Attorneys representing major marijuana companies in a lawsuit against the U.S. government filed their opening brief in the U.S. Court of Appeals for the First Circuit on Tuesday, part of an ambitious effort to block the enforcement of federal cannabis prohibition against their state-legal activities.
Lawyers argue in the filing that Congress has in recent decades “dropped any assumption that federal control of state-regulated marijuana is necessary,” essentially shirking the federal authority confirmed by a 2005 Supreme Court opinion, Gonzales v. Raich. That, they conclude, means “the [Controlled Substances Act’s] ban as applied to state-regulated marijuana cannot be upheld today.”
“In the nearly twenty years since Raich, Congress has enacted legislation demonstrating that it no longer seeks to control comprehensively, let alone ban, all marijuana commerce,” the brief contends, asserting lawmakers have “abandoned” their “former goal of eradicating marijuana from interstate commerce.”
“Congress has abandoned its goal of eradicating marijuana and has, in fact, expressly exempted it from federal enforcement in certain circumstances,” it says, pointing to policies embodied in the congressional budget rider that prevents federal funds from being used to interfere with state-legal medical marijuana or lawmakers’ decision to allow marijuana legalization to proceed in the District of Columbia.
“Congress has also dropped any assumption that federal control of state-regulated marijuana is necessary to prevent a ‘gaping hole in the CSA,’” the brief adds. “Yet the federal prohibition on state-regulated marijuana nonetheless continues.”
The latest filing is the next step in a courtroom battle begun last October, when plaintiffs represented by the prestigious law firm Boies Schiller Flexner LLP claimed that perpetuating federal prohibition in state markets is unconstitutional. Plaintiffs include multi-state marijuana operator Verano Holdings Corp. and the Massachusetts-based cannabis businesses Canna Provisions and Wiseacre Farm, along with Treevit CEO Gyasi Sellers.
Litigator David Boies—whose list of prior clients includes the Justice Department, former Vice President Al Gore and plaintiffs in the case that led to the invalidation of California’s ban on same-sex marriage—is leading the suit.
This summer, a district judge dismissed the challenge, ruling that while there were “persuasive reasons for a reexamination” of the current scheduling of cannabis and that the plaintiffs had standing to bring the suit, the court’s hands were effectively tied by the Raich decision upholding the government’s authority to regulate substances even within state borders.
The dismissal didn’t come as a particular surprise to attorneys for the marijuana companies, who had generally indicated that they expected the case to move up to higher courts, including, eventually, the Supreme Court. Days after the district court’s ruling, attorneys filed notice of their appeal.
At the time, Josh Schiller, a lawyer on the case, called the district court decision “thoughtful” and said that “on appeal we will continue to press our case that the federal government lacks any rational basis for banning state-regulated marijuana.”
On Tuesday, Schiller told Marijuana Moment that the companies’ “challenge against the federal government’s unconstitutional ban on marijuana is moving quickly to the next stage.”
“Today we’ve filed a brief with the First Circuit Court of Appeals explaining that Congress lacks authority to continue criminalizing the medical and adult use marijuana that is today relied on by people in thirty-eight states across the country,” he said. “We and our clients are continuing to push forward in this litigation to provide relief for this important industry.”
Lawyers for the government have until October 10 to file a response brief in the case, which Schiller noted is before a scheduled December 2 hearing on the Biden administration’s marijuana rescheduling proposal.
In addition to Congress’s more permissive recent stance toward state-level cannabis legalization in recent years, the new appellate filing argues that the district court ruling “ignored the long historical record of marijuana cultivation and use in ‘our Nation’s history, legal tradition, and practices.’”
“Since before the Founding, Americans have cultivated, traded in, and made use of marijuana… These centuries-old legal traditions are now being continued in the marijuana programs in thirty-eight different states, which recognize the ongoing value of marijuana commerce,” the filing says. “Together, both the historical record and these current practices demonstrate the fundamental nature of the right to cultivate, possess, and market marijuana.”
Central to the case is the degree to which in-state cannabis activity affects interstate commerce. Lawyers for the government, for example, have argued that cannabis legalization attracts out-of-state tourists.
DOJ argued in a filing in April that “it is rational to conclude that the regulated marijuana industry in Massachusetts fuels a different kind of marijuana-related interstate commerce: marijuana tourism.”
“As the Supreme Court held decades ago, Congress has the authority to regulate businesses that cater to tourists from out of state, even if the businesses’ transactions occur wholly in-state,” DOJ said in the brief.
Plaintiffs, meanwhile, contended the Constitution’s Commerce Clause should preclude DOJ from interfering in state-legal activity because it is regulated within a state’s borders.
Even while dismissing the case, the district court ruled that plaintiffs indeed had standing to bring the lawsuit.
“Plaintiffs have alleged they variously engage in the cultivation, manufacture, distribution, and possession of marijuana, wholly within Massachusetts and the CSA makes such activity a federal crime,” the decision says. “In the absence of any dispute regarding redressability, the court finds Plaintiffs have demonstrated that they have standing under Article III to challenge the portions of the CSA applicable to intrastate activities related to marijuana.”
“The court also finds Plaintiffs have shown there is a causal connection between their economic injuries and the CSA,” the judge said. “When credited, Plaintiffs’ detailed allegations about their financial injuries meet that burden. Though individual decisions by specific third parties are the final link in the causal chain, the economic injury actually flows from the multitude of similar decisions made by many third parties, all responding to the CSA.”
Nonetheless, the district court sided with the government in its motion to dismiss based on a failure to state a claim for relief.
“Given the scale of Plaintiffs’ operations, the court cannot find Congress lacks a rational basis for concluding Plaintiffs’ activities substantially affect interstate commerce without ignoring the Supreme Court’s broadly-worded holding” in Gonzales v. Raich, the court said.
It will now be up to the First Circuit to decide whether to uphold the lower court’s ruling or confront more directly whether broad federal cannabis prohibition is constitutional.
