Marijuana Dispensary Owner Says DEA Is Forcing Her To Fire Workers In Order To Get Federal Protections Under Trump’s Rescheduling Move

A medical marijuana dispensary owner in Mississippi is planning to fight a decision by the Drug Enforcement Administration (DEA) that she says could force her to fire two good employees if she wants to register for federal protections in line with the Trump administration’s move to federally reschedule cannabis.

Nicole Huff, CEO of the Wildflower Medical Dispensary in Aberdeen, shared with Marijuana Moment correspondence that a DEA official sent about the two workers in question, who have past felony convictions. As a result of those criminal records, the business must either fire the employees, withdraw its application for federal protections, seek a waiver while becoming ineligible for expedited processing or go before an agency judge.

“I am frustrated and disappointed that, after these two individuals have worked for me for more than a year without any issues or disciplinary actions, the DEA would require me to remove them from their positions,” Huff told Marijuana Moment.

Ashlie Way, a diversion investigator with DEA’s Jackson District Office, sent Huff an email last Thursday saying that “because you have the 2 employees who have felony convictions, you have the following options when it comes to your application.”

“You can waive your right to the expedited application in the event you want to proceed with an employment waiver,” it said. “Or you can withdraw your DEA application.”

“If you choose not to do either of those, I will send your application up for what we call an Order to Show Cause. An Order to Show cause is when an application is sent to Headquarters. They will assign it to an attorney who will send out a letter to the applicant letting them know that they have the right to request a hearing. If they choose to have a hearing, the applicant will respond to the letter, and a hearing will be set for them before the Administrative Law Judge (ALJ). I believe the hearing is held in Washington DC. The applicant will then have the opportunity to present their case to the ALJ. From there, the Judge will determine if the application proceeds to a registration or if the application will be denied.”

The email said the dispensary would need to make a decision by no later than the close of business four days later—on Monday, which was Labor Day.

Huff told Marijuana Moment that she will take the issue before a DEA judge.

“I plan to request employment waivers on their behalf,” she said. “I understand that doing so may require me to travel to Washington, D.C., and appear in federal court, and I am prepared to take the necessary steps.”

“It is already extremely difficult for individuals with nonviolent felony convictions to obtain stable employment. I intend to ask the court to consider a grandfather provision for individuals who were employed before the DEA application was submitted,” Huff said. “If an employee has a nonviolent conviction, has maintained satisfactory employment and has received no disciplinary actions, I believe that person should be eligible for an exemption from mandatory removal.”

The two Wildflower workers in question “have demonstrated their reliability through more than a year of successful employment,” she said. “I plan to ask that their individual circumstances and employment records be considered before a final decision is made. I hope other dispensary owners would do the same.”

Huff didn’t directly respond to Marijuana Moment’s question about what kind of felony convictions her employees have.

Marijuana Moment also reached out to DEA about the number of applications for registration it has received to date and how many of those are being similarly held up due to workers’ criminal records, but a representative did not respond.

DEA regulations for registration to handle controlled substances state that “the registrant shall not employ, as an agent or employee who has access to controlled substances, any person who has been convicted of a felony offense relating to controlled substances.”

The agency does, however, allow employers to submit requests for waivers.

“A waiver will not be considered unless there are valid reasons to believe that diversion is unlikely to occur,” a DEA manual says.

The agency will weigh several factors in making its determination on a waiver, it says:

1. A detailed description of the nature and extent of the individual’s past controlled substances violations, including all pertinent documentation;
2. Current status of the individual’s state licensure;
3. Extent of individual’s proposed access to controlled substances. “Access” is not limited to only physical access to controlled substances, but includes any influence over the handling of controlled substances;
4. Registrant’s proposed physical and professional safeguards to prevent diversion by the individual;
5. Status of employing registrant regarding handling of controlled substances;
6. Other pertinent information uncovered by DEA in its investigation of the individual’s or registrant’s handling of controlled substances; and
7. All other relevant factors or materials.

In Huff’s case, even if she asks for and receives a waiver, she will still have to waive her right to the agency’s expedited application process for registration for the federal benefits and protections that come with rescheduling, according to Way’s email.

Meanwhile, the agency has been conducting inspections and follow up interviews with medical cannabis businesses that register for federal protections, but industry sources say the way the agency has been carrying out those activities varies between DEA’s regional offices throughout the country.

In June, Mississippi medical cannabis businesses spoke to Marijuana Moment about being visited by DEA officials, who told them they were among the first in the country to be seen for inspection under the registration process.

Last month, Marijuana Moment obtained a list of 26 questions that DEA officials are sending to medical cannabis businesses in Colorado as part of the consideration of their applications for registration.

The questions on the form being sent to Colorado businesses include:

• Will you be ordering marijuana or marijuana products from other states?
• Will you be ordering synthetic cannabinoids?
• Will you be ordering marijuana seeds or plants in order to grow at the dispensary location?
• What are the specific types of products offered (e.g., gummies, extracts, concentrates, tinctures, topical products, oils, flower buds, oil cartridge vapes, dry herb vapes, pre-rolled cannabis cigarettes, etc.)?
• Please identify your medical marijuana supplier(s) to include name(s), address(es), and DEA registration number(s).
• Please provide a copy of any labeling, packaging, and sealing policies (refer to federal guidelines for medical marijuana packaging pursuant to Title 21 CFR § 1301.13(k)(8) which states that the label of all medical marijuana products shall, when dispensed to or for a patient, contain a clear, concise warning that it is a crime to transfer the drug to any person other than the patient).
• How is defective (e.g. mold, rot, bug infestation), expired, or discontinued/deadstock marijuana products disposed of?

The agency launched its initial registration form for dispensaries in April, days after Attorney General Todd Blanche issued an order immediately moving marijuana products regulated by a state medical cannabis license from Schedule I of the Controlled Substances Act (CSA) to Schedule III, along with marijuana products that are approved by the Food and Drug Administration (FDA).

A DEA hearing that recently concluded testimony is considering broader marijuana rescheduling.

Meanwhile, the agency said it plans to launch new forms for additional types of state-licensed medical marijuana businesses beyond dispensaries, such as manufacturers, distributors and laboratories.

The currently available registration form for state-licensed medical marijuana dispensaries asks for information about their processes for storage, ordering, dispensing, inventory, maintenance of records and other aspects of their businesses.

The application asks about specific details about security measures such as vaults, safes, secure storage rooms, access controls, alarm systems and on-site security personnel.

Applicants can choose whether they are requesting to handle marijuana, marijuana extracts or naturally derived delta-9 THC.

While only medical marijuana is currently being moved to Schedule III, the application also asks potential registrants whether their firms handle or dispense recreational marijuana.

The DEA application also asks businesses to submit information about their state cannabis licenses and to answer questions about criminal and disciplinary histories.

It also asks: “Has anyone who will be involved in the ownership or operation of the firm previously manufactured, distributed, and/or dispensed any controlled substance without a DEA registration authorizing such activity?”

Presumably, every currently operational state-legal cannabis business has key personnel who have done so, since medical marijuana was, until recently, a Schedule I controlled substance that DEA did not broadly authorize manufacturing, distribution and dispensation of.

Applicants must additionally list suppliers from which they intend to procure marijuana, and to disclose whether they anticipate repackaging or relabeling cannabis products.

They also need to provide lists of individuals with the business that are anticipated to have “access to controlled substances,” including their dates of birth, social security numbers, criminal histories related to drugs.

Photo courtesy of Mike Latimer.