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Judge clears U.S. crackdown on Oakland medical pot shop

SAN FRANCISCO (Reuters) - A judge paved the way on Thursday for federal authorities to seek the closure of a medical marijuana dispensary in California, dismissing a challenge by the city of Oakland to a federal crackdown targeting the facility, court papers showed.

But the executive director of the Harborside Health Center pledged that he would not close the Oakland outfit that bills itself as the world's largest medical pot dispensary and was featured in the Discovery Channel television series "Weed Wars."

Magistrate Judge Maria-Elena James wrote in a 10-page ruling that a local U.S. attorney had successfully argued the federal government was immune from Oakland's lawsuit under the Administrative Procedures Act, which sets out how U.S. agencies develop and issue regulations.

California is one of 18 states which, in addition to the District of Columbia, allow medical marijuana. But the federal government holds the drug is illegal and liable to be abused.

A representative for the U.S. Attorney for the Northern District of California declined to comment on the ruling.

Oakland, in a novel lawsuit filed in October, sought to halt federal prosecutors' efforts to shutter Harborside. The dispensary was expected to generate an estimated $1.4 million in sales tax revenues for the city this year.

Federal prosecutors in 2012 filed civil actions in federal court seeking to seize the properties for Harborside's locations in Oakland and San Jose, and terminate the dispensary's leases with the landlord for each site, said Harborside's attorney Henry Wykowski.

James, the judge who dismissed the Oakland lawsuit on Thursday, is also overseeing those two civil actions.

She had put those cases on hold until the Oakland lawsuit could be resolved, but Wykowski said he expects the cases to move forward and that two separate San Francisco juries will decide them. The juries will get those cases late this year or in early 2014, he said.

Wykowki added that he expects juries in San Francisco, a predominately liberal city, would "allow Harborside to remain open and conduct its business consistent with the mandate of the voters of California to legalize medical cannabis."

"I think that the U.S. Department of Justice is out of touch with the will of the American people with regards to the legalization of medical cannabis," he said.

Harborside officials say they serve over 100,000 patients.

"We are, of course, disappointed in today's ruling," Steve DeAngelo, executive director of Harborside, said in a statement.

"But the message of Oakland's lawsuit remains powerful and relevant: The City Council and mayor have determined that if Harborside Health Center is closed, the entire city will be harmed," he said.

(Reporting by Ronnie Cohen, Writing by Alex Dobuzinskis; Editing by Cynthia Johnston and David Gregorio)

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