Justices Weigh Case of Truck Driver Fired After CBD Oil Use (1)

The Supreme Court seemed divided over whether a truck driver can sue the maker of a CBD hemp oil he alleges cost him his job under a federal law that was designed to fight organized crime.

The Racketeer Influenced and Corrupt Organizations Act allows someone to sue for three times their damages and recover attorneys’ fees when their business or property is hurt by a criminal enterprise, but Justice Clarence Thomas questioned if loss of income from being fired is a business injury.

Douglas Horn argues it is. He sued Medical Marijuana Inc. and Dixie Holdings LLC in 2015 for lost wages under the RICO Act after he took its CBD hemp oil Dixie X to treat his chronic pain from a trucking accident and then was fired for failing a routine drug test.

Horn claims he never would have taken the product if he knew it contained THC and that everything he read said it didn’t.

“So the injury here is we were fired,” said Horn’s attorney Easha Anand. “That’s the injury to our business.”

A trial court tossed out Horn’s RICO claims but the US Court of Appeals for the Second Circuit reversed that ruling. The appeals court said Horn’s termination was an injury to his business.

He’s now seeking an amount equal to the salary he would have made and other economic benefits he would have gotten had he remained in employed, Anand explained during ther hour-long arguments on Tuesday.

“But Medical Marijuana did not fire you,” Thomas countered.

The manufacturers of Dixie X argue RICO doesn’t allow someone to recover damages that are caused by a personal injury.

Justice Ketanji Brown Jackson struggled to understand why the companies are claiming there was a personal injury when Horn isn’t claiming he got ill because of the product.

“He’s not saying he was personally injured,” she said. “He didn’t even know that he had ingested THC until the testing and the firing.”

The companies’ attorney Lisa Blatt said that doesn’t matter.

“If I ate poppyseed bagels and failed a drug test, it’s a personal injury. If I took a medicine like doxycycline, which is an antibiotic, and I can’t be out in the sun and I lose my job as a lifeguard, it’s a personal injury claim,” she said.
But referring back to Jackson’s earlier point, Justice Sonia Sotomayor said “the harm is not ingesting the drugs.”

“That’s the personal injury. The harm is from being fired,” she said.

Even Horn’s attorney Easha Anand said she didn’t think ingesting the THC is critical to her client’s case. She said they would have brought the same RICO suit if the product had been found in Horn’s work locker and that caused him to get fired.

‘Dramatic Shift’

Siding with Horn, Blatt warned will cannibalize state tort law and make every slip and fall personal injury case a RICO case.

That was an argument that seemed to resonate with Justice Brett Kavanaugh. He said any lawsuits over a product that’s falsely advertised or has inadequate warnings could easily be made into a RICO case.

“I’m not saying it’s right or wrong, but I think it’s a dramatic shift,” he said.

Anand tried to assuage those concerns. She said RICO has a number of guardrails that will prevent these average product liability cases from becoming RICO cases.

In the “mine-run of cases, the big chunk of recovery is pain and suffering or economic distress, and you cannot got those under civil RICO right? Those are not injuries to business or property,” she said.

Chief Justice John Roberts didn’t seem convinced.

“Well, again, you’re talking about these other guardrails, not to worry about the fact that you’re diluting the business or property requirement,” he said.

Anand disagreed with that characterization of her position.

“We think that lost employment is a classic business injury,” she said.

Anand is co-director of the Supreme Court Litigation Clinic at Stanford Law School. Blatt chairs the Supreme Court and appellate practice at Williams & Connolly LLP.

The case is Medical Marijuana, Inc. v. Horn, U.S., No. 23-365, oral arguments 10/15/24.