Oct 26 (Reuters) – A group of cannabis businesses operating in Massachusetts filed a lawsuit on Thursday challenging federal law banning marijuana as an unconstitutional infringement on state powers.
Represented by lawyer David Boies, the companies–Massachusetts retailer Canna Provisions, marijuana delivery business owner Gyasi Sellers, Wiseacre Farm and multistate operator Verano Holdings– sued U.S. Attorney General Merrick Garland in U.S. District Court in Massachusetts. The lawsuit claims that the federal Controlled Substances Act undermines state law, harms the owners’ businesses and threatens their public safety by forcing them to operate largely on a cash basis.
Cannabis has been broadly legalized in 23 states, but the federal law, according to the lawsuit, prevents cannabis businesses from receiving loans from the Small Business Administration, saddles them with heavy taxes and prevents them from using trademark law to protect their intellectual property, among other effects. They also say the threat of federal enforcement has kept people and businesses within Massachusetts from working with the cannabis businesses.
“We want to be treated equally, on an even playing field with any other small business in Massachusetts,” Meg Sanders, CEO and co-founder of Canna Provisions, said in a statement.
In 2005, the U.S. Supreme Court held that Congress’ intent to “eradicate” marijuana from interstate commerce was enough to support the federal government’s intrusion on state regulation of the drug.
“Outdated precedents from decades ago no longer apply,” Boies said in a statement. “The Supreme Court has since made clear that the federal government lacks the authority to regulate purely intrastate commerce.”
Boies is known for his work representing the U.S. government in its antitrust battle with Microsoft Corp and Vice President Al Gore in the U.S. Supreme Court battle over the 2000 presidential election recount. He has more recently drawn criticism over his work for Harvey Weinstein and failed blood testing startup Theranos.
The lawsuit seeks a declaration that the Controlled Substances Act is unconstitutional when applied to state-legal operations and asks the court to ban the federal government from enforcing it against state-legal businesses.
Representatives for the U.S. Justice Department did not immediately respond to a request for comment.
The department’s stance on enforcing federal drug laws against state-legal cannabis businesses has fluctuated between presidential administrations. Under President Barack Obama, prosecutors were told to limit their cases to a specific list of circumstances, which included blocking marijuana revenue from going to criminal enterprises.
That guidance was rescinded by the Trump administration in 2018.
In March, Garland testified before the Senate Judiciary Committee that the department’s policy on marijuana enforcement was in development but would be “very close” to the policy under Obama.
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