The Government's Motion to Dismiss in Massachusetts (the Boies Case)

Standing, standing, standing

I called my shot.

And, of course, I nailed it.

I wrote this months ago in footnote 2 of this essay:

One potential outcome of this lawsuit is that [it] never gets off the ground and gets tossed for lack of jurisdiction or non-ripeness. Unlike the case in Raich whether there was a genuine threat of prosecution, none of the plaintiffs in this case face any realistic threat of prosecution due to the non-prosecution policies and laws the complaint trumpets. Parties can’t just barge into court and lodge constitutional objections about statutes. Generally, to bring a pre-enforcement challenge, there must be a credible threat of prosecution. In Raich, circa 2007, the issue was straightforward: Raich was “faced with the threat that the Government will seize her medical marijuana and prosecute her for violations of federal drug law.” Because the Government doesn’t enforce marijuana laws in 2023, however, one cannot say the same thing today.

That isn’t to say the banking issues can’t be injuries, but there is a real issue here. And the precise details are important. For example, what, exactly, is the injury can’t be fear of prosecution, and that’s the main injury the CSA is capable of causing. If the complaint is about something else, such as 280E, then the lawsuit runs headfirst into the Taxing and Spending clause and the Obamacare case, where the the individual mandate survived on grounds that it was a valid exercise of the Taxing and Spending power. And if the plaintiffs aren’t complaining about prosecution or taxes, what are they complaining about?

And, here is the Government’s lead argument:

A federal court aficionado in cases against the federal government could see this from a mile away. Standing is a serious thing. It is something the Government will argue in every case if it is plausible, so you have to really nail it. You can’t just go into court and complain about laws. You have to be harmed or injured. Here, there’s no risk of prosecution, and all the injuries emanate from other laws or third-party conduct—not enforcement of the CSA.

It will be interesting to see how the Plaintiffs respond. I don’t think it is impossible for them to prevail. But it won’t be easy either.

The rest of the memo (here) argues that Raich is binding and and that there is no fundamental right to cultivate, distribute, or possess marijuana. There’s no need to go into these arguments in detail. There’s no good precedent for either. Indeed, the first is against precedent. So, unless we’re at the Supreme Court—unlikely since getting Supreme Court review generally requires Circuit splits and is more difficult than getting into Harvard—these arguments won’t win either.

I haven’t scoured the filing, which occurred minutes ago. But I will say this: at minimum, the Government appears to be taking the case somewhat seriously with a dense 25-page memo. That’s a compliment. In particular, the section on why Raich—where the Supreme Court rejected an as-applied challenge to intrastate conduct—are unpersuasive is five-pages long. That’s a lot of time to spend on a foreclosed claim.

Interestingly, in this section, the Government echoes another weakness I identified in in my footnote above—this is not a case well positioned to overrule Raich. Here is what I said:

[I]n Raich, in which the Court held that the Controlled Substances Act could constitutionally apply to prohibit two medical marijuana patients, Diane Monson and Angel Raich, from home growing medical marijuana…

Perhaps most inexplicably, the lawsuit includes Verano Holdings as a member of the plaintiff class. What better way to show that the intrastate Massachusetts cannabis operations really isn’t intrastate but is connected to interstate commerce by including a Canadian multi-state operator holding company plaintiff whose principal place of business is in Chicago that “operates regulated cannabis businesses through wholly-owned subsidiaries in Massachusetts and other states.” Total unforced error in my view.

Raich dealt with two patients. Both used marijuana for medical conditions. In contrast, this case is about marijuana businesses claiming intrastate commerce (one isn’t even in the state) who by all accounts, want cash. That’s fine. I love cash too. But it isn’t the most compelling story to overturn Raich.

Here is how the Government puts it:

Under Raich, the relevant question is whether intrastate economic activities “substantially affect interstate commerce,” because “Congress has the power to regulate” such activities. Id. at 17. Here, it is even clearer than in Raich that the intrastate activities at issue substantially affect interstate commerce. While Raich involved a plaintiff who grew marijuana for personal consumption and another plaintiff who obtained marijuana free of charge from local caregivers, 545 U.S. at 7, Plaintiffs here operate businesses that engage in commercial cultivation, manufacture, or sale of marijuana, see Compl. ¶¶ 32, 38-39, 42, 45, as part of a market that generates hundreds of millions of dollars in sales each year in Massachusetts, see id. ¶ 78 (more than $4 billion in gross sales since 2012), and explicitly caters to out-of-state visitors, see Commonwealth of Massachusetts, Cannabis Control Board, Know the Laws, https://masscannabiscontrol.com/know-the-laws/ (“Out-of-state visitors can purchase marijuana” and “enjoy your purchase in Massachusetts”); Canna Provisions, Frequently Asked Questions, https://cannaprovisions.com/faq/ (Canna Provisions sells to visitors with valid identification “from any state in the land” or “from any Canadian province”).

The Government even argues that these folks pleaded themselves out of the case:

Indeed, Plaintiffs concede and affirmatively allege that intrastate marijuana activity substantially affects interstate commerce in marijuana. According to Plaintiffs, “[t]he regulated market in Massachusetts, and the dozens of intrastate markets like it, have substantially reduced interstate commerce in marijuana by providing a regulated alternative for consumers.” Compl. ¶ 21 (emphasis omitted); see also id. ¶ 76 (“illicit interstate marijuana is being displaced with state-regulated, local marijuana”); id. ¶ 77 (“The states’ medical and adult-use marijuana programs have drastically reduced illicit interstate and international commerce in marijuana.”). Where intrastate economic activity substantially affects interstate commerce, the precise nature of the economic interaction between the intrastate activity and interstate commerce does not affect Congress’ authority to regulate the intrastate activity.

Bottom line, if the objective of this lawsuit is to win, don’t count of it. (I know of many other legal theories more likely to succeed.) If, however, the objective is to raise the profile of the issue, be proactive, and get people talking, then let’s give it some credit. At least we’re having a conversation, right?