Federal Exception for Medical Cannabis

The Iowa Medical Cannabidiol Act currently operates as if it were a Federal racketeering scheme.  See Safe Streets Alliance v. Hickenlooper, 859 F.3d 865 (10th Cir. 2017) (“racketeering activity”).  The State is recklessly endangering the lives of patients enrolled in the program, as well as the public.  State officials should seek a waiver under 21 U.S.C. § 822(d) to eliminate the State’s imagined conflict with Federal law.
21 U.S.C. § 903.  Application of State law
No provision of this subchapter shall be construed as indicating an intent on the part of the Congress to occupy the field in which that provision operates, including criminal penalties, to the exclusion of any State law on the same subject matter which would otherwise be within the authority of the State, unless there is a positive conflict between that provision of this subchapter and that State law so that the two cannot consistently stand together.

The board that regulates the Medical Cannabidiol Act has been asking the legislature to fix this inconsistency for the past 5 years, beginning in 2019.  See recommendation 8 in most recent 2024 Annual Report, requesting a legal task force to address this inconsistency.

8.  Seek a Federal Exemption for Iowa’s program
The Board recommends that a task force of legal experts be authorized, similar to the current board of medical experts, to assist the department in navigating the legal issues involved with requesting an exemption for Iowa’s program from necessary Federal agencies.  This is related to a recommendation in the Board’s 2019 Annual Report and the passage of HF2589 in June 2020.
U.S. Constitution, Article IV, Section 2:
The Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States.
U.S. Constitution, First Amendment:
Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.
U.S. Constitution, Tenth Amendment:
The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.
21 U.S.C. § 822(d).  Waiver:
The Attorney General may, by regulation, waive the requirement for registration of certain manufacturers, distributors, or dispensers if he finds it consistent with the public health and safety.
21 U.S.C. § 903.  Application of State law:
No provision of this subchapter shall be construed as indicating an intent on the part of the Congress to occupy the field in which that provision operates, including criminal penalties, to the exclusion of any State law on the same subject matter which would otherwise be within the authority of the State, unless there is a positive conflict between that provision of this subchapter and that State law so that the two cannot consistently stand together.
42 U.S.C. § 1983.  Civil action for deprivation of rights
Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory or the District of Columbia, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress, except that in any action brought against a judicial officer for an act or omission taken in such officer’s judicial capacity, injunctive relief shall not be granted unless a declaratory decree was violated or declaratory relief was unavailable.  For the purposes of this section, any Act of Congress applicable exclusively to the District of Columbia shall be considered to be a statute of the District of Columbia.
Bond v. United States, 564 U.S. 211, 220 (2011) (“The individual, in a proper case, can assert injury from governmental action taken in excess of the authority that federalism defines.  Her rights in this regard do not belong to a State.”).
Bond v. United States, 564 U.S. 211, 221 (2011) (“federalism secures to citizens the liberties that derive from the diffusion of sovereign power”).
Bond v. United States, 564 U.S. 211, 222 (2011) (“Separation-of-powers principles are intended, in part, to protect each branch of government from incursion by the others.  Yet the dynamic between and among the branches is not the only object of the Constitution’s concern.  The structural principles secured by the separation of powers protect the individual as well”).
Bond v. United States, 564 U.S. 211, 223 (2011) (“If the constitutional structure of our Government that protects individual liberty is compromised, individuals who suffer otherwise justiciable injury may object”).

Proposed Legislation

124E.27 Legal Task Force.  The Attorney General shall convene a task force to assist in executing the department’s responsibilities under 2020 Iowa Acts, chapter 1116, section 31 (protection of federal funding).
Under state and federal controlled substances acts medical use of cannabis is inconsistent without interstate marketing approval or other authorization.  Gonzales v. Raich, 545 U.S. 1 (2005).
Authorization is available by making a request to the Attorney General pursuant to 21 U.S.C. § 822(d) (“The Attorney General may, by regulation, waive the requirement for registration of certain manufacturers, distributors, or dispensers if he finds it consistent with the public health and safety”).
The task force shall consider:
  1. the federal exemption for the religious use of peyote by the Native American Church, 21 C.F.R. § 1307.31, as an example of how 21 U.S.C. § 822(d) is used;
  2. the phrase “public health and safety” as used in 21 U.S.C. § 822(d);
  3. the phrase “to occupy the field” as used in 21 U.S.C. § 903 (“Application of State law”);
  4. judicial review of agency decision making under 21 U.S.C. § 877 (“Judicial review”); and
  5. judicial deference to agency decision making.  Loper Bright Enterprises v. Raimondo, 603 U.S. 369 (2023).  https://www.supremecourt.gov/opinions/23pdf/603us1r54_o7jp.pdf
In addition to any other factors the task force deems relevant, the task force shall consider each of the following:

Authorities

Tenth Amendment: Anti-Commandeering Doctrine.
Application of State Law 21 U.S.C. § 903; Gonzales v. Oregon, 546 U.S. 248, 251 (2006) (“The CSA explicitly contemplates a role for the States in regulating controlled substances, as evidenced by its pre-emption provision.”).
U.S. Department of Justice (2009-2013): U.S. Department of Justice, Ogden Memorandum, October 19, 2009; U.S. Department of Justice, Cole Memorandum, June 29, 2011; U.S. Department of Justice, Cole Memorandum, August 29, 2013.
Appropriations: H.R.5342 (2025 Pending); S.2354 (2025 Pending); Public Law 118-42, § 531, 138 STAT. 25, 174 (March 9, 2024) Consolidated Appropriations Act, 2024 (H.R.4366); Public Law 117-328, § 531, 136 STAT. 4459, 4561 (December 29, 2022) Consolidated Appropriations Act, 2023 (H.R.2617); Public Law 117-103, § 531, 136 STAT. 49, 150 (March 15, 2022) Consolidated Appropriations Act, 2022 (H.R.2471); Public Law 116-260, § 531, 134 Stat. 1182, 1283 (Dec. 27, 2020) Consolidated Appropriations Act, 2021 (H.R.133); Public Law 116-93, § 531, 133 Stat. 2317, 2431 (Dec. 20, 2019) Consolidated Appropriations Act, 2020 (H.R.1158); Public Law 116-6, § 537, 133 Stat. 13, 138 (Feb. 15, 2019) Consolidated Appropriations Act, 2019 (H.J. Res. 31); Public Law 115-141, § 538, 132 Stat. 347, 444 (Mar. 23, 2018) Consolidated Appropriations Act, 2018 (H.R.1625); Public Law 115-31, § 537, 131 Stat. 135, 228 (May 5, 2017) Consolidated Appropriations Act, 2017 (H.R.244); Public Law 114-113, § 542, 129 Stat. 2241, 2332 (Dec. 18, 2015) Consolidated Appropriations Act, 2016 (H.R.2029); Public Law 113-235, § 538, 128 Stat. 2129, 2217 (Dec. 16, 2014) Consolidated and Further Continuing Appropriations Act, 2015 (H.R.83).
Peyote: 21 C.F.R. § 1307.31.
Delta-9 THC: Agriculture Improvement Act of 2018, Pub. L. No. 115-334, 132 Stat. 4490 (December 20, 2018); 7 U.S.C. § 1639o(1); AK Futures LLC v. Boyd St. Distro, LLC, 35 F. 4th 682 (9th Cir. 2022).
UN Commission on Narcotic Drugs: reclassifies cannabis to recognize its therapeutic uses, World Health Organization, December 4, 2020; CND votes on recommendations for cannabis and cannabis-related substances, Commission on Narcotic Drugs, Press Release, December 2, 2020.
Drug Enforcement Administration: Notice of proposed rule making, A Proposed Rule by the Drug Enforcement Administration on 05/21/2024.
Items Not Deductible: Application of Internal Revenue Code Section 280E to Marijuana Businesses;  26 U.S.C. § 280E.  Standing Akimbo v. United States, 141 S.Ct. 2236, 2237, 594 U.S. ___, 210 L.Ed.2d 974 (2021) (Statement of Justice Thomas) (“This contradictory and unstable state of affairs strains basic principles of federalism and conceals traps for the unwary”).  https://www.supremecourt.gov/opinions/20pdf/20-645_9p6b.pdf.
Money Laundering and Exclusion from Banking: Marijuana Banking: SAFE(R) Banking Acts;  18 U.S.C. § 1956;  18 U.S.C. § 1957.
RICO: Safe Streets Alliance v. Hickenlooper, 859 F.3d 865, 884 (10th Cir. 2017) (“Marijuana is a controlled substance under the CSA.  21 U.S.C. § 802(16).  So the manufacture, distribution, and sale of that substance is, by definition, racketeering activity under RICO.  18 U.S.C. § 1961(1)(A), (D)”).
Judicial Review:  21 U.S.C. § 877.
Independent Judiciary:  Slip Opinion: Loper Bright Enterprises v. Raimondo;  Page Proof Pending Publication: Loper Bright Enterprises v. Raimondo, 603 U.S. 369 (2024).

Text of Authorities

Cole Memo (2013):  Indeed, a robust system may affirmatively address those priorities, for example, implementing effective measures to prevent diversion of marijuana outside of the regulated system and to other states, prohibiting access to marijuana by minors, and replacing illicit marijuana trade that funds criminal enterprises with a tightly regulated market in which revenues are tracked and accounted for.
Public Law 118-42, § 531 (March 9, 2024):  SEC. 531.  None of the funds made available under this Act to the Department of Justice may be used, with respect to any of the States of Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming, or with respect to the District of Columbia, the Commonwealth of the Northern Mariana Islands, the United States Virgin Islands, Guam, or Puerto Rico, to prevent any of them from implementing their own laws that authorize the use, distribution, possession, or cultivation of medical marijuana.
21 C.F.R. § 1307.31  Native American Church:  The listing of peyote as a controlled substance in Schedule I does not apply to the nondrug use of peyote in bona fide religious ceremonies of the Native American Church, and members of the Native American Church so using peyote are exempt from registration. Any person who manufactures peyote for or distributes peyote to the Native American Church, however, is required to obtain registration annually and to comply with all other requirements of law.
Public law: 115-334, § 10113 (December 20, 2018).  Hemp production:  The term “hemp” means the plant Cannabis sativa L. and any part of that plant, including the seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry weight basis.
World Health Organization (WHO) (December 4, 2020):  On 2nd December 2020, the UN Commission on Narcotic Drugs (CND), the drug policy making body of the UN re-classified cannabis and cannabis resin under an international listing that recognizes its medical value.
Health and Human Services (HHS) (August 29, 2023):  Pursuant to the Controlled Substances Act (CSA), 21 U.S.C. 811(b) and (c), I, the Assistant Secretary for Health, am recommending that marijuana, referring to botanical cannabis (Cannabis sativa L.) that is within the definition “marihuana” or “marihuana” in the CSA, be controlled in Schedule III of the CSA.
    Upon consideration of the eight factors determinative of control of a substance under 21 U.S.C. 811(c), the Food and Drug Administration (FDA) recommends that marijuana be placed in Schedule III of the CSA.  The National Institute on Drug Abuse has reviewed the enclosed documents (which were prepared by FDA’s Controlled Substance Staff and are the basis for FDA’s recommendation) and concurs with FDA’s recommendation.  Marijuana meets the findings for control in Schedule III set forth in 21 U.S.C. 812(b)(3).
    Based on my review of the evidence and FDA’s recommendation, it is my recommendation as the Assistant Secretary for Health that marijuana should be placed in Schedule III of the CSA.
Internal Revenue Service (IRS(:  26 U.S.C. § 280E.  Expenditures in connection with the illegal sale of drugs.  No deduction or credit shall be allowed for any amount paid or incurred during the taxable year in carrying on any trade or business if such trade or business (or the activities which comprise such trade or business) consists of trafficking in controlled substances (within the meaning of schedule I and II of the Controlled Substances Act) which is prohibited by Federal law or the law of any State in which such trade or business is conducted.
Banking:  18 U.S.C. § 1956(7)(C).  Laundering of monetary instruments: the term “specified unlawful activity” means any act or acts constituting a continuing criminal enterprise, as that term is defined in section 408 of the Controlled Substances Act (21 U.S.C. § 848);  18 U.S.C. § 1957(f)(3).  Engaging in monetary transactions in property derived from specified unlawful activity: the terms “specified unlawful activity” and “proceeds” shall have the meaning given those terms in section 1956 of this title.
Judicial Review:  21 U.S.C. § 877.  Judicial review.  All final determinations, findings, and conclusions of the Attorney General under this subchapter shall be final and conclusive decisions of the matters involved, except that any person aggrieved by a final decision of the Attorney General may obtain review of the decision in the United States Court of Appeals for the District of Columbia or for the circuit in which his principal place of business is located upon petition filed with the court and delivered to the Attorney General within thirty days after notice of the decision. Findings of fact by the Attorney General, if supported by substantial evidence, shall be conclusive.
Independent Judiciary:  Courts must exercise their independent judgment in deciding whether an agency has acted within its statutory authority, as the APA requires.  Careful attention to the judgment of the Executive Branch may help inform that inquiry.  And when a particular statute delegates authority to an agency consistent with constitutional limits, courts must respect the delegation, while ensuring that the agency acts within it.  But courts need not and under the APA may not defer to an agency interpretation of the law simply because a statute is ambiguous.  Loper Bright Enterprises v. Raimondo, 603 U.S. 369, 412-13 (2024).