Last week, the U.S. Supreme Court decided not to hear an appeal from the owners of a Colorado marijuana business, not because they didn’t have a good case, but rather, because they did.
We know this because Justice Clarence Thomas chose to write a statement about the court’s denial of the petition for a writ of certiorari. “A prohibition on intrastate use or cultivation of marijuana may no longer be necessary or proper,” he concluded.
The owners of Standing Akimbo Medical Dispensary were challenging a provision of the federal tax code that limits tax deductions for companies that deal in controlled substances prohibited by federal law. Under the federal rules, marijuana businesses may deduct from their taxable income only the cost of goods sold, not ordinary business expenses such as rent, utilities and employee salaries. The business owners argued that this makes the tax unconstitutional.
Thomas wrote in a footnote that their argument “implicates several difficult questions, including the differences between ‘direct’ and ‘indirect’ taxes and how to interpret the Sixteenth Amendment.” He said he agreed with “the Court’s decision not to delve into these questions.”
But the constitutional amendment that sheds the most light on this case isn’t the Sixteenth, which established the income tax. It’s the Eighteenth, which enacted a federal ban on the manufacture, sale or transportation of intoxicating liquors.
The Prohibition amendment, and the 21st Amendment repealing Prohibition in 1933, stand as witnesses to the fact that the federal government did not have the power under the Constitution to ban alcohol. The states had to approve an amendment to the Constitution to enact it, and to reverse it.
Why is marijuana different than alcohol?Ducking this question, the Supreme Court relied on complicated and disputed reasoning in the 2005 case of Gonzales v. Raich. A divided court held that Congress’ power to regulate interstate commerce gave it the power to prohibit marijuana use within a state’s borders. The majority found that the federal prohibition on intrastate use of marijuana was “necessary and proper” to avoid creating a “gaping hole” in Congress’ “closed regulatory system.”
Justice Thomas has now pointed out that this “closed” system is full of openings. Thirty-six states allow medicinal marijuana use and 18 states allow recreational use as well. In 2009, Congress itself allowed Washington D.C.’s government to decriminalize medical marijuana under a local ordinance. Further, Congress has prohibited the Department of Justice from “spending funds to prevent states’ implementation of their own medical marijuana laws” every year since 2015.
“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,” Thomas wrote.
The manufacture, distribution or possession of marijuana remains a federal criminal offense as long as it is listed as a prohibited Schedule I drug under the Controlled Substances Act. Congress could change that, but so far has not.
Justice Thomas’s statement hints at the possibility that the Supreme Court would hear a case that tees up the constitutional issue for a landmark decision. Quoting from Justice Sandra Day O’Connor’s dissenting opinion in the Raich case, Thomas wrote that the federal government “might no longer have authority to intrude on the States’ core police powers…to define criminal law and protect the health, safety and welfare of their citizens.”