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Navigating the Tricky Waters of Medical Marijuana – Your Questions Answered

May 29, 2018, 1:00 PM

Legal marijuana continues to take the country by storm. This is particularly true for medicinal or medical marijuana, which is currently permitted in one form or another in twenty-nine states and the District of Columbia. Medical marijuana creates unique headaches for the health-care industry as it must address medical marijuana on two fronts: (1) patients and long-term care residents, and (2) employees. This article looks at how we got here and identifies best practices from both an administrative and an employment perspective.

Are federal authorities prosecuting individuals or companies for medical marijuana?

The short answer is not right now, and the reason why may surprise you. Marijuana is and has always been illegal under the federal Controlled Substances Act (“CSA”). (21 U.S.C. §§ 801, et seq.) The CSA was passed as Title II of the Comprehensive Drug Abuse Prevention and Control Act of 1970. It was signature legislation signed by President Nixon and as a whole, formed the backbone of the “war on drugs.” Marijuana has always been a Schedule 1 substance, along with heroin, LSD, and ecstasy, for example. (21 U.S.C. § 812, Schedule I.) As a Schedule 1 substance, according to federal law, marijuana has a high potential for abuse and no currently accepted medical use. (21 U.S.C. § 812(b)(1).) In turn, the possession or use of marijuana for any reason is illegal under the CSA.

Despite this broadly worded statute, under the Obama administration, a number of guidance memos were distributed throughout the Department of Justice. These memos culminated with the “Cole memo,” authored by Deputy Attorney General James Cole. The Cole memo provided guidance on marijuana enforcement “in light of state ballot initiatives to legalize under state law the possession of small amounts of marijuana and to provide for the regulation of marijuana production, processing, and sale.” (Cole memo., p. 1, ¶ 1). In short, the Cole memo directed a more hands-off approach in “jurisdictions that have enacted laws legalizing marijuana in some form and that have also implemented strong and effective regulatory and enforcement systems to control the cultivation, distribution, sale and possession of marijuana.” (Id., p. 3, ¶ 1.) The Cole memo was comprehensive in that it applied to “all federal enforcement activity, including civil enforcement, criminal investigations and prosecutions, concerning marijuana in all states.” (Id., p. 1, ¶ 1.)

For nearly five years, the Cole memo largely relegated marijuana control and enforcement to the states. Then, on Jan. 4, 2018, Attorney General Jeff Sessions issued a memo rescinding the Cole memo and the guidance memos related to it. Sessions stated that his memo was intended to return prosecutorial discretion to local U.S. Attorneys and other on-the-ground personnel. Commentators largely viewed the memo as signaling the DOJ’s intent to prosecute marijuana-related activities in states that have legalized it.

Regardless of what the current attorney general the DOJ may want, Congress has largely prohibited federal authorities from taking legal action against businesses and individuals participating in state-run medical marijuana programs. These efforts began in conjunction with the Cole Memo and led to the then-named Rohrabacher-Farr Amendment. The Amendment, today known as the Rohrabacher-Blumenauer Amendment, is a budgetary amendment that expressly prohibits the DOJ from using any funds whatsoever to interfere with state-run medical marijuana programs. The Amendment has survived legal challenges, mainly in the criminal context. (See, e.g., United States v. Tote, 2015 BL 187068, at *3 (E.D. Cal. June 12, 2015) (“Defendant cites no authority which suggests that the proper remedy for the expenditure of funds in violation of the Rohrabacher–Farr Amendment would be the dismissal of the information against Defendant when Congress chose not to repeal the statutory provisions giving rise to criminal liability against Defendant.”).) And it has been continuously adopted since 2014, including on March 27 when Congress approved the most recent budget. The Amendment next expires on September 30, 2018, along with all other federal funding. So the reason federal authorities are not prosecuting individuals and companies for medical marijuana has little to do with ideology and politics, and everything to do with a lack of funding.

Are CBD products illegal under federal law?

The short answer is yes, and the long answer changes depending on who you ask. Putting aside the botany specifics, marijuana (scientifically known as cannabis) contains a number of different compounds—chief among them are tetrahydrocannabinol, or THC, and cannabidiol, or CBD. THC is what produces marijuana’s “high.” CBD, by comparison, is generally considered not to produce a “high” or any other intoxicating effect. CBD is also generally considered to be a viable option for treating certain medical conditions, such as epilepsy, anxiety disorders, and chronic pain. When intended for medical use, CBD products often do not contain THC—or they contain de minimis amounts of THC—especially if intended for use by minors.

Regardless of whether CBD products can be made without THC, they remain illegal under federal law. Both the Drug Enforcement Agency and the Food and Drug Administration take the position that because CBD is derived from marijuana, it is treated no differently under the CSA. CBD is a Schedule I substance; therefore, the possession or use of CBD products for any reason is illegal under federal law.

Senator Mitch McConnell recently introduced a bill related to the farming and processing of hemp. (See S. 2667 – Hemp Farming Act of 2018). Hemp, like marijuana, is part of the cannabis family, and, like marijuana, CBD can be extracted from it. Unlike marijuana, hemp has virtually no amount of THC. In short, Senator McConnell’s bill sets the stage for CBD to be decriminalized at the federal level, provided the CBD is extracted from hemp, not marijuana. For now, however, all CBD products remain illegal under federal law.

What if a patient or resident wants to use medical marijuana or a “no THC” CBD product?

Unfortunately this question has too many variables for a one-size-fits-all answer. That said, the CSA makes it illegal to “knowingly open, lease, rent, use, or maintain any place . . . for the purpose of . . . distributing or using [marijuana].” (21 U.S.C. § 856(a)(1).) It is also illegal for a company or individual, in any capacity, to make any place available for the “storing, distributing, or using” marijuana. (21 U.S.C. § 856(a)(2).) Based on this, it at least appears that allowing a patient or resident to use medical marijuana, or even a “no THC” CBD product, would violate federal law. Criminal prosecution is unlikely for the time being given the DOJ’s lack of funding. However, the receipt of federal funding is almost always conditioned on compliance with federal law. For this reason, running afoul of the CSA may put at risk a company’s or entity’s receipt of federal funds.

Can an employee be disciplined or fired for using medical marijuana?

Yes. Marijuana use or possession in the workplace is grounds for disciplinary action, up to and including immediate termination. Not only is medical marijuana illegal under federal law, but like alcohol, marijuana is an intoxicant. For this reason alone, employers can take disciplinary action based on medical marijuana use or possession in the workplace, up to and including immediate termination. Additionally, because CBD products remain illegal under federal law, employers can take disciplinary action based on their use or possession in the workplace.

The result is the same if an employee uses medical marijuana (or a CBD product) away from work and, for example, fails a drug test. Please note the distinction between knowing an employee is using medical marijuana, e.g., based on a positive drug test, and suspecting medical marijuana use, e.g., the employee has a medical marijuana card. Like all employment decisions, care should be taken to base them on actual knowledge, not suspicions.

Please also note that employment decisions may require closer consideration in certain states. There are, for example, at least nine states that arguably offer some degree of workplace protections related to medical marijuana: Arizona, Arkansas, Colorado, Connecticut, Illinois, Massachusetts, New York, Pennsylvania, Rhode Island, and West Virginia. In at least three of these states—Massachusetts, Connecticut, and Rhode Island—courts have refused to dismiss lawsuits filed by individuals terminated (or not hired) because of medical marijuana. The most troubling case comes out of Massachusetts.

In the Connecticut and Rhode Island cases, rejected applicants filed suit alleging, among other things, that they were not hired because they were participating in the respective state’s medical marijuana program. In both cases, the employers sought dismissal. The employers argued that whether the applicants were participating in a medical marijuana program was irrelevant because the applicants had admitted to using marijuana. Because of this admission, reasoned the employers, the applicants’ failure-to-hire theory should fail as a matter of law. This argument was rejected by both courts. While the courts took different paths, both concluded that it could not determine as a matter of law whether the employers failed to hire the applicants because of marijuana use, or because of participation in the respective state’s medical marijuana program. (See Callaghan v. Darlington Fabrics Corp., 2017 BL 216178 (R.I. Super. Ct. May 23, 2017); Noffsinger v. SSC Niantic Operating Co. LLC, 273 F. Supp. 3d 326 (D. Conn. Aug. 8, 2017).)

In Massachusetts, an employee was fired for actively using medical marijuana. The employee sued for wrongful termination. In response, the employer argued that the employee was terminated for using marijuana and succeeded in getting the lawsuit dismissed. On appeal, however, the dismissal was reversed. The Massachusetts Supreme Judicial Court held that because using medical marijuana was allowed by state law, the employee’s lawsuit should not have been dismissed at such an early stage. (See Barbuto v. Advantage Sales & Mktg., LLC, 78 N.E.3d 37 (Mass. 2017).)

As these court cases show, if your company operates in multiple “medical marijuana” states, policies and approaches to medical marijuana must be tailored for each.

Do I have to make workplace accommodations for employees using medical marijuana?

Not quite. Broadly stated, marijuana use does not have to be tolerated in any form or at any time. This includes workplace accommodations. Every federal court to consider the issue has held that marijuana use is neither protected nor, for example, a reasonable accommodation under the Americans with Disabilities Act (“ADA”).

To start, as noted above, marijuana is an intoxicant. As such, an employee would be hard pressed to describe the use of marijuana as reasonable. That aside, marijuana and CBD remain illegal under federal law. Thus, they fall within the “illegal use of drugs” exclusion to the ADA. (42 U.S.C. § 12210(d)(1).) The ADA, therefore, does not apply. (See, e.g., James v. City of Costa Mesa, 700 F.3d 394, 398 (9th Cir. 2012) (generally discussing the issue); see also Forest City Residential Mgmt., Inc. ex rel. Plymouth Square Ltd. Dividend Hous. Ass’n v. Beasley, 71 F. Supp. 3d 715, 730-31 (E.D. Mich. 2014) (not reasonable accommodation under Fair Housing Act or Rehabilitation Act).)

While this is good news for companies, it does not provide the answer to every question or situation. Take, for example, an employee asking to use medical marijuana outside of the workplace to treat a medical condition. While this may not be a reasonable accommodation under the ADA, the employer should still engage in the interactive process required by the ADA. Moreover, a general request for leave to treat a medical condition may trigger an employer’s obligations under the Family and Medical Leave Act. (See 29 U.S.C. §§ 2601, et seq.)

As another example, say an employer learns from social media that two employees used medical marijuana outside of the workplace. If one employee is terminated but the other is not, this inconsistency could be seen as discriminatory should employees be different races, genders, etc. Or say an employer learns an employee sometimes uses marijuana outside of the workplace not just for medical purposes but in connection with a religious practice or ritual. This may provide an employer grounds for drug testing the employee, but using it as grounds for immediately terminating the employee will likely give rise to a charge of religious discrimination.

Does my company need to change its drug testing policy?

It depends. If the policy has not been reviewed in some time, it likely needs to be updated as a matter of course. Beyond that, whether under the federal Drug Free Workplace Act, see 41 U.S.C. § 8102, or in connection with a state’s workers’ comp. program, companies can still require a drug-free workplace. Also, because marijuana is illegal under federal law, testing for it is not a medical examination under the ADA. Therefore, the ADA’s restrictions on medical examinations and inquiries do not apply. However, given that many drug tests cover substances beyond marijuana—including prescription medications—employers are strongly encouraged to maintain drug testing programs in compliance with the ADA, or a state’s law if and when it provides heightened requirements. For general guidance on medical examinations, inquiries, and drug testing under the ADA see U.S. Equal Employment Opportunity Commission, Enforcement Guidance on Disability-Related Inquiries and Medical Examinations of Employees Under the Americans with Disabilities Act.

Conclusion

The overall takeaway is this. As of now, marijuana in any form remains illegal under federal law. Accordingly, administrative and employment decisions adverse to the use of marijuana under any circumstances are generally defensible. By avoiding snap decisions and seeking informed advice, these marijuana-related decisions become more and more defensible.

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Zachary B. Busey practices out of Baker Donelson’s Memphis office. He is a member of the firm’s Cannabis Law & Regulation Team and its Labor & Employment Health Care Team. He can be reached at (901) 577-8164 or zbusey@bakerdonelson.com.

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