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II.

PARTIES

Plaintiffs are companies engaged in the business of publishing and distributing magazines and/or newspapers that carry and seek to carry advertisements concerning Retail Marijuana Establishments through print media and the Internet, and that also may seek to carry advertisements concerning Retail Marijuana Establishments through television, radio, and outdoor advertising, and thus are subjected to and restricted by the regulations at issue. Defendants enacted and are prepared to enforce the regulations codified at 1 CCR 212-2, R1104 (Advertising: Television), R1105 (Advertising: Radio), R1106 (Advertising: Print Media), R1107 (Advertising: Internet), R1108 (Advertising: Targeting Out-of-State Persons Prohibited), and R1111B (Outdoor Advertising Generally Prohibited), each of which constitute irrational, inadequately supported, and overly broad restrictions on Plaintiffs First Amendment rights to engage in advertising concerning Retail Marijuana Establishments. Plaintiffs request immediate relief from the unduly sweeping restrictions Defendants have placed upon them, which violate Plaintiffs First Amendment rights and are causing Plaintiffs and the public at large irreparable harm. III. LEGAL ANALYSIS

PLAINTIFFS MEET THE PRELIMINARY INJUCTION STANDARD IN A FIRST AMENDMENT CASE Plaintiffs in a First Amendment case must meet four conditions to obtain a preliminary injunction: Plaintiffs must show that (1) they will suffer irreparable harm unless the injunction issues; (2) there is a substantial likelihood the plaintiffs ultimately will prevail on the merits; (3) the threatened injury to the plaintiffs outweighs any harm the proposed injunction may cause the opposing party; and (4) the injunction would not be contrary to the public interest. Johnson, 194 F.3d at 1155 (citations omitted). Here, 6

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Plaintiffs meet all four conditions, and the entry of a preliminary injunction against all the regulations at issue is therefore warranted. A. Plaintiffs will suffer irreparable harm unless a preliminary injunction is issued.

Plaintiffs produce and distribute publications that carry, seek to carry, and/or may seek to carry advertisements concerning Retail Marijuana Establishments through television, radio, print media, the Internet, and outdoor advertising. Many of Plaintiffs publications discuss and educate the public on current economic and political issues surrounding marijuana in the State of Colorado and elsewhere throughout the nation and world. The MED rules codified at 1 CCR 212-2, Series R1104 (Advertising: Television), R1105 (Advertising: Radio), R1106 (Advertising: Print Media), R1107 (Advertising: Internet), R1108 (Advertising: Targeting Out-of-State Persons Prohibited), and R1111B (Outdoor Advertising Generally Prohibited) burden and restrict the display and distribution of Plaintiffs publications, harming and severely limiting the distribution of Plaintiffs ideas and speech, and the publics access to this speech. Where First Amendment rights are burdened, there is a presumption of irreparable harm. See Cmty. Communications v. City of Boulder, 660 F.2d 1370, 1376 (10th Cir. 1981); Johnson, 194 F.3d at 1163. The reason for the presumption is self-evident: The loss of First Amendment freedoms, for even minimal periods of time, unquestionably constitutes irreparable injury. Elrod v. Burns, 427 U.S. 347, 373-74 (1976). See also Utah Licensed Beverage Assn v. Leavitt, 256 F.3d 1061, 1076 (10th Cir. 2001) (court assumes irreparable injury where there is a deprivation of speech rights). The unduly burdensome restrictions on Plaintiffs speech at issue are manifestly a loss of First Amendment freedoms and the injury is irreparable. 7

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B.

Plaintiffs will likely succeed on the merits of their First Amendment claim.

The second condition likelihood of success on the merits plays a decisive role in a First Amendment case. However, once plaintiffs have shown that their freedom of speech is burdened, the probability-of-success requirement may be somewhat relaxed. Cmty. Communications, 660 F.2d at 1375. Because the regulations at issue have not been and cannot be supported by sufficient evidence to demonstrate that they directly advance any arguably substantial government interest(s), the regulations irrationally single out Retail Marijuana Establishments for more stringent advertising restrictions than those regulating the alcohol industry although the Colorado Constitution calls for the regulation of marijuana in a manner similar to alcohol, Colo. Const. art. XVIII, 16(I)(b), the regulations have a uniformly broad sweep that demonstrates a fatal lack of tailoring, and there are less restrictive forms of regulation that could advance the governments underlying interests, Plaintiffs will likely succeed on the merits of their First Amendment claim. i. The Central Hudson test applies.

Government restrictions on commercial speech that concerns lawful activity and is not misleading violate the First Amendment unless (1) the asserted governmental interest is substantial; (2) the regulation directly advances the governmental interest asserted; and (3) the regulation is not more extensive than necessary to serve the asserted governmental interest. Leavitt, 256 F.3d at 1066 (citing Central Hudson Gas & Elec. Corp. v. Public Serv. Comm'n, 447 U.S. 557, 566 (1980)) ( Central Hudson test). All advertising Plaintiffs carry, seek to carry, and/or may seek to carry concerning Retail 8

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Marijuana Establishments constitutes protected commercial speech because it addresses lawful activity, see Colo. Const. art. XVIII, 16 (authorizing the operation of Retail Marijuana Establishments), and is not deceptive, false, or misleading. Therefore, the Central Hudson test applies. An analysis of each Central Hudson prong follows. ii. Substantial government interest governments burden to articulate and prove B]ecause of the importance of First Amendment speech protections, the government bears the responsibility of building a record adequate to clearly articulate and justify [its asserted] state interests. U.S. West, Inc. v. Federal Communications Comm'n, 182 F.3d 1224, 1234 (10th Cir. 1999). Not only is this the government's burden, but courts may not help; the Supreme Court has clearly stated that courts may not supplant the precise interests put forward by the State with other suppositions. Edenfield v. Fane, 507 U.S. 761, 768, 123 L. Ed. 2d 543, 113 S. Ct. 1792 (1993). Leavitt, 256 F.3d at 1069. Presumably, the MEDs primary interest in promulgating its advertising regulations is to prevent marijuana products from reaching children under the age of 21. Although Defendants have legitimate power to protect children from harm[,] . . . that does not include a free-floating power to restrict the ideas to which children may be exposed. Speech that is neither obscene as to youths nor subject to some other legitimate proscription cannot be suppressed solely to protect the young from ideas or images that a legislative body thinks unsuitable for them. Brown v. Entmt Merchs. Ass'n, 131 S. Ct. 2729, 2736-2737 (2011) (internal citations omitted) (quoting Erznoznik v. Jacksonville, 422 U.S. 205, 213-214 (1975)).

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iii.

All the regulations at issue fail to directly advance any substantial government interest(s).

The second step of the Central Hudson test requires that the speech restriction directly and materially advance the asserted governmental interest. This burden is not satisfied by mere speculation or conjecture; rather, a governmental body seeking to sustain a restriction on commercial speech must demonstrate that the harms it recites are real and that its restriction will in fact alleviate them to a material degree. Lorillard Tobacco Co. v. Reilly, 533 U.S. 525, 555 (2001) (internal citations and quotation marks omitted). Accordingly, there must be some findings of fact or evidentiary support that the restriction will significantly advance the states interest. See 44 Liquormart v. R.I., 517 U.S. 484, 505 (1996) (without any findings of fact, or indeed any evidentiary support whatsoever, [the Court] cannot agree with the assertion that the price advertising ban will significantly advance the States interest in promoting temperance). It is unlikely that Defendants could produce sufficient evidence to satisfy their burden to show that the MEDs heavy-handed advertising restrictions at issue directly advance any asserted state interest(s). See Leavitt, 256 F.3d at 1074 (Utah has the burden to prove both that liquor advertising harms its substantial interest in operating a public business in alcohol sales, and that its laws restricting liquor advertising will reduce any such harms to a material degree); 44 Liquormart, 517 U.S. at 505 (given the drastic nature of its chosen means the wholesale suppression of truthful, nonmisleading information[,] . . . we must determine whether the State has shown that the price advertising ban will significantly reduce alcohol consumption); Abilene Retail # 30, Inc. v. Six, 641 F. Supp. 2d 1185, 1194 (D. Kan. 2009) (reviewing ban on all off-premises signs and advertising for adult cabarets or sexually-oriented businesses located within 10

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one mile of any state highway, and stating that an outright ban requires a showing that the signage statute will significantly further its stated interests, a slightly higher burden). There is a paucity of evidence demonstrating that marijuana advertising stimulates minors demand for marijuana. And even assuming studies from the alcohol, cigarette, or other analogous contexts could be applied to marijuana advertising, the MED regulations at issue still fail to adequately advance any cognizable government interests. First, it is unclear how a ban on all advertising that targets out-of-state persons could marginally advance, much less significantly advance, any state interests properly deemed substantial. See R1108 (Advertising: Targeting Out-of-State Persons Prohibited); 44 Liquormart, 517 U.S. at 505. Several MED regulations also irrationally apply much more stringent restrictions to marijuana advertising than alcohol advertising although Colo. Const., art. XVIII, section 16 states that marijuana should be regulated in a manner similar to alcohol. For example, MED regulations mandate restrictions on television, print, Internet, and radio advertising (prohibiting all such advertising unless the Retail Marijuana Establishment has reliable evidence that no more than 30 percent of its audience is reasonably expected to be under the age of 21) that mirror standards the alcohol industry voluntarily follows. Additionally, the regulations essentially ban all outdoor advertising. While the national legal status of the marijuana and liquor industries are not the same, this alone does not provide a legitimate basis for a state agency enforcing state laws to impose more onerous advertising restrictions on marijuana retailers than liquor retailers. Nor is there sufficient evidence that minors are more susceptible to marijuana advertising than alcohol advertising to justify the Defendants stigmatization of marijuana

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advertising. Therefore, R1104 (Advertising: Television), R1105 (Advertising: Radio), R1106 (Advertising: Print Media), R1107 (Advertising: Internet), R1108 (Advertising: Targeting Out-of-State Persons Prohibited), and R1111B. (Outdoor Advertising Generally Prohibited) all fail the second part of the Central Hudson test. In a similar context, the United States Court of Appeals for the Tenth Circuit, in Leavitt, held that Utahs restrictions on liquor sales advertisements violated the First Amendment, and issued a preliminary injunction enjoining the state from enforcing its contested regulations. The main Utah statutes at issue were: Utah Code Ann. 32A-12-401(2), which provides that: The advertising or use of any means or media to induce persons to buy liquor is prohibited, except: (1) a restaurant licensee, an airport lounge licensee, a manufacturing licensee, or a private club licensee may display a sign on the front of, in the window of, and inside its premises stating Department of Alcoholic Beverage Control Licensee, DABC Licensee, or State Liquor Licensee in a form approved by the department; (2) a restaurant licensee may use the designation Department of Alcoholic Beverage Control Licensee, DABC Licensee, or State Liquor Licensee in magazines, newspapers, telephone book advertising pages, and other advertising in a nonbold 10-point type face; (3) a permittee may use the designation Department of Alcoholic Beverage Control Permittee, DABC Permittee, or State Liquor Permittee in a form approved by the department when informing the public or its invited guests about the event or service for which the permit was obtained; (4) a restaurant licensee may advertise liquor availability in menus only to the extent authorized in Chapter 4; (5) a hotel may advise its guests of liquor availability at its outlets in informational materials; and 12

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(6) as otherwise authorized by this title or the rules of the commission. Utah Code Ann. 32A-12-401(2) (2000); as well as 32A12-401(4), which provides that: The display of liquor or price lists in windows or showcases visible to passersby is prohibited. Utah Code Ann. 32A-12-401(4) (2000); and 32A-12104, which provides that: Any person who violates this title or the commission rules adopted under this title is guilty of a class B misdemeanor, unless otherwise provided in this title. Leavitt, 256 F.3d at 1068-1069. Evaluating these regulations, the court concluded that, while Utah asserted two substantial interests in support of its speech restrictions temperance and the operation of a public business Utahs laws failed to directly advance the states interests because, first, the regulations at issue applied only to liquor, and it was irrational to distinguish between different types of alcoholic beverages particularly considering that Utahs evidence solely proved there is a substantial state interest in tempering the consumption of all types of alcohol. Id. at 1074. Second, the court held that Utah could not justify its advertising restrictions through its operation of a public business in liquor sales because the state presented no evidence supporting the somewhat counterintuitive argument that advertising by liquor licensees poses any threat to the operation of a public business. Id. Because, for the reasons above, the MEDs contested rules for marijuana advertising also irrationally single out a lawful product for particularly restrictive regulation and are unsupported by sufficient evidence, they, too, should be invalidated on the basis of Central Hudsons second prong. 13

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iv.

All the regulations at issue are more extensive than necessary to serve any substantial government governmental interest(s).

Assuming, arguendo, that Defendants can overcome the hurdle set out in Central Hudsons second prong, Defendants cannot overcome the last step: The regulations at issue are more extensive than necessary to serve the goal of preventing minors from using marijuana (or any other legally-cognizable state interest). In Lorillard, tobacco product manufacturers and retailers challenged advertising restrictions passed by Massachusetts. 533 U.S. 525. One of the contested regulations prohibited any outdoor advertising within 1000 feet of schools and playgrounds. Id. The United States Supreme Court took into consideration the breadth of area that this regulation would cover (87%-91% of metro areas would have been off limits) and stated, The uniformly broad sweep of the geographical limitations demonstrates a lack of tailoring. Lorillard, 533 U.S. at 564. Regulations must be drafted on a case-by-case basis and account for the fact that the effects of advertisements and the impact of restrictions may vary between localities. Id. Many of Defendants marijuana advertising regulations at issue have a similar sweeping effect to those that were invalidated in Lorillard, such as the rules limiting radio, print, Internet, and television advertising to audiences that marijuana retailers can prove are comprised of no more than 30% individuals under the age of 21. Further, because a limit on some outdoor advertising was struck down in Lorillard, then, surely, the MEDs ban on all off-premises outdoor advertising violates the First Amendment. 533 U.S. at 565-566. Additionally, the interest of manufactures and retailers in conveying truthful information about their products to adults, and adults hav[ing] a corresponding interest in receiving truthful information cannot be limited to only what is appropriate for children. 14

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Id. at 564. This has been reiterated many times by the United States Supreme Court. See e.g., Reno v. ACLU, 521 U.S. 844, 875 (1997) (the governmental interest in protecting children from harmful materials . . . does not justify an unnecessarily broad suppression of speech addressed to adults); Bolger v. Youngs Drug Products Corp., 463 U.S. 60, 74 (1983) (The level of discourse reaching a mailbox simply cannot be limited to that which would be suitable for a sandbox.); Butler v. Michigan, 352 U.S. 380, 383 (1957) (The incidence of this enactment is to reduce the adult population . . . to reading only what is fit for children.). The MEDs advertising regulations at issue also fail Central Hudsons third prong because Defendants underlying interests could be promoted through less restrictive means. Leavitt, 256 F.3d at 1077 ([W]here the state's legitimate interests may be promoted through methods that do not restrict speech, those methods must be preferred over speech restrictions.). In Coors, the United States Supreme Court declared that the availability of . . . options . . . which could advance the Government's asserted interest in a manner less intrusive to . . . First Amendment rights, indicates that [the challenged statute] is more extensive than necessary. 514 U.S. at 491. And in 44 Liquormart, a plurality of the United States Supreme Court stated: [A]lternative forms of regulation that would not involve any restriction on speech would be more likely to achieve the State's goal of promoting temperance. As the State's own expert conceded, higher prices can be maintained either by direct regulation or by increased taxation. Per capita purchases could be limited as is the case with prescription drugs. Even educational campaigns focused on the problems of excessive, or even moderate, drinking might prove to be more effective. 517 U.S. at 507.

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Because it is doubtful that Defendants could show that nonspeech regulations would be an ineffective means to accomplish the ends it desires, or that its speech regulations are no more extensive than necessary, the contested ban on off-premises outdoor advertising, and significant restrictions on print, television, radio, and Internet advertising could be deemed unconstitutional on this basis alone. Leavitt, 256 F.3d at 1077 (even in the commercial speech context, a ban placing only partial limits on speech is nevertheless subject to the same standard of First Amendment review that would be applied to a complete ban). See also U.S. West, Inc. v. FCC, 182 F.3d 1224, 1232 (10th Cir. 1999) (The existence of alternative channels of communication . . . does not eliminate the fact that the . . . regulations restrict speech.). Defendants ban on advertising that targets out-of-state persons likewise fails the final Central Hudson prong. To reiterate, that regulation (R 1108) states: A Retail Marijuana Establishment shall not engage in Advertising that specifically targets Persons located outside the state of Colorado. Because this expansive and vaguely-worded prohibition potentially applies to a multitude of advertising messages and mediums, it is not narrowly or reasonably tailored to the governments potential asserted interests. See Leavitt, 256 F.3d at 106. (government is not required to employ the least restrictive means conceivable, but it must demonstrate narrow tailoring of the challenged regulation to the asserted interest a fit that is not necessarily perfect, but reasonable) (internal citation and quotation marks omitted). C. Plaintiffs harm is outweighed by any alleged harm to Defendants.

The balance of harms test will most often be met once First Amendment plaintiffs demonstrate a likelihood of success on the merits. A threatened injury to plaintiffs

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constitutionally protected speech will usually outweigh the harm, if any, the defendants may incur from being unable to enforce what is in all likelihood an unconstitutional statute or directive. See Johnson, 194 F.3d at 1163. As discussed above, Plaintiffs can and have demonstrated a likelihood of success based on the unprecedented, irrational, inadequately supported, and overly broad nature of the restrictions the MED has promulgated at 1 CCR 212-2, R1104 (Advertising: Television), R1105 (Advertising: Radio), R1106 (Advertising: Print Media), R1107 (Advertising: Internet), R1108 (Advertising: Targeting Out-of-State Persons Prohibited), and R1111B (Outdoor Advertising Generally Prohibited) place on Plaintiffs. Defendants cannot demonstrate serious harm in permitting the free exchange of ideas by lifting the contested restrictions on free access to Plaintiffs publications, even if they find the topic(s) objectionable. In addition to unduly restricting the free exchange of politically, culturally, socially, and commercially important speech, each of the regulations at issue directly harms the Plaintiffs by chilling the Plaintiffs from soliciting advertisements from prospective clients, and preventing the Plaintiffs from making revenue from clients who wish to engage in advertising concerning marijuana-related products and services. Prospective clients for Plaintiffs are likewise chilled from carrying and seeking to advertisements concerning marijuana-related products and services through Plaintiffs media, to Plaintiffs and the publics great detriment. The penalties for Retail Marijuana Establishments for violating each of the regulations at issue include, but are not necessarily limited to, a written warning, license suspension, a fine per individual violation, a fine in lieu of suspension of up to $50,000, and/or license revocation

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depending on the mitigating and aggravating circumstances. Sanctions may also include restrictions on the license. 1 CCR 212-2, R 1307(A)(2). Thus, each of the regulations at issue would reasonably chill a corporation of ordinary firmness from engaging in the prohibited activity. Globe Newspaper Co. v. Superior Court, 457 U.S. 596, 605 (1982); Richmond Newspapers, Inc. v. Virginia, 448 U.S. 555, 576, 586-88, (1980); First Nat'l Bank v. Bellotti, 435 U.S. 765, 783 (1978); Houchins v. KQED, Inc., 438 U.S. 1, 11 (1978). The balance of harms test favors the Plaintiffs. D. Plaintiffs requested injunction serves the public interest.

Plaintiffs can satisfy the public interest test because the enactment and enforcement of MED rules R1104 (Advertising: Television), R1105 (Advertising: Radio), R1106 (Advertising: Print Media), R1107 (Advertising: Internet), R1108 (Advertising: Targeting Out-of-State Persons Prohibited), and R1111B (Outdoor Advertising Generally Prohibited) burden both Plaintiffs and the publics free speech rights. Injunctions blocking state action that would otherwise interfere with First Amendment rights are consistent with and serve the public interest. Elam Constr. v. Reg. Transp. Dist., 129 F.3d 1343, 1347 (10th Cir. 1997) (The public interest . . . favors plaintiffs assertion of their First Amendment rights.); Leavitt, 256 F.3d at 1076; Johnson, 194 F.3d at 1163; Local Org. Comm., Denver Chap., Million Man March v. Cook, 922 F. Supp. 1494, 1501 (D. Colo. 1996). Furthermore, because Amendment 64 was passed by popular referendum by Colorado voters who wanted to regulate marijuana like alcohol, putting additional restrictions on marijuana that do not exist for alcohol is contrary to the intent of Amendment 64 and the public interest in Colorado. Therefore, Plaintiffs requested relief materially advances the public interest.

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CONCLUSION For all the reasons stated above, Plaintiffs respectfully request that this Court grant their Motion for Preliminary Injunction. The First Amendment tolerates no lesser result. DATED this 10th day of February, 2014.

KILLMER, LANE & NEWMAN, LLP s/ David A. Lane__________________ David A. Lane Darold W. Killmer Michael P. Fairhurst 1543 Champa Street, Suite 400 Denver, CO 80202 (303) 571-1000 dlane@kln-law.com dkillmer@kln-law.com mfairhurst@kln-law.com Attorneys for Plaintiffs

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