On Monday, administrative law judge John Mulrooney postponed the start of hearings on federal cannabis rescheduling by at least three months, with reform-minded participants alleging bias on the part of DEA officials involved in the process.
“The decision to not move forward with rescheduling cannabis from a Schedule I drug to a Schedule III drug is a major setback for the cannabis industry, from both cultural and operational standpoints,” says Sasha Nutgent, vice president of cannabis retail at Housing Works Cannabis Co. “This decision also harms the legal cannabis market by limiting profitability due to the constraints of IRS code 280E.”
Although Mulrooney cited statutory restrictions on his office’s ability to take actions such as removing DEA as the “proponent” of the proposal to move marijuana from Schedule I to Schedule III of the Controlled Substances Act (CSA), he sharply criticized the agency over various procedural missteps that he argued contributed to a delay of the rulemaking, potentially indefinitely as a new administration is set to come into office next week, as stated in Marijuana Moment.
Vince Ning, co-CEO and co-founder of Nabis, notes that while the judge’s decision to delay the hearings and maintain the status quo is disappointing, it won’t deter the continued momentum of the cannabis industry.
“If anything, this setback underscores the critical importance of continuing to build resilient, adaptable infrastructure within our current constraints,” he says. “We will see what the next administration has planned soon, but at Nabis, we’ve always operated under the philosophy that we must be the change we want to see in the industry. This isn’t a moment for despair; it’s a call to action for every player in the cannabis space to innovate, collaborate and advocate more fiercely than ever.”
The judge ordered either the government or the movants to provide the court with an update on the status of the interlocutory appeal in 90 days. To the extent the issues are not resolved, they must update the court every subsequent 90 days. The window to file an appeal is 15 days from the issuance of the order.
