Cannabis Litigation: Second Circuit Could Force DEA to Re- or Deschedule Marijuana

A split decision decided last Thursday, May 30, by the Second Circuit Court of Appeals reflects a lack of patience with U.S. Drug Enforcement Administration (DEA) when it comes to DEA’s handling of petitions to remove marijuana from the list of most dangerous drugs. As most of our readers likely know, the Schedule of Controlled Substances, established by the Controlled Substances Act of 1970 (CSA), places marijuana in the most restrictive class, Schedule I, alongside heroin. Schedule I is reserved for drugs with a high potential for abuse, no currently accepted medical uses, and a lack of accepted safety for medical use. Less dangerous than marijuana, according to the CSA Schedule, are methamphetamine, cocaine, and hydrocodone.

The Schedule was garbage when created and remains so today. (Click here and here for a detailed explanation why marijuana ended up as a Schedule 1 drug.) Here’s what John Erlichman, a key aid to then-President Nixon, told Harper’s Magazine in 2016:

You want to know what this was really all about? . . . The Nixon campaign in 1968, and the Nixon White House after that, had two enemies: the antiwar left and black people. You understand what I’m saying? We knew we couldn’t make it illegal to be either against the war or black, but by getting the public to associate the hippies with marijuana and blacks with heroin, and then criminalizing both heavily, we could disrupt those communities. We could arrest their leaders, raid their homes, break up their meetings and vilify them night after night on the evening news. Did we know we were lying about the drugs? Of course we did.”

NORML launched the first petition to reschedule marijuana in 1972. Since then many different parties have tried to reschedule or end prohibition by filing petitions with DEA per the CSA protocol on rescheduling. Yet despite the horrid purpose of the drug schedule, the ensuing tragic and profound effect on African Americans, and the waves of state legalization sweeping across the country, the DEA has essentially refused to act.

Last year we wrote about a new lawsuit filed by a group of five plaintiffs comprised of a 12-year old who uses cannabis oil successfully to treat life-threatening seizures; a 6-year old who treats Leigh Syndrome with cannabis; a former NFL linebacker who uses cannabis; an Iraq War veteran who suffers from post-traumatic stress disorder and was told by the Veterans Administration that his options were “opioids or nothing;” and the nonprofit Cannabis Cultural Association. In discussing the history of attempts to reschedule, or end the federal prohibition on marijuana, we noted:

A dozen times or so, private parties have filed petitions with the Drug Enforcement Administration (DEA), per CSA protocol on rescheduling. The DEA has routinely denied each petition, or declined to accept it outright. The lone exception was a petition filed by the pharmaceutical manufacturer of Marinol, to move the synthetic cannabis drug from Schedule II to Schedule III. That one was granted.

Other efforts have been made in the court system. These efforts are too numerous to detail at present, but they too have failed. Even a ruling by DEA’s own administrative law judge that cannabis should be reclassified was swatted away by the agency—and that was nearly 30 years ago.

This post provides an update on the lawsuit in light of the Second Circuit’s decision. Before getting to that, here’s a bit of background by way of our prior post:

The lawsuit targets marijuana’s status as a Schedule I drug under the CSA, and it asks the court to declare this status unconstitutional under the Due Process Clause of the Fifth Amendment, the Right to Travel, and the Commerce Clause. It also seeks a permanent injunction restraining the federal government from enforcing the CSA as relates to marijuana, and other relief. The named defendants here include none other than Attorney General Jeff Sessions, the Department of Justice, DEA, and the United States itself. Earlier in the litigation, plaintiffs sought a temporary restraining order against the feds with respect to enforcement of the CSA as to cannabis, but that motion was denied.

Typically, challenges to marijuana’s status under the CSA have been brought in administrative fora, where venue is not in dispute. Here, however, plaintiffs argue that the administrative process has proven to be so dysfunctional—and plaintiffs’ requests so urgent—that district court is a viable alternative. Thus, much of the oral arguments presented recently by both sides centered around whether the plaintiffs’ case could continue. If the judge can find a creative justification for that to occur, he seems to be leaning strongly toward plaintiffs on the merits.

Unfortunately, the district court ruled that the plaintiffs must seek relief from the DEA before turning to the courts. That set the stage for plaintiffs’ appeal to the Second Circuit.

The appeal turned on the doctrine of law known as exhaustion of remedies. That doctrine, well known to lawyers, is routinely applied by courts across the country. The doctrine holds that before going to court, a person challenging an administrative decision (here the DEA) must first pursue any remedies available before the agency. A prime example at the state level is the recreational marijuana industry, where participants must first resolve issues through the governing regulatory body (e.g. the Oregon Liquor Control Commission, the Washington Liquor Control Board) before seeking relief in the courts.

At the district court and on appeal, the plaintiffs sought to avoid petitioning the DEA pursuant to various exceptions to exhaustion requirement. Although the plaintiffs did not prevail on appeal, they didn’t exactly lose.

The opinion has four key parts. In the first, the court ruled that although the CSA does not mandate the exhaustion of remedies, requiring exhaustion was consistent with congressional intent. The court relied on specific statutory language concerning rescheduling and procedures from which the court inferred that Congress intended to implement scheduling decisions under the CSA through an administrative process. The court also ruled that exhaustion furthered the goals of protecting administrative agency authority and promoted judicial efficiency by giving the agency a chance to resolve the dispute.

The court’s skepticism of the scheduling regime seems apparent:

[Plaintiffs’] argument raises a complex policy question: whether the extant regulatory regime continues to advance the CSA’s goals in light of the current state of our knowledge about the drug. It is possible that the current law, though rational once, is now heading towards irrationality; it may even conceivably be that it has gotten there already.”

This is strong language. Appellate courts do not often call out the rationality of regulatory regimes.  After holding that exhaustion applies, the second and third parts of the opinion address whether any exceptions to exhaustion apply (no) or whether the requirement may be waived (no).

At this point, things have not gone very well for the plaintiffs.

But the fourth portion of the opinion is another story because two of the three judges ruled in favor of holding the case in abeyance and retaining jurisdiction. (The third dissented from this portion of the opinion). In the usual case, an appellate court would affirm the lower court and dismissed the lawsuit. Here, however, the majority expressed considerable displeasure with the DEA which, when combined with the exigencies of plaintiffs’ health issues, led the court to retain jurisdiction over the case.

The opinion here reads as a stern warning to the DEA:

Taking the facts as alleged, and, accordingly, taking the supposed benefits some Plaintiffs have experienced from marijuana as true as well, we—like the District Court below—are struck by the transformative effects this drug has assertedly had on some Plaintiffs’ lives.  As a result, we are troubled by the uncertainty under which Plaintiffs must currently live.

. . .

Plaintiffs argue that the administrative process will prolong their ordeal intolerably.  And their argument is not without force.  Plaintiffs document that the average delay in deciding petitions to reclassify drugs under the CSA is approximately nine years.

. . .

Courts have, moreover, on occasion deemed it proper to encourage prompt decisionmaking.  Thus, where agencies have a history of dilatory proceedings, federal courts have sometimes retained jurisdiction of related cases to facilitate swift review.

. . .

We think it possible that future action by us may become appropriate here.  Plaintiffs have not asked for—and we do not even consider issuing—a writ of mandamus to force the DEA to act.  But we exercise our 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.  And we note 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.

(emphasis added).

This is a good result for the plaintiffs, all things considered. The practical effect is that the DEA will have to act with “adequate dispatch” or face the prospect of the court reinserting itself into the case and deciding the scheduling question. And once the DEA acts, plaintiffs can challenge the DEA’s ruling in court.

With any luck, this opinion marks the beginning of the end of marijuana’s inclusion as a Schedule I drug. We will keep you posted.