DOJ Asks Federal Court to Dismiss Lawsuit Calling CSA ‘Unconstitutional’

BOSTON – The Department of Justice has asked a federal district court to dismiss a cannabis-industry lawsuit that seeks to bar federal enforcement action against state-legal businesses, citing the lawsuit’s potential to disrupt a rescheduling process that’s already underway at the Drug Enforcement Administration.

The DOJ’s motion, filed Tuesday in U.S. District Court for the District of Massachusetts, Western Division, also claims the plaintiffs, led by multistate operator Verano Holdings, lack standing to sue because the feds have taken no action against their businesses.

At the heart of the multifaceted lawsuit is the plaintiffs’ belief that the federal government lacks any constitutional basis to enforce the Controlled Substances Act (CSA) against the intrastate activities of state-legal cannabis operations. Lawyers for the plaintiffs argue the federal government’s power to regulate commerce is based on the Dormant Commerce Clause of the Constitution and, in barring production, distribution, and possession of cannabis at the state level, the CSA exceeded Congress’s authority.

Since passing the CSA in 1970, Congress has revised its position on cannabis. Many members now believe the plant and related products should be either federally legal or much less rigidly controlled. A bevy of reform bills has passed through the legislature in recent years. In late 2022, President Joe Biden requested the DOJ (of which the DEA is a branch) and the Department of Health and Human Services (HHS) reevaluate cannabis’s prohibition under the CSA.

“While reforms such as the SAFER Banking Act and rescheduling cannabis under the Controlled Substances Act would improve certain aspects of this broken and antiquated system [federal prohibition], they will not solve the fundamental issue,” said Verano President Darren Weiss when the lawsuit was filed in October. “The application of the CSA to lawful state-run cannabis business is an unconstitutional overreach on state sovereignty that has led to decades of harm, failed businesses, lost jobs, and unsafe working conditions. We are prepared to bring this case all the way to the Supreme Court in order to align federal law with how Congress has acted for years. We believe that the Supreme Court will adhere to the core value on which our country was founded and which is central to guaranteeing freedom: that the federal government’s powers are limited.”

Federal attorneys representing Merrick Garland, the U.S. Attorney General and named defendant in the lawsuit, argue the plaintiffs lack standing and have failed to state a claim upon which relief can be granted. To support that argument, the federal government’s thirty-seven page motion cites sixty-six court cases, four sections of the U.S. Constitution, seven federal statutes, and two state statutes.

“This court and others have uniformly held that in light of the information available to Congress about marijuana’s effectiveness, Congress acted rationally in classifying marijuana as a Schedule I controlled substance in the CSA and thereby prohibiting its cultivation, distribution, manufacture, and possession,” the motion to dismiss states. “Every federal circuit court to consider the constitutionality of the scheduling of marijuana as a Class I drug has applied the rational-basis standard of review and upheld the statute.”

Federal attorneys cited dozens of case examples in support of its argument to dismiss the lawsuit. However, the feds stopped short of calling the issue settled.

“Congress also rationally set up an administrative process for rescheduling drugs. Pursuant to that mechanism, the DEA is currently considering HHS’s recommendation to reschedule marijuana,” the motion states. “It is not for the courts to disrupt or get ahead of that administrative process.”

While there’s no specific timeline for the DEA’s decision, the Federal Register and Alliance Global Partners examined previous rescheduling decisions and predicted an outcome for cannabis by July 2, 2024, exactly 308 days from a rescheduling recommendation HSS sent to the DEA. Under this timeline, the DEA’s proposed ruling and public comment period would commence before the end of 2024’s first quarter.