The Supreme Court never had the slightest intention of hearing the Canna Provisions appeal, an outcome that has been obvious for at least six months (when the Court of Appeals opinion was issued). Canna Provisions and several other cannabis businesses doing business in Massachusetts challenged the application of Schedule I of the Controlled Substances Act to cannabis grown and sold entirely within a state.
To begin with, it should be made clear that there is a 2005 Supreme Court decision, Gonzales v. Raich, on this exact issue, so it’s a big hurdle to overcome to ask the Supreme Court to overrule a relatively recent decision. Canna Provisions advanced two central arguments—the first is that the circumstances of the cannabis market have changed so much that the Raich factual analysis is now wrong. The second argument is that Congress has passed legislation demonstrating that cannabis no longer belongs in Schedule I. The First Circuit Court of Appeals emphatically disagreed with those arguments, pointing out that the facts had not changed enough to make Congress’ Schedule I classification irrational as part of a comprehensive regime of drug regulation (the relevant test). The Court further noted that the federal funding restrictions were limited to medical cannabis (Canna Provisions does not sell medical cannabis) and were limited in other ways.
The 3-0 First Circuit opinion is unrelentingly critical of Canna Provisions’ arguments and even takes some shots at the way the law firm, Boies Schiller, argued the case. Anyone reading the opinion would not view this case as being remotely a suitable candidate for being taken up by the Supreme Court.
And the Canna Provisions petition for certiorari implicitly concedes as much. Reading the petition’s legal analysis, it seems like a different case altogether. Petitioner now seems to have discovered the concurring opinion (Scalia) and dissenting opinions (O’Connor and Thomas) in Raich, advancing the arguments that should have been made starting at trial level. Even the cases cited in the cert petition are significantly different from the cases cited in the legal analysis below. The Supreme Court has no desire to hear a case in which the most important issues are raised in the petition for certiorari rather than being fully briefed and argued in the proceedings in the District Court and Court of Appeals.
The Pacific Legal Foundation, a libertarian/conservative public interest law firm, filed an amicus brief asking the Supreme Court to hear the case. The brief focused on the origins and proper interpretation of the Commerce Clause and the Necessary and Proper Clause in the Constitution. Americans for Prosperity Foundation, a conservative foundation, and the Cato Institute, a libertarian foundation, also filed amicus briefs making similar points. All three organizations assert that Canna Provisions is an ideal vehicle for curbing Congressional overreach under the Commerce Clause and Necessary and Proper Clause. All three organizations contend that the Controlled Substances Act as applied to Canna Provisions would not withstand an appropriate level of scrutiny.
However, all three organizations are sophisticated players in the Washington D.C. conservative nonprofit world, and they knew there was no chance that the Supreme Court would hear the case. These briefs are performative, evidence of their positions in favor of limiting the Commerce Clause and signaling to donors that they are fighting the good fight. Nevertheless, the amicus briefs underline what was missing from the Boies Schiller efforts—any arguments designed to appeal to the conservative majority on the Supreme Court.
While it is difficult to understand how a big-name firm made such fundamental errors in its litigation strategy, perhaps the more interesting question is why the cannabis companies funding the litigation failed to see the issue. One possible explanation concerns the fact that top tier law firms won’t take cannabis clients due to the federal illegality of their business. Cannabis industry executives can’t get the best and brightest litigators to take their phone calls, so they’re stuck with ones who will. Rescheduling won’t change that reality, either. Perhaps the Canna Provisions outcome will serve as a wakeup call to industry leaders that they need to rethink some of their strategies.
James B. Mann is a cannabis tax attorney who helps public and private cannabis companies with tax planning to minimize current liability. He serves as special counsel at Harris Beach Murtha and is a partner at the Law Offices of James B. Mann.