A federal appeals court issued an opinion on Monday determining that a congressionally-approved provision can be invoked to block the Department of Justice from spending money to defend against appeals from people convicted of medical marijuana activity that was in compliance with state laws.
A three-judge panel of the U.S. Court of Appeals for the Ninth Circuit, which previously ruled in 2016 that the budget rider (known commonly as “Rohrabacher-Farr” or § 542) protects people who are complying with state medical cannabis laws from being prosecuted for their activities, went even further in the current opinion.
The case at issue concerns Noah Kleinman, who was sentenced to federal prison for various federal marijuana-related crimes on December 8, 2014, just weeks before Congress approved the medical cannabis protections.
“Preliminarily, we clarify that the government’s approach to this case is mistaken,” the court wrote in the Monday opinion. “[Kleinman] argues that § 542 prohibits continued DOJ expenditures on his case since its enactment, which in this case refers to the DOJ’s ongoing litigation on appeal. We determined in [the 2016 ruling] that § 542 can prohibit continued DOJ expenditures even though a prosecution was properly initiated prior to § 542’s enactment…and the same reasoning applies to continued expenditures on a direct appeal after conviction.”
Unfortunately for Kleinman, however, the court ruled that he personally cannot take advantage of the medical marijuana protections because not all of his cannabis actions were in strict compliance with California’s medical use program. Specifically, he was convicted of sending product out of the state, which is a violation of California law.
In the earlier 2016 Ninth Circuit case, known as McIntosh, the court ruled against Department of Justice arguments that the spending provision only stops the government from blocking the implementation of state medical marijuana laws and doesn’t shield patients or providers who are operating in accordance with those laws.
But the court made clear that because the spending rider only concerns individual annual appropriations bills, its protections for states and for persons are temporary.
“We note the temporal nature of the problem with these prosecutions,” the court wrote at the time. “The government had authority to initiate criminal proceedings, and it merely lost funds to continue them. DOJ is currently prohibited from spending funds from specific appropriations acts for prosecutions of those who complied with state law. But Congress could appropriate funds for such prosecutions tomorrow.”
Now, in the opinion in Kleinman’s case, the court elaborates on its reasoning and adds the caveat that DOJ could be blocked from spending money to defend against appeals:
“§ 542 does not require a court to vacate convictions that were obtained before the rider took effect. In other words, when a defendant’s conviction was entered before § 542 became law, a determination that the charged conduct was wholly compliant with state law would not vacate that conviction. It would only mean that the DOJ’s continued expenditure of funds pertaining to that particular state-law-compliant conviction after § 542 took effect was unlawful. That is because, as we explained in McIntosh, § 542 did not change any substantive law; it merely placed a temporary hold on the expenditure of money for a certain purpose… When § 542 took effect, the DOJ was obligated to stop spending funds in connection with any charges involving conduct that fully complied with state law, but that temporary spending freeze does not spoil the fruits of prosecutorial expenditures made before § 542 took effect. Instead, as it pertains to this case, because § 542 became law after Kleinman’s conviction and sentence, but before this appeal, § 542 (if it applies at all) might operate to bar the DOJ from continuing to defend this prosecution on appeal insofar as it relates to those counts that may be determined to involve only conduct that wholly complies with California medical marijuana law.”
However, the court sidestepped the question of whether the medical marijuana protections prevent federal prisons, which fall under the Department of Justice, from spending money to incarcerate people convicted of state-legal medical cannabis activity.
In a footnote in the new opinion, Judge Milan D. Smith, Jr., on behalf of a three-judge panel of the court, said:
“Kleinman separately argues that § 542 compels the Bureau of Prisons, as a subdivision of the DOJ, to stop spending money to incarcerate persons for medical marijuana convictions based on activity that fully complies with state law. We need not resolve this issue in this case. As we have explained, at least two of Kleinman’s convictions fall outside the scope of § 542 because they involved conduct that violates California law. Those two convictions (Counts 1 and 6) carried the longest terms of imprisonment (211 months) and all terms for each count were sentenced to run concurrently. Thus, even if the DOJ could not separately continue to expend funds to incarcerate Kleinman on the remaining counts because of § 542, Kleinman’s custodial status would not be changed because § 542 does not bar his continued incarceration for his conspiracy convictions. Further, Kleinman makes no argument that the Bureau of Prisons would calculate his credit for early release any differently without those concurrent sentences. Thus, we do not decide in this case the impact of § 542 on the Bureau of Prisons’ expenditure of funds to incarcerate persons who were convicted only of federal drug offenses involving conduct that was fully compliant with state medical marijuana laws.”
The state medical cannabis protections temporarily expired over the weekend as part of a federal government shutdown, but have now been extended through February 8 as part of a short-term appropriations deal. It is unclear if they will be included in a longer-term Fiscal Year 2018 spending package that congressional leaders are currently negotiating.
(The new Ninth Circuit opinion is actually an amended version of a ruling the court issued last June, and adds additional analysis about other aspects of Kleinman’s case which don’t directly concern the congressional rider. While the original opinion received some press coverage, most of it focused on jury nullification aspects of the case and the broader interpretation of the medical cannabis protections to cover the appeals process was mostly overlooked at the time.)
State Treasurers Group Endorses Marijuana Banking Legislation
A group representing state treasurers and finance officials is formally calling on Congress to pass legislation allowing marijuana businesses to more readily store their profits in banks.
The National Association of State Treasurers adopted a resolution on Friday announcing that the organization “supports common sense federal laws and regulations to provide essential banking services to state legalized cannabis businesses, promote public safety and financial transparency, and facilitate local, state and federal tax and fee collection.”
The measure, which makes clear that the group “takes no position as to whether cannabis should be legalized under the laws of the United States or of any state,” highlights the public safety issues caused by current federal policy, which makes many financial services providers reluctant to work with the marijuana industry.
“Lacking banking services, many legal cannabis businesses operate solely in cash,” it says. “Cash-based systems are inefficient, expensive, and opaque, making illicit activity more difficult to track and posing a significant risk to public safety by increasing the likelihood of violent crime.”
The status quo also causes headaches for regulators, the group argues.
“Whereas, unbanked cannabis businesses are unable to write checks, make and receive electronic payments, utilize payroll providers, accept debit or credit cards, or pay taxes through a financial institution, tax collection is more difficult and burdensome for both businesses and governments, and the potential for tax fraud is substantially increased,” the resolution states.
The group’s endorsement, which was led by Oregon State Treasurer Tobias Read and Utah Treasurer Damschen, follows a letter on the issue that 17 state treasurers signed earlier this month.
“This was an ongoing, thoughtful conversation the Association has been having for the last two years,” Read told Marijuana Moment. “The majority of states have legalized medical or recreational cannabis, and need to have safe banking options for these businesses. I hope that Congress will recognize that this public safety issue is bi-partisan and will create safer communities.”
The move by treasurers’ organization also comes after the National Association of Attorneys General, which represents the top law enforcement officials at the state level, issued a similar endorsement.
Legislation to protect banks from being punished by federal regulators for working with marijuana businesses is gaining momentum in Congress.
In March, the House Financial Services Committee approved a cannabis banking bill in a bipartisan vote of 45 to 15. The legislation, which is awaiting a vote on the House floor, now has 182 cosponsors. A companion Senate bill has 28 senators signed on.
In the meantime, the National Association of State Treasurers is urging the Trump administration to keep in place Obama-era guidance meant to provide some level of clarity and comfort to banks interested in working with the cannabis industry.
“NAST supports financial law enforcement authorities’ consistent interpretation of the FinCEN guidance and, barring changes to federal law, the continued application of the guidance to allow some financial institutions to offer banking services to the state legalized cannabis industry,” the resolution says.
Texas Senate Committee Approves House-Passed Medical Marijuana Expansion Bill
Even as the Senate stonewalls a handful of bills aimed at lessening criminal penalties for possession of marijuana, an upper chamber committee on Friday advanced legislation that aims to vastly expand who has access to medical cannabis in the state.
As filed, state Rep. Stephanie Klick’s House Bill 3703 would add multiple sclerosis, epilepsy and spasticity to the list of debilitating medical conditions that qualify for cannabis oil. The progress on her bill comes four years after Klick authored legislation that narrowly opened up the state to the sale of the medicine.
The bill requires approval by the full Senate chamber before it can return to the Texas House, where lawmakers have already approved two bills to drastically expand the Compassionate Use Program, which currently only allows the sale of cannabis oil to people with intractable epilepsy who meet certain requirements. But according to the Senate sponsor of the bill, the legislation is likely to pass the upper chamber — despite leadership once expressing aversion to relaxing the existing state program.
Several who testified before the Senate committee pleaded with the panel to advance the bill, sharing personal stories of how using cannabis oil has helped them treat a bevy of medical ailments. Lawmakers from both parties were receptive to the emotional testimony and, after more than an hour of discussion, voted unanimously to send the legislation to the full Senate.
When laying out the bill in front of the Senate committee Friday, state Sen. Donna Campbell, R-New Braunfels, introduced a reworked version of the measure which further expanded which Texans have access to the medicine. In addition to the conditions already outlined by Klick, those with other illnesses like seizure disorders, amyotrophic lateral sclerosis, or ALS, terminal cancer and autism would also be eligible to obtain the medicine. The version of the bill Campbell laid out also eliminated what she called an “onerous requirement” that those wanting access to the medicine get the approval of two licensed neurologists.
Under Campbell’s version of the bill, the Texas Department on Public Safety would still have oversight of the Compassionate Use Program. Her revised bill also keeps intact the 0.5% cap on the amount of the psychoactive element in marijuana known as THC that medical cannabis products are legally allowed to contain.
“For many patients in the [Compassionate Use Program], participation in the program has been life altering,” Campbell said. “These people are our friends, our family, our neighbors. Members of our churches and in our communities have benefitted from this.”
Multiple Texans who either currently use the medicine, or felt they could benefit from access to it, spoke before the Senate committee.
“Before CBD, I had 200 seizures a day lasting 15 to 30 seconds,” said Brenham resident Julia Patterson. “It affected my grades and my social life. I couldn’t play sports. I couldn’t go to sleepovers. … After CBD oil, I’m now one year seizure free. I have my driver’s license and I’m finishing the school year with A’s.”
Still, there was a small show of opposition from a handful of parents and veterans who said they wished the legislation was more broad and included conditions like post-traumatic stress disorder.
State Sen. José Menéndez, a San Antonio Democrat who filed a medical expansion bill this legislative session that never got hearing, raised questions about the potential shortfalls of Klick’s bill.
“What happens if the Legislature does not address PTSD in this bill? What do you think is going to be the impact?” Menéndez asked Keith Crook, a retired Air Force veteran who testified on the bill.
“I’m going to bury more of my friends because this medicine saved my life,” Crook responded. “And there are people who don’t have the ability to access it or will be refused access to it because of a law.
“I’m a criminal. I use everyday. But I’m just trying to stay alive and do the right thing.”
Nearing the end of the testimony, Campbell implied that it would take more than one legislative session before Texas further expanded the number of conditions who qualify for the medicine in order to prevent “unintended consequences.”
“Anybody who watches a football game is going to root for their team and be happy when they at least get a first down,” Campbell said. “We would like to be able to include so many more diagnoses. This is more certainly a more expanded list and we will keep working with this.”
The bill still faces several more hurdles before it can be signed into law. The bill will need approval from the full Senate and then the House will have to accept the Senate’s changes — or both chambers will need to reconcile their differences on the bill’s language in conference committee.
Its chances of passage look sunny in the upper chamber, however, though Lt. Gov. Dan Patrick previously said he was “wary of the various medicinal use proposals that could become a vehicle for expanding access to this drug.” During Friday’s hearing, Campbell said Patrick “helped craft” the reworked version of the legislation. House Speaker Dennis Bonnen also told Spectrum News this week he thinks the Senate will take concepts from both medical cannabis bills passed by the House earlier — one from Klick and the other from Democratic state Rep. Eddie Lucio III of Brownsville — and “put them into one.”
Expanding the Compassionate Use Act has drawn the support of some politically powerful players since the last legislative session. In March, a new group lobbying for medical marijuana, Texans for Expanded Access to Medical Marijuana, emerged and has players with some serious clout in the Capitol — including Allen Blakemore, a top political consultant for Patrick.
The Republican Party of Texas also approved a plank last year asking the Legislature to “improve the 2015 Compassionate Use Act to allow doctors to determine the appropriate use of cannabis to certified patients.”
This article originally appeared in The Texas Tribune.
The Texas Tribune is a nonprofit, nonpartisan media organization that informs Texans — and engages with them — about public policy, politics, government and statewide issues.
Presidential Candidate Jokes About Why Denver Decriminalized Psychedelic Mushrooms
Sen. Michael Bennet (D-CO) joked on Thursday that Denver voters approved a measure to decriminalize psychedelic mushrooms because they thought the state of Colorado was running low on marijuana.
The 2020 Democratic presidential candidate made the remark during an appearance on Late Night with Seth Meyers. The host asked Bennet if it was “true that magic mushrooms are going to be legal in Colorado.”
(The measure actually simply decriminalizes psilocybin mushrooms for adults, and only in the city of Denver.)
Bennet slapped his knee and quipped, “I think that our voters just voted to get Denver to do that, and I think they might’ve thought that we were out of marijuana all of a sudden.”
“And by the way, we’re not out of marijuana in Colorado,” he said.
“That’s what it says on the state flag now, right?” Meyers said.
“Yeah, exactly,” Bennet replied.
The senator, who previously served as the superintendent of the Denver Public Schools, has cosponsored several wide-ranging cannabis bills in Congress, including legislation to federally deschedule marijuana and penalize states that enforce cannabis laws in a discriminatory way.
But before his state voted to legalize marijuana in 2012, Bennet stood opposed.
It’s not clear how he voted on Denver’s historic psilocybin initiative.
At least Bennet is aware of the measure and was willing to joke about it, though. Several of his colleagues who have worked on cannabis issues declined to weigh in on decriminalizing psychedelics when asked by Marijuana Moment recently.
Photo courtesy of YouTube/Late Night with Seth Meyers.