The critical June 29 administrative hearing, set to determine whether the US will extend rescheduling efforts to recreational cannabis, is now set to be a fiercely contested event.
In the few weeks since Ating Attorney General Todd Blanche signed the order moving state-licensed medical cannabis to Schedule III, a string of legal challenges on both sides of the aisle have been filed in the US Court of Appeals in DC.
Once again, the rescheduling action that the industry was promised and had dared to hope for, has been thrown into serious doubt.
Part of the Series The Cannabis Rescheduling Hub The definitive 1970–present record of America’s cannabis rescheduling fight — full timeline, DEA process, market reaction, and FAQ.
Read the full record →
The attorneys general of Nebraska, Indiana, and Louisiana filed their petition in the DC Circuit on 22 May, arguing that the Blanche order ‘exceeds or is inconsistent with pertinent authority’, including both the Controlled Substances Act and the Single Convention on Narcotic Drugs, and that it failed to follow required administrative procedures.
That suit has been consolidated with an earlier challenge brought by Smart Approaches to Marijuana and the National Drug and Alcohol Screening Association, represented by attorneys at Torridon Law, where former US Attorney General William Barr is a partner.
A third, separate coalition filed in the same court in late May. The plaintiffs, New Directions Addiction Recovery Services, Cannabis Industry Victims Educating Litigators, two medical doctors, and cannabis biopharmaceutical company MMJ International Holdings, go further, naming President Trump, the DOJ, the DEA, Blanche, and DEA Administrator Terrance Cole as defendants.
They contend that the order creates a ‘Hybrid schedule’ Congress never authorised, that it failed to address cannabis’s documented health risks, that it lacks FDA-quality prescribing guidance, and that it violates equal protection by treating chemically identical products differently based solely on whether they carry a state licence or FDA approval. The plaintiffs are seeking a stay of the order pending review and its complete vacatur.
The latter challenge is perhaps most pertinent, as it comes from outside the well-established anti-cannabis lobby groups.
MMJ International Holdings is a pharmaceutical development company that has been pursuing FDA-authorised cannabinoid medicines since 2015. It received FDA Orphan Drug Designation for its Huntington’s disease drug in 2019, submitted a DEA bulk manufacturer application in December 2018, and completed all required regulatory compliance, including DEA inspections, but that application has remained unanswered.
As Business of Cannabis reported in 2024, MMJ has an active lawsuit against the DEA over what it describes as unjustified delays to its application to conduct clinical trials into cannabis treatments for Huntington’s disease and Multiple Sclerosis.
In early 2025, the DOJ determined that protections preventing the removal of Administrative Law Judges (those presiding over federal agency hearings, including DEA proceedings) are unconstitutional, and announced it would no longer defend them in court.
MMJ argued the ruling directly undermined the DEA’s legal position in the existing case, stating: “The DOJ’s decision to stop defending ALJ removal protections weakens the DEA’s legal position. This strategic shift reinforces our case that DEA delays are rooted in unconstitutional administrative practices.”
The biopharma company has now formally entered the June 29 hearing as an ‘interested person,’ raising six objections. It argues that companies that have spent years following the FDA pharmaceutical pathway, at significant cost because the government required it, now find themselves disadvantaged relative to state-market operators who bypassed that pathway and received immediate Schedule III relief.
“We followed the exact federal framework the government told cannabinoid developers was required,” said Duane Boise, MMJ’s Chief Executive. “Eight years later, the companies that complied with federal law are still waiting while the government increasingly rewards entities operating outside that same framework.”
MMJ also challenges the constitutional foundations of the hearing process itself, citing a run of recent Supreme Court decisions that have curbed federal agencies’ ability to act as judge and jury in their own proceedings, and removed courts’ obligation to simply accept those agencies’ interpretations of the law.
Five weeks after Treasury and the IRS announced guidance was forthcoming on 280E tax relief, one of the most highly anticipated aspects of rescheduling for the industry, nothing has arrived.
On 28 May, seven House Democrats, led by Reps. Steven Horsford and Steve Cohen wrote to IRS CEO Frank Bisignano and Treasury Secretary Scott Bessent, urging ‘prompt guidance’.
This guidance was set to clarify how operators holding a single licence covering both medical and adult-use activities under the same roof would be treated under the new rules, alongside operators holding separate licences for each. Both questions remain unanswered.
The delay also creates time pressure for operators who overpaid taxes in prior years, who now have a limited window to file refund claims, typically three years from when the original return was filed, or two years from when the tax was paid.
The fast-approaching June 29 hearing was presented in April as the potential mechanism for extending Schedule III to recreational cannabis and the broader market.
In the weeks since Blanche’s order, it has evolved into a far more complex event fraught with potential for more delays.
The House Appropriations Subcommittee on Commerce, Justice, Science, and Related Agencies voted 8–6 on 30 April to advance FY2027 spending legislation containing a rider that, if enacted, would block federal officials from taking further steps to reschedule cannabis. The committee has passed similar language in previous years, though none has ever become law.
The post Mounting Legal Challenges Threaten Hearing to Extend Cannabis Rescheduling to Adult Use appeared first on Business of Cannabis.
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In the few weeks since Ating Attorney General Todd Blanche signed the order moving state-licensed medical cannabis to Schedule III, a string of legal challenges on both sides of the aisle have been filed in the US Court of Appeals in DC.
Once again, the rescheduling action that the industry was promised and had dared to hope for, has been thrown into serious doubt.
Part of the Series The Cannabis Rescheduling Hub The definitive 1970–present record of America’s cannabis rescheduling fight — full timeline, DEA process, market reaction, and FAQ.
Read the full record →
Three court cases
The attorneys general of Nebraska, Indiana, and Louisiana filed their petition in the DC Circuit on 22 May, arguing that the Blanche order ‘exceeds or is inconsistent with pertinent authority’, including both the Controlled Substances Act and the Single Convention on Narcotic Drugs, and that it failed to follow required administrative procedures.
That suit has been consolidated with an earlier challenge brought by Smart Approaches to Marijuana and the National Drug and Alcohol Screening Association, represented by attorneys at Torridon Law, where former US Attorney General William Barr is a partner.
A third, separate coalition filed in the same court in late May. The plaintiffs, New Directions Addiction Recovery Services, Cannabis Industry Victims Educating Litigators, two medical doctors, and cannabis biopharmaceutical company MMJ International Holdings, go further, naming President Trump, the DOJ, the DEA, Blanche, and DEA Administrator Terrance Cole as defendants.
They contend that the order creates a ‘Hybrid schedule’ Congress never authorised, that it failed to address cannabis’s documented health risks, that it lacks FDA-quality prescribing guidance, and that it violates equal protection by treating chemically identical products differently based solely on whether they carry a state licence or FDA approval. The plaintiffs are seeking a stay of the order pending review and its complete vacatur.
The pharmaceutical industry’s complaint
The latter challenge is perhaps most pertinent, as it comes from outside the well-established anti-cannabis lobby groups.
MMJ International Holdings is a pharmaceutical development company that has been pursuing FDA-authorised cannabinoid medicines since 2015. It received FDA Orphan Drug Designation for its Huntington’s disease drug in 2019, submitted a DEA bulk manufacturer application in December 2018, and completed all required regulatory compliance, including DEA inspections, but that application has remained unanswered.
As Business of Cannabis reported in 2024, MMJ has an active lawsuit against the DEA over what it describes as unjustified delays to its application to conduct clinical trials into cannabis treatments for Huntington’s disease and Multiple Sclerosis.
In early 2025, the DOJ determined that protections preventing the removal of Administrative Law Judges (those presiding over federal agency hearings, including DEA proceedings) are unconstitutional, and announced it would no longer defend them in court.
MMJ argued the ruling directly undermined the DEA’s legal position in the existing case, stating: “The DOJ’s decision to stop defending ALJ removal protections weakens the DEA’s legal position. This strategic shift reinforces our case that DEA delays are rooted in unconstitutional administrative practices.”
The biopharma company has now formally entered the June 29 hearing as an ‘interested person,’ raising six objections. It argues that companies that have spent years following the FDA pharmaceutical pathway, at significant cost because the government required it, now find themselves disadvantaged relative to state-market operators who bypassed that pathway and received immediate Schedule III relief.
“We followed the exact federal framework the government told cannabinoid developers was required,” said Duane Boise, MMJ’s Chief Executive. “Eight years later, the companies that complied with federal law are still waiting while the government increasingly rewards entities operating outside that same framework.”
MMJ also challenges the constitutional foundations of the hearing process itself, citing a run of recent Supreme Court decisions that have curbed federal agencies’ ability to act as judge and jury in their own proceedings, and removed courts’ obligation to simply accept those agencies’ interpretations of the law.
READ MORE…
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No guidance on 280E relief
Five weeks after Treasury and the IRS announced guidance was forthcoming on 280E tax relief, one of the most highly anticipated aspects of rescheduling for the industry, nothing has arrived.
On 28 May, seven House Democrats, led by Reps. Steven Horsford and Steve Cohen wrote to IRS CEO Frank Bisignano and Treasury Secretary Scott Bessent, urging ‘prompt guidance’.
This guidance was set to clarify how operators holding a single licence covering both medical and adult-use activities under the same roof would be treated under the new rules, alongside operators holding separate licences for each. Both questions remain unanswered.
The delay also creates time pressure for operators who overpaid taxes in prior years, who now have a limited window to file refund claims, typically three years from when the original return was filed, or two years from when the tax was paid.
Critical hearing just weeks away
The fast-approaching June 29 hearing was presented in April as the potential mechanism for extending Schedule III to recreational cannabis and the broader market.
In the weeks since Blanche’s order, it has evolved into a far more complex event fraught with potential for more delays.
The House Appropriations Subcommittee on Commerce, Justice, Science, and Related Agencies voted 8–6 on 30 April to advance FY2027 spending legislation containing a rider that, if enacted, would block federal officials from taking further steps to reschedule cannabis. The committee has passed similar language in previous years, though none has ever become law.
The post Mounting Legal Challenges Threaten Hearing to Extend Cannabis Rescheduling to Adult Use appeared first on Business of Cannabis.
Continue reading...
