by Stephen Curran, San Luis Obispo Tribune (CA) August 6th, 2007 -- The former owner of a Morro Bay medical marijuana dispensary pleaded not guilty today on charges he used his controversial co-op as a front for illegally selling the drug.

Charles Lynch, who operated Central Coast Compassionate Caregivers, appeared this morning in a Los Angeles courtroom. A grand jury indictment accuses him and about 10 employees of growing and selling the cannabis for profit and distributing it to minors. He pleaded not guilty to distributing marijuana to minors, maintaining premises that were involved with illegal drugs and aiding and abetting illegal marijuana distribution to minors, Lou Koory, his local attorney, said.

Lynch’s supporters have said his client has been unfairly targeted by the federal government and that his dispensary is allowed under a state law that allows use of marijuana for medical purposes. Lynch was arrested at his Arroyo Grande home July 17, two months after a raid at the dispensary by federal authorities.

Dispensaries such as the one owned by Lynch have operated in a legal gray area since California voters approved Proposition 215 in 1996.

The federal government has argued that national prohibitions outlawing all marijuana use trump exceptions passed at the state level.