Wednesday, March 7, 2018
Tuesday, March 6, 2018
Monday, March 5, 2018
A Big Win for the LGBT Community and Why it Matters to Cannabis Companies
The Trump administration is known for its hostility to marijuana. It’s also known for its hostility to the LGBT community. In a huge blow to the Trump administration, the Second Circuit Court of Appeals ruled last Monday that employers cannot discriminate against employees based on sexual orientation. Many states, including Oregon, Washington, and California have statutes explicitly prohibiting employers from discriminating against employees based on sexual orientation. The Federal Civil Rights Act (“the Act”) does not explicitly protect employees based on sexual orientation: instead, it only protects employees based on sex. Circuit courts across the country are taking up the issue of whether employees should be protected based on sexual orientation, and reaching different conclusions.
In 2010, Donald Zarda sued his employer, Altitude Express, Inc. alleging they had terminated him because he was gay. The federal district court ruled in favor of the employer, holding the Act did not protect employees based on sexual orientation. The case pitted the federal Equal Employment Opportunity Commission (EEOC) against the federal department of justice. The EEOC submitted a brief in support of Mr. Zarda, arguing the Act protects employees based on sexual orientation. The Federal Department of Justice (headed by our good friend, Mr. Sessions) submitted a brief supporting the employer, and arguing the Act did not extend to sexual orientation.
The Second Circuit overruled the lower court. Siding with Mr. Zarda in a lengthy, 69-page opinion, with multiple concurrences and 80 pages of dissents, it ultimately held that “sexual orientation is doubly delineated by sex because it is a function of both a person’s sex and the sex of those to whom he or she is attracted. Logically because sexual orientation is a function of sex and sex is a protected characteristic under [the Act] it follows that sexual orientation is also protected.” Makes sense to us.
Two other federal appeals courts recently have heard similar cases. The Seventh circuit determined discrimination based on sexual orientation was discrimination based on sex under the Act, while the Eleventh Circuit held the Act’s reference to sex did not encompass discrimination based on sexual orientation. The Supreme Court declined to hear the Seventh Circuit’s case, but now, with multiple circuits offering opinions on the issue, the Supreme Court may be persuaded to hear the Second Circuit’s case. If they do, let’s hope they get it right.
So why does this matter to cannabis businesses? Cannabis businesses are subject to both state and federal employment laws. If a cannabis business discriminates against an employee because of sexual orientation, the business could be in violation of both state and federal law. As we all know, Attorney General Sessions ripped up the Cole memorandum earlier this year. Without the memorandum, there is little guidance about when and where federal district attorneys will choose to enforce the Controlled Substance Act (CSA) against cannabis companies. Thus, compliance with state and federal regulations is more important than ever during this time. It is best to stay under the radar rather than drawing federal attention to your business by arguably violating federal laws—other than the CSA that is.
If you ever have questions about terminating an employee it is always best to consult an employment law expert first to ensure all basis are covered and no violations arise from the termination. If your company is not terminating an employee on the basis of sexual orientation, but you believe that the employee could make such a claim, it is crucial to consider and attempt to mitigate possible claims. Both state and federal laws tend to be very detailed when it comes to protection of employees. In unsettled areas of law, such as the employees and sexual orientation, prudence is advised.
source https://www.cannalawblog.com/a-big-win-for-the-lgbt-community-and-why-it-matters-to-cannabis-companies/
Sunday, March 4, 2018
Cannabis Administrative Law 101
Anyone that does business in a highly regulated environment like cannabis or alcohol needs to have a basic understanding of administrative law. The majority of government interaction as a cannabis business–and the primary sources of headaches–involve state agencies. In Washington, for example, our Liquor and Cannabis Board is the primary regulatory agency, but the Department of Labor and Industries, the Employment Security Department, the Department of Revenue, the Department of Agriculture, and others all play a role in the lives of marijuana businesses. Sometimes agencies feel all-powerful, as if they can govern by fiat. Other times, they seem extremely limited in their abilities to act in certain ways. Cannabis businesses interact with administrative agencies when they are applying for licenses, advocating for regulatory change, and when they are held liable for violations of regulations. Smart cannabis businesses know the ins and outs of authority that their governing agencies wield.
Some background on how these agencies are structured and why they exist is probably in order. We’ll use the federal government as our example because every state is a little bit different, but most are structured similarly to the federal structure. The power to write law is vested in the legislative branch – the U.S. Congress. The power to enforce those laws is vested in the executive branch — the President and federal agencies. And the power to interpret those laws is held in the judicial branch — the court system. Administrative law blends all of those authorities together somewhat and places them, in a limited way, in the hands of a regulatory agency.
Congress is not good at dealing with rapidly changing legal landscapes. Its statutes are written broadly, and meant to stand the test of time. As such, Congress almost always drafts statutes that delegate some portion of its authority to write further laws to the executive branch, via administrative agencies. This Congressional enacting statute provides the general boundaries in which the executive branch, through a named agency or department, can create rules and regulations. That same executive branch agency is also tasked with enforcing those rules, and adjudicating initial disputes of whether those rules are broken (often, with the involvement of administrative law judges).
In the cannabis context, the enacting statute hasn’t tended to come from legislatures — it tends to come from the people in the form of a citizen’s initiative. In that context, the citizens are playing the same role as the legislative branch — writing law for the executive to enforce. Sometimes, the state’s Constitution will allow the legislature to amend an initiative statute, even before it takes effect. Unless the legislature makes a broad alteration, though, the only authority granted to the regulatory body is whatever is included in that initiative. If a regulatory agency like the Liquor and Cannabis Board does something that either oversteps the authority granted in the initiative or acts directly contrary to the initiative, it is acting unlawfully.
But agencies have significant leverage here. First, there is a federal interpretation rule that many states also follow called “Chevron Deference.” Under this rule, if there is vague or ambiguous wording in a statute that grants administrative authority to an agency, courts will defer to that agency’s reasonable interpretation of that language. Agencies get to decide any question about the extent of their power in a way that maximizes that power, so long as it is at least a reasonable reading of that enacting statute. If you are suing an agency, this can be a difficult standard to overcome.
Additionally, you generally can’t challenge an agency action until you have “exhausted administrative remedies.” This means that if you want to take an agency to court because you think it is doing something wrong, you first have to go through the agency’s internal dispute process. This can take time and money, and it often feels like the deck is stacked against you when the writer of the regulation, the enforcer of the regulation, and the judge for that regulatory enforcement are all the same people.
We’ll write more in the coming weeks about agency authority generally, and interacting with regulators specifically. Sometimes, it is good to defer to regulatory decisions and go with the flow, but other times it’s vital that regulated parties push back hard to make sure that their regulators are following the law themselves.
source https://www.cannalawblog.com/cannabis-administrative-law-101/