U.S.: Feds Have No Viable Legal Challenge To Marijuana Legalization, Admits Deputy A.G.

JamesColeDeputyAttorneyGeneral

By Steve Elliott
Hemp News

The U.S. Justice Department doesn't have a viable legal basis on which to challenge marijuana legalization laws in Colorado and Washington, Deputy Attorney General James Cole admitted on Sunday.

"It would be a very challenging lawsuit to bring," Deputy Attorney General Cole said while testifying at the first Congressional hearing on cannabis legalization in the two states, reports Jacob Sullum at Forbes.

Cole said that simply repealing state penalties for growing, possessing, and selling marijuana does not create a "positive conflict" with the Uniform Controlled Substances Act.

He argued that the feds would be on firmer legal ground if they tried to preempt state licensing and regulation of cannabis businesses which are newly legal under state law. But the deputy attorney general said that approach would mean that if such litigation were successful, it would leave the industry unregulated.

That's why the Department of Justice decided on the approach summarized in the memo Cole issued on August 29, limiting federal enforcement to cases that involve eight "federal concerns," including sales to minors, drugged driving, and diversion of marijuana to other states.

"We have reserved quite explicitly the right to go in and preempt at a later date," Cole said, summarizing the DOJ's policy as "trust, but verify."

"This was a mess," Sen. Sheldon Whitehouse (D-R.I.) said at Sunday's hearing. Whitehouse welcomed Cole's memo as a clarification of the Obama Administration's inconsistent policy on medical marijuana, which started by assuring state-legal suppliers they didn't have to worry about federal prosecution, followed by letters from U.S. Attorneys who said complying with state laws wouldn't protect anyone but patients.

"As long as they are not violating any of the eight federal priorities, the federal government is not going to prosecute them," Cole said. But if those eight priorities don't make for a viable prosecution, he added, U.S. Attorneys might decide to target state-legal cannabis businesses for other, unspecified reasons, as indicated in the last sentence of his memo:

"Nothing herein precludes investigation or prosecution, even in the absence of any one of the factors listed above, in particular circumstances where investigation and prosecution otherwise serves an important federal interest," the memo equivocates.

Cole claimed that "catch-all" is "not meant to swallow the entire memo," but the fact is, that language leaves federal prosecutors with the leeway to prosecute almost anyone whom they wish, even in legal states. Causing additional concern is the fact that several U.S. Attorneys in states with legal medical or recreational marijuana have already said the new federal directive will have no effect on their choices of whom to prosecute.

Besides seeming to promise restraint on the part of federal prosecutors, Cole also said the DOJ is working with federal banking regulators to address banks' fear of working with marijuana businesses, which are forced to operate on a cash-only basis because financial institutions don't want to incur federal wrath by accepting their deposits.

"We agree it is an issue we need to deal with," Cole said in response to a question from Senate Judiciary Committee Chairman Patrick Leahy (D-Vt.). "There is a public safety concern when businesses have a lot of cash lying around."

Cole denied that the Drug Enforcement Administration had warned armored-car services not to do business with cannabis sellers. "DEA was merely asking questions of the armored car companies as to what their practices are," Cole claimed, adding that the "questions" came before his memo.

The deputy attorney general said the inability of marijuana businesses to deduct expenses on federal tax returns would have to be fixed by Congress through legislation.