Black and white photograph of a cannabis nug and a long-armed leaf protruding away from it.

Sarah Climaco

Lawmakers and Cannabis Industry Stakeholders React to Federal Policy Change

Attorney General Jeff Sessions has officially released the memo rescinding the Obama-era protections of the Cole Memo, which barred federal prosecutors from taking legal action against state-legal cannabis companies.

And, while the memo does not outline new enforcement directives, it includes language allowing federal prosecutors to bring cases against cannabis businesses.

“In deciding which marijuana activities to prosecute under these laws with the [Justice] Department’s finite resources, prosecutors should follow the well-established principles that govern all federal prosecutions…Given the Department’s well-established general principles, previous nationwide guidance to marijuana enforcement is unnecessary and is rescinded, effective immediately,” the memo states.

The announcement caused a dip in both U.S. and Canadian cannabis stocks, and outcry from both U.S. lawmakers and industry operators. Washington Gov. Jay Inslee, said the state “will vigorously defend” the state’s adult-use and medical cannabis laws “against undue federal infringement.”

“In Washington state, we have put a system in place that adheres to what we pledged to the people of Washington and the federal government,” Inslee said in a statement. “We are going to keep doing that and overseeing the well-regulated market that Washington voters approved.”

Colorado Sen. Cory Gardner, a Republican who opposed legalization, went so far as to threaten to hold up Department of Justice nominations.

“Up until about 8:58 this morning we believed, in Colorado, that state’s rights would be protected. Up until about 8:58 – or maybe it was 8:55 – until Twitter told us otherwise, we believed the will of Colorado voters would be respected. Why did we believe that? Well, conversations that I had with then-Sen. Jeff Sessions prior to his confirmation as Attorney General about Colorado’s marijuana policy.” Gardner said during remarks on the Senate floor. “Sen. Sessions told me marijuana wasn’t going to be on President Trump’s agenda. … Up until 8:58 this morning that was the policy.I would like to know from the Attorney General – what has changed?”

Oregon Attorney General Ellen Rosenblum called the new policy “another example of [the] administration’s overreach” and vowed to “do everything” within her legal authority to protect the state regime.

“Lat year in Oregon we collected over $60 million in state taxes as a result of out now legal marijuana industry. At the Oregon Department of Justice we will continue to make sure Oregon’s legal industry thrives under our carefully considered state regulatory requirements,” she said in a statement. “I value my working relationship with Oregon U.S. Attorney-nominee Bill Williams and I look forward to working with his office.”

Jesse Peters, CEO of Oregon cannabis licensee Eco Firms Farms, said operators and activists “must determine the cannabis reform positions” of local federal prosecutors in legal states.

“Cannabis has higher approval ratings than apple pie and our country watches with heavy hearts as it’s often disregarded by those positioned to represent the will of the people,” Peters said in a statement. “This needs to be addressed: Call your Representatives, call your Congress-people, and be heard. It is our duty and our right to speak out – a privilege we are afforded by the sacrifices of many.”

Activists march in the street during a protest for the legalization of cannabis. Photo Credit: Sebastian Dooris

Representatives for iAnthus Capital Holdings, which operates dispensaries in New York and Vermont and invests in cannabis companies in the US and Canada, opined that it is “unlikely that the President will allow the Attorney General’s personal bias against marijuana use to damage the President’s political brand or that of his party.”

“The Cole Memo was not a federal law and did not alter the DOJ’s authority or discretion to enforce federal drug laws, which discretion continued after the Cole Memo was adopted in 2013. Accordingly, iAnthus’ management believes the rescinding of the Cole Memo does not indicate any specific change in DOJ enforcement policy,” the statement says. “There is no new policy that directs or demands the U.S. Attorneys to prosecute individuals in states where marijuana programs are legal. U.S. Attorneys will continue to have the same wide prosecutorial discretion that they had prior to today.”

And in Massachusetts, where voters approved legalization in 2016 but regulators have until July to implement the program, the state Cannabis Control Commission said their role remains the same: “To fulfill the will of the voters.”

“Our priority has always been to protect public safety and develop regulations that are compliant with all laws including those passed by the voters and the legislature legalizing the recreational use of marijuana in the Commonwealth,” the statement says. As for as the mandate and the work of the Cannabis Control Commission is concerned nothing has changed.”

The National Cannabis Industry Association, which represents over 1,500 cannabis-related businesses nationwide, called the policy change “disturbing.”

“But, the rescinding of this memo does not necessarily mean that any major change in enforcement policy is on the horizon. This has been, and still will be, a matter of prosecutorial discretion,” the organization said in a statement. “We therefore hope that Department of Justice officials, including U.S. Attorneys, will continue to uphold President Trump’s campaign promise to not interfere with state cannabis programs, which have been overwhelmingly successful in undercutting the criminal market.”

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