On May 30, 2019, in a written opinion issued by the United States Court of Appeals for the Second Circuit, a United States federal appellate court for the first time noted “the transformative effects” of cannabis, questioned cannabis’s status as a Schedule I narcotic, and retained jurisdiction to “induc[e] [the DEA] to act promptly” to review Plaintiffs’ claims, stating that the court would “take whatever further action might become appropriate should Plaintiffs’ initial administrative review and the administrative process fail to operate with adequate dispatch.”

In Washington v. Barr, Docket No. 18-859-cv (2d Cir. May 30, 2019), the Second Circuit considered an appeal of a claim brought by plaintiffs alleging that “the current scheduling of marijuana poses a serious, life-or-death threat to their health.” The plaintiffs included:

  • Marvin Washington, an African-American businessman working in the medical marijuana space, who would like to expand his business into whole-plant cannabis products and take advantage of the federal Minority Business Enterprise Program, but is impeded from so doing by the drug’s scheduling.
  • Alexis Bortell and Jagger Cotte, children with dreadful medical problems including chronic and intractable seizures and Leigh’s disease. They allege that they exhausted traditional treatment options before finding success medicating with cannabis. They claim that marijuana has saved their lives. Because of its Schedule I classification, however, they cannot bring their life-saving medicine with them when they travel onto federal lands or into states where marijuana is illegal. For Bortell, these travel limitations also mean that she cannot take full advantage of the veteran’s benefits to which she is entitled through her father. In addition, both Bortell and Cotte live in constant fear that their parents might be subject to arrest and prosecution for their involvement in their children’s medical treatment.
  • Jose Belen, a veteran of the war in Iraq, who suffers from post-traumatic stress disorder. After his honorable discharge, he became suicidal and was adjudged 70% disabled. He alleges that he pursued conventional therapies unsuccessfully. In despair, he turned to medical marijuana, which he claims has allowed him to manage his symptoms. He further asserts, like Bortell, that marijuana’s Schedule I classification restricts his ability to travel and to take full advantage of his veteran’s benefits.
  • The Cannabis Cultural Association, Inc. (CCA), a not-for-profit organization dedicated to assisting people of color develop a presence in the cannabis industry. CCA is particularly focused on the way past convictions for possession, cultivation, distribution, and use of marijuana have disproportionately affected people of color and prevented minorities from participating in the new state-legal marijuana industry.

Defendants included the United States, the Attorney General, the Department of Justice, the Acting Administrator of the DEA, and the DEA itself. Defendants are responsible for implementing the CSA and, more particularly, for updating the classification of controlled substances (21 U.S.C. § 811(a); 28 C.F.R. § 0.100(b)). Defendants moved to dismiss Plaintiffs’ complaint at the trial level. The District Court granted Defendants’ motion, determining that Plaintiffs had failed to exhaust their administrative remedies and that they did not qualify for an exception to the exhaustion rule. On the merits, the District Court did not find Plaintiffs’ arguments persuasive and deemed their claims to be either foreclosed by precedent or without legal authority.

On appeal, the Second Circuit made history. Though the Court agreed with the lower court judge that Plaintiffs did not exhaust their administrative remedies and that “exhaustion was appropriate here,” the Court held the dismissal in abeyance noting that “strong interests compel [the] Court to retain jurisdiction.” Without opining on the merits of Plaintiffs’ arguments, Judges Jacobs, Calabresi, and Rakoff (sitting by designation), stated that they were “troubled by the uncertainty under which Plaintiffs must currently live” and that “Plaintiffs should not be required to live indefinitely with uncertainty about their access to allegedly life-saving medication or live in fear that pursuing such medical treatment may subject them or their loved ones to devastating consequences.” Pointing out that “the average delay in deciding petitions to reclassify drugs under the CSA is approximately nine years,” the Court stated that “[s]uch long delays cast doubt on the appropriateness of requiring exhaustion”, especially where health is involved. 

The Second Circuit identified several instances in the past where courts have “deemed it proper to encourage prompt decision making” by government agencies, and stated that such “future action by [the Court] may become appropriate here.” The Court expressly exercised its “discretion to keep jurisdiction of the case in this panel, to take whatever action may become appropriate if Plaintiffs seek administrative review and the DEA fails to act promptly,” noting that “under the unusual health-related circumstances of this case, what has counted as appropriate speed in the past may not count as appropriate speed here.”

The onus is now with the DEA. According to the Court, “to the extent that the agency does not respond to Plaintiffs with adequate, if deliberate, speed, . . . we retain jurisdiction exclusively for the purpose of inducing the agency to act promptly.”

The ramifications of these decisions are profound. For the first time, a United States Circuit Court (one level below the U.S. Supreme Court) has reviewed the rationale for the Schedule I classification of cannabis, considered the medical benefits of cannabis as described by a diverse collection of plaintiffs, deliberated over the consequences of the current administrative scheme and the DEA’s history of dilatory proceedings, and issued a written opinion supportive of the plight of medical cannabis patients. 

The Cannabis Law Practice Group at Bressler consists of attorneys with the skills, experience, depth and flexibility needed to assist clients looking to capitalize on opportunities within the legal cannabis industry. Bressler’s expertise in a broad range of practice areas gives it the unique advantage of being able to provide its clients with full service legal counseling in a rapidly emerging industry faced with myriad challenges and complexities. Bressler professionals are available to discuss and assess the risks to your business, as well as potential solutions to make sure you are informed and prepared.

Disclaimer: Possessing, using, distributing and/or selling marijuana or marijuana-based products is illegal under federal law, regardless of any state law that may decriminalize such activity under certain circumstances. Although federal enforcement policy may at times defer to states’ laws and not enforce conflicting federal laws, interested businesses and individuals should be aware that compliance with state law in no way assures compliance with federal law, and there is a risk that conflicting federal laws may be enforced in the future. No legal advice we give is intended to provide any guidance or assistance in violating federal law.

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