Village Farms International, Inc. VFF and Hemp for Victory filed a joint motion seeking to disqualify the Drug Enforcement Administration (DEA) from defending the proposed rescheduling of marijuana from Schedule I to Schedule III under the Controlled Substances Act.

The parties argue that the DEA is compromised and opposes the rescheduling, suggesting its role should be taken by the Department of Justice (DOJ) to ensure an impartial process.

"It is our belief that the DEA cannot lawfully act as the proponent of the Proposed Rule and that its actions throughout the administrative process demonstrate that it opposes the proposed transfer of marijuana to Schedule III and is therefore compromised," Shane Pennington, partner at Porter Wright Morris & Arthur, LLP and counsel to Village Farms and Hemp for Victory commented, "Treating the DEA as the proponent of the Proposed Rule would violate APA and DEA regulations and render these proceedings a sham. Lawyers from the Department of Justice, not the Drug Enforcement Administration, must therefore defend this rule."

In August 2023, Health and Human Services (HHS) Secretary Xavier Becerra confirmed his agency responded to President Biden’s directive to provide scheduling recommendations for cannabis to the DEA. HHS called for marijuana to be reclassified as a Schedule III drug under the Controlled Substances Act.

The motion argues that "Not once in its history as an agency had DEA ever rejected an HHS scheduling recommendation. This time, however, DEA did not just disagree with HHS's views, it opposed them so vehemently that the Attorney General had to refer the interagency dispute to the Office of Legal Counsel for resolution."

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Calling For Transparency

The motion also asks that the record include all requests for hearing and/or participation in these proceedings filed with the DEA; a record of the decisions made by the Administrator regarding why certain parties were designated as participants and others were not; and any ex parte communications between DEA and third parties.

"Without knowing who DEA excluded and why, there is no way to assess whether and to what extent the Agency's decisions are arbitrary and capricious, the subject of bias, or otherwise unlawful," reads the filing. "If, for example, DEA included parties with expertise on a particular topic but only if they opposed the Proposed Rule while also excluding parties with even more expertise on that same topic if they supported the Proposed Rule, then there would be a powerful case to be made that the Agency's decisions were arbitrary and capricious."

Among 25 participants that DEA chose to join the hearing on rescheduling cannabis is Smart Approaches To Marijuana (SAM), an organization opposed to marijuana legalization and commercialization. On the other hand, Village Farms is the only cannabis operator selected to represent cannabis industry.

Village Farms and Hemp for Victory also require that SAM and the DEA be ordered to preserve their records, as factual evidence demonstrates unlawful conduct which has further compromised the DEA's participation in the proceedings.

Michael DeGiglio, retired Navy captain and naval aviator and president and chief executive officer of Village Farms concluded, "Our organization embraces the power of the cannabis plant as an alternative to Big Pharma and harmful, addicting drugs like opioids. However, we continue to face burdensome challenges in several of our regulatory jurisdictions that not only restrict us from advancing access to cannabis for millions of people, but have also created near-insurmountable institutional barriers to clinical research involving cannabis. We are proud to be one of the pro-cannabis participants selected to testify as a witness in the upcoming Rescheduling Hearing, but the filing of this joint motion reflects our desire for a more transparent process that ensures all credible voices are heard, including other applicants whose expertise has been overlooked or ignored."

DEA Under Attack

The motion follows a lawsuit by a Washington-based researcher filing a lawsuit against the DEA alleging multiple legal violations in the agency’s process of rescheduling marijuana. David Heldreth, CEO of psychedelic research firm Panacea Plant Sciences, claims the DEA’s recent actions violate federal law and constitutional principles. Despite submitting a request to participate in the hearings, Heldreth’s company, Panacea Plant Sciences, was excluded from the list of 25 participants chosen by Milgram. This exclusion is at the heart of Heldreth’s lawsuit, which accuses the DEA of bias and of sidelining critical voices in favor of larger, established players in the industry.

Moreover, the Veterans Action Council (VAC), a cannabis advocacy organization for military vets, filed a petition also challenging its exclusion from the DEA’s participant list. VAC contends that the DEA failed to meet its obligation to include all interested parties. “The DEA was tasked with putting forward a group of ‘interested parties.’ They failed to do so, as illustrated by the judge’s recent order,” said VAC’s Michael Krawitz.

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