Oregon Company Withdraws Interstate Marijuana Trade Lawsuit, Saying ‘Big Things’ Are Coming ‘Very Soon’

Plaintiffs in a federal court case centered on interstate marijuana trade have voluntarily withdrawn their lawsuit against the state of Oregon, providing no public explanation for the move beyond saying that “big things are coming on this front very soon.”

Jefferson Packing House, a state-licensed cannabis wholesaler based in Medford, filed suit against Oregon Gov. Kate Brown (D) and others in November 2022, challenging a state law that bans exporting marijuana across state lines. While cross-border cannabis commerce is also illegal under federal law, the company said at the time that its goal was to invite Oregon officials to join them in pursuing reform.

“We recognize that marijuana is still illegal under federal law, and that this lawsuit will not change that fact,” the company said in a letter to state officials when the suit was filed. “However, we believe that the State of Oregon should be fully aligned with supporting its local marijuana industry, and therefore that Oregon law should no longer prohibit the export of marijuana to other states.”

In a one-sentence notice filed with the court this week, however, Jefferson Packing House withdrew its suit.

“Plaintiff Jefferson Packing House, LLC hereby provides notice of its voluntary dismissal of the above captioned matter, without prejudice,” wrote Andrew DeWeese, a Portland attorney who represents the company.

In response to questions from Marijuana Moment, DeWeese sent the following statement said the company “remains committed to leading the way in the push towards a true national cannabis market.”

“State prohibition on interstate commerce in cannabis remains unconstitutional,” he said. “Today’s procedural move does not change any of that. Big things are coming on this front very soon.”

DeWeese did not immediately respond to a follow-up email.

Lawyers for the state have previously asked the court to dismiss the case, asserting that Jefferson lacks standing. In a January motion, they wrote that because federal law also prohibits the export of cannabis products, the company’s “alleged injuries are not likely to be addressed by the relief that it is seeking.” Further, they argue the Dormant Commerce Clause does not apply as the lawsuit describes it.

“That doctrine prohibits states from treating interstate and intrastate commerce differently,” the state’s filing said. “Here, however, there is no interstate commerce to treat differently.”

A reply last March from Jefferson, however, contended that the federal Controlled Substances Act (CSA) “did not ‘eliminate’ commerce in marijuana any more than a criminal statute ‘eliminates’ the act or conduct it forbids.”

It’s not clear what might have led the company to drop its legal challenge. The move, first reported by Law360, may signal that the company expects a future development that would allow interstate commerce, though it’s also possible the company is concerned that an unfavorable ruling would cause more harm than good. Legal changes at the state level—for example, undoing the prohibition on interstate trade—could also render the case irrelevant.

Federal rescheduling of marijuana would conceivably allow some cross-border cannabis trade—at least of medications approved by the Food and Drug Administration—but it’s unlikely a Schedule III designation in itself would allow state-legal cannabis businesses to broadly engage in interstate commerce.

Already Oregon has a law on the books—which Brown signed into law in 2019—that would permit the state to export and import cannabis across state lines, but only if the federal government makes it legal or if the Justice Department implements an administrative policy allowing for such commerce. The Justice Department has not signaled that such a policy change is forthcoming.

All three West Coast states have interstate commerce laws on the books, in fact, with Washington adopting a law similar to Oregon’s in May of last year.

California has also enacted a cross-border cannabis law, but under that policy, the state attorney general could also trigger the implementation regardless of federal considerations. In January of last year, state regulators requested that Attorney General Rob Bonta (D) prepare that guidance.

Bonta’s office, however, said last month that launching interstate cannabis commerce could put California at “significant risk” of federal action.

In 2022, a federal appellate court ruled that Maine’s law prohibiting non-residents from owning medical marijuana businesses in the state violated the Commerce Clause of the U.S. Constitution. Some experts believe the same rationale invalidating the residency restrictions comes into play with state-level bans on marijuana imports and exports.

Disallowing imports and exports of medical cannabis between consenting states could be construed as similarly protectionist and unconstitutional, the thinking goes.

Meanwhile in Oregon, both Republicans and Democrats have expressed interest in rolling back certain positions of Measure 110, the state’s historic voter-approved law that decriminalized possession of all drugs. Though Oregon’s secretary of state said late last year that the law has improved treatment, critics contend that police need to be able to arrest and charge drug users in order to encourage treatment.

Opponents of rolling back the reform, however, say recriminalizing drugs will only cause further harm.

Separately, more than two dozen Oregon officials and advocates visited Portugal last year to study the country’s health-focused response to substance abuse disorders.

Read Jefferson Packing House’s voluntary dismissal of the interstate cannabis commerce suit below:

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