Update on Medical Marijuana Law and its Impact on Employment

In our blog posted on May 29 2015, we reviewed the issues surrounding the use by an employee of medical marijuana and its consequences in the workplace. Since then, a closely watched case pending before the Colorado Supreme Court was decided by the full court. Coats v. Dish Network, LLC, 2015 WL 3744265 (June 15, 2015).

Coats is a quadriplegic and has been confined to a wheelchair since he was a teenager. In 2009, he registered for and obtained a state-issued license to use medical marijuana to treat painful muscle spasms caused by his quadriplegia. He consumes medical marijuana at home, after work, and in accordance with his license and Colorado state law.

For three years Coats worked for Dish as a telephone customer service representative. The month before he was fired, he tested positive for tetrahydrocannabinol (“THC”), a component of medical marijuana, during a random drug test. Coats had told Dish Network that he was a registered medical marijuana patient and planned to continue using medical marijuana. He was then fired for violating the company’s drug policy.

Coats filed a wrongful termination claim against Dish under Colorado law (section 24–34–402.5), which generally prohibits employers from discharging an employee based on his engagement in “lawful activities” off the premises of the employer during nonworking hours. § 24–34–402.5(1). He asserted that Dish violated the statute by terminating him based on his outside-of-work medical marijuana use, which he argued was “lawful” under the Medical Marijuana Amendment and its implementing legislation.

Dish filed a motion to dismiss, arguing that Coats’s medical marijuana use was not “lawful” for purposes of the statute under either federal or state law, and the trial court granted the motion. It rejected Coat’s argument that the Medical Marijuana Amendment made his use a “lawful activity” for purposes of section 24–34–402.5. Instead the court found that the Amendment provided registered patients an affirmative defense to state criminal prosecution without making their use of medical marijuana a “lawful activity” within the meaning of section 24–34–402.5. The trial court concluded that the statute afforded no protection to Coats and dismissed the claim without examining the federal law issue.

On appeal, Coats again argued that Dish wrongfully terminated him under section 24–34–402.5 because his use of medical marijuana was “lawful” under state law. Dish likewise reiterated that it did not violate section 24–34–402.5 because medical marijuana use remains prohibited under federal law.

In a split decision, the court of appeals affirmed based on the prohibition of marijuana use under the federal Controlled Substances Act (the “CSA”). Looking to the plain language of section 24–34–402.5, the majority found that the term “lawful” means “that which is ‘permitted by law.’ ” Applying that plain meaning, the majority reasoned that to be “lawful” for purposes of section 24–34–402.5, activities that are governed by both state and federal law must “be permitted by, and not contrary to, both state and federal law.” Given that the federal CSA prohibits all marijuana use, the majority concluded that Coats’s conduct was not “lawful activity” protected by the statute. The majority therefore affirmed the trial court’s decision on different grounds, not reaching the question of whether the state constitutional amendment created a constitutional right for registered patients to use medical marijuana or an affirmative defense to prosecution for such use.

In dissent, Judge Webb argued that the term “lawful” must be interpreted according to state, rather than federal, law. He argued that the majority’s interpretation failed to effectuate the purpose of the statute by improperly narrowing the scope of the statute’s protection. Finding that the Medical Marijuana Amendment made state-licensed medical marijuana use “at least lawful,” Judge Webb concluded that Coats’s use should be protected by the statute.

The Supreme Court granted review of the court of appeals’ opinion and under a de novo standard of review, affirmed. The Court held that the term “lawful” as it is used in section 24–34–402.5 is not restricted in any way, and declined to “engraft a state law limitation onto the term.” It concluded, therefore, that medical marijuana’s use that is unlawful under federal law is not a “lawful” activity under section 24–34–402.5.

The Court refused to read the term “lawful” in the state statute restrictively (i.e., to mean “lawful” according only to Colorado state law). Instead, the Court held that term is used in its general, unrestricted sense, indicating that a “lawful” activity is that which complies with applicable “law,” including state and federal law.

The Court analyzed the CSA, which prohibits medical marijuana use. Noting that the CSA lists marijuana as a Schedule I substance, meaning federal law designates it as having no medical accepted use, a high risk of abuse, and a lack of accepted safety for use under medical supervision, the Court concluded that this makes the use, possession, or manufacture of marijuana a federal criminal offense, except where used for federally-approved research projects. As there is no exception for marijuana use for medicinal purposes, or for marijuana use conducted in accordance with state law (see Gonzales, 545 U.S. at 29 (finding that “[t]he Supremacy Clause unambiguously provides that if there is any conflict between federal and state law, federal law shall prevail,” including in the area of marijuana regulation) the Court held that Coats’s use of medical marijuana was unlawful under federal law and thus not protected by section 24–34–402.5.

The decision is significant. Even under circumstances where Colorado law specifically provides that an employee may not be discharged based on his engagement in “lawful activities” off the premises of the employer during nonworking hours and an employee has a license to use medical marijuana, doing so during non-work hours, off work premises, the employee has no basis to challenge an employer’s termination based upon the use of medical marijuana, even where, as in the Coats case, there were no allegations that he smoked marijuana at work. According to Dish’s lawyer: “He tested positive, had THC in his system. We are alleging that he was using THC at the workplace. The definition of use is in the medical marijuana act. It’s the employment of something, the longstanding possession of something. He smoked marijuana while at home, but he crossed the threshold [to his office] with THC in his system. The use is the effects, it’s the THC, it’s the whole point of marijuana. So when he came to work, he was using.”


2017-01-13T17:21:04+00:00 June 22nd, 2015|Categories: Labor Law & NLRB, Laws & Regulations, Litigation, Mary E. (Beth) O'Neal, Wage & Hour|0 Comments

Leave A Comment