How many times should judicial nominees be allowed to consume marijuana before they are confirmed to the federal bench?
That’s a question United States senators spent roughly half an hour debating on Thursday.
“Over time, there’s been an evolving attitude in our society towards marijuana,” Senate Judiciary Committee Chairman Charles Grassley (R-IA) said. “And I suppose as I’ve looked at it over a period of time in which I’ve had this absolute prohibition attitude that I’ve demonstrated maybe not in public but in private about it, I’ve come to the conclusion that sometime down the road — and we may be down the road there now — that we, if [marijuana use is] the sole judgement of whether somebody ought to have a judgeship or not, or maybe any other position, we may not be able to find people to fill those positions.”
The statement is significant, coming from Grassley, long one of Congress’s most vocal opponents of cannabis law reform. He has, for example, blocked bipartisan medical marijuana bills from even getting a hearing in his committee.
The Judiciary panel, which held a business meeting on Thursday, is preparing to pare back a long-held standard on prior marijuana use by judicial nominees.
Previously, any use of marijuana after passing a bar exam would disqualify a nominee under the committee’s rules, though waivers have sometimes been granted, seemingly depending on which party controls the Senate and the White House.
“I thought that standard and that unwritten rule in the committee was unfair, unwise” Sen. Dick Durbin (D-IL) said. “I saw…how good people because of a mistake they made in a young part of their lives were disqualified from a lifetime of federal service on the bench. I just think it was wrong.”
Durbin recounted previous cases where President Obama’s nominees were blocked under the rule by objecting GOP senators.
“I know of some who would have been top-notch federal judges [and] were disqualified and stopped by Republican senators,” he said.
Now, he pointed out, Republicans seem to be in favor of a “more permissive standard for President Trump’s judicial nominees… I’m not opposed a different standard, but we should not have a double standard for nominees who are presented under a Democratic president and nominees that are presented under a Republican president.”
Senate Republicans blocked Obama nominees who had used marijuana after passing the bar. Now they want a more flexible standard for Trump nominees.
— Senator Dick Durbin (@SenatorDurbin) November 17, 2017
I am not opposed to a more flexible standard. But it shouldn’t be a double standard for Democratic vs. Republican nominees.
— Senator Dick Durbin (@SenatorDurbin) November 17, 2017
Sen. Patrick Leahy (D-VT) shared the concern.
“There’s seems to be one standard with a Republican administration [and] a different one with a Democratic administration. It’s tougher on the Democrats. I’m just saying, let’s have one standard. It may evolve,” he said.
Grassley replied that he hopes waivers aren’t “related to who’s president, but I don’t blame you for drawing that conclusion.”
Sen. Dianne Feinstein (D-CA) who, along with Grassley has been one of Congress’s most ardent drug warriors, said she too supports easing committee’s policy.
“The rule has had real consequences,” she said. “For my part, and I was opposed to legalization of marijuana in California, I believe that the rule should change.”
(As an aside, Feinstein incorrectly stated several times during the meeting that 29 states have legalized marijuana for recreational purposes. Grassley attempted to correct her by rightly pointing out that that’s the number of states that allow medical cannabis use, but added further confusion by saying only two states have legalized recreational marijuana. The correct number is eight.)
The committee hasn’t finalized the new standard yet, but the public discussion by its members provided an indication of where they may end up.
Durbin asked Grassley whether they would set a “reasonableness standard that has some flexibility or are we going to set a numeric standard?”
The chairman replied that he’s “aware of the ranking member [Feinstein] having a view, that it ought to be a very hard rule, and I probably have taken a rule of a reasonable approach.”
Feinstein seemed somewhat taken aback by the comment, and Grassley then told her, “I thought your rule was a little harder than my rule.”
After an interlude from Sen. Patrick Leahy (D-VT) about using “discretion” in enforcing rules, Feinstein said, “My understanding is that we have agreement that the post-bar reasonable standard is one to two uses [of marijuana].”
Grassley confirmed, “That is so.”
It is unclear when the committee will finalize and formally announce the new policy.
In 1987, Supreme Court nominee Douglas Ginsberg was forced to withdraw his name from consideration after it was revealed that he had smoked marijuana.
GOP Senator Presses Treasury Secretary On Tax Credits For Marijuana Businesses
A Republican senator recently pressed the head of the Treasury Department on whether marijuana businesses qualify for a federal tax benefit.
During a Senate Finance Committee hearing on Wednesday, Treasury Secretary Steven Mnuchin was asked about the “opportunity zone” tax credit, which is meant to encourage investments in “distressed,” low-income communities through benefits such as deferrals on capital gains taxes.
Sen. James Lankford (R-OK), whose state’s voters approved a medical marijuana ballot measure in 2018, told Mnuchin that businesses that derive more than five percent of their profits from things like alcohol sales are ineligible for the tax credit, but there’s “not a definition dealing with cannabis businesses.”
“Are they within that five percent amount or are they not at all because there’s a federal prohibition on cannabis sales?” the senator asked.
“I’m going to have to get back to you on the specifics,” Mnuchin replied.
“That’d be helpful to get clarity because there are cannabis businesses across the country that, if they fall in opportunity zones, they’ll need clarification on that,” Lankford said. “When you and I have spoken about it before—it’s difficult to give a federal tax benefit to something that’s against federal law.”
Lankford, who opposes legalization and appeared in a TV ad against his state’s medical cannabis ballot measure, has raised this issue with the Treasury secretary during at least two prior hearings. When he questioned whether cannabis businesses qualify for the program last year, he clarified that he personally does not believe they should.
While Mnuchin’s department has yet to issue guidance on the issue, he said in response to the earlier questioning that his understanding is that “it is not the intent of the opportunity zones that if there is this conflict [between state and federal marijuana laws] that has not been cleared that, for now, we should not have those businesses in the opportunity zones.”
Mnuchin has also been vocal about the need for Congress to address the lack of financial resources available to state-legal marijuana businesses. Because so many of these companies are forced to operate on a largely cash-only basis, he said the Internal Revenue Service has had to build “cash rooms” to store their tax deposits.
“There is not a Treasury solution to this. There is not a regulator solution to this,” he said during one hearing. “If this is something that Congress wants to look at on a bipartisan basis, I’d encourage you to do this. This is something where there is a conflict between federal and state law that we and the regulators have no way of dealing with.”
Last week’s Finance Committee hearing was centered around President Trump’s Fiscal Year 2021 budget request, which separately includes a provision calling for the elimination of an appropriations rider that prohibits the Justice Department from using its fund to interfere in the implementation of medical cannabis laws as well as a continued block on Washington, D.C. spending its own local tax dollars to legalize marijuana sales.
Photo courtesy of C-SPAN.
American Bar Association Wants Protections For Marijuana Banking And Lawyers Working With Cannabis Clients
The American Bar Association (ABA) approved two marijuana-related resolutions during its midyear meeting on Monday.
The group’s House of Delegates voted in favor of proposals endorsing pending federal legislation to protect banks that service cannabis businesses and calling for a clarification of rules to ensure that lawyers will not be penalized for representing clients in cases concerning state-legal marijuana activity.
Under the banking resolution, ABA “urges Congress to enact legislation to clarify and ensure that it shall not constitute a federal crime for banking and financial institutions to provide services to businesses and individuals, including attorneys, who receive compensation from the sale of state-legalized cannabis or who provide services to cannabis-related legitimate business acting in accordance with state, territorial, and tribal laws.”
HOD Res 103D: Adopted. Urges enactment of laws to ensure that it shall not constitute a federal crime for banks and financial institutions to provide cannabis-related services. #ABAMidyear
— American Bar Association (@ABAesq) February 17, 2020
ABA added that “such legislation should clarify that the proceeds from a transaction involving activities of a legitimate cannabis-related business or service provider shall not be considered proceeds from an unlawful activity solely because the transaction involves proceeds from a legitimate cannabis-related business or service provider, or because the transaction involves proceeds from legitimate cannabis-related activities.”
A bill that would accomplish this goal was approved by the House of Representatives last year, but it’s currently stalled in the Senate, where it awaits action in the Banking Committee. That panel’s chair, Sen. Mike Crapo (R-ID) is under pressure from industry stakeholders to advance the legislation, but he’s also heard from anti-legalization lawmakers who’ve thanked him for delaying the bill.
“Passage of the [Secure and Fair Enforcement] Banking Act or similar legislation will provide security for lawyers and firms acting to advise companies in the industry against having their accounts closed or deposits seized,” a report attached to the ABA resolution states. “This will also foster the rule of law by ensuring that those working in the state-legalized legitimate cannabis industry can seek counsel and help prevent money laundering and other crimes associated with off-the-books cash transactions.”
“Currently, the threat of criminal prosecution prevents most depository institutions from banking clients, including lawyers, who are in the stream of commerce of state-legalized marijuana. This Resolution is necessary to clarify that such provision of legal and other services in compliance with state law should not constitute unlawful activity pursuant to federal law.”
The second marijuana-related resolution ABA adopted on Monday asks Congress to allow attorneys to serve clients in cannabis cases without facing federal punishment.
Text of the measure states that the association “urges Congress to enact legislation to clarify and explicitly ensure that it does not constitute a violation of federal law for lawyers, acting in accord with state, territorial, and tribal ethical rules on lawyers’ professional conduct, to provide legal advice and services to clients regarding matters involving marijuana-related activities that are in compliance with state, territorial, and tribal law.”
HOD Res 103B: Adopted as revised. Urges enactment of laws to ensure lawyers can provide legal advice and services for clients' legal marijuana-related activities. #ABAMidyear
— American Bar Association (@ABAesq) February 17, 2020
Such a change would provide needed clarity for lawyers as more states legalize cannabis for adult use. ABA’s own rules of conduct have been a source of conflict for attorneys, as it stipulates that they “shall not counsel a client to engage, or assist a client, in conduct that the lawyer knows is criminal or fraudulent.” Federal law continues to regard marijuana as an illegal, strictly controlled substance.
An ABA report released last year made the case that there’s flexibility within that rule, however, as “it is unreasonable to prohibit a lawyer from providing advice and counsel to clients and to assist clients regarding activities permitted by relevant state or local law, including laws that allow the production, distribution, sale, and use of marijuana for medical or recreational purposes so long as the lawyer also advises the client that some such activities may violate existing federal law.”
A new report attached to the resolution states that “statutory guidance is needed that explicitly ensures that attorneys who adhere to their state ethics rules do not risk federal criminal prosecution simply for providing legal counsel to clients operating marijuana businesses in compliance with their state law.”
“This Resolution accomplishes this elegantly by harmonizing federal criminal liability with States’ ethical rules regarding the provision of advice and legal services relating to marijuana business. If a state has legalized some form of marijuana activity and explicitly permitted lawyers to provide advice and legal services relating to such state-authorized marijuana activity, such provision of advice and legal services shall not be unlawful under the Controlled Substances Act or any other federal law.”
Last year, ABA adopted another cannabis resolution—arguing that states should be allowed to set their own marijuana policies.
Border Patrol Union Head Admits Legalizing Marijuana Forces Cartels Out Of The Market
The head of the labor union that represents U.S. Border Patrol agents acknowledged on Friday that states that legalize marijuana are disrupting cartel activity.
While National Border Patrol Council President Brandon Judd was attempting to downplay the impact of legalization, he seemed to inadvertently make a case for the regulation all illicit drugs by arguing that cartels move away from smuggling cannabis and on to other substances when states legalize.
Judd made the remarks during an appearance on C-SPAN’s Washington Journal, where a caller said that “the states that have legalized marijuana have done more damage to the cartels than the [Drug Enforcement Administration] could ever think about doing.”
“As far as drugs go, all we do is we enforce the laws. We don’t determine what those laws are,” Judd, who is scheduled to meet with President Trump on Friday, replied. “If Congress determines that marijuana is going to be legal, then we’re not going to seize marijuana.”
“But what I will tell you is when he points out that certain states have legalized marijuana, all the cartels do is they just transition to another drug that creates more profit,” he said. “Even if you legalize marijuana, it doesn’t mean that drugs are going to stop. They’re just going to go and start smuggling the opioids, the fentanyl.”
One potential solution that Judd didn’t raise would be to legalize those other drugs to continue to remove the profit motive for cartels. Former presidential candidate Andrew Yang made a similar argument in December.
Federal data on Border Patrol drug seizures seems to substantiate the idea that cannabis legalization at the state level has reduced demand for the product from the illicit market. According to a 2018 report from the Cato Institute, these substantial declines are attributable to state-level cannabis reform efforts, which “has significantly undercut marijuana smuggling.”
Additionally, legalization seems to be helping to reduce federal marijuana trafficking prosecutions, with reports showing decreases of such cases year over year since states regulated markets have come online.
In his annual report last year, Supreme Court Chief Justice John Roberts also noted reduced federal marijuana prosecutions—another indication that the market for illegally sourced marijuana is drying up as more adults consumers are able to buy the product in legal stores.