U.S. Attorney General Jeff Sessions' announcement that the U.S. Department of Justice (DOJ) will be rescinding its prior position regarding relaxed marijuana enforcement adds questions and complexity in states that allow the drug. Sessions' memo states the following: "Given the Department's well-established general principles, previous nationwide guidance specific to marijuana enforcement is unnecessary and is rescinded, effective immediately." Translated, this statement permits federal prosecutors to pursue cases against those involved in marijuana businesses operating legally under their state's laws as they deem appropriate. Prior DOJ policy under the Obama Administration prevented these prosecutions in states where the drug was legal and regulated. The elements federal prosecutors are to consider in determining whether to pursue a case are: "the seriousness of the crime, the deterrent effect of criminal prosecution, and the cumulative impact of particular crimes on the community."
Federal law under the Controlled Substance Act (CSA) bans marijuana (since 1970) as a Schedule 1 drug. But since that time, 29 states have passed laws legalizing marijuana for medical purposes; eight states and Washington, D.C., for recreational use and another 14 have decriminalized the drug. Further, 12 states are considering pot legalization in 2018 for recreational purposes including New Jersey, Delaware and Connecticut.
What does the DOJ action mean? And what if a future administration's DOJ reverts to the prior rule promulgated under the Obama Presidency?
There is no doubt that the DOJ has the right to enforce federal law under the Supremacy Clause, Article VI of the U.S. Constitution, which unambiguously establishes the supremacy of federal law over any conflicting state law. In its last session, Congress extended a provision known as the Rohrabacher-Blumenauer amendment, which blocks the DOJ from using federal funds to impede state medical marijuana laws. Federal prosecutors are still not able to pursue cases against medical marijuana users or businesses operating legally within their states. However, Congress needs to pass the budget again on January 19, 2018, and will need to include that amendment in order for those protections to remain in place.
Regardless, it is almost inevitable that the recent DOJ action will have a chilling effect on states considering passing laws in the future, and on corporations from getting involved in the marijuana business.
With polls showing 60 percent of the public in favor of legalization in some form, the DOJ is effectively placing the onus on Congress to legislate a solution. This may include rescheduling marijuana from a Schedule 1 drug to a Schedule 2 drug, a step that would permit legalized medical pot.
Comment: Recent DOJ action seems to help employers deny employment to a person who is taking marijuana legally under their respective state laws. A number of states including Pennsylvania and Delaware have anti-discrimination provisions in their medical marijuana statutes, while New Jersey currently does not.
There have been no Court rulings in New Jersey, Delaware, or Pennsylvania on the issue. Among states that have decided the issue, most have taken the position that an employer may terminate an employee who is using marijuana legally under their state laws, largely because of the conflict with federal law. More recently Courts on the East Coast have started a trend toward ruling in favor of the employee.
Workers' compensation carriers face violating the CSA if they reimburse injured workers for the cost of medical marijuana. To date, carriers in five states including Maine, New Jersey, Connecticut, California and New Mexico have been ordered to reimburse the injured worker for the cost of the medical marijuana and most of those opinions cite the Obama era policy memo for support. Since this is no longer DOJ policy, Judges could be more reluctant to order reimbursement. It should be noted certain State Courts, New Jersey included, have ordered carriers to reimburse the employee for the cost and not to pay for the marijuana directly.
We recommend closely monitoring the Rohrabacher-Blumenauer amendment's reauthorization process once it comes up again on January 19, 2018. If it is reauthorized, the medical marijuana business will be protected from federal prosecution. If it is not reauthorized, those protections will be gone and we would not recommend paying for the cost associated with medical marijuana based on the DOJ's recent actions.
For more information, please contact John C. Kutner, at jkutner@wglaw.com or 973.854.1077.