On October 13, the Supreme Court of Minnesota barred an employee from getting reimbursed for medical marijuana treatment for a work-related injury.[1] Although the employee was entitled to reimbursement from her employer under state law, the court found that the Controlled Substances Act (CSA) preempted state law. The decision highlights the latest episode of tension between marijuana’s federal listing as a Schedule I controlled substance — which includes drugs with “no currently accepted medical treatment use”[2] — and states that have authorized marijuana for medical treatment.

In 2003, Susan Musta suffered an on-the-job injury to her neck. She underwent years of treatment, then surgery, and finally prescription narcotics for continuing pain. In 2019, Musta’s doctor certified her to participate in Minnesota’s medical marijuana program. Musta sought reimbursement for the cost of the treatment, her employer opposed, and the state agency ordered the employer to reimburse Musta for medical marijuana. No one disputed that her medical marijuana complied with state law, and all agreed it was “reasonable, medically necessary, and causally related to her work injury.” Her employer instead argued that reimbursing her would be a crime under federal law.

The Minnesota Supreme Court agreed with the employer. The court found that ordering the employer to reimburse Musta would constitute aiding and abetting the possession of marijuana — a federal crime under the CSA.

In reaching its decision, the Minnesota Supreme Court rejected the reasoning of two other states’ high courts that have looked at nearly identical issues with different outcomes. For instance, the New Hampshire Supreme Court found that an employer in similar circumstances would not possess the required mental state to commit criminal aiding and abetting of marijuana possession because their reimbursement was not voluntary, but instead compelled by state law.[3] Meanwhile, the New Jersey Supreme Court found no preemption because Congress has withheld funds from the Department of Justice (DOJ) for enforcement that might interfere with state medical marijuana laws, which the court found trumps the CSA.[4] In short, both of the other high courts found the employers could reimburse the employees for medical marijuana treatment for work-related injuries without running afoul of federal law.

The Minnesota Supreme Court, however, disagreed. The court held that Musta’s employer would have the requisite mental state to be liable for an aiding and abetting offense because it would be “fully knowledgeable” that Musta’s marijuana possession is unlawful under the CSA. The court also found it unpersuasive that Congress had not funded enforcement efforts against state medical marijuana programs because the text of the CSA remained unchanged, and marijuana was still listed as a Schedule I drug. In rendering its decision, the Minnesota Supreme Court joined Maine’s Supreme Judicial Court in finding that the CSA preempted the state’s workers’ compensation and medical marijuana laws.[5]

It is unclear if Musta will appeal, but the split among states’ high courts creates an attractive opportunity for the U.S. Supreme Court to weigh in.[6] In Gonzales v. Raich in 2005, the U.S. Supreme Court upheld the CSA’s provisions criminalizing the manufacture, distribution, or possession of marijuana for medical purposes as constitutional and reiterated the supremacy of federal law over state law in making its decision.[7]

Since that time, however, the federal government has sent mixed messages regarding the enforcement of the CSA as applied to states that have legalized medical and recreational marijuana. For instance, following the Supreme Court’s 2005 decision in Raich, the DOJ issued memorandums outlining policies curtailing enforcement against those in compliance with state law; Congress enabled the District of Columbia to decriminalize medical marijuana; and Congress prohibited the DOJ from spending funds that would prevent states’ implementation of their medical marijuana laws.

In a statement accompanying a recent denial of a writ of certiorari,[8] Justice Thomas reflected on these developments and observed, “the Federal Government’s current approach to marijuana bears little resemblance to the watertight nationwide prohibition that a closely divided Court found necessary to justify the Government’s blanket prohibition in Raich.”[9] He then signaled his willingness (and perhaps that of other justices) to reconsider Raich if Congress does not act. Justice Thomas wrote:

If the Government is now content to allow States to act “as laboratories” “‘and try novel social and economic experiments,'” Raich, 545 U.S. at 42 (O’Connor, J., dissenting), then it might no longer have authority to intrude on “[t]he States’ core police powers … to define criminal law and to protect the health, safety, and welfare of their citizens.” Id. A prohibition on intrastate use or cultivation of marijuana may no longer be necessary or proper to support the Federal Government’s piecemeal approach.[10]

Should Musta appeal, there is a small chance the Supreme Court could act to resolve, in Justice Thomas’ words, this “contradictory and unstable state of affairs.”[11]

Thirty-six states and four territories allow legal, medical marijuana.[12] So long as marijuana is listed as a Schedule I drug under the CSA, collisions between the CSA and state laws will continue with varying outcomes. All companies operating in states with legal marijuana regimes must remain attentive to case law in their jurisdiction to ensure they do not run afoul of federal law.

[1] Musta v. Mendota Heights Dental Center, No. A20-1551, 2021 WL 4767978 (Minn. Oct. 13, 2021).

[2] 21 U.S.C. § 812(b)(1)(B).

[3] Appeal of Panaggio, 174 N.H. 89 (2021).

[4] Hager v. M&K Construction, 247 A.3d 864 (N.J. 2021).

[5] Bourgoin v. Twin Rivers Paper Co., LLC, 187 A.3d 10 (Me. 2018).

[6] See Egelhoff v. Egelhoff ex rel. Breiner, 532 U.S. 141, 146 (2001) (resolving split among Washington Supreme Court and U.S. Circuit Courts of Appeals regarding whether federal statute, ERISA, preempted related state acts).

[7] Gonzales v. Raich, 545 U.S. 1, 29 (2005) (“The Supremacy Clause unambiguously provides that if there is any conflict between federal and state law, federal law shall prevail.”).

[8] Standing Akimbo, LLC v. United States, 141 S. Ct. 2236, 2237 (2021).

[9] Id. at 2238.

[10] Id.

[11] Id. at 2237.

[12] State Medical Marijuana Laws, National Conference of State Legislatures (Aug. 23, 2021), https://www.ncsl.org/research/health/state-medical-marijuana-laws.aspx.

Our Cannabis Practice provides advice on issues related to applicable federal and state law. Marijuana remains an illegal controlled substance under federal law.