On August 16, 2016, the United States Court of Appeals for the Ninth Circuit, which includes Montana, ruled in favor of medical marijuana providers in United States v. Macintosh. At issue was the prosecution of a number of medical marijuana providers and dispensaries in California and Washington under federal law (the controlled substances act) while those same activities are protected under state law and while Congress keeps in place a prohibition of federal expenditures for the prosecution of medical marijuana operations. In other words, the question facing the court was whether the federal government can prosecute medical marijuana growers, providers or distributors who are compliant with state law.
In December 2014, Congress attached a rider to an omnibus appropriations bill funding the government. That rider provided:
None of the funds made available in this act to the Department of Justice may be used with respect to [the medical marijuana states] to prevent such states from implementing their own state laws that authorize the use, distribution, possession, or cultivation of medical marijuana.
Congress renewed the rider through September 30, 2016.
Nevertheless, the Department of Justice indicted a number of medical marijuana providers in California and Washington. The providers moved the trial courts for dismissal or injunctive relief to stop the Department of Justice from spending money to prosecute them. Because the same issue was addressed in each case, the Ninth Circuit consolidated the cases so that it could consider them all at the same time. The court determined that the individuals had standing to challenge the prosecution and that the court had jurisdiction over the case.
The court then approached the task of determining what Congress meant when it said, “prevent any of [the medical marijuana states] from implementing their own laws that authorize the use, distribution, possession, or cultivation of medical marijuana.”
The Department of Justice argued that prosecuting individuals under federal laws, rather than taking legal action against the medical marijuana states, does not interfere with the implementation of state medical marijuana laws. The court flatly rejected this position. Instead, it ruled that the Department of Justice, even if it takes no direct action against the states, prevents the implementation of state law by prosecuting individuals who engage in the medical marijuana business. Accordingly, the rider passed by Congress prevents the Department of Justice from spending any appropriated funds on such prosecutions.
The court continued its analysis of the appropriations rider. It determined that the precise language of the rider and context of medical marijuana laws limit the scope of the protection from federal prosecution.
[W]e conclude that [the rider] prohibits the federal government only from preventing the implementation of those specific rules of state law that authorized the use, distribution, possession, or cultivation of medical marijuana.
Importantly, it does not prohibit the Department of Justice from prosecuting individuals who do not strictly comply with all state-law conditions relating to medical marijuana. Thus, medical marijuana providers have a safe harbor from federal prosecution only if they are in strict compliance with state law. In Montana, that means a provider must be in compliance with the Montana Marijuana Act, commonly referred to as SB 423, as modified by the Montana Supreme Court decision dated February 25, 2016 (allowing for providers to be paid for marijuana grown for patients).
Interestingly, the Montana Supreme Court considered the rider to the appropriations act and was not impressed. “While the measure does evince developing attitudes in Congress, the substantive criminal prohibitions and federal law remain intact." After McIntosh, there is reason to question whether the foundation of the Montana Supreme Court decision is as solid as it once appeared.
At the Watson Law Office, we help medical marijuana providers stay in compliance with state laws and regulations. It is much better for the provider to consult with us before getting started than after he or she has been charged with non-compliance, or worse, a criminal offense.