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A researcher has filed a lawsuit against the Drug Enforcement Administration, accusing the agency of multiple legal violations in its process of marijuana rescheduling.
David Heldreth, researcher and CEO of psychedelic research and development company Panacea Plant Sciences, filed a complaint last week in the U.S. District Court for Western Washington against the Department of Justice, Attorney General Merrick Garland, the DEA, its Administrator Anne Milgram, and DEA Judge John J. Mulrooney II.
Heldreth alleges multiple violations in the DEA’s recent marijuana scheduling process and seeks injunctive and declaratory relief.
The process to reschedule marijuana under the Controlled Substances Act began in 2022 when President Joe Biden directed federal agencies to reconsider marijuana’s classification.
Marijuana is currently classified as a Schedule I drug, indicating no accepted medical use and high abuse potential. Rescheduling it to Schedule III would recognize its medical uses and lower abuse potential, similar to drugs like ketamine and anabolic steroids, which have moderate to low dependence risks.
This change would also remove marijuana from Section 280E of the Internal Revenue Code, which currently prohibits businesses involved in the cultivation, production, or sale of Schedule I drugs from deducting operating expenses for tax purposes.
In April 2024, the DEA agreed with the Department of Health and Human Services’ recommendation to move marijuana from Schedule I to Schedule III, easing restrictions on the marijuana industry.
Following this, the DEA opened a 62-day public comment period, which closed on July 22, and received around 43,000 comments from diverse stakeholders, including cannabis advocates, medical professionals, and law enforcement officials.
On August 27, the DEA announced it would hold a hearing on the rescheduling proposal, set for December 2.
Despite requesting to participate, Panacea Plant Science was not included in the final list of 25 participants selected by DEA Administrator Milgram.
In this context, Heldreth accuses the DEA of ignoring Native American tribes, sidelining small businesses, blocking his company’s participation in key hearings, and using unconstitutional practices in its rulemaking process.
Alleged Legal Violations in DEA’s Marijuana Rescheduling
In the complaint, Heldreth argues the DEA refused to consult tribes on its decision to reschedule marijuana when rescheduling to Schedule III would directly impact tribal law enforcement and health services, thus placing a burden on the tribal government for which there is no supporting federal funding.
Also, Heldereth says that the DEA’s rulemaking harms small cannabis businesses, including Panacea Plant Sciences, where he is the CEO, and claims the DEA’s approach favors larger entities with Schedule III licenses, leaving small businesses with no opportunity to engage in the rulemaking process.
Furthermore, Heldereth says that the DEA excluded him and his company from a scheduled hearing on marijuana despite submitting a timely request. He views this exclusion as punitive, claiming DEA Administrator Milgram’s decision was biased and aimed at sidelining critics.
Lastly, Heldereth challenges the constitutionality of the DEA’s Administrative Law Judges, arguing their appointment by the DEA Administrator violates Article II of the U.S. Constitution.
In light of these claims, Heldereth seeks injunctive relief to stop the DEA’s marijuana rulemaking and pause the ALJ hearings until issues with tribal and small business consultations, participant selection, and ALJ appointments are resolved.
Marijuana reforms come amid a transition period following President-elect Donald J. Trump’s victory over Vice President Kamala Harris in November’s election.
During his campaign, Trump expressed support for reclassifying marijuana under federal law and enabling regulated cannabis companies to access traditional banking services. He also backed state efforts to legalize recreational marijuana, including a measure in Florida, his adopted home state. However, the ballot measure did not pass.
After the DEA hearing, the presiding administrative law judge will file a report on the testimony, which the DEA must review before issuing its final rulemaking.
This final rule must consider all relevant materials from the public comment period. The DEA must also address significant issues raised in the comments and provide reasoned explanations for its decisions. Once this is complete, the final rulemaking will be published in the Federal Register, which officially changes marijuana rescheduling under the CSA.
“}]] A researcher has filed a lawsuit against the Drug Enforcement Administration, accusing the agency of multiple legal violations in its process of marijuana rescheduling. Read More
