DEA Judge Denies Agency-Registered Drug Company’s Request To Join Marijuana Rescheduling Hearing

A Drug Enforcement Administration (DEA) judge has denied a request from a drug development company to participate in an upcoming marijuana rescheduling hearing, deferring to the head of the agency about approved witnesses amid ongoing questions about alleged “unlawful” communications with a prohibitionist group.

After DEA Administrator Anne Milgram selected 25 witnesses to participate in the hearing that’s set to commence on December 2, there was pushback from certain advocates and stakeholders who requested to join but were ultimately denied. MedPharm was among those denied the opportunity to weigh in.

In response, MedPharm, a DEA-registered research firm, filed a motion to intervene. It asked the DEA administrative law judge (ALJ) overseeing the hearing to allow it to join despite the administrator’s denial.

“To MedPharm’s knowledge, not one DEA-licensed marijuana researcher made the Administrator’s list of ‘Designated Participants,’ leaving a significant gap in knowledge as DEA considers whether to reschedule marijuana,” it said.

Beyond the exclusion of DEA registrants in the hearing, MedPharm also raised concerns about how selected witnesses include “multiple prohibitionist organizations, conservative law enforcement agencies, and others who clearly oppose the Proposed Rule that DEA, as the putative proponent of the [notice of proposed rulemaking], is obligated to defend.”

“The deck appears to be stacked against those in favor of promulgation of the NPRM that was proposed by DOJ and supported by” the U.S. Department of Health and Human Services (HHS) and DEA Office of Legal Counsel (OLC), it said.

“In short, the list of participants is not designed to offer the best evidence to support the findings of our leading health agencies,” which recommended moving marijuana from Schedule I to Schedule III of the Controlled Substances Act (CSA). “Instead, it is designed to thwart a legitimate process that DEA’s parent agency has indicated is lawful and thus should be defended.”

“By inserting itself into these proceedings to rig the list of Designated Parties before referring this matter to this Tribunal, DEA has undermined the legitimacy of these proceedings before they have even begun,” it said.

Of course, there is one reason why the “deck appears to be stacked” with witnesses opposing the rule: For rulemaking hearings under the Administrative Procedures Act (APA), those who can demonstrate that they’d be adversely impacted by the policy change are prioritized for participation. Supporters of the rescheduling proposal therefore face a higher bar.

In any case, DEA ALJ John Mulrooney responded to MedPharm’s motion on Friday—denying the request to intervene in the hearing but also making clear that his office is statutorily limited in its ability to restrict the administrator in this scheduling process.

Mulrooney on Tuesday officially ruled on which of the agency’s 25 selected witnesses for the hearing will be able to participate, while laying out the procedure for the administrative process—including how pro- and anti-reform speakers will be able to cross-examine one another.

“The Agency is endowed with the right to place reasonable limits on the number of participants in a given [Administrative Procedures Act] hearing. Which is, when reduced to its essence, precisely what the Administrator did in exercising her discretion in determining the number and nature of participants,” he said. “To be sure, thousands upon thousands of individuals and entities across the country could add value to the issues to be decided here, but they cannot all be included.”

The ALJ’s ‘functions…commence upon his designation and terminate upon the certification of the record to the Administrator,’” the judge said, citing statute. “Thus, the time the [designated participants] were selected by the Administrator preceded my authority to act on the case.”

“The Administrator exercised her discretion to fix the number of DPs to be included, and to expand that number would effectively overrule her decision and exceed the proper and logical role of the ALJ under the APA and the CSA,” he said. “Accordingly, no action can or will be taken on MedPharm’s Motion to Intervene.”

This is one of the latest wrinkles in the rescheduling hearing proceedings. And much of the recent focus has been on the DEA administrator’s choice to selected the prohibitionist group Smart Approaches to Marijuana (SAM) as a witness.

The DEA judge this week invited SAM to explain recent allegations that it was involved in “unlawful” communications with the agency as it considered the Biden administration’s rescheduling proposal. The ALJ on Wednesday separately notified DEA that it was welcome to respond to the “serious” allegations. Both parties are able to respond up until a November 25 deadline.

Meanwhile, in response to an underlying motion that challenges DEA’s role as a “proponent” of the proposed rescheduling rule—due to the alleged communications and the agency’s apparent resistance to the proposed rule—Mulrooney separately responded with a filing directed at the agency that expressed mixed opinions about the arguments.

The order emphasized that the case was unprecedented, with attorneys for the two cannabis organizations asking the DEA tribunal to “unilaterally remove the DEA, its counsels, and its Administrator” from the rescheduling process ahead of an initial hearing on December 2.

The petitioners have asked that DEA be replaced by the Justice Department or Hemp for Victory as the “proponent” of the rule.

In a historic first, it was Attorney General Merrick Garland—and not DEA Administrator Anne Milgram—who signed the proposed rule to move marijuana to Schedule III.

The judge, in turn, said that the prospect of removing an agency head from rulemaking that it is responsible for overseeing would likely, “and correctly,” be deemed beyond the ALJ office’s jurisdiction.

“That said, this tribunal does retain sufficient authority and independence to tender recommendations to the Administrator, no matter what discomfiture those recommendations may inflict upon the Agency or its Leadership,” it said.

Meanwhile, the DEA ALJ rejected a separate motion seeking to postpone the marijuana rescheduling hearing over the agency’s alleged “improper blocking” of witnesses, while arguing that the process should be halted at least until President-elect Donald Trump’s administration comes into power so it can review the rulemaking.

About a week after Panacea Plant Sciences founder and CEO David Heldreth filed a lawsuit in federal court, requesting an order halting the cannabis rescheduling proceedings, he submitted a motion to the DEA judge on Monday seeking a stay of the upcoming December hearing.

Mulrooney said that the “propounded basis for the requested stay is founded primarily on this absence from the [designated participant] roster, but is alternatively based upon his aspirational view that the impending change in presidential administrations might yield a more successful decisional structure.”

“Inasmuch as the Petitioner was not included in the Administrator’s Designated Participant list, and has not been admitted to the proceedings in some other manner, no action can or will be taken on his Motion to Stay,” the judge said.

Mulrooney separately rejected a veterans group’s petition to participate in the upcoming rescheduling hearing, which the organization called a “travesty of justice” that excludes key voices that would be affected by the potential policy change.

For what it’s worth, Vice President Kamala Harris said recently that part of the reason for the delay in the administration’s marijuana rescheduling effort is federal bureaucracy that “slows things down,” including at DEA.

In March, Harris also expressed some frustration with the bureaucratic process of rescheduling marijuana, prior to DOJ’s formal recommendation, calling on DEA to expediently finish the job.

While the Biden–Harris administration facilitated the review that led to the DOJ rescheduling proposal, Trump has also voiced support for the reform.

In Congress, numerous lawmakers have shared their own perspectives on the proposed reform with DEA and DOJ since the Schedule III announcement was made.

In August, for example, Sen. Chuck Grassley (R-IA) raised concerns about the Biden administration’s justification for recommending marijuana rescheduling, demanding answers to questions from federal agencies about how they arrived at that decision in what he described as a rushed and unconventional administrative process.

A week earlier, top Democratic senators—including  Senate Majority Leader Chuck Schumer (D-NY)—sent a separate letter to DOJ’s Garland and DEA’s Milgram urging the agencies to ”promptly finalize” the rule to reschedule marijuana.

While rescheduling would remove certain research barriers and free up state-licensed cannabis business to take federal tax deductions under the Internal Revenue Service (IRS) code known as 280E, it would not federally legalize marijuana, as the Congressional Research Service (CRS) has made known in multiple recent reports.

Meanwhile, two additional congressional lawmakers have joined the ranks of GOP members who are challenging what they say is the “unusual” process that led the Biden administration to propose rescheduling marijuana, expressing concern about how the review was carried out and demanding answers.

Rep. Doug LaMalfa (R-CA) condemned the Biden administration’s push to reclassify marijuana, as well as legislative efforts to enact bipartisan cannabis banking reform, because he says the policy changes would “prop up this immoral industry” and give a “green light to the evil that comes from drug use.”

Sen. Bill Cassidy (R-LA) also blasted the Biden administration over what he described as repeated refusals from federal agencies to brief Congress on its plans and justification for rescheduling marijuana, which he argues fuels speculation that the proposed policy change is politically motivated.

Similarly, 25 GOP congressional lawmakers sent a public comment letter in July opposing the administration’s planned rescheduling of marijuana, specifically alleging the government’s recommendation was based on politics rather than science.

Read the MedPharm motion on the marijuana rescheduling hearing and the DEA judge’s response below: 

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Photo courtesy of Chris Wallis // Side Pocket Images.