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Eaze cannabis delivery drivers threaten strike ahead of annual pot holiday

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Eaze cannabis delivery drivers threaten strike ahead of annual pot holiday

California cannabis delivery company Eaze may face a work stoppage next week, a peak sales time for weed businesses.

Nearly 600 cannabis delivery drivers and depot staff across California who work at Eaze and its subsidiary Stachs are represented by various locals of the United Food and Commercial Workers Union.

Last week, they voted to approve a strike, the union said, after contract negotiations with Eaze stalled over disagreements about hourly wages as well as the mileage reimbursement rate for drivers, who use their own cars to make deliveries. The vote gives leaders authority to call a strike if contract talks stall at a bargaining session scheduled for Monday.

“We are totally willing to negotiate and if you want to give us a deal, we are into it, but if you won’t, we will strike,” said Ron Swallow, a delivery driver at Eaze’s depot in Van Nuys, at a Wednesday news conference held by UFCW Local 770, which represents 180 workers at Eaze depots in Southern California.

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Workers at his depot in Van Nuys approved a strike authorization by a 95% margin, according to Swallow.

“I am super proud of all my co-workers, they have stood united while their cars fell apart, while their rent is two months late,” Swallow said.

Ed Gutierrez, deputy director of UFCW Local 770’s cannabis division, said a super-majority of Eaze workers across the state voted in favor of a strike. The union declined to disclose a specific percentage and total number of ballots cast.

Cory Azzalino, chief executive officer at Eaze, said the company is hiring a “large cohort of new drivers” in anticipation of a work stoppage.

“Eaze is preparing itself to maintain operations in the event of a strike,” Azzalino said. “Corporate and depot staff will assist in keeping operations as normal as possible for our customers.”

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Eaze, the largest multi-state cannabis delivery operator in the U.S., launched in 2014 and was valued at $700 million, with more than $255 million in total investment capital raised, according to TechCrunch.

But the San Francisco-based company has struggled with cash flow problems and legal issues, with its former chief executive pleading guilty to a $100-million bank fraud scheme.

A lawsuit filed last year by the founders of Green Dragon, a cannabis retail company that merged with Eaze in late 2021, accused Eaze of defrauding investors by intentionally concealing its poor finances in order to finalize the merger.

Stachs and Eaze workers at the Van Nuys depot voted to unionize in March 2023, with workers in La Brea, Gardena, Silverlake and other Southern California locations following suit later in the year.

Six depots in Southern California and five in Northern California have unionized with various UFCW locals, which are coordinating to negotiate a statewide contract. Negotiations have been ongoing since August 2023.

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UFCW Local 770 counts about 700 cannabis workers among the 31,000 healthcare, retail, grocery, and packing workers it represents in Southern California. Some Eaze workers in Sacramento recently unionized with the Teamsters.

Delivery drivers have complained that the company’s decision last summer to slash the reimbursement rate for drivers from the 65.5 cents per mile rate recommended by the IRS to about 40 cents per mile — with slight variation depending on location — has cut drivers’ pay by $300-$700 per month. Drivers currently earn minimum wage, plus tips.

Another sticking point is Eaze’s use of a third-party company, Motus, to calculate a variable mileage rate based on where drivers are located and gas prices, which drivers said keeps them in the dark about how their reimbursement is calculated.

Lori Riehle, a delivery driver based out of Eaze’s depot in Silverlake, said the mileage rate reduction “has been a nightmare.”

“Reimbursement is not a perk they give us… we need that money,” Riehle said. “Today, my savings are gone — I’m reaching for my credit card to get through the end of the pay period.”

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Azzalino, the Eaze executive, said the company’s offer was reasonable, considering troubling economic headwinds the weed industry faces and considering it’s higher than the state standard of a $0.35 reimbursement rate set for rideshare and delivery drivers classified as independent contractors under gig worker law Proposition 22.

“In an industry being suffocated from high taxes and over regulation, Eaze pays our drivers fair wages averaging over $25 per hour including tips, as well as benefits and consistent scheduling,” Azzalino said in an email. “Eaze has not earned a profit in its history, so this is not the case of old industry hoarding profits.”

There is limited turnover among drivers, who on average, have worked at the company for 2.4 years, “which is evidence of a reasonable compensation package,” Azzalino said.

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Eric Goepel, the founder and CEO of the Veterans Cannabis Coalition, said at the Wednesday news conference that cannabis delivery workers serve as a lifeline for patients who rely on cannabis to treat pain and lamented broader economic instability for players in the cannabis industry.

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California’s “bizarre” taxes and regulatory scheme makes it nearly impossible to turn a profit, he said, but squeezing workers is a “terrible miscalculation” by Eaze.

“The way forward here is not by going after the workforce and trying to nickel and dime them out of $500, $600 a month that they most desperately need, and which adds a smidgen of a fraction to their actual bottom line, when a company has raised hundreds of millions of dollars,” Goepel said.

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California is making restaurants tell the truth about prices. Will it give you sticker shock?

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California is making restaurants tell the truth about prices. Will it give you sticker shock?

California restaurants finally have their answer: They, too, must comply with a new state law that bans unadvertised fees, surcharges and other costs tacked onto the end of the bill.

Starting July 1, restaurants will join thousands of other California businesses, including event ticket sellers, short-term rental apps, hotels and food delivery services, that are required to include all mandatory fees and charges in the prices they display or advertise.

The state attorney general’s office gave conflicting statements in the weeks after Gov. Gavin Newsom signed the measure into law last year, telling some news outlets that restaurants could continue to keep their current prices while listing any surcharges on their menus, and others that the surcharges had to be included in the prices themselves.

On Wednesday Atty. Gen. Rob Bonta’s office released a set of guidelines to clarify that issue and answer other questions about how businesses must comply with the new law. Bonta sponsored the measure, Senate Bill 478, along with its co-authors, state Sens. Bill Dodd (D-Napa) and Nancy Skinner (D-Berkeley).

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For restaurants, that means it will no longer be enough to just list service charges and surcharges on a bill or a menu’s fine print. Instead, these charges must be included in the prices printed on the menu.

For example, a $20 mole enchilada at a restaurant that levies a 5% fee to cover employee health costs will have to be listed on the menu as a $21 mole enchilada. And a flier advertising a $10 lunch buffet at a restaurant that adds a mandatory 10% “service charge” will have to refer to the offer as an $11 lunch buffet.

In a statement, the Golden Gate Restaurant Assn. said Bonta’s guidelines “will create significant challenges for the restaurant industry moving forward.”

The association, which advocates for the restaurant industry, argues that by prohibiting the longtime practice of using service charges to increase staff pay or cover the cost of local ordinances — such as San Francisco’s requirement that businesses spend at least a minimum amount on healthcare services — the law will compound the problems faced by an already struggling industry.

“Diners will not pay less, instead they will see significant menu price increases, which we believe will further cause them to pull back on dining out,” the statement said. “Not only will restaurants struggle, but workers will lose hours and jobs.”

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With few exceptions, businesses of all sorts across California will not be able to advertise, display or offer a price for their goods or services that does not include all of the “mandatory fees or charges” other than government-imposed taxes or fees or reasonable shipping costs, according to the measure’s authors.

“Put simply, the price a Californian sees should be the price they pay,” Bonta’s office said in a news release.

The new law doesn’t dictate what companies charge for their goods or services. Businesses will still be able to set prices, but the posted price will need to match the full amount a customer will see on their final bill.

Though businesses can exclude taxes and shipping charges, handling fees must be included. In other words, actual postage or delivery charges can be excluded, while the cost of pulling an item off a shelf and taking it to a shipping company has to be included in its advertised price.

Separate fees for optional services or features do not need to be advertised. This could extend to a bevy of industries and services — for example, the amount an airline charges for a seat upgrade or checked bags.

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What about late fees or extra charges for customers who smoke in a hotel room? Because those charges can be avoided, they do not have to be advertised, according to the guidelines from Bonta’s office.

Businesses will not be allowed to skirt the law by advertising one price and then letting customers know that additional fees might be added later. A business can, however, list the full price of its product and provide customers a breakdown of all the fees that are included.

Bonta also offered some guidance for businesses that say they do not know up front what the final cost will be once their work is done. Such businesses “should wait to display a price until they know how much they will charge,” the guidelines say.

This could affect how live music fans interact with ticket sellers for concerts and other live events. The nonprofit watchdog Consumer Reports noted that hidden fees can increase the price of live-event tickets by 30% to 40%.

Live Nation Entertainment, parent company of ticketing giant Ticketmaster, said in a statement that it supported SB 478 and has already offered all-in pricing at some venues and festivals across the country. “Unfortunately, we routinely see resellers defy state laws requiring all-in pricing which confuses and harms fans, so we strongly encourage regulatory scrutiny to ensure compliance across the industry,” the company said.

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The Virginia-based Travel Technology Assn., a global network of online travel agents, said it views transparency as a top priority but opposed SB 478 and would rather see a uniform national standard for regulations on lodging prices.

“We take this position to create uniformity and certainty for lodging operators, travel technology companies, and most of all, travelers, who will have a better understanding of what is included in advertised prices for trips both in and out of their home state,” President and Chief Executive Laura Chadwick said in a statement.

The online travel company Expedia opposed the bill for similar reasons.

In response to the argument, Bonta said that California does not need to wait for federal action to ensure transparency for consumers. The practice of hiding mandatory charges, he said in a statement, “is deceptive and unfair to consumers wherever it occurs — not just in certain industries.”

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Ocean technology hub AltaSea blooms on San Pedro waterfront

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Ocean technology hub AltaSea blooms on San Pedro waterfront

A moon shot to make Southern California an international leader in the “blue economy” is taking shape in San Pedro as a $30-million renovation of three historic waterfront warehouses nears completion.

AltaSea at the Port of Los Angeles, as the complex is known, is home to sea-centered businesses such as the headquarters of explorer Robert Ballard, who located the wrecks of the Titanic and the German battleship Bismarck. His research vessel the Nautilus docks there, as does Pacific Alliance, a vessel for farming mussels far out at sea.

On barges docked on AltaSea’s wharf, scientists from USC, UCLA and Caltech are developing methods of reducing ocean carbon dioxide and technology to scrub ships’ exhaust stacks. Other tenants in the former warehouses include startup firms that are building a new generation of remote undersea cameras and 3-D printers to build parts for offshore wind, wave and solar farms.

Jenny Cornuelle Krusoe, executive vice president and COO of AltaSea at the Port of Los Angeles.

(Allen J. Schaben / Los Angeles Times)

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An aerial view of the Captura barge, where crews monitor equipment used for pulling carbon dioxide from seawater.

An aerial view of the Captura, a barge at AltaSea where crews monitor equipment used for pulling carbon dioxide from seawater.

(Allen J. Schaben / Los Angeles Times)

“AltaSea is education, research and business all working together,” said Jenny Krusoe, executive vice president and chief operating officer. The size and waterfront location, she added, make AltaSea “a unicorn piece of property that is basically made to be the mother ship for the blue economy.”

Mayor Karen Bass and others who played a part in AltaSea, including City Councilman Tim McOsker and Port of Los Angeles Executive Director Gene Seroka, are expected to officially open the facilities at a ceremony Wednesday.

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AltaSea is bringing new purpose to a previously moribund wharf that once played a rich part in the evolution of Southern California.

In the early 20th century, Los Angeles merchants and city leaders set out to capture a share of the increased global shipping trade expected to pass through the Panama Canal, a link between the Atlantic and Pacific oceans that opened in 1914. They created a municipal wharf on the waterfront of what has become the sprawling Port of Los Angeles, with a long stretch of warehouses where ships were loaded and unloaded into trains, carts and trucks by burly longshoremen.

The growth of containerized shipping after World War II gradually rendered City Dock No. 1 obsolete for moving goods, and the wharf was little used for decades. By 2011, advocates, including port officials, saw it for what it was: a choice 35-acre site for a research center and tech companies focused on sustainable uses of the world’s oceans.

A key part of the mission of the nonprofit enterprise is to create jobs with pioneering companies. Among them is the nonprofit AltaSeads Conservancy, the largest aquaculture seed bank in the United States. Like their terrestrial counterparts, aquaculture seed banks are meant to preserve genetic diversity in plant life for the future. AltaSeads is also advancing the use of kelp as an easily grown resource.

“It’s a super versatile crop,” said scientist Emily Aguirre of AltaSeads, that can provide food for humans and livestock while removing carbon from the atmosphere. “It can be also be used to fertilize terrestrial agriculture, and it’s fantastic because if you grow it out in the ocean, you’re not taking up any land.”

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Michael Marty Rivera and Emily Aguirre monitor varieties of kelp in storage tanks at AltaSeads

Michael Marty Rivera and Emily Aguirre of AltaSeads Conservancy monitor varieties of kelp in storage tanks.

(Allen J. Schaben / Los Angeles Times)

Kelp is also a source of algae that cuts methane emissions from cows, Aguirre said, and has many other food applications, including reducing freezer burn in ice cream.

Eco Wave Power, an Israel-based company, is set to install the first U.S. onshore wave energy pilot station in the coming months on the port’s Main Channel, next to AltaSea. The system of floaters attaches directly to preexisting structures — like breakwaters, wharfs and jetties — and produces energy from the constant motion of the waves. Another AltaSea business, CorPower Ocean, uses buoys and hydraulic pressure for energy production.

 Rustom Jehangir, founder and CEO at Blue Robotics, demonstrates his BlueROV2

Rustom Jehangir, founder and CEO at Blue Robotics, demonstrates his BlueROV2, a high-performance remotely operated vehicle that can be used for inspections, research and adventuring.

(Allen J. Schaben / Los Angeles Times)

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The figurative whale for AltaSea so far is Ballard, who set up shop at the aged docks several years ago and has captured public interest as a deep-sea explorer and scientific researcher. It’s his headquarters and home to his research and development.

AltaSea has an array of solar panels on the roof bigger than three football fields that generates 2.2 megawatts, enough to power 700 homes annually and more energy than the entire campus will need when it reaches full capacity.

BlueROV2, a high-performance remotely operated vehicle (ROV) that can be used for inspections, research, and adventuring,

The BlueROV2 vehicle.

(Allen J. Schaben / Los Angeles Times)

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To fund the wharf’s redevelopment, AltaSea received $29 million from the state, Port of Los Angeles and private donors. The funds paid for construction, installation of the solar panels and the future creation of a park.

AltaSea is one of multiple projects that are part of a two-decade process to clean up the air and water at the port and turn unused docks, wharves and warehouses into places where more people will want to work or visit, port officials said.

“Bringing people to our waterfront has been a hallmark of the Port of Los Angeles for decades,” Seroka said in 2020, and recent investments “will really bring us to the next level.”

Before the pandemic, about 3 million people came to L.A.’s waterfront annually for recreation, a tally port leaders hope to see double in the years ahead. To smooth the path of new development catering to visitors, the Port of Los Angeles is investing about $1 billion in infrastructure improvements over 10 years, Seroka said. Private developers building AltaSea and other projects will invest an estimated $500 million.

Taylor Marchment shows off 3D concrete printing for offshore renewable energy

Taylor Marchment, the manufacturing R&D lead at RCAM Technologies, shows off 3-D concrete printing for offshore renewable energy.

(Allen J. Schaben / Los Angeles Times)

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One of those projects, West Harbor, is a long-planned redevelopment of a 42-acre site that used to be home to Ports O’ Call, a kitschy imitation of a New England fishing village, built in the 1960s, that fell out of favor years ago and was razed in 2018.

Restaurants anchoring the dining, shopping and entertainment center will include Yamashiro, the second branch of a Japanese-themed Hollywood destination for locals and tourists. Another large restaurant will be Mexican-themed, with an over-water bar. There will also be a food hall and Bark Social, a membership off-leash dog park, bar and cafe. The complex is slated to open next year.

The waterfront developments represent improvements that San Pedro residents have been waiting decades to see, said Dustin Trani, whose family has been in the local restaurant business for nearly a century. Last year the chef opened Trani’s Dockside Station, a seafood restaurant situated between AltaSea and West Harbor, in part to capitalize on the expected influx of visitors.

“We’re on the cusp of a very big economic boom in this area that has not yet been seen,” Trani said.

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Netflix beefs up film ranks, hiring 'Bad Boys for Life' producer

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Netflix beefs up film ranks, hiring 'Bad Boys for Life' producer

“Bad Boys for Life” producer Doug Belgrad will join Netflix as its vice president of film as the streaming giant continues to beef up its movie ranks following a major shakeup.

A longtime Sony Pictures executive, Belgrad was involved in nearly all the movie studio’s live-action intellectual property, including the “Spider-Man” franchise, “Ghostbusters” and “Jumanji.” In 2016, after leaving Sony, he founded his own film and TV production and financing company called 2.0.

The Culver City-based firm has co-financed such movies as “Peter Rabbit,” “Peter Rabbit 2: The Runaway” and “Zombieland: Double Tap,” all of which had Belgrad attached as an executive producer.

“As an executive and producer, I’ve been fortunate to work with many of the world’s most talented filmmakers and performers,” Belgrad said in a statement. “There is no better place to continue that work than Netflix, whose global reach and resources are unmatched.”

The move comes just months after Netflix hired producer Dan Lin to run the company’s film division, which has seen tremendous growth in production and release of original movies. Lin replaced Scott Stuber, the former Universal Pictures executive who guided Netflix’s movie slate for years, resulting in tent poles including “Red Notice” and Oscar winners such as “Roma.”

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In a statement, Lin praised Belgrad’s years of experience.

“We will be leaning on Doug’s great creative instincts, his eye for talent, and his deep relationships across the filmmaking and talent community,” he said.

After Belgrad moves to Netflix, his 2.0 production and financing company will be led by current chief financial officer Zack Conroy and Sophie Cassidy, executive vice president of production.

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