Federal court judges have ruled that a Maine law requiring licensed medical cannabis providers to be in-state residents is unconstitutional.

Judges for the US Court of Appeals for the First Circuit ruled 2 to 1 that the law was “facially protectionist” and thereby in violation of the Constitution’s dormant commerce clause – which seeks to discourage states from taking steps that excessively burden interstate commerce. The majority further determined that the medical cannabis industry is subject to the dormant commerce clause, even despite the federal prohibition of marijuana, because commercial activity in the marijuana market is routinely taking place absent any intervention from federal law enforcement. 

They opined, “Congress’s enactment of the Rohrabacher-Farr Amendment in the wake of the CSA’s [Controlled Substances Act] passage … undermines the notion that no such interstate market exists. … [Further,] the prohibition that Maine’s Medical Marijuana Act seeks to impose on out-of-state actors entering that very market reflects the reality that the market continues to operate. That prohibition even indicates that the market is so robust that, absent the Medical Marijuana Act’s residency requirement, it would be likely to attract entrants far and wide.” 

The majority concluded, “Why, then, would it be improper for us to apply the dormant Commerce Clause here? There is an interstate market, and a state is trying to protect its advantageous position with respect to it.”

The dissenting judge argued that the commerce clause’s protections ought to be applicable only to national markets involving goods or services that Congress has deemed legal.

Maine regulators had already dropped a similar residency requirement for those seeking licensure to participate in the adult-use market.

The case is Northeast Patients Group v. Maine Department of Administrative and Financial Services.

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