Cannabis businesses sue over federal ban

NORTHAMPTON — A cannabis business coalition is suing the U.S. attorney general over the federal government’s ban on the cultivation, production, possession and distribution of pot, saying it penalizes legal activities under state law.

The federal ban means that regulated marijuana businesses in Massachusetts and other states can’t use banks or take credit card payments, and they and their employees are excluded from federal programs and can’t get mortgages.

“It’s groundbreaking,” Northampton attorney Thomas Lesser said of the lawsuit. “Everyone expects this to end with the Supreme Court.”

The Lesser firm, Lesser, Newman, Aleo & Nasser, has represented New York-based lead counsel Boies Schiller Flexner in representing plaintiffs Gyasi Sellers, Canna Provisions and Wiseacre Farm in a lawsuit filed against Attorney General Merrick Garland in the U.S. District Court for the District of Massachusetts. helps. . Sellers is the founder and CEO of Treevit, a cannabis delivery service. Canna Provisions operates two dispensaries, one in Holyoke and one in Berkshire County, and Wiseacre Farm is the Berkshire County grower.

“We want to be on a level playing field with any other small business in Massachusetts,” said Meg Sanders, CEO and co-founder of Canna Provisions.

A fourth plaintiff, Verano Holdings, does business in Massachusetts.

Boies Schiller director David Boies is best known for three major jobs: leading the federal government’s successful prosecution of Microsoft in the late 1990s; Unsuccessful representation of Democratic presidential candidate Al Gore in his fight against Bush Gore; and for representing a plaintiff in a case invalidating California’s same-sex marriage ban.

The lawsuit seeks to assert the right of Massachusetts and other states to regulate commerce within their borders and to assert appropriate limitations on the federal government’s power to regulate commerce based on the Interstate Commerce Clause of the Constitution.

The law at issue in the lawsuit is the Controlled Substances Act, which prohibits the production, distribution, and possession of marijuana, regardless of whether those activities cross state lines or take place within the borders of a single state.

“This unreasonable and unconstitutional ban on in-state cannabis harms plaintiffs and impedes states’ efforts to provide patients and adults with access to tightly regulated and tested cannabis,” the plaintiffs said in a statement announcing the lawsuit.

Lawyers point to a 2005 ruling upholding the Controlled Substances Act’s cannabis bans, noting that the situation has changed dramatically since then.

“Today, 38 states, including Washington, DC, have medical or adult-use cannabis programs with significant regulatory oversight,” the plaintiffs said.

They argue that these regulated cannabis products can be traced back to the seeds from which they were originally grown and therefore easily distinguished from illegal interstate cannabis.

State-regulated cannabis businesses are illegal under the Controlled Substances Act, and their day-to-day operations are federal crimes. They are cut off from numerous federal programs and protections, including small business loans that are subject to discriminatory tax penalties, and organizations such as banks and credit card processors refuse to do business with them.

“It’s a money industry,” Lesser said. “This is dangerous. This is not good for anyone.”

Lesser added that people who work for cannabis companies can’t get mortgages and can’t get into federal housing.

“Their options are significantly limited,” he said.

The lawsuit seeks to declare the Controlled Substances Act “unconstitutional as applied to the intrastate cultivation, manufacture, possession, and distribution of marijuana under state law”; and prohibiting the government from enforcing the law to interfere with any aspect of the production or distribution of cannabis under state law.

James Pentland can be contacted at [email protected]

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