ENDING THE FEDERAL CANNABIS PROHIBITION: LESSONS LEARNED FROM THE HISTORY OF ALCOHOL REGULATIONS, TWENTY-FIRST AMENDMENT, AND DORMANT COMMERCE CLAUSE JURISPRUDENCE.

• Author: Baek, Changdae

INTRODUCTION I. CURRENT LEGAL LANDSCAPE OF THE CANNABIS INDUSTRY A. Discrepancy between State and Federal Cannabis Laws and the Preemption Doctrine B. Non-Enforcement of the Federal Cannabis Laws C. Movement Towards the Federal Legalization of Cannabis: Intrastate and Interstate Approaches II. LESSONS FROM THE HISTORY OF ALCOHOL REGULATIONS A. The Eighteenth and Twenty-first Amendments B. Alcohol Regulations after the Twenty-first Amendment C. Problematic Structure of the Cannabis Industry D. The Potential Solution: Interstate Measures III. LESSONS FROM THE DORMANT COMMERCE CLAUSE JURISPRUDENCE ON ALCOHOL REGULATIONS A. Early Dormant Commerce Clause Jurisprudence on Alcohol Regulations B. Modern Dormant Commerce Clause Jurisprudence on Alcohol Regulations C. Applying the Dormant Commerce Clause Jurisprudence on Alcohol Regulations to Interstate Cannabis Measures CONCLUSION INTRODUCTION

Public attitudes toward cannabis are changing. As of September 2019, sixty-seven percent of Americans favors legalization of cannabis, a considerable shift from just twelve percent in 1969. (1) The growth in public support has caused an expanding number of jurisdictions to reform their cannabis laws: thirty-six states and the District of Columbia have legalized cannabis for medical purposes, and seventeen states and the District of Columbia have legalized the drug for adult recreational purposes. (2) Additionally, nine states are projected to be next to say yes to some form of cannabis legalization in 2020. (3)

Cannabis remains a Schedule I drug under the federal Controlled Substances Act (CSA) (4)--even for medical use--and the cultivation, distribution, or possession of cannabis carry hefty prison sentences and fines. (5) Yet the sheer volume of commercial cannabis activities within states that have legalized cannabis (6) have far exceeded the federal government's capacity to enforce the CSA, and its struggle has been compounded by the growing number of states that support cannabis legalization. (7) In April 2019, Attorney General William Barr stated that although he would personally favor one uniform federal law against cannabis, if there is insufficient consensus to obtain that then the Department of Justice would be better off continuing the Obama Administration's hands-off enforcement policy in states that enforce their own cannabis laws. (8) This is a complete reversal of the former Attorney General Jeff Sessions's pledge of criminal prosecution for cannabis use, and may signify the federal government's resignation that it is too late to try to contain consumer demand in the expanding number of states that have legalized cannabis. (9)

Since 2015, "various bills have been introduced in Congress to legalize cannabis at the federal level." (10) By far, the 116th Congress has been the most pro-cannabis in history, with an unprecedented number of hearings held in 2019 to consider issues caused by the discrepancy between federal and state laws on cannabis. (11) No fewer than sixty-one individual cannabis reform bills were introduced in the first seven months of the 116th Congress. (12) Given the current political climate with respect to solving the federal-state divide over cannabis, it is imperative that Congress carefully consider its stance on cannabis as well as potential legal implications that may follow from it. The most critical question to be answered, as the CEO of the Cannabis Trade Federation Neal Levine put it, is "a matter of timing and political calculus about what kind of reform is achievable and can help stop many ongoing harms of prohibition in the short term." (13)

Currently, there are two competing types of policy proposals on ending the federal cannabis prohibition. (14) One type includes intrastate measures, such as the Strengthening the Tenth Amendment Through Entrusting States (STATES) Act (15) and the Compassionate Access, Research Expansion, and Respect States (CARERS) Act, (16) which would empower states to enforce their own cannabis laws free from the federal government's interference but leave cannabis as a Schedule I drug under the CSA. Such measures would inevitably maintain the status quo of balkanized state markets of cannabis. (17) The other type includes interstate measures such as the Marijuana Opportunity, Reinvestment and Expungement (MORE) Act (18) and the Marijuana Revenue and Regulation Act, (19) which would remove cannabis from Schedule I under the CSA entirely and allow cannabis trades between states where the drug is legal. (20)

This Note evaluates the two competing types of reform measures for legalizing cannabis at the federal level and proposes that Congress should adopt an interstate measure while explicitly authorizing states to regulate cannabis within their borders. Part I discusses the current legal landscape of the cannabis industry and explains intrastate and interstate measures in depth. Part II addresses the history of alcohol regulations and applies it to an issue stemming from small businesses' domination in the current cannabis industry. It then asserts that interstate measures would more likely resolve the issue than intrastate measures would. Part III analyzes the Supreme Court's Dormant Commerce Clause jurisprudence on alcohol regulations and anticipates how courts would rule if Congress were to adopt an interstate measure. It then proposes that Congress completely disclaim any intent to regulate cannabis in terms of interstate commerce when adopting an interstate measure.

I. CURRENT LEGAL LANDSCAPE OF THE CANNABIS INDUSTRY

Legal cannabis is the fastest growing industry in the United States. (21) As of February 2020, the legal cannabis industry employed a record-high 243,700 Americans, with a stunning 100% growth since 2017. (22) In the year 2019 alone, sales of recreational cannabis in the United States rose by 45% to hit $8.9 billion, and sales of medical cannabis grew even faster, rising at a rate of 54% to hit $6.2 billion. (23) Nevertheless, despite such rapid growth and money at stake, legal obstacles to states' cannabis liberalization efforts still remain, the most pronounced of which is the CSA. (24)

1. Discrepancy Between State and Federal Cannabis Laws and the Preemption Doctrine

   Under the CSA, cannabis is classified as a Schedule I controlled substance, (25) a status reserved for the most dangerous class of drugs "with no currently accepted medical use and a high potential for abuse." (26) This status puts cannabis in a category on par with ecstasy, heroin, and LSD. (27) Those convicted of simple possession of cannabis may face one year in prison and a minimum fine of $1,000. (28) Punishments can extend to life in prison and millions of dollars in fine for large-volume manufacturers and dealers of the drug. (29)

   The preemption doctrine derives from the Supremacy Clause in the Constitution. Under that clause, all treaties made by the United States and "the Laws of the United States which shall be made in Pursuance" of the Constitution are the "supreme Law of the Land," notwithstanding contrary state laws or constitutions. (30) In essence, the doctrine provides that if Congress exercises its valid legislative authority, then any conflicting state laws are superseded by the federal law. (31) Due to the preemption doctrine, ever since California first legalized cannabis use for medical purposes in 1996, (32) there has been tension between permissive state regimes and the federal prohibition. (33) A detailed exploration of whether Congress may or may not preempt states' cannabis liberalization efforts and the corresponding issues of federalism exceeds the scope of this Note. (34) Instead, it must suffice to simply state that the Supreme Court has upheld the federal government's constitutional authority to enforce the CSA in states that have decriminalized or legalized cannabis usage, (35) and that the federal statute, accompanied by the preemption doctrine, have prevented normalized commercial activities for cannabis businesses and consumers within such states. (36)

2. Non-Enforcement of the Federal Cannabis Laws

   Despite the federal government's constitutional power to prohibit the cultivation, distribution, or possession of cannabis pursuant to the CSA, it "lacks the fiscal and political capital" necessary to enforce the statute aggressively, (37) and its ability to enforce the statute is heavily dependent on state and local cooperation. (38) To put it simply, there are about four times as many state and local law enforcement officers within the states of Colorado and Washington alone as there are federal Drug Enforcement Administration agents around the world. (39) Thus, if state and local governments were not to cooperate, the federal government would be left with a grossly insufficient number of officers to handle the enforcement of the CSA. (40)

   The longstanding history of the federal government's pushback against states' liberalization efforts of cannabis usage exceeds the scope of this Note. While the federal government's enforcement actions still continue, it suffices to say that the growing number of states reforming their cannabis laws, (41) together with the unprecedented volume of commercial cannabis activities (42) and decline of prosecution therefor, (43) have effectively incapacitated the federal government's ability to properly enforce the CSA within those states. (44)

   During the Obama Administration, recognizing the difficulty of fully enforcing the federal cannabis prohibition, then-Deputy Attorney General James Cole issued a memorandum (Cole Memorandum), announcing that the Department of Justice would not prioritize the enforcement of the CSA in states with their own robust cannabis regulations. (45) Early in the Trump Administration, then-Attorney General Jeff Sessions rescinded the Cole Memorandum by issuing a new memorandum, which provided in part: "In deciding which marijuana activities to prosecute under these laws with...