The Nation Showed Overwhelming Support for Cannabis Reform
July 22, marked the end of the historic DEA public comment period for marijuana’s proposed rescheduling to Schedule III. Industry engagement was strong, and thanks to the efforts of advocacy organizations, industry stakeholders, and Vicente LLP clients, nearly 43,000 comments were submitted! This was the most comments ever submitted during a DEA public comment period, and according to Headset, 92.45% of comments were in favor of cannabis reform. With this process coinciding with the election and a new democratic ticket, we are in one of the most exciting and significant times in cannabis and drug policy reform in history.
As a member of the legal team for the American Trade Association of Cannabis and Hemp’s Coalition for Cannabis Scheduling Reform, Vicente LLP contributed to the coalition’s public comment. Read an excerpt of this and other comments. The firm also submitted its own comment on the US’s ability to meet its treaty obligations in Schedule III.
In addition, Vicente’s cannabis economist and other industry economists conducted a nationwide survey of cannabis businesses and wrote a rescheduling public comment that analyzed the economic impacts on small and minority businesses on behalf of the Minority Cannabis Business Association. Read more about the analysis and the comment.
What Happens Now and How Might Election Dynamics Have an Impact?
Next Steps
The DEA will review the nearly 43,000 comments, which may take some time. During this time, or after its review, DEA will either grant a hearing in front of an administrative law judge (ALJ hearing) or forego an ALJ hearing and go directly to issuing a final rule. Either way, the DEA, in issuing a final rule, must consider the ALJ report submitted to the DEA via the ALJ Judge (if a hearing is permitted), all of the relevant comments submitted during the comment period, the HHS report, and the Office of Legal Counsels memorandum. It must then issue a final rule that is supported by the record. The DEA has broad discretion in granting an ALJ hearing and it would run much like a court, so it is unclear how long this process might take. DEA Administer Milgram will make the final determination as to whether an in-person ALJ hearing will be permitted.
Timeline
This process is unprecedented and influenced by regulatory processes, political pressures, and potential legal challenges—making it difficult to predict a timeline. Usually, a rescheduling process takes many years with minimal comment. In this situation, there are nearly 43,000 comments, and so far, the process has moved expediently per President Biden’s October 2022 directive to the HHS.
If an ALJ hearing is granted (for which there is no required timeframe), the process could go into next year. If the ALJ hearing is not granted and a final order is issued, it’s possible this process could be wrapped by October 2024, ahead of the election. The political pressure to wrap this process by October to support the democratic ticket rally pre-election could have a major impact.
Litigation
Litigation is almost certain. If litigation is successful in getting a stay on the final rule, particularly if there is an unfavorable judge, the process could be substantially delayed.
Congressional Review Act (the “CRA”)
The CRA is a tool Congress can use to overturn certain federal agency actions. After the DEA issues its final rule, it will submit the rule to Congress. Congress then has “60-days-of-continuous-session" to pass a resolution of disapproval in both houses that, once signed by the president, will cause the final rule to be treated as though it never took effect. This means that whenever DEA issues its final rule, the next Congress and president could rescind the rule. Importantly, the CRA states that “no determination, finding, action, or omission under this chapter shall be subject to judicial review.” As such, the majority view of federal courts believes that should a disapproval be signed by the president, judicial review will be unavailable.
