Marijuana Law, Policy & Reform

Editor: Douglas A. Berman
Moritz College of Law

Wednesday, August 16, 2017

Washington Gov and state AG respond forcefully to letter from AG Sessions about marijuana reform concerns

As noted in this prior post, a few weeks ago US Attorney General Jeff Sessions sent letters to the leaders of states with recreational marijuana laws detailing troublesome data that, in the words of these letters, raised "serious questions about the efficacy of marijuana 'regulatory structures'."  An example of one such letter can be found here, addressed to Washington's Governor Jay Inslee and Attorney General Bob Ferguson.

Now, as detailed in this local article, headlined "Gov. and AG to Sessions: You are blowing smoke on our marijuana law," there has now been at least one forceful official response to these letters.  Here are the basics:

Allegations by Sessions, in a recent letter on Washington's marijuana policy, "are outdated, incorrect, or based on incomplete information," the two state leaders wrote to Sessions. "We have twice requested an in-person meeting with you because we believe it will lead to better understanding than exchanging letters," Inslee and Ferguson wrote to the U.S. Justice Department on Tuesday.

"If we can engage in a more direct dialogue, we might avoid this sort of miscommunication and make progress on the issues that are important to both of us. " Inslee and Ferguson called for both a sit-down with Sessions, and "further appropriate meetings" between state and Dept of Justice officials....

Sessions, in his letter, stressed a 2016 Northwest Drug Trafficking Area report asserting that Washington marijuana has been diverted to "43 other states" and cites 17 explosions at THC extraction laboratories.

Inslee and Ferguson bluntly told Sessions he was blowing smoke. "Your letter fails to clearly acknowledge that this (43 state) statistic covers several years before our recreational sales even began, and reveals nothing about whether the sources of the marijuana were legal or illegal," they wrote. "Again, your intent is for our state-regulated marijuana market to displace and destroy illegal marijuana activity. "

Sessions made charges that Washington's medical marijuana market is "considered 'grey' due to lack of regulation and oversight." Inslee and Ferguson acknowledged that medical marijuana "was not well regulated or supervised" in Washington. Shortly before the 2016 report came out, however, the Legislature passed reform legislation.

"We realigned medical marijuana to bring it within the state's far more stringent recreational system," wrote the Governor and AG. In fact, they told Sessions, a subsequent 2017 report by the feds made clear that "as of July 1, 2016, the long-standing illegally operating dispensaries were shut down or became licensed retailers; sales are now subject to taxation and medical marijuana products now must pass strict packaging and testing requirements before being sold to patients." "Your letter, relying on the old . . . report, ignores this important development."...

"We encourage you to keep in mind why we are having this conversation," Inslee and Ferguson told Sessions. "State and federal prohibition of marijuana failed to prevent its widespread use, which was generating huge profits for violent criminal organizations. "The people of Washington State chose by popular vote to try a different path. Under Washington's system, responsible adults are allowed access to a highly regulated product that returns substantial tax revenues to the government even as it displaces illegal activity."

The full letter from Gov Inslee and state AG Ferguson can be found at this link, and I like that the letter included a request to discuss additional matters with federal officials including:

  • Whether DOJ will support reasonable federal policies allowing financial institutions to provide service to licensed marijuana businesses, in order to avoid the public safety risks and transparency problems associated with all-cash businesses. 

  • How state-regulated marijuana should be treated by the federal government following the President’s declaration that the opioid crisis constitutes a national emergency, and whether the federal government will support objective, independent research into the effects of marijuana law reform on opioid use and abuse.

August 16, 2017 in Federal Marijuana Laws, Policies and Practices, History of Marijuana Laws in the United States, Recreational Marijuana Data and Research, Recreational Marijuana State Laws and Reforms, Who decides | Permalink | Comments (0)

Tuesday, August 15, 2017

US Justice Department reportedly blocking marijuana research requests supported by DEA

The Washington Post has this notable new article reporting that "The Justice Department under Attorney General Jeff Sessions has effectively blocked the Drug Enforcement Administration from taking action on more than two dozen requests to grow marijuana to use in research." Here is more:

A year ago, the DEA began accepting applications to grow more marijuana for research, and as of this month, had 25 proposals to consider.  But DEA officials said they need the Justice Department’s sign-off to move forward, and so far, the department has not been willing to provide it.  “They’re sitting on it,” said one law enforcement official familiar with the matter. “They just will not act on these things.”

As a result, said one senior DEA official, “the Justice Department has effectively shut down this program to increase research registrations.’’  DEA spokesman Rusty Payne said the agency “has always been in favor of enhanced research for controlled substances such as marijuana.’’  Lauren Ehrsam, a Justice Department spokeswoman, declined to comment....

[Attorney General Jeff] Sessions frequently speaks harshly about marijuana use, and Justice Department officials have been reviewing the policy of his predecessor when it comes to enforcing federal laws on marijuana in states where the drug is legal.  Sessions, too, has called medical marijuana “hyped, maybe too much,” and signaled that he is skeptical about benefits of smoking it.  “Dosages can be constructed in a way that might be beneficial, I acknowledge that, but if you smoke marijuana, for example, where you have no idea how much THC you’re getting, it’s probably not a good way to administer a medicinal amount.  So forgive me if I’m a bit dubious about that,” Sessions said earlier this year.

The DEA is no shrinking violet when it comes to marijuana enforcement.  Last year, Rosenberg declined to lessen restrictions on its use, maintaining its classification as a Schedule 1 controlled substance — which means it has no accepted medical use and a high potential for abuse.  But Rosenberg wrote at the time that the DEA would “support and promote legitimate research regarding marijuana and its constituent parts.”  The DEA, he wrote, already had approved such research, registering 354 people and institutions to study marijuana and related components, including the effects of smoked marijuana on humans.

The DEA indicated at the time it was willing to see those studies expand, asking for applications from people who wanted to grow marijuana to be used for research.  The only source of marijuana for researchers then was — and is — the University of Mississippi, which has permission to grow and distribute the drug for research.

One still-waiting applicant is Lyle Craker, a professor at the University of Massachusetts at Amherst.  Craker has spent years seeking approval to do research into whether other parts of marijuana plants have medicinal value.  “I’ve filled out the forms, but I haven’t heard back from them. I assume they don’t want to answer,’’ said Craker. “They need to think about why they are holding this up when there are products that could be used to improve people’s health . I think marijuana has some bad effects, but there can be some good and without investigation we really don’t know.’’  Craker submitted his latest application Feb. 14, and after getting additional questions from the DEA in March, supplied additional information in April.

Brad Burge, spokesman for the Multidisciplinary Association for Psychedelic Studies, said the federal government for years has prevented important research into marijuana.  “That’s a sad state of affairs,’’ he said, adding, “if the DEA is now asking for permission to say yes, then the resistance is now further up the chain of command.’’

Rosenberg indicated in a call with The Washington Post that he still would support more marijuana research.  “I stand by what I wrote,” he said.  Tension between Rosenberg and Trump is perhaps unsurprising.  Rosenberg was appointed during the Obama administration, and he had served as chief of staff and senior counselor to James B. Comey, who was the FBI director until Trump fired him earlier this year.

The Justice Department has not rejected any of the 25 people whose applications to grow marijuana the DEA is considering. Rather, the department is not taking any action at all, officials said.  Before approving such applications, DEA officials have to assess each applicant and determine whether their facility is secure and whether they had previously been complying with federal law.

August 15, 2017 in Federal Marijuana Laws, Policies and Practices, Medical community perspectives, Medical Marijuana Commentary and Debate, Who decides | Permalink | Comments (0)

Wednesday, August 9, 2017

Could the States Do Anything to Blunt the Impact of a Federal Crackdown?

Cross-posted at Marijuana Law, Policy, and Authority 

I just returned from the NCSL annual meeting in Boston, where I participated on a Marijuana Federalism panel with Representative Roger Goodman (WA state house) and John Hudak (Brookings). A short recap of the panel can be found here . Consistent with recent reports, all the panelists agreed the Trump Administration is unlikely to crack down on state-licensed marijuana suppliers anytime soon. (John and I have both previously written about the Trump Administration’s approach to marijuana policy, e.g., here and here.)

Nonetheless, given Jeff Sessions’ stated opposition to legalizing marijuana, I think it’s worthwhile to consider what (if anything) the states could do to blunt a federal crackdown, if the Trump Administration did decide to attempt one. Let me offer two possibilities state lawmakers might consider:

1. Create an indemnification fund to help pay the legal expenses of any state-licensed marijuana supplier who faces federal legal sanctions. This would include a supplier who faces a federal criminal prosecution, a civil forfeiture action, or even a civil RICO lawsuit brought by another private citizen.

Why would states ever do this? Individual defendants sometimes lack the ability and / or incentive to optimally (from the state’s perspective) defend themselves against federal claims. For one thing, defendants don't always have the money needed to pursue every viable defense vigorously, especially if their assets have been frozen by the government. In addition, individual defendants capture only a small part of the benefit (to the state) of successfully asserting certain types of defenses. After all, those defenses -- once established -- can be invoked by other, similarly situated defendants.
To illustrate the problem, suppose a Massachusetts-licensed medical marijuana supplier is being prosecuted by the DOJ for distributing marijuana. Her attorneys tell her she could spend $25,000 trying to convince a federal court that her prosecution is barred by the Rohrabacher-Farr amendment (discussed on pages 353-358 of my book), but there’s no guarantee she’ll win – say, because the First Circuit might not follow United States v. McIntoshand the Ninth Circuit’s interpretation of Rohrabacher-Farr. In this case, the supplier might not pursue the defense vigorously (even if she could afford to); she might instead prefer to cut her losses and cut a plea deal, say, by agreeing to shut down her shop if the DOJ drops all of its charges against her. But that may not be the best outcome for the state – it might prefer that the defendant spend $25,000 for even the chance that all state law-abiding medical marijuana suppliers would be declared immune from federal prosecution. Thus, to ensure that defendants vigorously pursue legal defenses that benefit others in the state, the state might help cover individual defendants’ legal expenses (say, using a portion of marijuana tax revenues).
I develop this first proposal in more detail in a symposium article for the Montana Law Review here. It’s loosely modeled on personal liberty laws adopted by northern states in response to the federal Fugitive Slave Act.

2. Adopt poison pill legislation that would make it costly for Congress to preempt certain state marijuana reforms. Some state laws are vulnerable to preemption challenge because they (arguably) undermine one of Congress's goals, like deterring drug use. Citing such reasoning, for example, a few state courts have held that state laws purporting to protect medical marijuana patients from employment discrimination are preempted by the federal CSA (the issue is discussed on pages 672-681 of the book). To defuse the threat that a court would find such measures preempted, a state could pass a second law – one that Congress clearly favors – and then tie the two laws (favored and disfavored) together – i.e., make them inseverable.
To illustrate, suppose Massachusetts was interested in preserving its recently recognized employment protections (discussed here) from a preemption challenge. To do so, the state could pass a law limiting the quantity of marijuana that non-residents are allowed to buy at state licensed shops, similar to the way Colorado once limited non-residents to buying one-quarter ounce of marijuana at its shops (discussed at pages 283-287 of the book). It could then make the new quantity restriction inseverable from the employment protections. While Congress (in theory) might not want states to protect marijuana users from employment sanctions, it might tolerate those protections if the states limit non-resident access to marijuana.
I develop this second proposal in more detail in a new article for the George Washington Law Review here. It’s very loosely modeled on the poison pill tactic in corporate law.


Part of the appeal of both options is that their success does not depend on the DOJ’s willingness to heed past enforcement guidelines or Congress’s willingness to restrict the agency’s spending.

August 9, 2017 in Court Rulings, Current Affairs, Federal Marijuana Laws, Policies and Practices, Medical Marijuana State Laws and Reforms, Recreational Marijuana State Laws and Reforms | Permalink | Comments (0)

Sunday, August 6, 2017

"Is Supporting Legal Pot Becoming Politically Viable in DC?"

The title of this post is the headline of this lengthy Rolling Stone article.  Here are excerpts:

It's no longer political suicide, or so it seems, to embrace legalizing marijuana. At least among the younger generation of prominent Democrats, though there seems to be cracks in the dam amongst Republicans too.

The latest evolution on the issue was on display this week as New Jersey Democratic Sen. Cory Booker – a former mayor of Newark who is a young, affable guy rumored to be considering a presidential bid in 2020 – unveiled the most sweeping proposal yet to the nation's marijuana policy.  The bill, dubbed the Marijuana Justice Act, would end the federal prohibition on weed by removing the plant from the list of controlled, as in banned, substances where it currently sits next to drugs like heroine and LSD....

During his failed presidential bid, Vermont Sen. Bernie Sanders released a bill to simply legalize marijuana federally, but it didn't go nearly as far as this new one.   Besides ending the federal prohibition on pot, Booker's legislation incentivize states to decrease their prison populations by withholding federal funds if they have disproportionate numbers of minorities and poor people locked up for cannabis violations.   His proposal also calls on the courts to expunge the records of people behind bars for marijuana violations, while investing money in job training programs.

A sweeping proposal like this would have been seen as the political third rail a few years ago, but voters in red and blue states alike have far outpaced the nation's stodgy political class and lawmakers are now slowly catching up with voters.  Now it's becoming more en vogue for politicians to challenge some of the key underpinnings of the nation's decades-long war on drugs....

While Democrats, especially this younger generation of lawmakers, are coming around more quickly to the will of citizens across the political spectrum – who have voted in recreational marijuana in eight states and the nation's capital, as well as in the dozens of states that allow medical marijuana – GOP leaders (including Attorney General Jeff "Just Say No" Sessions) are still proving a roadblock to the reform effort.

Before leaving town for August, Speaker Paul Ryan's top lieutenants in the House beat back a broadly supported, bipartisan effort to allow doctors at VA hospitals to prescribe marijuana to veterans suffering from everything from PTSD to losing a limb, which often comes with astronomically large and recurring opioid prescriptions.

Still other Republicans brush aside any talk of marijuana legalization. That's in part because the GOP base doesn't seem to be as vocal on the issue, which former presidential candidate Lindsey Graham says never really came up as he traversed Iowa and other states that vote early. "No – didn't hang around with the right crowd I guess," Sen. Graham tells Rolling Stone....

Some Republicans are learning marijuana is no longer the political third rail it once was.  There are other efforts afoot in the Capitol to make it easier for universities and research hospitals to study marijuana, while also protecting medicinal marijuana business owners and patients.  While the progressive Booker supports those efforts, so do two Tea Party darlings, Sens. Mike Lee of Utah and Rand Paul of Kentucky....

While slow moving, the change is palpable, especially for the lawmakers in those purple, blue and even red states alike who represent voters who approved medical or recreational weed.  "The country is changing, as did Massachusetts, and as each state moves further than it creates a national culture," Democratic Sen. Ed Markey tells Rolling Stone.  "It's like gay marriage: in Massachusetts it starts and then another state and another state and before long it's something that people understand is a part of the modern political culture."

August 6, 2017 in Campaigns, elections and public officials concerning reforms, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Recreational Marijuana Commentary and Debate, Who decides | Permalink | Comments (0)

Friday, August 4, 2017

AG Sessions Task Force reportedly not pushing for a crack-down on marijuana reform states

As reported in a new AP article, which the Washington Times gives the headline "Sessions task force on marijuana not producing ammo to bolster federal war on weed," it appears that the DOJ task force looking at federal marijuana policies is not advocating any major changes for now.  Here are the basic details:

The betting was that law-and-order Attorney General Jeff Sessions would come out against the legalized marijuana industry with guns blazing. But the task force Sessions assembled to find the best legal strategy is giving him no ammunition, according to documents obtained by The Associated Press.

The Task Force on Crime Reduction and Public Safety, a group of prosecutors and federal law enforcement officials, has come up with no new policy recommendations to advance the attorney general’s aggressively anti-marijuana views. The group’s report largely reiterates the current Justice Department policy on marijuana.

It encourages officials to keep studying whether to change or rescind the Obama administration’s hands-off approach to enforcement — a stance that has allowed the nation’s experiment with legal pot to flourish. The report was not slated to be released publicly, but portions were obtained by the AP.

Sessions has been promising to reconsider that policy since he took office six months ago. He has assailed marijuana as comparable to heroin and blamed it for spikes in violence. His statements have sparked support and worry across the political spectrum as a growing number of states have worked to legalize the drug....

[T]he tepid nature of the recommendations signals just how difficult it would be to change course on pot. Some in law enforcement support a tougher approach, but a bipartisan group of senators in March urged Sessions to uphold existing marijuana policy. Others in Congress are seeking ways to protect and promote pot businesses.

The vague recommendations may be intentional, reflecting an understanding that shutting down the entire industry is neither palatable nor possible, said John Hudak, a senior fellow at the Brookings Institution who studies marijuana law and was interviewed by members of the task force....

The task force suggestions are not final, and Sessions is in no way bound by them. The government still has plenty of ways it can punish weed-tolerant states, including raiding pot businesses and suing states where the drug is legal, a rare but quick path to compliance. The only one who could override a drastic move by Sessions is President Donald Trump, whose personal views on marijuana remain mostly unknown.

Rather than urging federal agents to shut down dispensaries and make mass arrests, the task force puts forth a more familiar approach. Its report says officials should continue to oppose rules that block the Justice Department from interfering with medical marijuana programs in states where it is allowed. Sessions wrote to members of Congress in May asking them — successfully so far — to undo those protections. The Obama administration also unsuccessfully opposed those rules.

The report suggests teaming the Justice Department with Treasury officials to offer guidance to financial institutions, telling them to implement robust anti-money laundering programs and report suspicious transactions involving businesses in states where pot is legal. That is already required by federal law.

And it tells officials to develop “centralized guidance, tools and data related to marijuana enforcement,” two years after the Government Accountability Office told the Justice Department it needs to better document how it’s tracking the effect of marijuana legalization in the states.

Most critically, and without offering direction, it says officials “should evaluate whether to maintain, revise or rescind” a set of Obama-era memos that allowed states to legalize marijuana on the condition that officials act to keep marijuana from migrating to places where it is still outlawed and out of the hands of criminal cartels and children, among other stipulations. Any changes to the policy could impact the way pot-legal states operate, but the task force offers no further guidance on how to do that.

It remains unclear how much weight Sessions might give the recommendations. He said he has been relying on them to enact policy in other areas. Apart from pot, the task force is studying a list of criminal justice issues and the overall report’s executive summary says its work continues and its recommendations “do not comprehensively address every effort that the Department is planning or currently undertaking to reduce violent crime.”

August 4, 2017 in Criminal justice developments and reforms, Federal Marijuana Laws, Policies and Practices, Who decides | Permalink | Comments (0)

Reactions to Cory Booker's Marijuana Justice Act

Senator Cory Booker (D NJ) has introduced a proposal to repeal the federal marijuana ban. In a nutshell, Booker’s Marijuana Justice Act (MJA) would exempt marijuana from the Controlled Substances Act.

I believe Booker’s proposal is incomplete (and therefore, both unwise and politically unpalatable) because it fails to offer any replacement for prohibition. I develop this argument in a new op-ed at Fortune: http://fortune.com/2017/08/04/senator-cory-booker-marijuana-bill-justice-act-legalization/. Check it out.

The MJA does one additional thing that is worth noting but which I did not have space to address in Fortune: It pressures states to repeal their own marijuana bans. It does so by withholding a portion of federal law enforcement grants from prohibition states (and only prohibition states) if “the percentage of minority individuals arrested [or incarcerated] for a marijuana related offense in a [prohibition] State is higher than the percentage of the non-minority individual population of the State.” (The measure has similar language regarding treatment of low-income populations, but to simplify I’ll focus on racial minorities.)

The wording of the condition is somewhat opaque (raising its own set of problems), but let me illustrate how I think the condition would work in a hypothetical state with a 30% minority population. If minorities comprised more than 70% of those persons arrested or incarcerated on marijuana charges in that state, the state would lose some federal grant money going forward. If minorities comprised 70% or less of those arrested or incarcerated, the state would retain full eligibility for federal grants. The fact that this provision is aimed only at prohibition states (what the MJA calls “Covered States”) is why I say it pressures states to legalize marijuana: if a state does so, its federal grants are safe, even if it enforces any remaining prohibitions--say, on possession by minors--disproportionately against minorities. (This has happened in some legalization states, as in discuss in my book on pages 249 and 521).

I think this is an interesting and novel proposal to address race (and class) disparities in the enforcement of criminal law, and it deserves further consideration. But I think it also raises a handful of serious constitutional concerns (not to mention practical and political ones). Let me briefly flag just two of those legal concerns here.

One problem is that the MJA arguably fails to give states adequate notice of the new conditions it imposes on the receipt of federal grants. The problem arises from tying federal grant funds to the composition of the presently incarcerated population. The problem is that disparities in the racial composition of the incarcerated population undoubtedly stem from actions taken by the states in the past– i.e., before they were aware of the new condition. After all, many of those who are now serving time in state prison on marijuana charges would have been arrested and prosecuted years ago. Even though Congress can condition federal funds on states doing (or not doing) X, Y, and Z, it has to give them clear notice of those conditions in advance. E.g., Arlington v. Murphy, 548 U.S. 291 (2006). I’m not sure whether a condition that seemingly requires states to remedy past discrimination (e.g., by releasing inmates) would pass muster under this test.

A second concern is that the measure arguably amounts to reverse discrimination (or pressures states to engage in the same) in violation of the Equal Protection Clause. Return to my hypothetical state above, with a minority population of 30%. Suppose, fancifully, that this state arrested and incarcerated on marijuana charges only whites. Under the MJA, there would be no consequences for this state. In other words, the MJA only punishes a state if it discriminates against minorities. And the MJA would appear to pressure states to engage in reverse discrimination – for example, to keep its federal grant dollars, a state might have to release only minorities currently serving prison time on marijuana charges, or selectively target whites for marijuana arrests (so as to balance the ledger).  Again, this approach might survive constitutional scrutiny, but it raises some doubts.

The simpler solution might be to preempt state marijuana bans. As I’ve argued elsewhere, that’s a permissible approach for Congress to take and would avoid the clear notice and Equal Protection concerns raised by the MJA.

August 4, 2017 in Criminal justice developments and reforms, Current Affairs, Federal Marijuana Laws, Policies and Practices, Who decides | Permalink | Comments (0)

Thursday, August 3, 2017

Effective review of back-and-forth between AG Sessions and legalization states over marijuana policies

At HuffPost, Matt Ferner has this lengthy new article discussing the various ways in which marijuana legalization states have made their case to the Trump Administration about their reformed marijuana laws.  The article is headlined "Legal-Weed States Tell Jeff Sessions Their Programs Are Working. He Might Crack Down Anyway."  It merits a full read, along with some of the notable documents linked within, and here are excerpts:

Marijuana legalization is going smoothly in Colorado and Oregon, state officials recently told the Justice Department as it prepares for a shift in federal law enforcement priorities that could include changes to marijuana policy.

But Attorney General Jeff Sessions, a staunch drug opponent, nevertheless is considering reversing the Obama administration’s relaxed approach to state legalization, and may resume strictly enforcing federal laws, which still regard all marijuana use as illegal....

Colorado and Oregon ― among eight legal-weed states that know the issues best ― produced detailed reports on their experiences, officials said. 

140-page report from Colorado Gov. John Hickenlooper’s (D) office contains data and analysis from six state agencies, showing that the state’s 2014 marijuana legalization didn’t significantly increase youth drug abuse, school dropouts or juvenile arrests.

Statistics do show a rise in car crashes and fatalities involving motorists testing positive for cannabinoids. But Colorado’s report notes the statistics may not prove more drivers are intoxicated, because inactive marijuana compounds can be detected for more than a month in some individuals.  Marijuana DUIs have declined 21 percent in the first six months of 2017 from the same period a year earlier. ...

19-page report prepared by Oregon Gov. Kate Brown’s (D) office gives a positive view of legalization that safeguards public safety, and describes the state’s robust system tracking weed from seed to sale.  The document was first made public in June following a records request by Oregonian reporter Noelle Crombie.

Oregon’s report acknowledges the continued existence of a marijuana black market.  It also notes legalization’s hiccups, including “overproduction” and new laws it needed to place limits on growers and to increase penalties for marijuana-related crimes....

Washington state, which also legalized recreational marijuana in 2014, has sent Sessions’ office three letters defending the state’s legalization scheme under current federal policy, and requested a meeting with Sessions, a representative from Gov. Jay Inslee’s (D) office told HuffPost.

Inslee’s office received a reply from Sessions on Wednesday expressing skepticism of the state’s marijuana legalization.  Sessions’ letter cites a 2016 law enforcement report that he says “raises serious questions about the efficacy of marijuana ‘regulatory structures’ in your state.”

August 3, 2017 in Federal Marijuana Laws, Policies and Practices, Recreational Marijuana Data and Research, Recreational Marijuana State Laws and Reforms, Who decides | Permalink | Comments (1)

Thursday, July 27, 2017

Senate committee preserves spending limit precluding DOJ interference with medical marijuana regimes

As this new piece from The Hill reports, the "Senate Appropriations Committee approved an amendment to a budget bill on Thursday to protect medical marijuana programs from federal interference in states that have legalized the drug for medical use." Here is more:

The amendment to the 2018 Commerce, Justice and Science appropriations bill passed by a voice vote and prohibits the Justice Department from using funds to prevent states from "implementing their own state laws that authorize the use, distribution, possession or cultivation of medical marijuana."

"The federal government can't investigate everything and shouldn't, and I don't want them pursuing medical marijuana patients who are following state law," said Sen. Patrick Leahy (D-Vt.), who offered the amendment. Leahy argued that the Department of Justice (DOJ) should be focusing its limited resources on more legitimate threats.

"We have more important things for the Department of Justice to do than tracking down doctors or epileptics using medical marijuana legally in their state," he said. Sen. Richard Shelby (R-Ala.), however, argued that while civil liberties and states' rights are important, telling DOJ not to enforce federal laws goes against legal principles. "If Congress wants to tell the Department of Justice to stop enforcing the medical marijuana laws, then it should change the authorization within the Judiciary Committee, not through an appropriations provision," he said.

The amendment passed despite a letter Attorney General Jeff Sessions sent in May asking House and Senate leadership not to block DOJ from using funds to enforce federal marijuana laws. "I believe it would be unwise for Congress to restrict the discretion of the Department to fund particular prosecutions, particularly in the midst of an historic drug epidemic and potentially long-term uptick in violent crime," Session wrote in the letter first obtained by Massroots.com and later confirmed by The Washington Post. "The Department must be in a position to use all laws available to combat the transnational drug organizations and dangerous drug traffickers who threaten American lives."

Rep. Dana Rohrabacher (R-Calif.) told The Hill on Thursday that he plans to once again offer the amendment to the House Commerce, Justice and Science Appropriations bill, which passed the appropriations committee earlier this month. When asked if he's expecting a fight on the floor, where he'll be forced to offer the amendment, Rohrabacher said he hopes there isn't one "but if there is, clearly we will win."

July 27, 2017 in Criminal justice developments and reforms, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Medical Marijuana State Laws and Reforms, Who decides | Permalink | Comments (0)

"Legal weed isn't living up to all of its promises. We need to shut it down"

The title of this post is the headline of this new CNBC commentary authored by Kevin Sabet, president of Smart Approaches to Marijuana. Here are excerpts:

Today, a growing class of well-heeled lobbyists intent on commercializing marijuana are doing everything they can to sell legal weed as a panacea for every contemporary challenge we face in America.  Over the past several years we've been barraged by claims that legal pot can cure the opioid crisis, cure cancer, eliminate international drug cartels, and even solve climate change.

One seemingly compelling case made by special interest groups is that legal marijuana can boost our economy too: after all, marijuana businesses create jobs and bring in millions of dollars in much-needed tax revenue.

Yet, a closer look at the facts reveals a starkly different reality.  The truth is, a commercial market for marijuana not only harms public health and safety, it also places a significant strain on local economies and weakens the ability of the American workforce to compete in an increasingly global marketplace.

We already know that drug use costs our economy hundreds of millions of dollars a year in public health and safety costs.  The last comprehensive study to look at costs of drugs in society found that drug use cost taxpayers more than $193 billion – due to lost work productivity, health care costs, and higher crime.

A new study out of Canada found that marijuana-impaired driving alone costs more than $1 billion.  Laws commercializing marijuana only make this problem worse and hamper local communities' ability to deal with the health and safety fallout of increased drug use....

Over the past several months, the Trump Administration has signaled it is considering a crackdown on marijuana in states where it is legal. We don't yet know what this policy change may look like, but one thing we know for sure is that incarcerating low-level, nonviolent offenders in federal prisons is not the answer.  Individual users need incentives to encourage them to make healthy decisions, not handcuffs.

But we do need to enforce federal law.  Indeed, by reasserting federal control over the exploding marijuana industry, we know we can make a positive difference in preventing the commercialization of a drug that will put profits over public health and fight every regulation proposed to control its sale and use.  Marijuana addiction is real, and simply ignoring this health condition will only cost us down the road. We should assess marijuana users for drug use disorders as well as mental health problems, and assist those into recovery.  This can't happen in a climate that promotes use. 

July 27, 2017 in Federal Marijuana Laws, Policies and Practices, Recreational Marijuana Commentary and Debate, Who decides | Permalink | Comments (2)

Tuesday, July 25, 2017

Latest effort to take down federal marijuana prohibition via constitutional litigation filed in SDNY

As reported in this Newsweek article, former New York Jets defensive end Marvin Washington "is one of five plaintiffs in a federal lawsuit against Sessions, the Department of Justice and the Drug Enforcement Agency" that attacks federal marijuana prohibition on various grounds.  Here is a bit more about the lawsuit via the press report:

The Manhattan lawsuit targets the 1970 Controlled Substances Act, which established federal drug policy and delineated narcotics into different schedules. Under the legislation, marijuana is considered a Schedule I controlled substance—along with other drugs such as heroin and ecstasy—and is subjected to the tightest restrictions.... “Classifying cannabis as a ‘Schedule I drug’ is so irrational that it violates the U.S. Constitution,” the lawsuit said.

Washington has joined the lawsuit because the current legislation prevents him from obtaining federal grants to start a business aimed at professional football players who want to use medical marijuana to manage pain.... Other plaintiffs include an 11-year-old boy, Alexis Bortell, who requires medical marijuana to control his epilepsy, and a disabled military veteran, Jose Belen, who uses it to control post traumatic stress syndrome....

Washington, whose playing career ended in 1999, has been a vocal advocate for the use of medical marijuana in football. He has lobbied the NFL to promote medical marijuana as an effective means of pain relief. Washington played eight seasons with the Jets, while also playing for the San Francisco 49ers and the Denver Broncos in a 11-year career. He won the Super Bowl XXXIII in 1999 with the Broncos.

Keith Stroup, legal counsel for the advocacy group NORML, has a lot more of the legal particulars in this new posting which also includes a link to the 89-page complaint in this case. Here are parts of his post:

Washington, et.al v. Sessions, et.al, was recently filed in US District Court in the Southern District of New York by lead attorney Michael Hiller, with NORML Legal Committee (NLC) attorneys David Holland and Joseph Bondy serving as co-counsel. The full complaint can be found here.

Individual plaintiffs in the suit were two young children, an American military veteran, and a retired professional football player, all of whom are medical marijuana patients; and a membership organization alleging their minority members have been discriminated against by the federal Controlled Substances Act.

Seeking to overturn the 2005 Supreme Court decision in Gonzales v. Raich, plaintiffs request a declaration that the CSA, as it pertains to the classification of Cannabis as a Schedule I drug, is unconstitutional, because it violates the Due Process Clause of the Fifth Amendment, an assortment of protections guaranteed by the First Amendment, and the fundamental Right to Travel. Further, plaintiffs seek a declaration that Congress, in enacting the CSA as it pertains to marijuana, violated the Commerce Clause, extending the breadth of legislative power well beyond the scope contemplated by Article I of the Constitution.

Named as defendants in the case are Attorney General Jeff Beauregard Sessions, Acting Administrator of the DEA Chuck Rosenberg, the Justice Department, the DEA and the Federal Government.

In their Complaint, plaintiffs allege that the federal government does not, and could not possibly, believe that Cannabis meets the definition of a Schedule I drug, which is reserved for the most dangerous of substances, such as heroin, LSD, and mescaline; and that classifying Cannabis as a “Schedule I drug,” is so irrational that it violates the U.S. Constitution.

 Among the other claims in the lawsuit are that the CSA: (i) was enacted and implemented in order to discriminate against African Americans and to suppress people’s First Amendment rights; and (ii) violates plaintiffs’ constitutional Right to Travel.

July 25, 2017 in Criminal justice developments and reforms, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Recreational Marijuana Commentary and Debate, Who decides | Permalink | Comments (0)

Sunday, July 23, 2017

"As Trump wages war on legal marijuana, military veterans side with pot"

The title of this post is the headline of this notable Los Angeles Times article.  Here is how it starts:

The Trump administration’s attack on legal marijuana, already stymied by large states determined not to roll back the clock, is increasingly confronting an even more politically potent adversary: military veterans.

Frustrated by federal laws restricting their access to a drug many already rely on to help treat post-traumatic stress disorder, chronic pain and opioid addiction, veterans have become an influential lobbying force in the marijuana debate after sitting on the sidelines for years.

The 2-million-member American Legion this spring got involved in a big way by launching a campaign to reduce marijuana restrictions, which it says hurt veterans and may aggravate a suicide epidemic. The move reflects the changing politics of marijuana, and of a conservative, century-old veterans service organization facing new challenges as its membership grows with those who served in Iraq and Afghanistan.

“We were hearing these compelling stories from veterans about how cannabis has made their lives better,” said Joseph Plenzler, a spokesman for the American Legion. “That they were able to use it to get off a whole cocktail of drugs prescribed by VA doctors, that it is helping with night terrors, or giving them relief from chronic pain.”

At the same time, some patients complained that Veterans Affairs doctors refused to offer any advice for using medical marijuana yet also made a record of who was using it, raising fears that such information might be used to punish former service members or strip their benefits. The legion’s call to reclassify marijuana federally from a drug that has no medical benefit and is more dangerous than cocaine to one that is in the same category as legal prescription painkillers has caught the attention of lawmakers.

A measure the legion now supports, that would permit VA doctors to give their patients the sign-off they need to access medical marijuana in states where it is legal, was approved by a key Senate budget committee earlier this month on a 24-7 vote, with nine Republicans voting in favor. The measure is among the veterans-related marijuana legislation getting new traction at an otherwise challenging time in Washington for pot advocates.

July 23, 2017 in Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Who decides | Permalink | Comments (0)

Thursday, July 20, 2017

Big meeting of feds and state/local officials in Colorado portends...?

As reported in this US News & World Report article, headlined "Feds Tour Colorado in DOJ Pot Review: Recommendations are due next week on whether to crush state-legal weed," there is some new activity in the arena of federal review of state marijuana reform. But what the new activity will lead to remains unclear. Here are excerpts:

Federal officials asked seemingly mundane questions during a Tuesday meeting in Colorado with state officials, at least some of whom were unaware that the discussion was part of a shadowy review of federal marijuana policy. The meeting provides the best glimpse yet into the issues authorities are considering as they prepare to make recommendations next week on what to do about state-legal recreational marijuana, with options ranging from a crackdown to keeping the status quo.

The guest list on Tuesday included Justice Department attorney Michael Murray, who is leading the department's marijuana policy review, and a State Department official with expertise in treaty obligations, according to Mark Bolton, deputy legal counsel to Colorado Gov. John Hickenlooper, a Democrat. John Zadrozny, a domestic policy adviser at the White House, was in the room, as were two representatives of the White House Office of National Drug Control Policy, says Bolton, who also attended.

A person with knowledge of the meeting's purpose says the gathering and another meeting Wednesday with officials from the city of Colorado Springs are directly related to the ongoing federal pot policy review. The source asked not to be identified. Bolton says he was unaware that the meeting – which featured about 20 state agency representatives -- was directly related to the policy review....

The only question that Bolton recalls Murray asking dealt with whether 2014 guidance from the Treasury Department's Financial Crimes Enforcement Network (FinCen) remains "up to date," he says. That guidance outlined how banks can work with pot businesses, but many financial institutions remain reluctant to take on the compliance burden or perceived risk involved in handling cash for cannabis firms operating in violation of federal law. "I don't remember him asking other questions, but it may be they weren't questions that resonated with me," Bolton says.

The State Department official asked if there had been significant problems with diversion of Colorado marijuana to other countries, Bolton says. A representative of the Colorado Department of Public Safety said that is not a significant problem....

The ONDCP representatives at the meeting asked about educational efforts and about continued black- and gray-market sales, Bolton says. He can't recall Zadrozny asking any questions....

Bolton says state officials shared how Colorado uses marijuana tax revenue – estimated to exceed $500 million since recreational sales began in 2014 – to educate the public about the risks of the drug and about responsible use, and that officials pointed out teen use has not increased. He says participants did not directly address the possible consequences of repealing the Justice Department's 2013 Cole Memo, which allowed recreational pot stores to open....

Hickenlooper was not present at the meeting. But Bolton believes invitations extended by the governor during an April meeting with Attorney General Jeff Sessions, as well as an invitation by Colorado Attorney General Cynthia Coffman, a Republican, inspired the visit. It's unclear if federal officials are touring other states as part of their policy review....

After meeting with state officials, a group of feds met Wednesday with legalization foes in Colorado Springs. No supporters of regulating recreational sales attended, KKTV reported after staking out the meeting and later interviewing Mayor John Suthers, a former U.S. attorney and state attorney general who opposes marijuana legalization. "A lot of [the meeting dealt with] sensitive case investigations. That's another reason why it couldn't be public," Suthers told the station. "Probably most of the discussion centered around the huge black market that exists for marijuana in Colorado." Suthers said the city's police department created the guest list, which included a local doctor and a school district director of discipline. The mayor and the police chief were unable to provide immediate comment....

KKTV reported a member of Vice President Mike Pence's staff and at least one member of the DEA also attended the Colorado Springs meeting. Pence's office did not immediately respond to a request for comment, and the national DEA headquarters referred questions to the local office, which did not immediately respond.

Although the Justice Department could launch a devastating legal assault on state-regulated recreational marijuana, medical marijuana currently is protected from federal prosecutors and anti-drug agents by a budget restriction passed in Congress. And in Colorado, state legislators approved legislation earlier this year allowing businesses to reclassify recreational pot as medical marijuana if the need arises.

July 20, 2017 in Campaigns, elections and public officials concerning reforms, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Medical Marijuana State Laws and Reforms, Recreational Marijuana Commentary and Debate, Recreational Marijuana State Laws and Reforms, Who decides | Permalink | Comments (1)

Tuesday, July 18, 2017

"What Jeff Sessions is getting wrong about legal weed"

The title of this post is the title of this notable new CNBC commentary authored by Gina Belafonte, Chris Leavy and Lindy Snider. Here are excerpts:

According to the American Civil Liberties Union, between 2001 and 2010 there were 8.2 million marijuana related arrests in the county, nearly 90 percent of them were for possession. African Americans were nearly four times as likely to be arrested for possession than whites.

Since California became the first state to legalize medical marijuana two decades ago, 28 others and the District of Columbia have followed suit. Eight states have also legalized adult use. We now have a track record of legal, regulated marijuana in more than half of the country, and clear evidence that it is a better approach than a blanket prohibition and harsh prison sentences for those who use it or participate in its commerce.

A 2014 study from the University of Texas, Dallas using FBI's crime data showed no rise in crime rates resulting from medical marijuana legalization, and even some evidence of decreasing rates of homicide and assault. According to the Drug Policy Alliance, Denver saw a 2.2 percent drop in violent crime rates in the year after the first legal recreational cannabis sales in Colorado, and overall property crime dropped by 8.9 percent in the same period while Washington, which legalized recreational use in 2012, saw violent crime rates drop by 10 percent from 2011 to 2014.

The history of the War on Drugs is also a history of the economic and social disparities in our country. Black and brown men are disproportionally incarcerated under our current drug laws, and because mass incarceration breaks up families and severely limits ex-convicts' employment and business opportunities, the War on Drugs has dramatically increased the poverty rate in minority communities....

To be sure, the War on Drugs is a much bigger and more complex issue than marijuana legalization alone, but it is a good place to start. State legal cannabis is now a $6 billion industry that employs 150,000 people and is on track to create more jobs than the manufacturing sector by 2020.

It has generated hundreds of millions of dollars in tax revenue; California alone is forecasting $1 billion annually. Two decades of state legal marijuana also has shaped public opinion, with record numbers of Americans now supporting legalization. A recent poll from Quinnipiac University shows 94 percent of U.S. voters support medical marijuana programs, and 60 percent favor full legalization.

In today's divided politics, few issues command such unanimous support. Medical marijuana is legal both in red and blue states. The first ever Congressional Cannabis Caucus, announced earlier this year, is made up of two Democrats and two Republicans. And in the cannabis industry social justice and business interests are often aligned, with advocates and entrepreneurs standing shoulder to shoulder against reactionary policies such as the ones proposed by Mr. Sessions.

If he has his way on marijuana, Mr. Sessions threatens to turn back the clock on two decades of painstakingly gained progress, bringing us back to the days of overflowing prisons, disenfranchised communities and a $50 billion black market for cannabis run by drug cartels. We must not allow that to happen.

July 18, 2017 in Criminal justice developments and reforms, Federal Marijuana Laws, Policies and Practices, History of Marijuana Laws in the United States, Medical Marijuana Commentary and Debate, Recreational Marijuana Commentary and Debate, Who decides | Permalink | Comments (2)

Friday, July 14, 2017

Looking at the DOJ lawyer working on review of federal marijuana policies

This new US News article, headlined "Federal Pot Policy in Hands of Little-Known DOJ Official: A proposal on what to do about state-legal pot is due in two weeks," provides an interesting little glimpse into the young Justice Department lawyer who may have a big say in the future of federal prosecutorial policies for marijuana:

Michael Murray isn’t well known outside of legal circles, but that may soon change.  The former Supreme Court clerk holds the fate of a multibillion-dollar cannabis industry in his hands and will make recommendations soon on whether to launch a crackdown.

People who know Murray can’t imagine the straight-laced young father of three thinking highly of marijuana use and describe him as quiet and personally conservative.  But they also say he is thoughtful and independent-minded.

Murray, a 2009 Yale Law School graduate, is a counsel to Deputy Attorney General Rod Rosenstein and was tasked with the review earlier this year, when Attorney General Jeff Sessions announced a larger crime task force would have a marijuana subcommittee.

The marijuana subcommittee's work is shrouded in secrecy, with recommendations due by July 27.  The outcome could be either a yawn or a jarring assault on states that have regulated seed-to-sale markets serving adults 21 and older.

Possession and sale of marijuana remain federal crimes.  The Obama administration, however, allowed states broad leeway to regulate medical and recreational sales.  Eight states now have laws authorizing recreational pot markets. Among the conceivable outcomes, the subcommittee could move to pull the rug out from under the cannabis industry by withdrawing or modifying the 2013 Cole Memo, which allowed recreational pot stores to open so long as enforcement triggers – such as underage sales, interstate smuggling and public health consequences – aren’t tripped.

At least in theory, Murray is not the only person reviewing the policy. But it’s not clear who else may be serving on the subcommittee and some legalization advocates fear the fix is in, with large pot advocacy and business groups saying they have had no contact.  "They have been operating in a black box, really," says Taylor West, deputy director of the National Cannabis Industry Association.  "There has been no indication that there was an opening for any viewpoint other than those of whoever is on this committee."  West says the group is "preparing with our allies in D.C. for whatever may come from this."

Statistics from the early years of pot legalization can be manipulated to support a viewpoint, making diverse input potentially significant.  For example, two recent studies came to opposite conclusions on the effects of legalization on traffic safety.  And while surveys show teen pot use has not increased nationally or in the pioneering states since 2012, contrasting current rates to historical low points offers a different impression.

A closed-to-the-press June summit associated with the larger Justice Department task force featured a discussion on drug-supply reduction with Kevin Sabet, the nation's most prominent anti-legalization organizer and leader of the group Smart Approaches to Marijuana. Sabet has not said what interactions, if any, he has with the subcommittee.

Amplifying reformers’ concern is the fact that the larger task force is co-chaired by Steve Cook, an advocate of harsh sentences for drug crimes.  And Murray’s boss, Attorney General Jeff Sessions, is a cantankerous critic of marijuana use who in May asked Congress to drop budget language protecting state medical marijuana programs.

Murray lacks the combative style of Sessions or Cook, according to friends and former colleagues, who describe him as family-oriented and scholarly. One supporter of legalization who asked not to be identified said they trusted his judgment.

Murray joined the Justice Department after working for the Jones Day law firm, which has sent many attorneys to the Trump administration.  His wife, Claire McCusker Murray, became associate counsel to President Donald Trump earlier this year.  “Michael is a brilliant young lawyer [and] he has a somewhat understated personality, especially compared to a lot of people who fill the ranks of the Trump administration,” says David Lat, who also clerked for Judge Diarmuid O'Scannlain, a prominent conservative on the U.S. Court of Appeals for the 9th Circuit.  “I would not expect anything crazy from him,” says Lat, who did not clerk for O'Scannlain at the same time as Murray but knows him socially....

Katherine Moran Meeks, an attorney who clerked alongside Murray for Supreme Court Justice Anthony Kennedy in 2013-2014, says Murray is, however, “a man of his own mind.”

“He’s a person of integrity and he’s there to offer a careful legal opinion,” Meeks says. “I’m sure that’s what he’ll give, rather than something driven by partisanship.”

July 14, 2017 in Campaigns, elections and public officials concerning reforms, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Recreational Marijuana Commentary and Debate, Who decides | Permalink | Comments (1)

Wednesday, July 5, 2017

"Pot with patents could plant the seeds of future lawsuits"

The title of this post is the headline of this reader-friendly piece by Craig Nard at The Conversation about the intersection of marijuana reform and intellectual property law.   Here is how the piece gets started:

It’s hard to make sense of cannabis regulation.

The Drug Enforcement Agency (DEA) continues to categorize marijuana as a Schedule I drug. That means the government believes it has “no currently accepted medical use and a high potential for abuse,” putting it in the same league as LSD and heroin.  The Trump administration has expressly voiced skepticism of marijuana’s medical benefits, with Attorney General Jeff Sessions calling them “hyped.”  Yet, legal pot has become a multi-billion-dollar industry that stuffs the coffers of eight states where voters have approved its legal recreational use.  And nearly 30 states have legalized pot for medicinal purposes so far.

This burgeoning industry has also witnessed the issuance of dozens of patents related to cannabinoids and various strains of cannabis, including ones on marijuana-laced lozenges, plant-breeding techniques and methods for making pot-spiked beverages.  Some of these products contain a significant amount of THC, the psychoactive ingredient in marijuana that makes people high.

As a professor who researches and teaches in the area of patent law, I have been monitoring how private companies are quietly securing these patents on cannabis-based products and methods of production, even though marijuana remains a Schedule 1 drug.  An even richer irony is that the government itself has patented a method of “administering a therapeutically effective amount of a cannabinoids.”

This engagement with the patent system raises several interesting questions as the legal pot industry grows and medical research on cannabis advances.

July 5, 2017 in Business laws and regulatory issues, Federal Marijuana Laws, Policies and Practices, History of Marijuana Laws in the United States, Science, Who decides | Permalink | Comments (2)

Monday, July 3, 2017

"Entrepreneurship and Legal Uncertainty: Unexpected Federal Trademarks for Marijuana Derivatives"

The title of this post is the title of this notable new paper available via SSR authored by W. Michael Schuster and Jack Wroldsen. Here is the abstract;

Though several states have legalized marijuana use, the drug remains illegal under federal law.  Not surprisingly, the United States Patent and Trademark Office (USPTO) refuses to register trademarks related to marijuana because of the federal prohibition.  What is surprising, though, is the USPTO’s willingness to grant trademarks for cannabidiol (CBD) — a marijuana derivative that is likewise expressly illegal under federal drug laws.

This article explains why the USPTO’s divergent treatment of trademark applications for CBD and marijuana products is legally incoherent.  Additionally, when viewed from an entrepreneurial perspective, this phenomenon exemplifies how legal uncertainty breeds entrepreneurial opportunity.  Specifically, the article argues that the evolving regulatory landscape for CBD and marijuana products has been, and continues to be, ripe for legal strategists and innovative entrepreneurs to combine forces to create competitive advantages in the emerging marijuana industry.

July 3, 2017 in Business laws and regulatory issues, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Recreational Marijuana Commentary and Debate, Who decides | Permalink | Comments (3)

Thursday, June 29, 2017

Complicated Tenth Circuit ruling tries to sort out marijuana banking issues in shadow of federal prohibition

As reported in this Cannabist article, headlined "Federal appeals court gives Colorado marijuana credit union another chance," the Tenth Circuit has issued an intricate and complicated ruling on banking issues in the marijuana space. Here are the basics from the article:

A federal appeals court has breathed life into a plan hatched in Colorado to open a credit union for the marijuana industry. A three-judge panel for the 10th U.S. Circuit Court of Appeals on Tuesday vacated a district court ruling that nixed Denver-based Fourth Corner Credit Union’s bid to receive a master account with the Federal Reserve Bank of Kansas City.

Fourth Corner Credit Union first formed in late 2014 with the goal of serving licensed marijuana-related businesses, which have had trouble accessing financial services from traditional banking institutions. Any credit union or bank needs a Federal Reserve master account to operate.

The judges remanded the case to the district court with instructions to dismiss the amended complaint without prejudice. “By remanding with instructions to dismiss the amended complaint without prejudice, our disposition effectuates the judgment of the two panel members who would allow the Fourth Corner Credit Union to proceed with its claims,” the judges wrote in the June 27 opinion.

Previously, the district court dismissed Fourth Corner’s case with prejudice, meaning that the credit union could not refile. The 10th Circuit panel decision allows for Fourth Corner to reapply to the Federal Reserve for a master account, and — if it were to be denied again — the credit union could take the case back to court, said Tom Downey, a Denver-based attorney who specializes in cannabis regulations and law with Ireland Stapleton Pryor & Pascoe P.C.

This paragraph from the start of the Tenth Circuit panel's 60+ page opinion in Fourth Corner Credit Union v. Federal Reserve Bank of Kansas, No. 16-1016 (10th Cir. June 27, 2107) (available here), serves as a kind of a symbol of the mess that persists thanks to state and federal laws on marijuana being in tension:

In this appeal, we vacate the district court’s order and remand with instructions to dismiss the amended complaint without prejudice.  This disposition is addressed in three opinions — one by each member of the panel. Judge Moritz would affirm the dismissal with prejudice. Judge Matheson would vacate and remand with instructions to dismiss the amended complaint without prejudice on prudential-ripeness grounds.  Judge Bacharach would reverse the dismissal of the amended complaint.  By remanding with instructions to dismiss the amended complaint without prejudice, our disposition effectuates the judgment of the two panel members who would allow the Fourth Corner Credit Union to proceed with its claims.

June 29, 2017 in Business laws and regulatory issues, Federal Marijuana Laws, Policies and Practices | Permalink | Comments (0)

Thursday, June 22, 2017

"A Principled Approach to Taxing Marijuana"

Download (3)The title of this post is the title of this terrific (and lengthy) article in National Affairs authored by Jonathan Caulkins. Every serious student of marijuana reform ought to read the whole piece, and here are excerpts that highlight just a fee of the many astute observations herein:

The concern with cheap marijuana is not that tens of millions more Americans might smoke marijuana once or twice a week. That would not matter much, because occasional use is, by and large, not terribly harmful. Rather, the concern is that millions more would become habitual users. Over the last decade or so of liberalizing policy, the number of people who report using marijuana at some point within the past year has increased moderately, but the number reporting heavy use has soared. In 1992, fewer than one million Americans self-reported daily or near-daily use of marijuana; by 2014, the figure had ballooned to 7.8 million. Half of the marijuana used in the U.S. is consumed by people who spend more than half their waking hours intoxicated.

 

Whatever one thinks about the long-term consequences of chronic heavy use, acute marijuana intoxication can interfere with the ability to perform useful and even necessary tasks. Marijuana is not a cognitive-performance enhancer. And while we welcome low prices for most consumer goods  —  if health care and rent were cheap, it would make life a lot easier for most people  —  that approach may not apply to "temptation goods." Suppose people could buy essentially unlimited candy and desserts for 50 cents a day. Would that be a good thing? Maybe not. Lots of Americans already struggle with their weight, and consumption tends to go up when prices fall.

 

Libertarians may want prices to be as low as possible even for temptation goods. But the internalities argument goes as follows: Marijuana is a dependence-inducing intoxicant that leads many users to systematically make bad decisions that harm themselves as well as third parties; more than four million Americans report suffering enough problems with chronic marijuana use to meet clinical criteria for a substance-use disorder.

 

Chronic drug use involves repeatedly ingesting chemicals that bind to one's neuro-receptors  —  literally altering the brain in ways that are visible in brain scans. Changes in the brain's reward circuitry can compromise the neural system that normally helps rational actors successfully negotiate free markets. Even if each dose considered on its own seems appealing, regular drug consumption can leave long-term users regretful. The phrase "drugs hijack the brain" is sensationalistic, but not altogether wrong. So there is nothing illogical about adopting a libertarian perspective toward conventional consumer goods but making an exception for temptation goods, particularly for artificially introduced neurotransmitters and their chemical cousins.

 

To be sure, taxing to protect the minority for whom cheap marijuana would trigger habitual use is paternalistic, and it sacrifices the interests of the majority whose use would not create such problems. But the sacrifice would not be large: A $5-per-gram tax would cost someone who smokes a half-gram joint every weekend only $125 a year. Furthermore, the taxes would not actually increase out-of-pocket costs, but merely lessen the decline in price that would inevitably accompany federal legalization. So even with high taxes, legalization would still save marijuana users money.

June 22, 2017 in Federal Marijuana Laws, Policies and Practices, History of Marijuana Laws in the United States, Recreational Marijuana Commentary and Debate, Taxation information and issues , Who decides | Permalink | Comments (1)

Tuesday, June 20, 2017

Fearing Trump turn, big bank no longer willing to serve national advocacy group Marijuana Policy Project

This new Washington Post article reports on a new reality in the banking space for the nation's leading marijuana reform advocacy group.  The article is headlined "‘It is too risky’: Marijuana group says PNC Bank to close its accounts amid fears of a DOJ crackdown," and it begins this way:

One of the nation’s leading marijuana legalization groups says PNC Bank has notified it that it will close the organization’s 22-year-old accounts, a sign of growing concerns in the financial industry that the Trump administration will crack down on the marijuana industry in states that have legalized it.

The Marijuana Policy Project (MPP) lobbies to eliminate punishments for marijuana use but is not involved in growing or distributing the drug — an important distinction for federally regulated banks and other institutions that do business with such advocacy groups.

Nick Field, MPP’s chief operating officer, said a PNC Bank representative told him in May that the organization’s bank accounts would be permanently closed July 7 because an audit of the organization’s accounts revealed it received funding from marijuana businesses that handle the plant directly. “They told me it is too risky. The bank can’t assume the risk,” Field said.

Although marijuana businesses are legal in some states, many banks will not provide services to sellers or growers of the drug because it is banned at the federal level. But policy and advocacy organizations such as MPP are spared. A bank’s severing ties with an organization that accepts donations from such businesses signals a new level of concern in the banking industry.

PNC bank declined to discuss its relationship with MPP, but a spokeswoman said that “as a federally regulated financial institution, PNC complies with all applicable federal laws and regulations.”

The bank has held MPP’s accounts since the organization was formed in 1995.

June 20, 2017 in Business laws and regulatory issues, Campaigns, elections and public officials concerning reforms, Federal Marijuana Laws, Policies and Practices, Who decides | Permalink | Comments (1)

Thursday, June 15, 2017

Bipartisan group introduces new version of CARERS Act to reform federal marijuana prohibition

CARERS-act-header-backgroundAs reported in this new Roll Call article, a "bipartisan group of senators and representatives have reintroduced legislation that would enable states to set their own medical marijuana policies."  Here are the basics:

Senators Cory Booker, D-N.J., and Kirsten Gillibrand, D-N.Y., joined by Rep. Steve Cohen, D-Tenn., made the announcement on Thursday....

The legislation reintroduced Thursday would protect patients, doctors and businesses participating in state medical-marijuana programs from federal prosecution. The Compassionate Access, Research Expansion and Respect States (CARERS) Act would not legalize medical marijuana in all 50 states. Instead, it would ensure that people in the states where medical cannabis is legal can use it without violating federal law.

In addition to Booker and Gillibrand, co-sponsors of the CARERS Act include Senators Rand Paul, R-Ky., Mike Lee, R-Utah, Lisa Murkowski, R-Alaska, and Al Franken, D-Minn. 

This press release from Senator Booker is titled "Lawmakers Reintroduce Bipartisan, Bicameral Medical Marijuana Bill: CARERS Act would ensure patients have access to lifesaving care without fear of federal prosecution." The press release includes quotes from all the sponsors and state that "the CARERS Act would:

(1) Recognize States’ Responsibility to Set Medical Marijuana Policy & Eliminate Potential Federal Prosecution

The CARERS Act amends the Controlled Substances Act so that states can set their own medical marijuana policies. The patients, providers, and businesses participating in state medical marijuana programs will no longer be in violation of federal law and vulnerable to federal prosecution.

(2) Allow States to Import Cannabidiol (CBD), Recognized Treatment for Epilepsy and Seizure Disorders

The CARERS Act amends the Controlled Substances Act to remove specific strains of CBD oil from the federal of definition of marijuana. This change will allow youth suffering from intractable epilepsy to gain access to the medicine they need to control their seizures.

(3) Provide Veterans Access

Current law prohibits doctors in Department of Veterans Affairs (VA) facilities from prescribing medical marijuana. The CARERS Act would allow VA doctors in states where medical marijuana is legal to recommend medical marijuana to military veterans.

(4) Expand Opportunities for Research

The CARERS Act removes unnecessary bureaucratic hurdles for researchers to gain government approval to undertake important research on marijuana and creates a system for the Secretary of the Department of Health and Human Services to encourage research.

The CARERS Act has the support of more than 20 health, veteran and policy organizations, including: American Civil Liberties Union, Americans for Safe Access, Compassionate Care NY, Coalition for Medical Marijuana NJ, Drug Policy Alliance, Housing Works, Law Enforcement Against Prohibition, Marijuana Policy Project, MS Resources of Central New York, Multidisciplinary Association for Psychedelic Studies, New Jersey Hospice and Palliative Care Organization, NY Physicians for Compassionate Care, Parents Coalition for Rescheduling Medical Cannabis, Patients Out of Time, Students for Sensible Drug Policy, The American Cannabis Nurses Association, The Breast Cancer Coalition of Rochester, Third Way, Veterans for Medical Cannabis Access, Veterans for Peace and Veterans for Safe Access and Compassionate Care."

June 15, 2017 in Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Medical Marijuana Data and Research, Medical Marijuana State Laws and Reforms, Who decides | Permalink | Comments (1)