Medical marijuana supplier speaks out on federal charges

Medical marijuana dispensary owner
Matt Davies speaks to CBS News in a recent interview.

(CBS News) A federal court Tuesday threw out an appeal from three groups that want to make marijuana legal for medical use in the United States. The decision could mean prison for a supplier who thought he was playing by the rules.

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Matt Davies' TV commercials made no secret he was selling marijuana through his medical marijuana dispensary.

Davies described his ads as "no different than a credit union running advertisements on TV."

Davies says his MediZen dispensaries had all the required permits to operate legally in California. "Every tax any another entity would have to pay, we had to pay and more," Davies said, and added that he "absolutely" was paying those taxes. "That was the whole point," he said.

But now, the 34-year-old father of two is caught between state law that permits medical marijuana and federal law that declares all marijuana illegal. He is facing federal charges that could put him in prison for years, a prospect that haunts his wife, Molly. She said, "He never would have gone down this avenue if he had ever, for a moment, thought that he would be in trouble with the federal government."

Davies' troubles began in October 2011, after four U.S. attorneys stood together to announce a statewide crackdown on medical marijuana providers. On Oct. 7, 2011, Melinda Haag, U.S. Attorney for the Northern District of California, said, "People are using the cover of medical marijuana to make extraordinary amounts of money. In short, to engage in drug trafficking."

Four days later, police raided the warehouse where prosecutors say Davies was growing 2,000 marijuana plants. Federal prosecutor Benjamin Wagner declined CBS News' request for an interview, but in a letter described Davies as "one of the most significant commercial marijuana traffickers to be prosecuted in this district."

CBS News asked Davies about the federal government's claim that his operation was an operation that had revenue in the millions of dollars and profits in the hundreds of thousands of dollars. Davies responded, "Monkey math, $50,000 came to me over the course, approximately, give-or-take, over the course of about a year and a half."

Davies is fighting the federal charges, insisting everything he did was legal under California law. But that defense may not keep him out of federal prison.

Davies said, "I am just thankful that my wife is so strong, that no matter what happens, she will take great care of our daughters."

For John Blackstone's full report, watch the video in the player above.