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Maine District Court Issues (Another) Decision Invalidating State Residency Requirement on DCC Grounds

Posted by on Friday, August 20, 2021 in News, Updates.

The federal district court in Maine just issued another decision in the NPG (aka Wellness Connection) v. Maine litigation challenging the state’s residency requirement for medical marijuana licenses. Last August, the same court issued a preliminary injunction barring the state from enforcing the requirement. My analysis of that decision can be found in UPDATE: Federal Judge Finds that State Residency Requirements for Marijuana Licensing are Unconstitutional. The latest decision reaches the same result – it simply makes the injunction permanent.

The full opinion in the latest decision can be found here:

NPG v Maine Dept of Admin. & Fin. Svcs., Order on Cross Motions for Judgment (D. Me. Aug. 11, 2021)

The latest opinion largely tracks the reasoning the court gave in its earlier (August 2020) decision. Here, I’ll briefly quote from the opinion and provide some commentary.

At the outset, the court nicely describes the core argument that Maine (the Defendant) makes to defend its residency requirement:

“The Defendants and Intervenor emphasize the unique context of this dormant Commerce Clause challenge. At oral argument, the Defendants pointed out that, at its core, the dormant Commerce Clause is not about protecting individual rights but rather about preserving a national market and prohibiting state laws that interfere with that national market. The Defendants . . . argue that Congress has eliminated the national market for marijuana and thus there is no national market with which Maine can interfere. . . . In other words, the Defendants argue that, ‘[i]n the most ‘active’ way imaginable, Congress has flexed its Commerce Clause powers and placed marijuana proprietors on notice that they enjoy no federal protections in the interstate market—because there is no such market.’ Defs.’ Mot. 9–10. And thus, the Defendants contend, the Dispensary Residency Requirement does not violate the dormant Commerce Clause.”

NPG v. Maine Dep’t of Admin. & Fin. Svcs., at p. 4.

The court rejects Maine’s contention on several grounds:

“First, the notion that the medical marijuana industry in Maine is wholly intrastate does not square with reality. Maine does not prevent qualified nonresidents from purchasing marijuana for medical use at Maine facilities . . . . Nor does Maine seem to prohibit nonresidents who purchase marijuana here from taking it home with them. And Maine appears to allow nonresidents to participate in some aspects of the medical marijuana market.”


I think the court is correct, though I think the explanation I give in my Interstate Commerce in Cannabis article, see here, is more compelling. I explain that Maine – and other states with similar residency requirements – has defined the “interstate” market far too narrowly. As I note on page 870, “Congress has banned all commerce in marijuana, reflecting its judgment that the intrastate and interstate markets for the drug are inextricably intertwined.” Thus, sales of marijuana that take place entirely within the state of Maine—and involve only Maine residents—are still part of the interstate market Congress has regulated. In other words, Maine’s entire premise – that Congress doesn’t care about marijuana transactions that take place entirely within one state – is fundamentally misguided.

The court also proffers a second reason to reject Maine’s defense:

“Second, the Defendants have the burden of showing Congress’s ‘unmistakably clear intent to allow otherwise discriminatory regulations.’ . . . The CSA says nothing about eliminating a national market, but merely criminalizes various acts of possession, manufacture, and distribution of controlled substances.”

NPG v. Maine Dep’t of Admin. & Fin. Svcs., at p. 5. Buried in a footnote, the court adds that “Although the CSA criminalizes marijuana, it does not affirmatively grant states the power to ‘burden interstate commerce ‘in a manner which would otherwise not be permissible.’” Id. at p. 5, n.11.

Once again, I agree with the court conclusion, but I think it could have done a better job defending it I provide a much more extensive explanation of why Congress has not (yet) authorized state restrictions on interstate commerce in cannabis in my article, pages 875-882.

For the curious, here are some of my prior posts on the DCC issues now hounding state marijuana reforms:

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