{"id":71950,"date":"2024-01-23T14:47:10","date_gmt":"2024-01-23T22:47:10","guid":{"rendered":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/2024\/01\/23\/biden-doj-tells-federal-court-not-to-disrupt-marijuana-rescheduling-decision-by-allowing-industry-lawsuit-to-proceed\/"},"modified":"2024-01-24T19:47:06","modified_gmt":"2024-01-25T03:47:06","slug":"biden-doj-tells-federal-court-not-to-disrupt-marijuana-rescheduling-decision-by-allowing-industry-lawsuit-to-proceed","status":"publish","type":"post","link":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/2024\/01\/23\/biden-doj-tells-federal-court-not-to-disrupt-marijuana-rescheduling-decision-by-allowing-industry-lawsuit-to-proceed\/","title":{"rendered":"Biden DOJ Tells Federal Court Not To \u2018Disrupt\u2019 Marijuana Rescheduling Decision By Allowing Industry Lawsuit To Proceed"},"content":{"rendered":"<\/p>\n

The Justice Department has asked a federal court to dismiss a cannabis industry lawsuit<\/a> that seeks to block the enforcement of marijuana prohibition against state-legal activity<\/a>\u2014in part, it says, because the court should not get ahead of a possible cannabis rescheduling decision that\u2019s being considered.<\/p>\n

In a document filed with the U.S. District Court for the District of Massachusetts, Western Division, on Tuesday, lawyers for Attorney General Merrick Garland said that Congress \u201crationally set up an administrative process for rescheduling drugs.\u201d<\/p>\n

\u201cPursuant to that mechanism, the DEA is currently considering\u201d a recommendation from the U.S. Department of Health and Human Services (HHS) \u201cto reschedule marijuana\u201d under the Controlled Substances Act (CSA).<\/p>\n

\u201cIt is not for the courts to disrupt or get ahead of that administrative process,\u201d DOJ said.<\/p>\n

Overall, DOJ also said that marijuana businesses who brought the case lack standing to pursue the challenge because they cannot claim direct injury since they haven\u2019t been federally prosecuted under the policy of prohibition. The filing also notes that a long-standing congressional rider has been in place for a decade, barring the department from using federal funds to interfere in state-legal medical cannabis laws.<\/p>\n

\u201cPlaintiffs do not dispute that as enacted, the CSA rationally served legitimate government purposes. Yet they argue that the CSA has been rendered irrational because Congress has chosen to allow federal territories to enact marijuana legalization laws and has prohibited the Department of Justice on spending funds to prevent implementation of state medical marijuana laws\u2026while the Department of Justice has allegedly exercised prosecutorial discretion to decline to prosecute conduct that complies with state marijuana laws under certain circumstances.\u201d<\/p>\n

\u201cYet as explained above, these actions and inactions serve the rational purpose of facilitating state and local experimentation with marijuana laws while focusing federal law enforcement resources on conduct that most significantly affects federal interests,\u201d it says.<\/p>\n

The government also asserts that precedent set in a 2005 Supreme Court ruling negates plaintiffs\u2019 argument that the U.S. Constitution\u2019s Commerce Clause renders bans on interstate marijuana commerce unlawful.<\/p>\n

The case is a \u201ctransparent entreaty to overrule\u201d that precedent, known as Raich, DOJ said.<\/p>\n

\u201cFederal regulation of intrastate marijuana activities is constitutional because such activities \u201csubstantially affect interstate commerce,’\u201d the department argued. \u201cPlaintiffs get no further by claiming that the CSA violates their right to substantive due process. Courts have consistently, and correctly, held that no fundamental right exists to distribute, possess, or use marijuana. Therefore, the CSA is subject only to deferential rational basis review, which it easily survives.\u201d<\/p>\n

\u201cTo raise a pre-enforcement challenge to a law, a plaintiff must show a substantial risk of future enforcement. Here, Plaintiffs allege the opposite, that the government\u2019s policy is not to prosecute conduct that complies with state marijuana laws. Neither Plaintiffs\u2019 contention that they are harmed by other federal laws and policies whose constitutionality is not challenged here, nor Plaintiffs\u2019 allegations that some third parties have independently chosen not to transact with them, suffice to provide Plaintiffs with standing to challenge the CSA.\u201d<\/p>\n

The motion to dismiss additionally says that plaintiffs \u201cfail to allege facts showing that the risk of prosecution is substantial.\u201d<\/p>\n

\u201cIn fact, Plaintiffs\u2019 allegations negate the existence of such a substantial risk,\u201d it says. \u201cYet even if this Court were sympathetic to Plaintiffs\u2019 arguments that [Gonzales v. Raich<\/em>] holding should no longer be good law, stare decisis<\/em> commands that this Court adhere to Raich unless and until it is overruled by the Supreme Court<\/p>\n

\u201cMoreover, Plaintiffs allege that the Department of Justice has implemented a policy of prosecutorial discretion that guides federal law enforcement to focus enforcement resources \u2018on persons or organizations whose conduct interferes\u2019 with important federal interests such as curtailing violence and gang activity, and otherwise to rely largely on \u2018enforcement of state law by state and local law enforcement and regulatory bodies\u2019 to \u2018address[] marijuana-related activity.’\u201d<\/p>\n

The filing adds that a policy of prosecutorial discretion for federal marijuana cases such as under the Obama-era Cole memo that was rescinded under the Trump administration is a \u201csurely rational\u201d approach.<\/p>\n

In the overarching lawsuit, plaintiffs claim that perpetuating prohibition in state markets is unconstitutional, creating undue public safety risks while precluding licensed marijuana businesses from accessing critical financial services and tax deductions that are available to other industries.<\/p>\n

Reacting to the DOJ filing on Tuesday, the plaintiffs said in a statement that they \u201clook forward to demonstrating their standing before the Federal District Court in Springfield, Massachusetts.\u201d<\/p>\n

\u201cPlaintiffs have been injured by the federal government\u2019s ban on cultivating, manufacturing, and distributing intrastate marijuana. Plaintiffs brought this suit to stop the enforcement of that unconstitutional ban and protect themselves and others similarly situated from further injury,\u201d they said. \u201cThe facts in the complaint distinguish this case from Gonzales v. Raich, the 2005 Supreme Court decision on which the government continues to rely.\u201d<\/p>\n

The government filing comes about a month after the Justice Department and plaintiffs\u2014a coalition of marijuana businesses represented by an influential law firm\u2014jointly agreed to request a deadline extension for the filing of initial briefs.<\/p>\n

The\u00a0suit against the federal government is being led by multi-state operator Verano Holdings Corp.<\/a>\u00a0and the Massachusetts-based cannabis businesses Canna Provisions and Wiseacre Farm, along with Treevit CEO Gyasi Sellers.<\/p>\n

On Monday, DOJ sought permission to submit the new 25-page of memorandum that exceeds the general 20-page limit allotted under the rules.<\/p>\n

The law firms Boies Schiller Flexner and Lesser, Newman, Aleo & Nasser LLP are representing the plaintiffs. David Boies, chairman of the former firm, has a long list of prior clients that includes the Justice Department, former Vice President Al Gore and the plaintiffs in a case that led to the invalidation of California\u2019s ban on same-sex marriage, among others.<\/p>\n

The lawsuit alleges that while Congress originally banned marijuana through the Controlled Substances Act (CSA) in an attempt to eradicate interstate commerce, ostensibly giving the government a basis to enforce prohibition at the state level, lawmakers and the executive branch have since \u201cabandoned\u201d that mission as more states have enacted legalization.<\/p>\n

\u201cDespite these changes, the federal criminal prohibition on intrastate marijuana remains in place, an unjustified vestige of a long-abandoned policy,\u201d the complaint, filed last October, states. \u201cThis unjustified intrusion of federal power harms Plaintiffs, threatens the communities they serve, and lacks any rational purpose.\u201d<\/p>\n

There were repeated mentions of the fact that, while the federal government has taken a largely hands-off approach to cannabis in recent decades, state-licensed marijuana businesses continue to suffer unique financial burdens, including a lack of access to banking services, credit cards and federal tax deductions under an Internal Revenue Service (IRS) code known as 280E.<\/p>\n

Without access to credit cards or online payment, state-regulated marijuana businesses must rely heavily on cash, creating serious public safety risks. State-regulated marijuana dispensaries have become targets of robberies,\u201d the original lawsuit says. \u201cThese collateral harms increase the costs of state-regulated marijuana businesses and reduce participation in state-regulated marijuana markets. As a result, there is less innovation and less consumer choice.\u201d<\/p>\n

The existing ban on cannabis under the CSA results in an \u201cunconstitutional imposition on state sovereignty,\u201d attorneys said. \u201cWhile Congress has authority to ban marijuana from interstate commerce, it has no general police power over marijuana grown, transported, and distributed in intrastate commerce. Neither the Commerce Clause nor the Necessary and Proper Clause of the Constitution permit this overreach by Congress.\u201d<\/p>\n

The lawsuit takes a look at the history of cannabis laws in the country, pointing out that prohibition is a relatively recent policy position that followed more than 100 years of permitted use and cultivation to some extent. It then returned to the federal government\u2019s justification for banning marijuana under the CSA, which was to prevent interstate commerce as was argued in the 2005 U.S. Supreme Court case\u00a0Gonzales v. Raich\u00a0<\/em>concerning medical cannabis access for California patients.<\/em><\/p>\n

That justification no longer rationally applies, the companies argue. Not only has Congress annually renewed an appropriations rider barring the Justice Department from using federal funds to intervene in state medical cannabis programs, but attorneys general over the course of multiple administrations have spoken to their lack of interest in criminalizing people over marijuana-related activity that\u2019s sanctioned by the states.<\/p>\n

\u201cWhat was once a single-minded federal crusade against the cannabis plant has been replaced with an ambivalent set of inconsistent policies, some aimed at reducing federal interference with state efforts to regulate marijuana,\u201d the suit says.<\/p>\n

\u201cIn short, the federal government has long ago abandoned the goal of eliminating marijuana from commerce. Nor does Congress have any comprehensive\u2014or even consistent and rational\u2014approach to marijuana regulation,\u201d it continues. \u201cThis inconsistent, patchwork approach to marijuana regulation provides no basis for Congress to regulate intrastate marijuana.\u201d<\/p>\n

That point echoes what conservative Supreme Court Justice Clarence Thomas said in 2021, criticizing the\u00a0\u201ccontradictory and unstable\u201d state-federal marijuana policy conflicts<\/a>\u00a0that have compounded as the federal government continues to take a \u201chalf-in, half-out\u201d approach to the issue.<\/p>\n

Attorneys for the plaintiffs said that \u201cwithout court intervention, the CSA will continue to undermine state efforts to create safe and regulated intrastate markets for marijuana. As long as the CSA continues to prohibit intrastate cultivation, manufacture, possession, and distribution of marijuana, Plaintiffs and the communities they serve will suffer irreparable harm.\u201d<\/p>\n

There\u2019s also a mention in the lawsuit of the impact of the current policy of criminalization on low-income communities, noting that the ban on intrastate marijuana commerce means that cannabis products cannot be delivered to public housing facilities in Massachusetts.<\/p>\n

\u201cThis prohibition is to the detriment of the states, their citizens, and Plaintiffs,\u201d the complaint states. \u201cNot only do Plaintiffs face the potential risk of enforcement, their businesses also face numerous hurdles that result directly from the CSA\u2019s treatment of intrastate marijuana.\u201d<\/p>\n

The consequences of this prohibition are devastating for the industry, particularly for small businesses that cannot rely on diversification or economies of scale,\u201d it continues.<\/p>\n

Josh Schiller, partner at the Boies Schiller Flexner law firm that is representing the plaintiffs, said during an X Spaces session in October that \u201cour clients have finally decided we can still look around the corner and hope that there is a legislative solution\u2014but let\u2019s decide whether or not we can create a permanent change by going to the courts,\u201d adding that Supreme Court ideological dynamics have shifted toward a \u201cfederalist\u201d point of view in a way that could bolster their case.<\/p>\n

The court is \u201clooking to enforce the constitutional protections for states to regulate commerce within the state, which is called intrastate commerce,\u201d he said. \u201cThere is no right of the federal government under the Constitution to regulate intrastate commerce.\u201d<\/p>\n

\u201cBut we\u2019ve built a lawsuit that we hope to get back to the Supreme Court as quickly as possible,\u201d Schiller added. \u201cThe factual evidence that we offer in our complaint\u2014which will be supported by testimony on a summary judgment motion which we hope to get to, probably not this year, but hopefully early next year\u2014will be the basis for going to the Supreme Court and demonstrating this evidence that negates any legitimacy that the federal government has in continuing to treat cannabis as a federal crime.\u201d<\/p>\n

He also briefly previewed plans to pursue future litigation as a \u201csecond step\u201d to help marijuana businesses recoup losses they\u2019ve incurred due to the \u201cinequality that they\u2019ve suffered for years\u201d if they\u2019re successful in the current case.<\/p>\n

\u201cBut this case is meant to create a new precedent that allows the states\u2014and only the states\u2014to let these businesses flourish under their regulations,\u201d he said.<\/p>\n

A press release says that Ascend Wellness Holdings, TerrAscend, Green Thumb Industries, Eminence Capital and Poseidon Investment Management are \u201cfoundational supporters\u201d of the suit.<\/p>\n

The lawsuit comes as the Drug Enforcement Administration (DEA) carries out a review into marijuana scheduling after the U.S. Department of Health and Human Services (HHS)\u00a0recommended moving it from Schedule I to Schedule III<\/a>\u00a0under the CSA. Such rescheduling could resolve certain tax-related issues for the industry under 280E, but it would not legalize the plant or permit intrastate commerce.<\/p>\n

\u201cThe federal criminalization of safe, regulated marijuana commerce in states where it is legal unfairly burdens legal operations and expands the production and sale of illegal marijuana that is unregulated, can be unsafe, and is likely to find its way to other states,\u201d Boies\u00a0said\u00a0in a press release in October. \u201cFederal criminalization also denies small, legal marijuana businesses of access to SBA loans, investors, benefits for their employees, and normal banking regulations (which among other things, forces them to rely on cash transactions with all of the dangers to them, and to the community, that result)\u2014as well as burdening them with discriminatory taxes.\u201d<\/p>\n

\u201cAmericans believe that cannabis should be legal and available subject to reasonable regulation by the states. 38 states have legalized some form of cannabis,\u201d he said. \u201cThe federal government lacks authority to prohibit intrastate cannabis commerce. Outdated precedents from decades ago no longer apply\u2014the Supreme Court has since made clear that the federal government lacks the authority to regulate purely intrastate commerce; moreover, the facts on which those precedents are based are no longer true.\u201d<\/p>\n

Cannabis business executives first described plans to file the lawsuit\u00a0challenging the constitutionality of enforcing criminalization of intrastate marijuana activity<\/a>\u00a0under the CSA last year.<\/p>\n

\u201cI think the fact that one of the leading constitutional law firms in the United States is willing and eager to take this case speaks volumes to the seriousness of the action and the potential likelihood of success,\u201d the then-CEO of Ascend Wellness Holdings told Marijuana Moment at the time, saying that he hoped the legal challenge would prompt Congress to pass cannabis banking legislation of other reforms.<\/p>\n

\u201cHopefully, this will be another factor [so] that the Senate says, \u2018you know, we\u2019ve gotta get off our ass or we\u2019re gonna lose this issue to the courts,\u2019\u201d he said.<\/p>\n

Read the federal government\u2019s filing<\/a> in the marijuana lawsuit below:\u00a0<\/strong><\/p>\n

\n

\n

Top German Official Says Marijuana Legalization Vote On Track For Next Month Despite Growing Criticism In Parliament<\/a><\/p>\n<\/blockquote>\n

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The post Biden DOJ Tells Federal Court Not To \u2018Disrupt\u2019 Marijuana Rescheduling Decision By Allowing Industry Lawsuit To Proceed<\/a> appeared first on Marijuana Moment<\/a>.<\/p>\n


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The Justice Department has asked a federal court to dismiss a cannabis industry lawsuit that seeks to block the enforcement of marijuana prohibition against state-legal activity\u2014in part, it says, because the court should not get ahead of a possible cannabis rescheduling decision that\u2019s being considered. In a document filed withContinue Reading<\/a><\/span><\/p>\n","protected":false},"author":458,"featured_media":0,"comment_status":"false","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[18,81],"tags":[],"_links":{"self":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/71950"}],"collection":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/users\/458"}],"replies":[{"embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/comments?post=71950"}],"version-history":[{"count":1,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/71950\/revisions"}],"predecessor-version":[{"id":71951,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/71950\/revisions\/71951"}],"wp:attachment":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/media?parent=71950"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/categories?post=71950"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/tags?post=71950"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}