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Marijuana Company Claims DEA Review Process Is Unconstitutional In New Federal Lawsuit

In a new federal lawsuit filed against the leaders of the Department of Justice (DOJ) and the Drug Enforcement Administration (DEA), a Rhode Island cannabis company is asking the court to prevent an administrative law judge for the agency from reviewing the firm’s application to manufacture marijuana for research purposes, calling the matter “an unconstitutional proceeding led by an unconstitutional decisionmaker.”



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MMJ BioPharma Cultivation Inc. has previously taken legal action against the federal government, filing a petition for a writ of mandamus last year in the U.S. Court of Appeals for the D.C. Circuit that alleged DEA’s yearslong licensing application process has hamstrung the company’s business and stymied innovation that could benefit patients.


The company says it applied to legally grow marijuana for research and development purposes back in 2018, aiming to produce medicine for clinical trials focused on treatment of multiple sclerosis and Huntington’s disease, but so far its been unable to secure the necessary approvals.

 

The immediate issue in the new lawsuit is whether an order by the government for MMJ BioPharma to show cause in relation to a manufacturing registration application should go before a DEA administrative law judge.


In the 21-page complaint, filed on Thursday in U.S. District Court for the District of Rhode Island, the company says it would suffer irreparable harm if it went before the DEA administrative law judge, whom it contends “was appointed in violation of the Appointments Clause of Article II, Section 2, of the Constitution and is not accountable to the President.”


The Constitution mandates that Article II “officers” such as the administrative law judge (ALJ) “be appointed either by the President or the Head of their Department, the Attorney General of the United States,” the suit argues. “DEA ALJs are appointed by neither.”


Rather, the administrative law judge presiding over MMJ BioPharma’s hearing “was selected from a group of candidates provided by the White House Office of Personnel Management (‘OPM’) and appointed by the DEA Administrator upon recommendation from DEA’s Chief ALJ.”


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The suit names as defendants U.S. Attorney General Merrick Garland, DOJ and DEA themselves, DEA Administrator Anne Milgram and DEA Administrative Law Judge Teresa Wallbaum.


Neither agency immediately returned Marijuana Moment’s requests for comment on the suit on Thursday evening.


MMJ BioPharma President Duane Boise described the situation as “horrific.”


“Her office is in the DEA, she gets paid by the DOJ, and [she] never went through the process to appoint a judge,” he told Marijuana Moment. “And here she sits ruling on all these cases.”


“The DEA is law enforcement. They’re supposed to uphold the law, not interpret it,” Boise added. “There is a federally legal way to do this. We are doing it… And we’re still getting blowback.”


Citing a 2023 Supreme Court decision, Axon v. Federal Trade Commission, the lawsuit says “MMJ is entitled to seek relief in this Court to address its constitutional challenges to avoid compounding the ‘here-and-now injury’ from being subjected to this illegitimate proceeding—a harm that is ‘impossible to remedy once the proceeding is over, which is when appellate review kicks in.'”


MMJ’s BioPharma’s hearing before the DEA administrative law judge was supposed to kick off April 10, but following the filing of the federal lawsuit, that matter has been temporarily put on hold as of Friday.


While the government in the DEA matter opposed delaying the review, Wallbaum, the administrative law judge wrote that “a stay is appropriate” in the matter.


“Respondent’s challenge to this tribunal’s authority under Axon, which now allows federal courts to entertain interlocutory structural challenges, is a sufficiently new issue that makes it challenging to gauge the likelihood of success,” she wrote in an order granting MMJ BioPharma’s requested stay.


More broadly, the company also claims in its lawsuit that DEA has repeatedly dragged its heels on its applications to move forward, alleging the agency failed to submit MMJ BioPharma’s application to the Federal Register within a required timeframe and missed other determination deadlines.


During a more-than-two-year time period following a pre-registration DEA investigation, for example, the company’s lawyers’ say MMJ BioPharma was “unable to receive an approval or denial (via a show cause order) of their applications. This was almost five years from the date of MMJ’s initial applications.”


It continues:


“During this time period, and despite numerous attempts to follow-up and check the status of the registration approval determinations for manufacturing and importing, DEA personnel expressed to MMJ that they have not yet made final determinations and they have no idea when that determination will be made. At one point during this period, DEA personnel responded ‘why do you want to know?’ when MMJ inquired regarding the status of the registrations.”


Other outreach to DEA Administrator Milgram, the DEA’s customer line and other personnel went unanswered, the company claims.


“Throughout this entire time period, counsel for MMJ and MMJ representatives reached out to the DEA and DEA counsel multiple times, requesting any feedback as to what was still required by the DEA for the registration,” its lawsuit says. “This outreach was most often met with silence, or with extremely confusing or contradictory responses from the DEA.”


The delays have not only hurt the company by stalling its plans but also hurt patients who could benefit from further research, it adds: “Countless patients who have been affected by Multiple Sclerosis and Huntington’s Disease are waiting on the potentially life-restoring treatments associated with development of these pharmaceuticals.”


Boise, MMJ’s president, said in a press release that “we are dealing with heartless individuals at the DEA who continue to hinder marijuana research and development.”


“MMJ has meticulously followed the law, yet the DEA fails to do the same,” he said.


“Ultimately, it is the patients in need who suffer due to government inaction.”


A ruling against MMJ BioPharma by the DEA administrative law judge could ultimately force the company to close its doors, it claims.


“Time and time again,” the lawsuit says, “the process is obfuscated by the DEA and its agents despite MMJ’s obvious desperation to obtain clarity on the alleged ‘requirements.'”


It asks the federal district court to “declare unconstitutional the statutes, regulatory provisions, and policies providing for the appointment and removal of DEA ALJs as applied by DEA and DOJ.” It also wants the court to order judicial review of the company’s order to show cause and a “finding that MMJ met its burden for issuance of the manufacturer registration under applicable law.”


Barrington, Rhode Island-based attorney Megan Sheehan is representing the company in the matter.


In November 2022, a federal judge in Rhode Island dismissed the company’s civil suit against the government for lack of subject matter jurisdiction.


MMJ BioPharma isn’t alone in its frustration over the federal government’s protracted cannabis bureaucracy. For years, bipartisan congressional lawmakers have bemoaned DEA’s delays, especially for its failure to license more cultivation for research purposes.


In 2019, Rep. Buddy Carter (R-GA), slammed DEA as the “epitome of ineptitude,” saying the agency was “failing the American public” by failing to reschedule cannabis.


A year later, 11 bipartisan members of Congress sent a letter saying that DEA’s sluggishness was costing America jobs.


Lawyers for MMJ BioPharma argue that DEA has failed to meet its obligations under federal law, including cannabis research legislation, the Medical Marijuana and Cannabidiol Research Expansion Act (MCREA), that President Joe Biden signed into law late last year in order to expedite the research licensing process.

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