The Ethical Implications of Legalized Cannabis
Public support for legalized cannabis is at an all-time high, and at least 33 states have legalized it in some fashion. In light of the booming cannabis industry and the significant regulatory challenges that cannabis-related businesses face, the need for legal advice is industry-wide. However, giving cannabis-related legal advice can raise some hazy ethical issues for attorneys, due in part to the continued illegality of cannabis at the federal level. In this presentation, we will examine both the ABA Model Rules of Professional Conduct and a selection of state rules and opinions as we work through the ethical implications for lawyers who don’t stay off the grass.
Jason Potter: Welcome to The Ethical Implications of Legalized Cannabis by Quimbee. My name is Jason Potter. I'm a Staff Presenter at Quimbee. This presentation includes a number of course materials, including today's slides, complete with detailed presenter notes. You can follow along with those slides, or just sit back and enjoy this presentation on the intersection of cannabis and legal ethics.
In his play, A Man For All Seasons, playwright Robert bolt's character of the common man states to his audience, "It isn't difficult to keep alive friends. Just don't make trouble, or if you must make trouble, make the sort of trouble that's expected." This excerpt might as well have been written for attorneys whose practices skirt the edge of criminality. The ABA Model Rules of Professional Conduct set out three basic kinds of duties: client related duties, duties as an officer of the court, and duties to uphold the law. But to be blunt, the ABA rules are silent about a lawyer's duties when advising on matters for which federal and state laws conflict.
In this presentation, we'll dive into the hazy ethical issues that can arise when attorneys engage with the legal cannabis industry, both the ethical implications of taking on cannabis related matters as well as an attorney's personal engagement with legal cannabis or the greater industry.
First, we'll bring you up to speed on the conflict between state legalization of cannabis and federal criminal laws. Against that backdrop, we will examine both the ABA rules and a selection of state ethics rules and opinions to increase your understanding of the ethical issues that can arise when attorneys don't stay off the grass. Finally, you'll gain some helpful practice related ethics tips.
All right, I think it's high time we begin. Right up front, let's make something clear. We will not be engaging in debate about or taking sides regarding the legalization of cannabis or cannabis's impact on the legal profession. No, to the contrary, we will analyze the ethics issues surrounding cannabis without getting drawn into the public debate about its value, about its efficacy, and about its impact. Now to keep it light, we do make heavy use of cannabis related puns, some of which you've already endured. Our use of this humor doesn't mean we support cannabis or that we are trivializing it or that we're using it. It just means that we're a little wacky.
Public support for cannabis is at an all time high. According to a 2019 CBS poll, approximately 65% of Americans support national legalization of cannabis. This is double the number that supported legalizing cannabis in 1979. According to this poll, most Americans now think that cannabis is less harmful than alcohol and most other drugs, with 51% of respondents agreeing that alcohol is more harmful to health than cannabis. On the other hand, opponents often believe that cannabis is equally as harmful as other drugs, and also engenders higher crime rates.
Regardless of where you fall on the issue of legalization, the fact of the matter is only four states today make no allowances for cannabis, so there's been a seismic shift in public support and in the policy sphere towards legalization. Per the Federal Controlled Substances Act, or CSA, the federal government regulates marijuana possession and use, or rather marihuana, as it appears as a controlled substance on Schedule 1 of the CSA, the text of which we have included in your course materials. Schedule 1 substances have no currently accepted medical use in the United States, a lack of accepted safety for use under medical supervision, and a high potential for abuse. That's Section 812. Under federal law, physicians can't write prescriptions for Schedule 1 substances because they're deemed to lack any current accepted medical use.
The CSA also makes it a crime among other things to possess and use marijuana, even for medical reasons. In Gonzalez v. Raich in 2005, the U.S. Supreme Court recognized the federal authority to outlaw all uses of marijuana even though state laws may say otherwise. In states where cannabis is legal in some manner, there is now a conflict between state law and the federal CSA. In areas where state and federal law conflict, the Supremacy Clause of the United States Constitution steps in and provides that in the event of conflicts between federal and state law, federal law wins. That's from Gonzalez. This means that the federal CSA is very much enforced despite state laws that say otherwise.
Federal state conflicts currently exist in the area of drones and their treatment per federal aviation laws and state privacy laws, federal criminalization of possession of drug paraphernalia, and state and municipal efforts to legalize syringe exchanges and supervised injection facilities, and federal voting rights laws versus state voter suppression laws. State local conflicts currently exist in the areas of immigration and sanctuary cities. Some states and municipalities have started declining immigration detainer requests as a matter of policy, which gave rise to the term sanctuary cities. Also local gun sanctuary resolutions suggesting that local authorities not enforce state gun regulations that they argue violate the Second Amendment. Over 100 Virginia municipalities and counties have declared themselves gun sanctuaries.
The areas where federal and state law conflict are ever expanding. Cannabis is a prominent member of this club. Legalization of marijuana at the state level and its contain criminalization at the federal level might be the most pervasive and highest profile example. So let's take a closer look at the legalization of cannabis at the state level.
As of the date of this presentation, cannabis is legal for adult use or recreational use in the states in green. Illinois became the 11th state to legalize adult use of cannabis on January 1st, 2020. Cannabis is fully legal for adult and medicinal use in the states in blue. This leaves the beige colored states where cannabis is illegal. Of these states, all but Idaho, South Dakota, Nebraska, and Kansas have approved a CBD or low THC program, which legalizes the production of hemp, which we'll introduce soon. So there are only four states where state law makes no allowances for cannabis at all.
By the end of 2020, over 40 states could legalize cannabis. This includes conservative states like Mississippi and South Dakota. In all states that have legalized cannabis, operating a cannabis related business or smoking pot there conflicts with federal law and is subject to federal prosecution. This is because per federal statute, anyone who, "Knowingly or intentionally manufactures, distributes, dispenses, or possesses with intent to manufacture, distribute or dispense is guilty of a criminal violation of federal drug laws and subject to substantial fines and imprisonment." We have also included the statute, Section 841B, in your course materials.
As a result of this prohibition, marijuana manufacture, distribution, possession, and use are federally illegal in every state, so the state and federal laws conflict. So what? What's wrong with that? Well, the legalization of cannabis at the state level and its continued illegality at the federal level pose a number of potential ethical issues for attorneys, but we'll primarily cover two of them.
First, attorneys advising clients in states that have legalized cannabis may find themselves advising clients involved directly or indirectly with the cannabis industry. Problems can occur when an attorney is advising vis-a-vis a matter that edges up to criminality. As one New York cannabis attorney put it, "Of course from a certain perspective, everything we do is a violation of law." Rule 1.2 states that a lawyer, "Shall not counsel a client to engage or assist a client in conduct that the lawyer knows is criminal or fraudulent." This rule is problematic for attorneys involved with cannabis related matters.
Second, attorneys personally using cannabis is becoming more acceptable largely due to marijuana's many medicinal uses and its availability in many communities in states that have legalized cannabis. Cannabis, as well as CBD, is also more accepted by the medical community now, so it's more common for doctors to recommend it for ailments like stress, anxiety, and sleep challenges, which attorneys often face.
However, any attorney thinking about using cannabis should consider its potential impact on their law practice and employment. In fact, at least one court has found that bartering legal services in exchange for cannabis directly implicates the practice of law and causes harm to the legal profession.
These are the issues will examine in this presentation. To get us there, we'll first introduce the history of cannabis prohibition in the U.S., including passage of the federal Controlled Substances Act, as well as trace the trend toward legalization among the states. Then we'll get into the weeds with the ABA rules and cover the topics of advising clients and attorney use of cannabis. Finally, we'll introduce some ethics-related tips for lawyering in this emerging area of practice. Pretty rad, huh?
All right. As a preliminary matter, let's make sure we're all on this same page with some important terminology you're going to hear in this presentation. First, marijuana, or marihuana in the federal CSA. That's the name for the cannabis plant, and it may refer to the entire plant or the portion of the plant containing high amounts of tetrahydrocannabinol, or THC, a psychoactive chemical. The term marijuana comes from a Mexican Spanish slang word for cannabis. The U.S. adopted the Mexican Spanish term marijuana into its drug laws, and it remains this way today. Marijuana or marihuana is now a disfavored term in the policy sphere, and has been replaced by the term cannabis. In this presentation, we will primarily use the term cannabis, and we'll refer to it as marijuana when referring to federal and state laws that classify it that way.
Now cannabis. You've already heard this term a number of times. The term cannabis is Latin, and the scientific name for a genus that includes three species: cannabis sativa, cannabis indica, and cannabis ruderalis. Uppercase cannabis refers to the genus, and lowercase c cannabis refers to the plant.
Hemp. Well, hemp is a specialized variety of cannabis sativa bred for low THC, high CBD levels. Hemp was widely cultivated in the U.S. for centuries and had numerous industrial applications. Hemp is distinct from and treated differently than marijuana on the federal level. The federal 2018 Farm Bill legalized hemp federally with serious restrictions. Attorney representations that solely involve the hemp industry may not involve the same ethical concerns as representations that involve higher THC-containing cannabises.
THC. This is the popular term for tetrahydrocannabinol. THC is one of many cannabinoids produced by the cannabis plant. THC is the main psychoactive chemical produced by certain varieties of cannabis.
CBD. This is the popular term for cannabinol. CBD is a non-psychoactive cannabinoid produced by the cannabis plant. Under U.S. federal law, CBD derived from hemp is legal, while CBD derived from marijuana is not, even though CBD extracted from hemp is exactly the same as CBD from marijuana plants.
What are medical marijuana laws? Medical marijuana laws remove state prohibitions against using marijuana for medical purposes under certain conditions. States with medical marijuana laws typically have a type of patient registry. Medical marijuana prescriptions are typically called recommendations or referrals as there's a federal prohibition against prescribing marijuana.
And recreational or adult use laws, these are full legalization laws that remove criminal and monetary penalties for the possession, use, and supply of marijuana for recreational purposes. These laws are often called adult use laws. Some states such as Massachusetts have both medical marijuana laws and adult use laws. Others such as California only have medicinal use laws.
Now the history of the prohibition of cannabis by the federal government is interesting. Marijuana used to be legal and profitable. Before the 1850s, growing cannabis was legal in the establishment and early development of this country. In fact, President George Washington was an avid hemp grower at his homestead in Mount Vernon. Cannabis was also featured on $10 bill.
Cannabis was used medicinally around that time as well. Thomas Jefferson once declared, "Hemp is a first necessity to the wealth and protection of the country." He also spoke of the personal benefits of hemp, noting that, "Some of my finest hours have been spent on my back veranda smoking hemp and observing as far as the eye can see."
Cannabis began to be regulated as a drug in 1906 with the Pure Food and Drug Act, and states started including cannabis as a poison. It was put under even closer scrutiny when the Federal Bureau of Narcotics was formed in 1930. Federal criminalization began on August 2nd, 1937 with the Marijuana Tax Act. This act effectively prohibited possession or transfer of marijuana nationwide by levying an excise tax on all sales of hemp.
However, federal criminalization took its greatest leap forward with the Controlled Substances Act of 1970. Marijuana was classified as a Schedule 1 controlled substance under the federal Controlled Substances Act. Schedule 1 controlled substances are substances with a high potential for abuse and no currently accepted medical applications in the U.S. and with no accepted safety use, even under medical supervision. "Anyone who knowingly or intentionally manufactures, distributes, dispenses, or possesses with intent to manufacture, distribute, or dispense is guilty of a criminal violation of the federal drug laws and faces substantial fines and imprisonment." As a result of passage of the CSA, marijuana manufacture, distribution, possession, and use are illegal in every U.S. state or territory. Today, the federal government continues to retain the 1970 classification of marijuana as a Schedule 1 substance with high potential for abuse and no accepted medicinal value.
In the 1990s, public opinion and state-based public policy began to trend in the opposite direction. On November 5th, 1996, Proposition 215 or The Compassionate Use Act of 1996 won at the ballot box, which legalized the medical use of cannabis in California. This was the first in the nation to legalize medical use of cannabis. This caused a wave of legalizations of medical use in 1998 by the District of Columbia, Oregon, Alaska, Washington, Maine in 1999, Nevada in 2000, and Colorado in 2000.
In 2009, the U.S. Department of Justice released the Ogden Memo, which set a precedent of prosecutorial discretion. The memo advised U.S. attorneys to refrain from prosecuting marijuana producers unless their activities violated state law or violated other federal laws like RICO. In 2011, the Cole Memo issued by Deputy Attorney General James M. Cole reiterated that guidance in the Ogden Memo and further specified that the protections were limited to individuals and not businesses. Under these memos, federal raids of medical cannabis providers increased. In 2013. A second Cole Memo was issued, in which the DOJ specified several instances that would trigger prosecutorial enforcement. These include transportation of marijuana across state borders from states where marijuana is legal, to some extent distribution of marijuana to minors, preventing state authorized marijuana activity from being used as a cover or pretext for the trafficking of other illegal drugs or other illegal activity. We have included links to each of these DOJ memos in the course materials.
The Rohrabacher-Blumenauer Amendment was passed in 2014, which prohibited federal enforcement of drug laws for people who were acting in compliance with state medical cannabis statutes, though prosecutions continued pursuant to a novel interpretation of the statute. Attorney General Jeff Sessions repudiated the 2013 Cole Memo on January 4th, 2018, calling the shift a, "Return to the rule of law." This sent shock waves through the cannabis industry and through Congress.
However, the executive branch sent mixed signals on April 10th, 2019, when Attorney General Barr stated in a hearing, "Personally, I would still favor one uniform federal rule against marijuana. But if there's not sufficient consensus to obtain that, then I think the way to go is to permit a more federal approach so states can make their own decisions within a framework of the federal law, so we're not just ignoring the enforcement of federal law."
Riding on the growing momentum for legalization, in November of 2019, Representative Jerry Nadler introduced House Resolution 3884, the Marijuana Opportunity Reinvestment and Expungement Act of 2019, or the MORE Act, in the House of Representatives. This bill would federally decriminalize cannabis. At this point, the Bill's future is uncertain. While there is clearly a move among states to legalize marijuana, the current executive branch remains committed to enforcing laws that criminalize cannabis related activities. This tension between federal and state law creates ethical challenges for attorneys, both in their representations of clients involved in cannabis related activities and insofar as they smoke a joint themselves.
The American Bar Association sets forth model rules of professional responsibility, or the ABA Rules. The ABA Rules are models for ethical rules of most jurisdiction. The purpose of the ABA Rules is to provide guidance to lawyers and to provide a structure for regulating conduct through disciplinary agencies or state bar associations. The ABA specifies that a lawyer's violation of a rule may be evidence of breach of the applicable standard of conduct in their jurisdiction. The ABA Rules lack the force of law and have no legal impact unless the controlling jurisdiction has adopted them. Every jurisdiction except California has adopted some form of the ABA Rules. California, the wild card, has developed its own ethical rules.
In addition to the rules themselves, the ABA issues comments on those rules. Per the Preamble, "Comments do not add obligations to the rules, but provide guidance for practicing in compliance with the rules." Also, the comments explain and illustrate the meaning and purpose of the rules. Additionally, the ABA Standing Committee on Ethics and Professional Responsibility issues non-binding formal and informal ethics opinions. States may also issue opinions addressing ethical issues arising from their own state's ethics rules.
In this presentation, our focus will be on the ABA rules, though we'll also give shout-outs to specific state rules and ethics opinions throughout.
Okay, so we're going to explore two basic issues now. First, in states where cannabis is legal, is an attorney subject to discipline in connection with representations of clients engaged in the cannabis industry? Second, in states where cannabis is legal, is an attorney use of cannabis unethical if it's legally procured and used within the state?
Before we do all that though, we should explain a little more about what a cannabis lawyer does. Clients looking to break into the cannabis industry and clients who are currently engaged in the industry all need to navigate a set of complex marijuana regulations in their home state. This makes establishing a business much more complicated and risky than typical business formation matters are. This also seriously complicates ongoing compliance issues after a business has launched. So, the need for advice in the cannabis industry is substantial, and the legal profession is trying to catch up, only just beginning to learn whether and how it can meet the needs of the cannabis industry.
So who are the potential clients in the cannabis industry? Well, businesses in the cannabis industry can be grouped into two categories: those that work directly with the product, and those that work indirectly with the product like provides support services. Those sectors of the industry that touch the product are legal cultivators and producers, such as the cultivator 1906, which offers artisanal edibles to Colorado dispensaries. Second, dispensaries like Rise Cannabis, a company that operates in eight states. And third, to consumers.
Those sectors that have indirect contact with cannabis include independent industrial standards bodies; ancillary products and services including logistics companies, laboratories, bankers, insurers, accountants, and lawyers; and regulators and researchers concerning cannabis and hemp. There are also sub sectors of the industry based on type of cannabis. In the burgeoning CBD/hemp market, businesses include cultivator, extractor, investor, entrepreneur, manufacturer, and retailer. Because CBD and hemp are now conditionally legal on the federal level, businesses focusing solely on these varieties of cannabis don't face the same challenges with respect to federal illegality as those companies that focus at least in part on THC-containing cannabis do.
In turn, attorneys representing companies that focus solely on CBD/hemp do not face the same ethical challenges that attorneys representing companies involved with the legal but THC-heavy varieties of cannabis do. For that reason, we do not focus on these representations in this presentation. But keep in mind that if a company works with both THC-heavy varieties of cannabis and THC hemp, this may raise the same ethical concerns we'll be discussing in a moment.
So what is the typical scope of a cannabis representation? Well, the scope of representations for cannabis lawyers are not unlike those of general practice attorneys. Those seeking advice from attorneys versed in cannabis law often seek the following: corporate formation, governance, and capital raises; business and commercial transactions, including mergers and acquisitions, joint ventures, financing, taxation, and banking: regulatory licensing for cultivars and dispensaries, including licensing for cultivars and dispensaries at the state and local levels; policy development, government relations; yearly compliance and record keeping issues, and product recalls; insurance, including theft, liability, and crop loss insurance; real estate, including navigating zoning laws, site selection, construction, and leasing; labor and employment, including policy and manual development, record keeping protocols, drug testing policies, benefits, and wage and hour compliance, as well as any litigation that arises; intellectual property, including trademark, patent, copyright, and trade secret protection; and finally dispute resolution, including criminal defense, breach of contract issues, product liability issues, and shareholder issues.
Nearly all of this work is made more complicated by federal criminalization of cannabis and the need for legal advice from all sectors of the market and in all areas we mentioned.
Let's get on with the show. In states where cannabis is legal, is an attorney subject to discipline in connection with representations of clients engaged in the cannabis industry? So here's a hypo to explore this issue. This is attorney Jackie. Jackie lives in Doobizonia, which has legalized medicinal and recreational use of marijuana. Jackie is doing compliance work for a cannabis retailer selling in Doobizonia pursuant to state law. Jackie knows that her client is selling cannabis in violation of the federal Controlled Substances Act. She also knows that strictly speaking, federal law preempts state laws that directly conflict like they do here. Also, Jackie understands that Doobizonia's laws legalize cannabis, and that the federal government has declined to enforce the Controlled Substances Act against cannabis-related businesses in that state. Jackie firmly believes that very soon, the federal government will decriminalize production and sale of marijuana.
So let's assume that the Doobizonia Bar has adopted the ABA Model Rules wholesale, and that the Bar has not issued any opinions on the issue of cannabis. Is Jackie's work for the cannabis retailer unethical or ethical under Doobizonia's ethics rules?
Well, let's start with ABA Rule 1.2(d), we've included the relevant portions of this rule in your course materials. Rule 1.2(d) states that a lawyer, "Shall not counsel a client to engage or assist a client in conduct that the lawyer knows is criminal or fraudulent, but a lawyer may discuss the legal consequences of any proposed course of conduct with the client and may counsel or assist a client to make a good faith effort to determine the validity, scope, meaning, or application of the law."
So it appears that Jackie's representation may violate the plain letter of Doobizonia's version of Rule 1.2(d). She is assisting her client in the sale of cannabis, which she knows is criminal onto the federal law. Lack of enforcement or likelihood of change won't be a defense to violating Rule 1.2, so Jackie's conviction about impending federal legalization will not save her from violating the Rule.
Jackie's predicament regarding 1.2(d) is common in states that have legalized cannabis. And as a result, a number of state bars have issued opinions regarding Rule 1.2(d)'s application to cannabis representations, and some provide specific parameters regarding scope of representation.
Now here's another hypo. Let's men that the Doobizonia Bar is considering weighing in on the issue of cannabis-related attorney representations as it relates to Rule 1.2(d). It hasn't done so yet. What are the Doobizonia Bar's options for doing so? In many states that have legalized either medicinal or recreational use of marijuana, state disciplinary bodies over the past 10 years have issued some sort of guidance on this very issue.
Some states added official commentary to their own version of Rule 1.2(d) or distributed a memo or policy that expressly permits counseling cannabis related businesses. Others have simply issued non-prosecution policies. It's unclear whether such guidance relates to attorneys practicing in the federal courts. States that have issued rules or guidance that permit cannabis-related representations typically emphasize that the federal government has consistently publicly announced a position of non-enforcement.
So here are some options for the Doobizonia Bar based on what other states have done. It could amend Rule 1.2. The issue has been so pressing a concern for a number of states that those states amended their Rule 1.2. The state of Illinois' Disciplinary Committee declared that, "The ethical conundrum faced by Illinois lawyers who represent medical marijuana, businesses is sufficiently grave to merit change to Rule 1.2(d).
And as of January 2015, Connecticut's version of Rule 1.2 was amended. It now states a lawyer may discuss the legal consequences of any proposed course of conduct with a client, counsel or assist a client to make a good faith effort to determine the validity, scope, meaning, or application of the law. Or three, counsel or assist a client regarding conduct expressly permitted by Connecticut law provided that the lawyer counsels the client about the legal consequences under other applicable law of the client's proposed course of conduct.
These amendments reflect the reality that attorneys have the expertise to guide the industry. They also reflect the reality that attorneys are asked to do this work in these states all the time, so it's pressing and merits a Rule 1.2 change. Some states don't adjust these rules, but change the comments to the rules. In Nevada, Rule 1.2 is the same as the ABA rule, but Nevada has its own comments. "A lawyer may counsel a client regarding the validity, scope, and meaning of the Nevada constitution, and may assist a client in conduct that the lawyer reasonably believes is permitted by these constitutional provisions and statutes, including regulations, orders, and other state or local provisions implementing them in these circumstances, the lawyers shall also advise the client regarding related federal law and policy."
Now, changes to comments like these can lead to confusion and inconsistencies because amendments to comments, which are merely illustrative, lack the force and assurance of amended rules, which must be followed. At least one state, Minnesota, added clarification about attorney representations directly into its legalization regulations. In Section 152.32, two relating to protections for medical marijuana registry program participation, the Minnesota legislature added, "An attorney may not be subject to disciplinary action by the Minnesota Supreme Court or professional responsibility board for providing legal assistance to prospective or registered manufacturers or others related to activity that's no longer subject to criminal penalties under state law." So this approach is an excellent springboard for amending Minnesota's Rule 1.2, which the state has not yet completed.
Other states clarify their rules of professional conduct by issuing advisory opinions. For example, Arizona's Opinion 11-01 issued in 2011 says, "A lawyer may advise a client about the Arizona Medical Marijuana Act and may help the client set up a licensed dispensary, but must also explain that the conduct may violate the federal Controlled Substances Act." Advisory opinions are a great first step to modifying a state's ethics rules, but they are not widely read or as readily available as the actual rules.
One way disciplinary authorities have handled this issue is simply by issuing non-prosecution policies. In Massachusetts, the Board of Bar Overseers policy states, "Members of the Massachusetts Bar will not be prosecuted solely for advising a client regarding the validity, scope, and meaning of Massachusetts statutes and laws regarding medical or other legal forms of marijuana, or for assisting a client in conduct that the lawyer reasonably believes is permitted by Massachusetts statutes, regulations, orders, and other state or local provisions implementing them as long as the lawyer also advises the client regarding federal law and policy."
Now, this approach in Massachusetts can lead to confusion because advisory opinions are more difficult to learn about and access. One Massachusetts attorney was unable to locate any information about this issue on the Board of Bar Overseers website, and could only learn of the opinion's existence through a telephone conversation with the Board of Bar Overseers.
In Doobizonia, like other states that have not opined on the issue either by amending Rule 1.2 or issuing guidance, Rule 1.2(d) probably still bars Doobizonia attorneys from taking on cannabis-related representations on matters that violate federal law.
All right, let's go back to Jackie's situation in Doobizonia. Let's move onto another rule potentially implicated by Jackie's situation, ABA Rule 8.4(a). We've included this in your course materials as well. This rule states that, "Misconduct occurs when a lawyer violates or attempts to violate the Rules of Professional Conduct, knowingly assists or induces another to do so, or does so through the acts of another." This is another rule that Jackie would seemingly be violating as her assistance for the retailer would likely violate Rule 1.2(d) as we previously discussed.
Well, do the comments help? Comment 1, also in your materials, states, "Lawyers are subject to discipline when they violate or attempt to violate the Rules of Professional Conduct, knowingly assist or induce another to do so, or do so through the acts of another as when they request or instruct an agent to do so on the lawyer's behalf. Paragraph (a), however, does not prohibit a lawyer from advising a client concerning action the lawyer is legally entitled to take." This comment provides little clarity on the issue of Jackie's cannabis-related representation because Jackie knows that the conduct violates federal law. The fact that Jackie's client is legally entitled to take the action according to state law might be sufficient peace of mind for her, especially if Jackie expressly limits their representation to matters involving state law. But the ABA provides no clarification about this solution.
Let's continue along with Rule 8(b). If Jackie was indicted for a federal crime attendant to advising her cannabis related client that operates legally under state law, would this sort of crime be a criminal act that reflects adversely on a lawyer's honesty, trustworthiness, or fitness as a lawyer in other respects? Is this the kind of crime that would reflect poorly on Jackie's fitness to practice law? Rule 8.4(b) states that, "It's professional misconduct for a lawyer to commit a criminal act that reflects adversely on the lawyer's honesty, trustworthiness, or fitness as a lawyer in other respects."
Let's look at the comments. Comment 2, included in your course materials, provide some helpful guidance here. First, it states that, "Many kinds of illegal conduct reflect adversely on fitness to practice law, like offenses involving fraud and the offense of willful failure to file an income tax return. However, some types of offenses carry no such implication. Traditionally, the distinction was drawn in terms of offenses involving moral turpitude. That concept can be construed to include offenses concerning some matters of personal morality, such as adultery and comparable offenses that have no specific connection to fitness for the practice of law." This portion of Comment 2 suggests that certain crimes reflect negatively on fitness, like crimes involving a certain level of malice and deception, like fraud for example. Some attorneys may argue that any potential crimes resulting from advising about activities that are perfectly legal at the state level do not have the same sort of malice and deception.
Second, Comment 2 continues. "Although a lawyer is personally answerable to the entire criminal law, a lawyer should be professionally answerable only for offenses that indicate lack of those characteristics relevant to practice law. Offenses involving violence, dishonest, breach of trust, or serious interference with the administration of justice are in that category." And this further supports the idea that any crime, like the CSA-related crime, Jackie commits resulting purely from her cannabis-related representation that are otherwise perfectly ethical and legal are not the sort of crime for which Jackie should be professionally answerable.
Interestingly, the ABA makes no mention of drug-related crimes in any guidance. This also supports Jackie. Overall, the answer to the issue of whether Jackie can be subject to discipline in connection with representations of clients engaged in the cannabis industry appears to be murky. Together, ABA Rules 1.2(d) and 8.4(a) through (b) seem to indicate that Jackie's representation could lead to discipline. However, the ABA's comments make the issue of whether federal criminality, however, the ABAs comments leave some room for hope. Jackie may be comfortable with her representation if her cannabis practice and her legal advice to her client are limited to Doobizonia law only.
As a corollary to the issue of representation, what happens if Jackie gets involved in a cannabis-related business, would that be ethical? Let's add to Jackie's hypothetical. Jackie, now an expert in Doobizonia cannabis law, decided that she wanted a piece of the pie. In addition to lawyering, Jackie wants to operate her own cannabis production outfit under Doobizonia's cannabis law. Assume that the Doobizonia Bar has issued no guidance on the issue. Jackie's engagement in a cannabis business legal in their state would seem to raise the same ethical concerns as advising clients legally operating in the industry in the state. It stands to run afoul of Rule 8.4(b). Jackie would be knowingly violating federal law and thus likely subject to malpractice since the Doobizonia Bar has issued no guidance on the matter.
In reality, few state bar associations have addressed the issue of whether an attorney involved with cannabis related businesses in the state where the cannabis is legal negatively impacts on attorney's competence or fitness to practice law under the state's version of Rule 8.4(b). However, the Pennsylvania Bar Association squarely addressed this issue in an opinion. The PBA found that, "A lawyer may participate as a principal or a backer in a medical marijuana organization organized under the Pennsylvania Medical Marijuana Act. Even if this violates the federal Controlled Substances Act, it does not reflect adversely on the lawyer's fitness within the meaning of rule 8.4(b). In essence, state bars in which cannabis is legal seem to be starting to indicate that ignoring or willfully blind to the federal illegality of cannabis isn't sufficiently culpable or morally wrong to be considered unethical. Jackie could issue a request to the Doobizonia Bar to issue guidance on the matter as some other state bar associations have.
Our next issue to explore is in states where cannabis is legal, is an attorney use of cannabis unethical if it's legally procured and used within the state? In states that have legalized either a medical cannabis or adult use recreational cannabis, attorneys in those states are likely to use it. So it's important to weed through the potential ethical implications of doing so.
Let's start this off with a new hypothetical, sorry Jackie. This is attorney Bruce. Bruce is a member of the Bar of the state of Dankota, and he resides there as well. Dankota passed a law in 2019, as well as accompanying regulations, permitting medical use of marijuana. Bruce suffers from anxiety and bipolar depression, both of which have been exacerbated by his hectic litigation practice.
Bruce visited a cannabis dispensary in Dankota that operates strictly according to Dankota's medicinal cannabis program. He picks up some edibles containing THC to help with his stress. Knowing that cannabis is illegal on the federal level, Bruce immediately ingests one. Should he be concerned about the potential ethical implications of buying and ingesting an edible?
Well as Bruce knows, he is still subject to arrest for violating federal law. In this regard, Rule 8.4 potentially comes into play again. However, it is unlikely that Bruce's possession and use of cannabis is the kind of criminal act that reflects adversely on the lawyer's honesty, trustworthiness, or fitness as a lawyer in other respects, according to Rule 8.4(b). Further, Bruce's possession of cannabis does not rationally fall into the same category of the types of illegal conduct described in Comment 2. His possession and use of cannabis is not tantamount to fraud or crimes involving malice and deception. And Comment 2 further indicates that the ABA is concerned with only those crimes that reflect poorly on an attorney's professional duties. Okay, fair enough. Assuming Dankota's Rule 8.4 is similar to the ABA Rule and Dankota has not provided further clarification, it appears that Bruce's use and possession of cannabis, which is legally procured, is probably not in and of itself unethical.
So consider this now. Back to our friend Bruce. After leaving a morning court hearing, Bruce headed home for lunch. While he usually waits until after work to enjoy a little cannabis, he knew he didn't have any client meetings or calls this afternoon, so Bruce smoked the second half of a joint he had laying around. Bruce felt great when he arrived back at his office, but all of a sudden the herb hit him hard. Bruce closed his door and began to feel ill and paranoid. He didn't leave work, as he thought it would all pass. But within a few minutes, Bruce's attorney knocked on the door letting him know that his 1:00 p.m. mediation was waiting in the conference room. It was almost 3:00 p.m.
Bruce hurried to compose himself. He was representing one of the parties to the mediation. When Bruce arrived in the conference room, he realized that he left his case file at his house. He also realized that he was good friends with the mediator. They recently had lunch together at their golf club. Bruce decided not to mention that, and neither did the mediator. Bruce also rushed through the mediation and made a number of concessions that hurt his client's case. Is Bruce's use of cannabis unethical now? Bruce's conduct, which seemed to have resulted from his cannabis use, would likely be unethical under a number of ABA rules and state rules, particularly those rules related to attorney competency.
Let's take Rule 1.1 for example. When attorney use of cannabis substantially affects representations, it may trigger Rule 1.1. 1.1, which we've included in your course materials, states, "A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness, and preparation reasonably necessary for the representation." Rule. 1.1 requires sufficient ability or preparation to competently represent the client.
Comment 1 states that, "One relevant factor is the level of preparation and study the lawyer is able to give the matter." Comment 2 highlights some important skills requiring sound reasoning, critical thinking, and synthesis. And Comment 5 suggests that stakes of the representation are relevant. In Bruce's case, since the cannabis substantially affected his ability to represent his client and seemed to affect his ability to make rational decisions, his conduct would likely run afoul of Rule 1.1.
But 1.3 may also come into play. Rule 1.3 states, "A lawyer shall act with reasonable diligence and promptness in representing a client. Comment 1 states, "A lawyer must also act with commitment and dedication to the interest of the client and with zeal in advocacy upon the client's behalf." Further, the Comment states, "Unreasonable delay can cause a client needless anxiety and undermine confidence in the lawyer's trustworthiness." In Bruce's case, his two hour delay for a mediation, a session where emotions often run high, is probably unreasonable. Bruce's lack of diligence likely reflects negatively on his fitness to practice law and hence likely violated Rule 1.3 as well.
Rule 1.16(a)(2) states in relevant part, "A lawyer shall not represent a client or where representation has commenced shall withdraw from the representation of a client if the lawyer's physical or mental condition materially impairs the lawyer's ability to represent the client." It's pretty clear that Bruce's mental capacity has affected his ability to properly fulfill his duties as mediator.
Bruce's marijuana use could trigger reporting requirements of others under Dankota's version of Rule 8.3. Rule 8.3 requires an attorney to report the ethical violations of another attorney when a lawyer knows that another attorney has committed a violation of the Rules of Professional Conduct that raises a substantial question as to the lawyer's fitness as a lawyer in other respects. Bruce's use of cannabis, illegal under federal law, may trigger reporting. Although his associate did not witness Bruce violating a federal law or any egregious professional behavior, he did disclose his usage, though only by implication.
Regardless, attorney use of cannabis can create a quandary for other attorneys around them. Let's look now at how state bars would treat this situation. Only a few state bar associations have issued opinions about whether attorneys may ethically use state legal cannabis. Colorado Bar Association's ethics opinion Number 124 found that attorneys use of cannabis without some other unethical conduct doesn't violate the rules. There must be additional evidence that the lawyers conduct adversely implicates their honesty, trustworthiness, or fitness.
The Connecticut Bar Association also cautioned that if cannabis use affects a lawyer's ability to provide competent legal advice, then it violates Rule 8.4. Colorado is in accord here, suggesting that the ethics rules involving attorney competency may be implicated when a lawyer's use of medical marijuana impairs the lawyer's ability to provide competent representation. And the Washington State Bar Association issued an ethics opinion addressing this very issue in 2015. The Bar Association declared that, "In this context, we again see no substantial public purpose in considering conduct unrelated to the practice of law in which members of the public are free to engage a violation of the Rules." The Washington Bar Association also raises an important consideration for attorneys considering use of legal cannabis in their opinion, whether such use violates conditions of employment, both in the private and government sectors. Attorneys engaged in federal practice should be especially attuned to prohibitions on attorney usage of cannabis.
In Bruce's case, Bruce should be sure that smoking cannabis is in conformance with employment practices at his law firm. In his case, if the Dankota Bar had not spoken on the issue of attorney use, partaking in his state, though legal there, may raise a number of ethical issues because it might be regarded as negatively impacting attorney competence and undermining attorney diligence.
And just to cap this discussion, the Preamble to the ABA Rules, Comment 5, states, "A lawyer's conduct should conform to the requirements of the law, both in professional service to clients and in the lawyer's business and personal affairs." So if weed use makes you a gnarly lawyer, just stay off the grass.
So here are some ethics tips for attorneys thinking about representing clients involved in the cannabis industry. First, know where your state bar stands on cannabis-related representations. Second, limit the scope of your representation to state law consistent with any state bar guidance on the issue. Third, do your due diligence before taking on a cannabis-related client. Four, subject to state guidance, place a disclaimer in every engagement letter related to cannabis that makes clear that the client understands that marijuana is illegal under federal law and that nothing in state law changes that. Fifth, develop a firm-wide policy with regard to accepting cannabis related clients. Sixth, check your professional liability insurance. And seven, if you plan to do business in the cannabis industry, consider having an experienced cannabis attorney do your legal work. Oh, and do it in a state in which it's legal silly.
If you plan to consume cannabis, here are just a few tips. Know whether your state bar has issued any guidance on the matter. Check if your employer has a workplace cannabis policy and whether that policy includes both use at work and outside the workplace. And do so responsibly and know when to stop. One professor of psychiatry at Harvard Medical School stated that cannabis may be less addictive than alcohol, less addictive than opioids, but just because it's less addictive doesn't mean that it's not addictive.
And importantly, if you can't stop or would like assistance in any addiction-related matters, reach out to your state bar's lawyer assistance program. Weed, tree, pot, ganja, dank, Mary Jane, reefer. In the English language, there are thousands of slang words for marijuana. Whatever you call it, despite its continued illegality on the federal level, cannabis appears to be in it for the long haul.
Whether the federal government will legalize cannabis in the near future remains to be seen. One expert stated, "It feels like legalization is going to happen soon, but it might not happen how people think. You get a bill passed to allow banks to clearly serve this industry without a whole bunch of restrictions, and that could be pseudo legalization."
Regardless of your opinion on legalization, the practical reality for state bars and states that have legalized cannabis is that there's an entire industry looking for legal advice. But unless a state's bar association has offered clarification on the ethical implications of legalized cannabis, the issues of representation and use remain dubious.
Thank you for joining us for this presentation on Legal Ethics and Cannabis by Quimbee. To learn more about the contents of today's presentation, please check out the course materials which include slides and presenter notes. Thank you so much for choosing Quimbee for your CLE needs, and join us again.