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Given the evolving legal landscape surrounding cannabis, smart entrepreneurs know to keep their eyes on cases that set important precedents impacting business operations. Three such cases are ongoing in 2022.
All these cases can create a significant impact on how cannabis companies and those that provide services are allowed to do business in the United States. In writing about these cases, Reuters reported that they stem from trends that occur when marijuana businesses face the headwinds created by continued federal marijuana prohibition.
The news service wrote: “Unsurprisingly, industry players continue to push the envelope, with the hope that courts will begin recognizing the “realities on the ground,” notwithstanding congressional inaction.”
Related: Everything Cannabis Business Owners Need to Know About Tax Code 280E
Each of the following cases revolves around an essential issue in the cannabis industry. The cases, and the central point involved, include the following.
Northeast Patients Group et al. v. Figueroa
The issue: The in-state requirement for cannabis business owners.
While cannabis remains illegal at the federal level, states control the industry’s laws. One of the rules followed by many states is to mandate an in-state requirement for licensed marijuana growers and dispensaries, preventing out-of-state companies from seeking to do business within the state.
This lawsuit, filed in Maine, challenges this requirement. The District Court of Maine has ruled that the in-state provision is unlawful. The 1st Circuit Court of Appeals will decide on this case later this year. The case started after plaintiffs High Street Capital Partners, owned by non-Maine residents, sought to acquire the Wellness Connection dispensary owned by all-Maine residents. The state prohibited the transaction.
Bierbach v. Digger’s Polaris and Musta v. Mendota Heights Dental Center
The issue: Reimbursing workers for expenses related to using medical marijuana to treat injuries sustained on the job.
This comes from the U.S. Supreme Court, which has asked the Solicitor General to submit an amicus brief on whether state laws requiring workers’ reimbursement for medical marijuana costs related to work injuries preempts the federal Controlled Substance Act (CSA) that makes marijuana illegal.
The two cases that sparked the request came from Minnesota, where the state Supreme Court ruled that such state laws are illegal because of the CSA. Similar cases have occurred in New Hampshire, New Jersey, and Maine.
RELATED: Legalized Cannabis Has Changed the American Workplace
Empyreal Enterprises LLC v. United States
The issue: Determining whether cash transport businesses are subject to interstate commerce laws prohibiting the transfer of marijuana or cash earned from marijuana sales from one state to another.
This case underlines the difficulties that cannabis businesses face in getting even the most basic financial services because of federal cannabis prohibition. A recent case shows the dangers companies face in transporting cash earned legally.
The case is being brought by Empyreal, a Pennsylvania-based cash collection, and transport company. The company claims that authorities in Kansas, working with the DEA, wrongfully seized about $165,620 in cash from a company vehicle engaged in transporting cash from a legal dispensary in Missouri for deposit in another state. The critical legal issue is whether companies that do not “touch the plant” are subject to U.S. interstate commerce laws.
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