Posted on 06/28/2021 11:03:24 AM PDT by zeugma
The Supreme Court rejected hearing the case cited below. Justice Thomas dissented in that denial of cert. The case concerned a business that operated a medical-marijuana dispensary in Colorado. Since marijuana is still illegal accordig to federal law, there are legal and tax implications to that. This is something that really needs to be dealt with by the court. It is exactly this sort of thing that the court exists for. For governments and courts at all levels to continue to just wink at this stuff and not actually resolve what is, and is not actually legal is really nothing short of tyranny, because we, as citizens, have no way to actually determine what the law actually is. As usual, Thomas is completely correct. The court should have heard this case.
The following is the text of Thomas' dissent. For footnotes and related stuff, click the link.
Supreme Court Of The United States
Standing Akimbo, LLC, et al., v. United States
On petition for writ of certiorari to the United States Court Of Appeals For The Tenth Circuit
No. 20–645.
Decided June 28, 2021
The petition for a writ of certiorari is denied.
Statement of JUSTICE THOMAS respecting the denial of certiorari.
Sixteen years ago, this Court held that Congress' power to regulate interstate commerce authorized it "to prohibit the local cultivation and use of marijuana." Gonzales v. Raich, 545 U. S. 1, 5 (2005). The reason, the Court explained, was that Congress had "enacted comprehensive legislation to regulate the interstate market in a fungible commodity" and that "exemption[s]" for local use could undermine this "comprehensive" regime. Id., at 22–29. The Court stressed that Congress had decided "to prohibit entirely the possession or use of [marijuana]" and had "designate[d] marijuana as contraband for any purpose." Id., at 24–27 (first emphasis added). Prohibiting any intrastate use was thus, according to the Court, " ‘necessary and proper' " to avoid a "gaping hole" in Congress' "closed regulatory system." Id., at 13, 22 (citing U. S. Const., Art. I, §8).
Whatever the merits of Raich when it was decided, federal policies of the past 16 years have greatly undermined its reasoning. Once comprehensive, the Federal Government's current approach is a half-in, half-out regime that simultaneously tolerates and forbids local use of marijuana. This contradictory and unstable state of affairs strains basic principles of federalism and conceals traps for the unwary.
This case is a prime example. Petitioners operate a medical-marijuana dispensary in Colorado, as state law permits. And, though federal law still flatly forbids the intrastate possession, cultivation, or distribution of marijuana, Controlled Substances Act, 84 Stat. 1242, 1247, 1260, 1264, 21 U. S. C. §§802(22), 812(c), 841(a), 844(a),1 the Government, post-Raich, has sent mixed signals on its views. In 2009 and 2013, the Department of Justice issued memorandums outlining a policy against intruding on state legalization schemes or prosecuting certain individuals who comply with state law.2 In 2009, Congress enabled Washington D. C.'s government to decriminalize medical marijuana under local ordinance.3 Moreover, in every fiscal year since 2015, Congress has prohibited the Department of Justice from "spending funds to prevent states' implementation of their own medical marijuana laws." United States v. McIntosh, 833 F. 3d 1163, 1168, 1175–1177 (CA9 2016) (interpreting the rider to prevent expenditures on the prosecution of individuals who comply with state law).4 That policy has broad ramifications given that 36 States allow medicinal marijuana use and 18 of those States also allow recreational use.5
Given all these developments, one can certainly understand why an ordinary person might think that the Federal Government has retreated from its once-absolute ban on marijuana. See, e.g., Halper, Congress Quietly Ends Federal Government's Ban on Medical Marijuana, L. A. Times, Dec. 16, 2014. One can also perhaps understand why business owners in Colorado, like petitioners, may think that their intrastate marijuana operations will be treated like any other enterprise that is legal under state law.
Yet, as petitioners recently discovered, legality under state law and the absence of federal criminal enforcement do not ensure equal treatment. At issue here is a provision of the Tax Code that allows most businesses to calculate their taxable income by subtracting from their gross revenue the cost of goods sold and other ordinary and necessary business expenses, such as rent and employee salaries. See 26 U. S. C. §162(a); 26 CFR. 1.61–3(a) (2020). But because of a public-policy provision in the Tax Code, companies that deal in controlled substances prohibited by federal law may subtract only the cost of goods sold, not the other ordinary and necessary business expenses. See 26 U. S. C. §280E. Under this rule, a business that is still in the red after it pays its workers and keeps the lights on might nonetheless owe substantial federal income tax.
As things currently stand, the Internal Revenue Service is investigating whether petitioners deducted business expenses in violation of §280E, and petitioners are trying to prevent disclosure of relevant records held by the State.6 In other words, petitioners have found that the Government's willingness to often look the other way on marijuana is more episodic than coherent.
This disjuncture between the Government's recent laissez-faire policies on marijuana and the actual operation of specific laws is not limited to the tax context. Many marijuana-related businesses operate entirely in cash because federal law prohibits certain financial institutions from knowingly accepting deposits from or providing other bank services to businesses that violate federal law. Black & Galeazzi, Cannabis Banking: Proceed With Caution, American Bar Assn., Feb. 6, 2020. Cash-based operations are understandably enticing to burglars and robbers. But, if marijuana-related businesses, in recognition of this, hire armed guards for protection, the owners and the guards might run afoul of a federal law that imposes harsh penalties for using a firearm in furtherance of a "drug trafficking crime." 18 U. S. C. §924(c)(1)(A). A marijuana user similarly can find himself a federal felon if he just possesses a firearm. §922(g)(3). Or petitioners and similar businesses may find themselves on the wrong side of a civil suit under the Racketeer Influenced and Corrupt Organizations Act. See, e.g., Safe Streets Alliance v. Hickenlooper, 859 F. 3d 865, 876–877 (CA10 2017) (permitting such a suit to proceed).
I could go on. Suffice it to say, 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. 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." Ibid. A prohibition on intrastate use or cultivation of marijuana may no longer be necessary or proper to support the Federal Government's piecemeal approach.
Exactly backwards. Thomas is asking for consistent treatment of individuals and businesses. Refusing a writ is the judges saying “Tough beans.” Thomas wanted the case heard, which would require the judges to make a decision that would apply to all in a similar position. The current situation means the IRS can go after one grower, for political reasons (remember Tea Party) while looking the other way as other cases with the same facts.
“A prohibition on interstate use or cultivation of marijuana may no longer be necessary or proper to support the federal government’s piecemeal approach,” he wrote.
Thomas said the Supreme Court’s ruling in 2005 upholding federal laws making marijuana possession illegal may now be out of date.
“Federal policies of the past 16 years have greatly undermined its reasoning,” he said. “The federal government’s current approach is a half-in, half-out regime that simultaneously tolerates and forbids local use of marijuana.”
Thirty-six states now allow medical marijuana, and 18 also allow recreational use. But federal tax law does not allow marijuana businesses to deduct their business expenses.
“What Thomas is saying is that Gonzalez v. Raich was wrongly decided”
No, that’s what he said at the time in his brilliant dissent; what he’s saying now is that the facts on which the Gonzalez majority’s argument was based no longer apply.
Even in Alabama, there are shops selling products laced with Delta8, but also $20 chocolate chip cookies laced with Delta9.
Tens of thousands of lives and billions of dollars later, where do we stand on the "war on drugs?"
The way I’m reading this is that if the Federal government is not willing to enforce the marijuana laws that they wrote, and are currently denying federal law enforcement from enforcing, then they need to rescind all “roadblocks” placed in front of businesses/people selling/using marijuana. Right now it is a Hodge Podge of enforcement and non-enforcement which leaves the average citizen totally unable to comply with the law or to even know what the law is.
No he is saying that the confusion between State and Federal winking at laws is causing citizens engaged in legal State commerce to be Violating Fed laws that can either be winked at or ignored or used against that citizen. Let’s say that citizen pisses someone in Fed government off.
“Thomas and Alito carryon in the tradition of Scalia, while the other “Conservatives” defer to the federal executive and lower courts too often.”
Except when Scalia endorsed the New Deal Commerce Clause and even expanded it in Raich.
It took a Constitutional Amendment to ban booze. If we are Originalits, we should require nothing less for drugs. Absent such an Amendment, it’s up to the States.
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