Just because state law permits marijuana possession does not make marijuana lawful — a reminder worth repeating.
More than twenty states have legalized the adult possession of cannabis under their own statutes, and even more have approved its use for medical purposes. Nevertheless, marijuana remains illegal under federal law. The federal government may not devote substantial resources to enforcing the prohibition, yet the existence of a nationwide ban can still produce meaningful effects (though less so for gun owners after the Supreme Court’s decision in United States v. Hemani). A concrete illustration of how federal prohibition can matter is the Sixth Circuit’s ruling in Hello Farms Marketing MI v. GR Vending MI, which held that a marijuana-related contract is unenforceable in federal court because the subject matter is illegal, overturning a district court decision. Judge Nalbandian encapsulates the case in the court’s opinion: Hello Farms, a Michigan marijuana grower, entered into an agreement to supply cannabis to Defendants GR Vending and CURA MI. When GR Vending breached, Hello Farms pursued the claim. A jury subsequently awarded Hello Farms $31.8 million. The defendants contended that since the contract violated federal law, the district court erred by not granting them judgment as a matter of law on the illegality defense. At the time of contracting, federal law criminalized the growth, distribution, and possession of marijuana. Michigan, like many states, allowed it to operate as a business. Yet even with Michigan’s legalization, federal courts cannot enforce agreements that aim to commit federal crimes. We reverse.
The ruling underscores a point I have long emphasized in this field (including in my work Marijuana Federalism: Uncle Sam and Mary Jane): to cultivate genuine marijuana federalism—where states can experiment with different, productive approaches to cannabis—it is insufficient for the federal government to remain passive. Federal policy must permit state experimentation by ending the criminal penalties for conduct that state law already makes lawful (while preserving the prohibition on activities that state law continues to deem illegal, including interstate trafficking across state lines). This is the very approach the federal government took with alcohol at the end of Prohibition, and it stands as the sole viable path to a marijuana federalism that is not distorted by a blanket federal prohibition.
