Navajo Nation moves to shut down hemp farms amid claims of marijuana growing
Leaders on the Navajo Nation have cracked down on one of its members who they say has used immigrant labor to transform 400 acres of crop land into hemp farms in the reservation's northeastern corner.
The crops — illegal under Navajo law — have pitted residents and reservation officials against entrepreneur Dineh Benally, who has formed a partnership with a Las Vegas company that says it develops hemp and cannabis businesses on Native American lands.
Navajo Nation leaders took Benally to court and got an initial victory last week: District of Shiprock Judge Genevieve Woody granted a temporary restraining order halting the hemp farming.
Navajo Nation President Jonathan Nez said the order grants tribal law enforcement officers authority to stop hemp production. Navajo Nation police have begun asking some workers on the hemp farms — people law enforcement officials claim are immigrant workers from Asia — to leave tribal land.
The ruling appears to provide a brief break in the dispute that came to a head this summer over the legality of Benally's operation, which he claims has also provided employment for more than 200 members of the tribal nation.
The hemp farms are located around Shiprock on the Navajo Nation, which encompasses northeastern Arizona, northwest New Mexico and a sliver of southeastern Utah.
The farms have prompted protests and allegations that Benally is illegally growing marijuana under the guise of a hemp farm with the help of foreign nationals.
Both crops are illegal on tribal land.
"The hemp will not stay here," Nez said.
A few hundred Navajo tribal members also work on the farms, officials say.
The battle over the farms has resulted in protests and last week's showdown in the District Court of the Navajo Nation Judicial District of Shiprock.
"We strongly urge everyone to respect the ruling of the court and move forward peacefully to ensure the safety of community members, police officers and everyone in the impacted area," Nez said after the hearing.
Benally said in a statement that he was disappointed by the court's decision, saying it will have a "chilling effect" on Navajo business and economic development.
But residents like Beatrice Redfeather, 75, said the hemp farms have made her fear opening her front door.
"I see marijuana plants. I see a bunch of foreign workers, armed security guards. I see a security patrol 32 feet from my front door," Redfeather said during a court hearing last week. "Those security guards have made it known they will attack, and they have shown their guns to our family. We are mentally afraid to walk outside … The smell of marijuana is so strong that I have had to go to the hospital because of my severe headaches."
In an investigation published Wednesday by Searchlight New Mexico, people who said they had worked on the farms described growing marijuana, and said some people who worked there were teenagers or younger.
An attorney for Benally says his client is growing hemp, a less potent form of cannabis. Products made from it are commonly used and sold across the United States at major supermarkets and convenience stores.
Benally argued in court filings that the 2018 Farm Bill, signed into law by President Donald Trump, allows him to grow hemp on reservation land.
But tribal leaders say harvesting both hemp and marijuana is illegal on the Navajo Nation — except for a government-backed pilot project.
Navajo law, however, has no penalty for growing hemp, Nez said, so the nation took Benally to court.
Navajo Nation Attorney General Doreen McPaul filed a lawsuit against Benally in June, charging Benally and his company of illegally growing industrial hemp and unlawfully issuing land use permits.
Nez said tribal leaders believe the potency of Benally's crops is well above the federal threshold that defines hemp as no more than 0.3% tetrahydrocannabinol. or THC, the main active ingredient of cannabis.
Regardless, the controversy has prompted heated skirmishes in recent months.
Benally has hired guards who patrol the farms wearing bulletproof vests and body cameras, according to court testimony that claimed arsonists torched at least one farm. Benally's top security officer, Duane Billey, said in court that protesters have attacked him, but his force doesn't carry guns. Locals say otherwise.
Officials also are critical of the use of what they believe are Asian migrants who have come to the reservation during a global pandemic and camped on the farms, where they work in greenhouses.
Sonya Sengthong, a Glendale resident whose family lives near Shiprock, said relatives have told her vans and sport utility vehicles with California and Texas license plates continually drop off what she believes are workers for the farms.
"We are concerned some of these visitors may be mistreating our people," Nez said in an interview with The Arizona Republic. "There are large areas that they are using to put up housing on these farms."
Nez said the laborers also are breaking the law as visitors have been banned from the reservation during the COVID-19 pandemic, which has ravaged the Navajo Nation.
Nez said he does not know when scores of workers started arriving on the reservation, adding that some live in nearby Farmington.
"Workers are coming in and they are not citizens. They are from other areas," Navajo Nation police Chief Philip Francisco said during last week's hearing. "There's a general worry about a criminal element coming in, and there's a belief that the hemp is not hemp but marijuana."
"We have seen a lot of Asian people working on the farms, and there's a law in place to not allow visitors on the Navajo Nation," Nez said in an interview. "Because of the high population of these visitors, there are concerns about human waste."
Nez and other Navajo officials confronted some of the workers during an unannounced visit to one of the farms on Sept. 3.
"They claim they don't speak English, so we started talking back to them in Navajo," Nez said.
Benally and his attorney, David Jordan, have declined to answer questions about how employees came to work on the farms. But Jordan claims the Asian workers have been racially profiled and attacked by Navajos who oppose Benally's business venture.
"They want to blame my client for the violent protests and that they threaten the safety of the Navajo Nation," Jordan said in court. "But they have a fear of other people who are different."
Benally has used his position on the San Juan River Farm Board, which represents a half-dozen or so communities or chapters on the Navajo Nation, to grant land use permits to grow hemp, and his ownership of the Native American Agricultural Company to produce the crops.
The farm board on which Benally sits is composed of elected members from various chapters or communities within the Navajo Nation. Its purpose is to develop and sustain farmland and water systems for economic development.
The initial lawsuit filed against Benally says farm boards are not authorized to issue agricultural land use permits for hemp. Instead, according to Navajo law, it only is authorized to review and recommend approval of permits to the Resources Committee of the Navajo Nation Council, the legislative branch of the reservation's government.
Tracy Raymond, a former farm board member, stated in a court filing that Benally has used his farm board position to "serve his personal interests without approval or authorization."
"It is a great disappointment to me to have to watch those growing hemp openly flouting the law just to make a quick profit," Raymond, a corn farmer, said.
She added the farm board never took a vote to authorize the issuance of hemp licenses.
Benally, on his personal website, said he's used his leadership position to "collaborate with government delegates, grazing officials, and chapter officials to protect native water rights and improve the economy and livelihood of the Navajo People."
Benally's business partners
His company partnered with One World Ventures, a Las Vegas-based penny-stock company with shares worth about 2 cents each, to operate the farms, financial records show.
Some financing came from SPI Energy Co., a Hong Kong-based firm that specializes in solar panels but has diversified its portfolio.
One World Ventures placed Benally on its board in March 2019.
One World Ventures CEO DaMu Lin last year issued a news release lauding One World's relationship with Benally's company and the San Juan River Farm Board, stating the company was well positioned for the upcoming hemp growing season.
Calls to the company and Lin were not returned.
One World Ventures has posted combined losses of $1.48 million the past two years, financial records show.
After Benally and Lin struck a deal, they obtained financing from SPI Energy Co., a publicly traded company on the NASDAQ.
SPI launched a hemp business last year and agreed to invest $1.1 million into the Shiprock farms.
But investments from SPI dried up last year after Benally's company failed "to deliver any of the hemp plants" and refused to return an initial installment of $324,125, SPI financial records show.
SPI officials visited the Shiprock farms after making their first payment by the July 31, 2019, deadline and found "the plants and growing operations appeared to be deficient and not up to industry standards," according to a company filing. Further, SPI alleges Benally didn't deliver updates or financial reports as required.
"Finally, NAAC failed to deliver any of the hemp plants by Nov. 30, 2019 … and refused to return the company's down payment and to make whole the damages the company has suffered," a filing says.
SPI said Benally's company also did not respond to two demand letters late last year.
Benally — whose Facebook page describes him as a "politician" despite his losing races for Navajo Nation president and Congress — claims he's become a political target.
Benally declined to be interviewed.
Benally was scheduled to be a witness during last week's hearing but didn't testify. His attorney had a farm owner and a security guard to testify.
Redfeather was among those who testified against Benally. Others included Navajo Nation Environmental Protection Agency Director Oliver Whaley and the tribal police chief.
Whaley said in court that during a Sept. 9 visit to one of Benally's farms, he found septic tanks discharging sewer water into soil and groundwater, pesticides not being properly applied and petroleum leakage. He also said Benally didn't have permits to operate.
Francisco, the police chief, testified after Whaley and said about a year ago a "crisis situation" began in the community, noting his office has been flooded with calls to maintain peace on the Shiprock farms. All of the calls have taken officers from other emergencies, he said.
Francisco has previously said his agency was working with the Navajo Department of Criminal Investigation and the Bureau of Indian Affairs Division of Drug Enforcement regarding potential criminal violations on the farms.
"It's a disruption to the community, and the smell is causing problems. And there's encroachment on people's land," Francisco said in court. "There has been discord and unrest."
Residents near the farms said in court that Benally's crews have flooded their fields, making it impossible to harvest, and destroyed a corn crop with constant dust from Benally's operation.
Loretta Bennett, a 69-year-old farmer, said in court that the workers on Benally's farms also don't wear masks, and she's concerned about the spread of COVID-19.
Arlando Teller, an Arizona state representative from Chinle, said in an interview that while the hemp farms are in New Mexico, he's concerned about "how the operation has taken place as far as the transparency of a business operation."
Hemp farms may remain
Benally, a 43-year-old father of four, has said in press releases and on his website that he brought hemp farms to Shiprock as an economic driver, and he's been successful in partnering with tribal members on his website.
He has paid $2,000 a month to childhood friend and farmer Farley Blueyes to use up to 150 acres of his farm for hemp production.
Blueyes said his land was fallow until Benally put people to work. Security officers were needed because residents have become confrontational.
Despite Friday's ruling, the battle is likely not over.
Attorneys for Benally say they will pursue "all legal channels" to keep fighting, and many Asian workers remained on the farms after Friday's ruling.
Sengthong, the Glendale resident, said she went to visit her relatives near Shiprock on Saturday after learning about the court order.
She told The Republic that a hemp farm on a relative's property, about 10 miles west of Shiprock, was still operating this past weekend. She said when Navajo Nation police visited the site, workers fled the farm.
Sengthong was taking pictures of the activity and said after police left, one of the workers tried to "smack" her cellphone and other workers were confrontational.
"I've been intimidated for what I did," she said. "They are still working and the camp is huge."
Benally's attorneys said the court decision violated their client's civil rights and put many tribal members out of work.
Jordan, Benally's attorney, declined to say how his client would respond to the court order. Jordan said in court filings that such an order would destroy the "entire crop of 2020."