BREAKING: Judge Orders Feds to Stop Enforcement Against California Marijuana Dispensary

A shocking new development occurred yesterday in the ongoing battle between state-legal medical marijuana facilities and U.S. Department of Justice (“DOJ”) enforcement of the Controlled Substances Act (“CSA”). In a case now spanning more than 17 years, a federal judge in California ordered the United States government to stop enforcing the CSA against Marin Alliance for Medical Marijuana (“MAMM”). We’ll get to the how and why momentarily, but first, some background.

We are jumping for joy over Judge Dreyer's ruling, but we can't help but have our doubts.
We are jumping for joy over Judge Dreyer’s ruling, but we can’t help but have our doubts.

In 1998 the DOJ filed suit against MAMM and five other medical marijuana dispensaries on the grounds that they were distributing marijuana in violation of the CSA. In 2002, a permanent injunction was entered against MAMM, ordering it to cease distribution of cannabis. Then nothing happened for nine years; MAMM continued its operations, and the DOJ stayed mum. In 2011, the DOJ issued cease and desist letters to MAMM and others, followed by a new round of forfeiture proceedings. MAMM’s landlord eventually settled with the DOJ, and MAMM was forced to close its doors. Throughout these several cases there was no dispute that MAMM was operating in compliance with California’s Compassionate Use Act of 1996; in fact, the Fairfax, CA mayor, in a letter to US Attorney Melinda Haag and in court filings has consistently stated that MAMM is a “model business” and has carefully followed the conditions of its local use permit to the letter. (For more on the benefits of making nice with your municipality, check out Your Marijuana Business and Your City: Friendship is Best.)

In June of this year, MAMM filed a motion asking the court to revisit the permanent injunction entered against it, in light of the Rohrabacher-Farr amendment, also known as § 538 of the Consolidated and Further Continuing Appropriations Act of 2015. As readers may recall, the amendment to the massive 2015 spending bill was intended by its sponsors and supporters to prevent the enforcement of the CSA against medical marijuana patients and the dispensaries that serve them by cutting off funding for such enforcement activity. Problem is, the language of § 538 has been open to some interpretation.

Cue the Honorable Judge Charles R. Breyer of the US District Court for the Northern District of California, who has overseen the MAMM case since its infancy. In its motion, MAMM argued that § 538 effectively prevents the continuing enforcement of the permanent injunction against it. Yesterday Judge Breyer agreed. In a thirteen-page order (available here), Breyer held that § 538 “prohibits the Department of Justice from expending any funds in connection with the enforcement of any law that interferes with California’s ability to implement [its] own State law[] that authorize[s] the use, distribution, possession, or cultivation of medical marijuana.” Although Breyer did not grant MAMM’s request to lift the injunction, he did order that the injunction could only be enforced against MAMM insofar as MAMM violated California state law. Since MAMM’s compliance with California law was never at issue, it is essentially back to business as usual for MAMM (assuming, of course the DOJ doesn’t seek reconsideration or immediate appeal including an injunction pending appeal, which it almost certainly will).

How sound is Breyer’s ruling? Well…

After the passage of the Rohrabacher-Farr amendment as part of the Cromibus in Summer 2014, we warned that the language just wasn’t what it should be. Let’s parse it once again:

None of the funds made available in this Act to the Department of Justice may be used, with respect to the States of Alabama, Alaska, Arizona, California … [all MMJ states], to prevent such states from implementing their own State laws that authorize the use, distribution, possession, or cultivation of medical marijuana.

Notice that the word “enforcement” is nowhere to be found. Just two months ago we again stressed that medical marijuana prosecutions were not likely to cease as a result of Rohrabacher-Farr. As we see it, the bottom line is that if this provision was intended to prevent enforcement of the CSA, why didn’t it just come straight out and say so? “Prevent such states from implementing?” Huh?

This is exactly what the DOJ argued in opposing MAMM’s motion:

[Section 538 prohibits] the use of appropriated funds to “prevent” states from “implementing their own” medical marijuana laws. Such prohibited uses could include, for example, federal actions that interfered with a state’s promulgation of regulations implementing its statutory provisions, or with its establishment of a state licensing scheme. However, such uses do not include CSA enforcement actions against individuals or private businesses because such actions do not prevent a State from implementing its own laws . . . . [T]here is no evidence in the record that California has been impeded in any way in implementing its own State laws during the thirteen years the permanent injunction at issue has been in effect.

Judge Breyer, however, disagreed, finding the government’s reading of § 538 “tortured.” In the court’s view, the DOJ was arguing that the closure of just one dispensary does not interfere with implementing state MMJ law, an argument Breyer deemed contradictory, since in the aggregate, enforcement actions would gut the Compassionate Use Act. Instead, Breyer took a “plain language” reading of § 538 and the dictionary definition of “implement” to conclude that he must enforce § 538 “according to its terms.” Though he claimed not to rely upon it (despite devoting more than two pages to its recitation), Breyer also took comfort in the legislative history of the Rohrabacher-Farr amendment, which unequivocally supports MAMM’s position and Judge Breyer’s ruling.

As skeptical as we were (and are) about the correct interpretation of Rohrabacher-Farr, Judge Breyer was equally intent in his own reading, taking the government to task for arguing “that it does not ‘prevent’ California from ‘implementing’ its medical marijuana laws by shutting down these same heavily-regulated medical marijuana dispensaries.” We whole-heartedly agree that government actions that truly prevent implementation of state laws (in the sense advocated for by the DOJ) would effectively undermine and destroy state MMJ laws; without a state law regime, no dispensaries would exist and no patients would be served, an outcome Rohrabacher-Farr clearly did not intend. This would produce what is known in law as an “absurd result.” As a general matter, courts always try to avoid reading statutes to avoid absurd results, but sometimes the reading that would be required is just too twisted and the absurd result cannot be escaped. Breyer could have reached this same conclusion, but he seemed swayed by the clear intent of the amendment’s sponsors, including their recent admonishment to Attorney General Holder that the DOJ has misinterpreted § 538. (As lawyers we must point out that resorting to legislative history as an interpretive tool generally is not supposed to happen if the language of the statute is clear.)

There is no question Breyer’s order will quickly be cited by every medical marijuana defendant in the country facing some type of CSA enforcement, especially defendants like Harborside Health Center and perhaps. The strength of that citation, however, remains to be seen. The United States v. MAMM decision is still just one judge’s opinion among 14 judges in his district, and one of 60 federal judges in California. There are more than 600 federal trial judges in our fifty states and territories, and decisions of trial judges are not binding precedent. The likelihood of judicial disagreement over the import and meaning of § 538 is near certain. If Breyer’s ruling is upheld on appeal by the Ninth Circuit, however, then it may really gain traction.

Don’t get us wrong – we would love to rally around Rohrabacher-Farr, hailing it as the end of federal efforts to enforce the CSA, and celebrate this case as groundbreaking. But we cannot help but worry that § 538’s language is just too weak and that Breyer may have gone out on a limb. Unless and until Rohrabacher, Farr, or some other Congressional leaders get it together and fix the language, these cases and the fights over the correct meaning of § 538 will continue.

One case down, but standby for more.