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Dozens of marijuana companies and advocacy groups are pushing back against Sen. Mitt Romney’s (R-UT) recent claims that the U.S. would be in violation of international drug treaty agreements if it reschedules cannabis to Schedule III of the Controlled Substances Act (CSA).

In a letter sent to Romney this month, more than 50 organizations said the senator made “inaccurate claims that neither reflect the current state of medical and scientific knowledge about marijuana nor an accurate application of relevant treaties to proposed reforms.”

As the U.S. government moves toward reclassifying marijuana as a less dangerous drug, there may be little immediate impact in the dozen states that have not already legalized cannabis for widespread medical or recreational use by adults.

But advocates for marijuana legalization hope a federal regulatory shift could eventually change the minds — and votes — of some state policymakers who have been reluctant to embrace weed.

Or would the INCB at last recognize that the trend toward legal regulation of adult recreational cannabis will not be reversed and initiate a process to assist State parties to the drug control treaties to find a solution, and a pathway to legally regulate cannabis in accordance with international law and the UN drug control treaties? On this issue, there has been an interesting debate for years among drug control experts and scholars in international law, with the notable exception of the INCB. Most experts involved recognize that legal regulation does in fact violate the 1961 Single Convention, so the debate focuses on legally sound and politically feasible options that would enable cannabis regulation to proceed in accordance with international law.

Without going into detail here, several viable options have been proposed.[3] One option would be to denounce the 1961 Single Convention and subsequently re-accede with a reservation regarding cannabis. Although contro­versial, this option is anchored in the treaty itself and has a precedent; Bolivia successfully used this procedure to allow for the cultivation, trade and consumption of the coca leaf within Bolivia. The country using the denounce-and-re-accede option runs the risk of being blocked, however, if more than one-third of the parties to the convention object to the re-accession with a new reservation. If a group of like-minded countries were to collectively follow this procedure, the risk of being blocked from re-entering the treaty might be mitigated. Another option available to like-minded countries would be an inter se modification,[4] a procedure specified in Article 41 of the 1969 Vienna Convention on the Law of Treaties (VCLT) in which two or more of the parties to a multilateral treaty may conclude an agreement to modify the treaty as between them­selves alone. This procedure would also prove to be politically controversial, but would not be subject to the risk of being blocked by objecting countries, as in the case of the unilateral procedure of denouncing and re-acceding to the treaty. If the expanding group of like-minded countries were to agree on an inter se modification, an alternative control regime that allows for legally regulated adult recreational cannabis would eventually emerge.

Federal law allocates the power to place drugs into a particular schedule to the Attorney General,27 but that authority has been delegated to the DEA.28 This discretion can, however, be circumscribed by congressional mandate.29 Indeed, that [*182] authority was invoked in 2018 with the passage of the Agricultural Improvement Act of 2018 ("2018 Farm Bill" or "Farm Bill").30

Emerging cannabis businesses face significantly different hurdles compared to emerging businesses in other industries. Due to federal laws and administrative rulings, cannabis businesses cannot and do not enjoy the same patent and trademark advantages that emerging businesses in other industries enjoy.

These IP disadvantages mean that cannabis businesses must be mindful of their legal options and take advantage of these options in an effective and creative manner. Ideally, emerging cannabis businesses should utilize a combination of IP mechanisms to protect and build their brands as each confers different protections. When patenting is not a viable option, businesses can utilize ancillary and state trademarks, carefully protect trade secrets, and capitalize on branding techniques like the first-mover advantage. But given the cannabis industry's exponential growth, the federal government must remove the IP hurdles that emerging cannabis businesses face. Congress can and should act to faithfully execute its duty to "promote the Progress of Science and useful Arts" 207 and grant cannabis businesses rights enjoyed by other industries. The most obvious measure Congress can take is legalizing the cultivation, transportation, sale, and use of marijuana on a federal level. Such action would likely create uniform regulation throughout the country whereas currently marijuana law is a patchwork of state law.

The eighteen objections submitted make hardly any attempt to argue against what Bolivia has actually proposed. The U.S. objection merely states that the objective of the Single Convention is to limit the use of narcotic drugs exclusively to medical and scientific purposes and that Schedule I lists coca leaf as a narcotic drug. No further explanation is provided.

However, the implication – as spelled out in the objection by Latvia – is that because the purpose of Bolivia’s amendment is “to maintain a habit and socio-cultural practice, not a medical or scientific purpose,” coca leaf chewing still needs to be abolished. The UK, Canada, Denmark, Bulgaria, Russia and Japan all more or less copied and pasted from the text of the U.S. objection, not adding any further explanation. These countries avoid addressing the inconsistency of a coca chewing ban with the 1988 Trafficking Convention, whereby all measures “shall take due account of traditional licit uses, where there is historic evidence of such use” (article 14) and with the 2007 UN Declaration on the Rights of Indigenous Peoples, key arguments brought forward by Bolivia.

Similarly, procedures within all three treaties allow even limited opposition to a proposed amendment to thwart the initiative. For both the 1961 and 1971 Conventions, if no Party rejects the amendment within 18 months after circulation ‘it shall thereupon enter into force.’ (Article 47 (2) and Article 30 (2) respectively). However, if a proposed amendment is rejected by one or more parties, the Council may follow suit in ‘response to objections and the substantial arguments provided’67 or decide whether a conference should be called to consider the amendment. As well as operating on a more generous timetable, provisions within the 1988 Convention differ somewhat in other respects. According to Article 31 (1), if a proposed and circulated amendment has not been rejected by any party within 24 months, ‘it shall be deemed to have been accepted and shall enter into force in respect of a Party…’ However, moving away from ‘tacit approval’ within the earlier treaties,68 this comes into effect ninety days after ‘that party has deposited with the Secretary General an instrument expressing its consent to be bound by that amendment.’ In this case, if the proposed amendment is rejected by any party, the UNSG must consult with the parties and ‘if a majority so requests, bring the matter to the Council which may decide to call a conference.’ (Article 31 (2))

A difficult dilemma has thus entered the international drug policy arena. There is no doubt that recent policy developments regarding cannabis regulation have moved beyond the legal latitude of the treaties. Initiating a formal procedure to review or amend the current treaty framework, however, would not only immediately trigger an avalanche of political frictions with some of the most powerful countries in the world, but could even lead to unintended negative outcomes. Indeed, even as many governments continue to tout the supposed global consensus on drug policy, officials are quite aware of the significant and growing policy differences among parties to the drug treaties; to the extent that a truly global consensus ever existed, it is now fractured, and there is no new consensus to take its place.

Under such conditions, it is not difficult to understand why many countries would prefer to avoid or delay confronting the treaty questions raised by cannabis regulation. Indeed, such concerns go far in explaining the attraction of the legally fallacious—but politically potent—stance that the drug treaties as they stand are flexible enough to accommodate the regulation of adult use cannabis. But the costs of adhering to such a legal fiction are likely to grow over time, at the expense of the reputations of the states that cling to it, and to the detriment of compliance with the drug control treaties themselves as well as international law more broadly.

Reaching a new global consensus to revise or amend the UN drug control conventions in order to accommodate legally regulated markets for cannabis, coca or other psychoactive plants and substances controlled under these treaties, does not appear to be a viable political scenario for the short-term foreseeable future. The inability to reach global consensus is not limited to drug control; it is a dilemma that links drug control with other global issues.197 Meanwhile, the limits of flexible treaty interpretations have been reached and overstretching them any further with legally dubious arguments would result in undermining basic principles of international law.198 States that intend to move towards legal regulation, or that have already done so, are therefore obliged to explore other options to reconcile such policy changes with their obligations under international law. Only a few options are available that do not require the consent of all the treaty parties.199

The WHO can recommend after a critical review by its Expert Committee on Drug Dependence to ‘un-schedule’ a controlled substance (remove it from the treaty schedules), and the Commission on Narcotic Drugs can adopt the recommendation by a simple or two-thirds majority vote (for the 1961 and 1971 conventions respectively). As noted above, the WHO Expert Committee is in fact undertaking a pre-review process for cannabis and has announced a special meeting to discuss the classification of cannabis for June 2018.200 The outcome of the subsequent critical review could come to the CND agenda earliest by March 2019 and will probably result in its deletion from Schedule 4, and possibly to a de-scheduling from Schedule 1 to 2. The chance that a WHO recommendation to fully un-schedule cannabis from the treaties altogether would get the required CND majority, however, also looks under current political circumstances to be unlikely.

Second, cannabis firms must have unfettered and legitimate access to networks in capital markets. Cannabis is a growth industry, with some cannabis stocks quickly transforming themselves from penny stocks to highly-desirable securities. 311Some firms have reported astounding growth, with returns between 2000% and 7500% reported over a three-year period. 312Such growth is of course unsustainable, and [*407] cannabis stocks are, as one writer described, "fraught with big time risks, hefty volatility, [and] zero profits ... many marijuana stocks are just speculative bets." 313Exchange traded funds ("ETFs") tied to cannabis firms have posted 50% losses within a short period of time. 314 In spite of this volatility, investors are still bullish on the long-term prospects of the cannabis industry. 315 This is in part because unlike some tech stocks that needed to create a market for their inventions, cannabis firms already have a substantial demand for their products in North America. 316

No matter how optimistic investors may be about future growth, cannabis firms cannot reach their potential without unfettered access to capital markets. 317Cannabis firms still struggle to find a bank that is willing to provide them with basic financial services. 318 This barrier represents a "mark of condemnation" that forces firms to deal largely in cash, which increases the risk of robbery as well as the difficulty to pay taxes or complete other transactions that do not accept cash payments. 319Banks are also reluctant to lend to cannabis firms, recognizing the possibility that the federal government could seize a firm's assets and leave the lender nothing to collect from the loan. 320

There is a growing body of literature on strategic behavior within the U.S. cannabis industry.199 This research describes how firms seeking competitive advantage in this market navigate a legal environment characterized by constant regulatory change and inconsistent enforcement of relevant laws.200

[Footnote 200 Begins]

More broadly, the desire to control the marijuana market via regulation is misguided.

If regulation is mild, it has no meaningful effect. Consider a rule that limits purchases to one ounce per customer per month. For most users an ounce lasts at least a month anyway. And consumers who want more can purchase at multiple stores or have friends or family purchase for them

The history of cannabis regulation is tainted by racism and xenophobia. The first modern attempts at criminalization coincided with an influx of Mexican immigrants to the United States. 21 The public began to associate the increase in cannabis consumption with this immigration, and the stereotypes that Mexicans are lazy and dangerous were tied to cannabis use. 22 Opponents also argued that cannabis made white women vulnerable to black men's lust and encouraged [black people] blacks and Mexicans to perpetrate violent crimes. 23 Cannabis's alternative name - marijuana - was used specifically to stoke fear and foreignness in American citizens about the otherwise banal-sounding cannabis plant. 24As a mid-century commissioner of the Federal Bureau of Narcotics infamously opined: "There are 100,000 total marijuana smokers in the U.S., and most are Negroes, Hispanics, Filipinos and entertainers. Their Satanic music, jazz and swing result from marijuana use. This marijuana causes white women to seek sexual relations with Negroes, entertainers and any others." 25 Cannabis prohibition was as much an invidious cultural expression of white fear as it was a legal prohibition of a supposedly dangerous drug.

The Cannabis Regulatory Agency (CRA) is frequently asked why marijuana is sometimes spelled with a “h” and other times is spelled with a ”j.” Both spellings – marijuana and marihuana – are acceptable. To avoid confusion, many in the industry refer to the botanical plant — cannabis. While the spelling with a “j” is more common today, you will still see Michigan law using the “h” spelling.

The spelling of marijuana has a long history in the United States. Michigan’s history primarily starts from the spelling that was chosen for the Marihuana Tax Act of 1937. Michigan adopted its statutory definition of marijuana in the Public Health Code, utilizing the past federal spelling, marihuana.

(16) (A) Subject to subparagraph (B), the terms “marihuana” and “marijuana” mean all parts of the plant Cannabis sativa L., whether growing or not; the seeds thereof; the resin extracted from any part of such plant; and every compound, manufacture, salt, derivative, mixture, or preparation of such plant, its seeds or resin. (B) The terms “marihuana” and “marijuana” do not include— (i) hemp, as defined in section 1639o of title 7; or (ii) the mature stalks of such plant, fiber produced from such stalks, oil or cake made from the seeds of such plant, any other compound, manufacture, salt, derivative, mixture, or preparation of such mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of such plant which is incapable of germination.

In a much-publicized development, Congress "legalized" hemp in 2018 by changing the definitions of marihuana and THC in the CSA. 226 First, this reveals the dubious position of those who assert hemp as some kind of separate cousin species to cannabis. The Agriculture Improvement Act 227 effectively defines hemp as Cannabis sativa with THC concentration of not more than 0.3 percent on a dry weight basis. 228 Second, the descheduling of "hemp" and Commissioner Gottlieb's response underscore this Article's thesis that descheduling cannabis will not result in the free production, marketing, and distribution that proponents have claimed. Instead, the FDA will continue to regulate any product containing ingredients such as TH Cand CBD that are themselves currently regulated as drugs, as well as any medical claims made by a producer of any products, regardless of whether those products or their ingredients are scheduled under the CSA.

What exactly federal legalization would entail is debatable. See JONATHAN P. CAULKINS ET AL., RAND CORP., CONSIDERING MARIJUANA LEGALIZATION: INSIGHTS FOR VERMONT AND OTHER JURISDICTIONS 50 (2015), https://www-rand-org.proxy.lib.umich.edu/pubs/research_reports/RR864.html [https://perma.cc/64QA-BNPS] (describing 12 alternative ways to regulate marijuana). Establishing a three-tier system to regulate recreational marijuana is widely supported, especially by the alcohol industry. See Spencer Bokat-Lindell, What's the Right Way to Legalize Weed?, N.Y. TIMES (Nov. 19, 2019), https://www.nytimes.com/2019/11/19/opinion/weed-legalization-biden.html [https://perma.cc/9DSF-YPCR]; see, e.g., Thomas Pellechia, Wine & Spirits Wholesalers of America Group Supports Legalized Cannabis, FORBES (July 27, 2018, 10:21 AM), https://www.forbes.com/sites/thomaspellechia/2018/07/27/the-u-s-trade-group-representing-80-of-alcohol-sales-supports-legalized-cannabis/#1a19aa6d74c2 [https://perma.cc/UA7F-SGR2]. Regardless of the end result, the first step must be removing marijuana from Schedule I of the CSA, and the House Judiciary Committee recently approved a bill that does just that. See Berkeley Lovelace, Jr., House Committee Approves Landmark Bill Legalizing Marijuana at the Federal Level, CNBC (Nov. 21, 2019, 6:18 PM), https://www.cnbc.com/2019/11/20/house-committee-approves-bill-decriminalizing-marijuana-on-the-federal-level.html [https://perma.cc/E9DZ-H8RK].

The most dramatic federal actions regarding cannabis during the Trump Era occurred in 2018. First, the FDA approved a cannabis-derived CBD drug [*314] (Epidiolex(R)) for certain forms of epilepsy. 199Then, with the Agricultural Improvement Act of 2018 (the "Farm Act"), Congress embraced a new, bifurcated approach to regulating cannabis in general. 200 While preserving the Schedule I status of "marihuana" under the Controlled Substances Act, the 2018 Farm Act deschedules "hemp," which it defines as Cannabis sativa L. containing no more than 0.3 percent THC (the principal psychoactive cannabinoid). The statutory definition of "hemp" does not, however, similarly limit the amount of CBD, a non-intoxicating cannabinoid widely studied and used for its medical (including psychological) effects. Moreover, because the Farm Act's dispensation for hemp covers derivatives of the plant--including "cannabinoids"--the statute effectively deschedules CBD derived from hemp. Congress thus opened the floodgates to the current deluge of hemp and CBD products marketed directly to consumers as dietary supplements, foods, cosmetics, and even drugs. In the FDA's view, almost all of these products remain illegal under the federal Food, Drug, and Cosmetic Act, but the agency remains uncertain about how to exercise its regulatory power in this area. 201

In December of 2018, the 2018 Farm Bill was signed into law. It removed hemp, defined as cannabis (Cannabis sativa L.) and derivatives of cannabis with extremely low concentrations of the psychoactive compound delta-9-tetrahydrocannabinol (THC) (no more than 0.3 percent THC on a dry weight basis), from the definition of marijuana in the Controlled Substances Act (CSA).

The 2018 Farm Bill explicitly preserved FDA’s authorities over hemp products. Therefore, hemp products must meet any applicable FDA requirements and standards, just like any other FDA-regulated product. For example, FDA’s existing authorities over foods, dietary supplements, human and veterinary drugs, and cosmetics apply to hemp products to the extent such hemp products fall within those categories. These safeguards help ensure that Americans have access to safe and accurately labeled hemp products, and, in the case of drugs, that patients can depend on the effectiveness of these products.

Third, "descheduling" means congressional amendment of the CSA to remove "marihuana"--or at least some parts of that broad statutory term--from any of the restricted Schedules of controlled substances. Descheduling should also include DEA action to remove medically relevant components of cannabis, such as THC and CBD, as well as synthetically-produced analogues, that it has placed in any of the controlled substances Schedules under its statutory authority granted under the CSA. Full descheduling would mean that (medical) cannabis is no longer a controlled substance at any level.