Supreme Court hears oral argument in case of employee fired for THC test after using CBD product

The U.S. Supreme Court heard oral arguments Tuesday in the case of a trucker who sued a cannabis company after he was fired for a positive THC test that he said resulted from consuming a hemp-derived CBD product. During questioning, the justices focused on how exactly the worker was harmed by the incident and whether his losses qualify for treble damages under federal law.

Douglas Horn filed a lawsuit in 2015 against the company that manufactured the cannabis product, Medical Marijuana Inc., under the Racketeer Influenced and Corrupt Organizations (RICO) Act. He claimed the company falsely advertised the product as “0% THC,” which is why he decided to try it for pain management. His employer later fired him after he tested positive for THC.

The core of the dispute is not about the cannabis law, but about the limits of RICO itself. The question is whether the law allows Horn’s civil suit.

While RICO cases are generally associated with large-scale prosecutions of criminal organizations, the law can also be applied in civil cases. In this case, Horn claims he suffered “harm to his business or property” because his employment was terminated due to the positive THC test. He claims that Medical Marijuana Inc. committed mail and wire fraud that caused him economic harm.

The question before the Supreme Court is whether “economic damages arising from personal injuries are damages to ‘business or property due to’ the defendant’s actions under civil RICO,” according to a description in the court calendar.

At Tuesday’s hearing, however, some judges expressed skepticism that Horn’s firing was even a personal injury. Judge Ketanji Brown Jackson, for example, seemed to distinguish between ingesting the product itself – which she said was the case not Causing harm to Horn – and the subsequent firing of a shot, which may be different from a “personal injury”.

“There are personal injury claims that result from a person being harmed by ingesting the product, right?” she said. “They are physically hurt for taking this thing. I do not believe this claim constitutes such a violation. He doesn’t say the product itself hurt him in any way.”

Lisa Blatt, the attorney who represented Medical Marijuana Inc. at the hearing, rejected that distinction.

“If I ate poppy seed bagels and failed a drug test, that’s personal injury,” Blatt said. “If I took a drug like doxycycline, an antibiotic, can’t go out in the sun and lose my job as a lifeguard, that’s a claim.”

“But why do you say that?” Jackson shot back, looking for basis in legal precedent. “I mean, that’s all you’re saying.”

The distinction is important because, according to Medical Marijuana, RICO does not allow victims to seek treble damages for personal injuries.

“No one can ever recover for personal injuries under this law, period. Never, ever,” Blatt said in court.

Judge Elena Kagen pointed out that the case, at its core, was “not a good RICO allegation.”

“He buys this thing, he swallows this thing and someone else fires him,” she told Blatt. “For that reason, this is not a good RICO claim. But it has nothing to do with the reason you give.”

Easha Anand, Horn’s lawyer, acknowledged later in the hearing that the fired truck driver would have “a heavy burden of remand” if the Supreme Court allows the case to proceed, “but that is not the argument before you.”

Anand added that she believes her side can prove that the business harm Horn suffered was the direct result of a civil RICO violation on behalf of Medical Marijuana Inc., but emphasized that that is a different question than the question before the judges in the current matter.

“We believe we can prove actual cause,” Anand said, “but that too is a question for the remand, not this court.”

The case is Medical Marijuana Inc. v. Horn and is expected to be decided by the Supreme Court by June.

The U.S. Court of Appeals for the Second Circuit had previously sided with Horn and allowed the RICO lawsuit to proceed, arguing that his termination “cost him current and future wages, as well as his insurance and pension benefits – all of which go to his employment were linked”. This violation falls within the plain meaning of the word “business” in the RICO statute, the opinion says.

But Medical Marijuana Inc. appealed that ruling and the Supreme Court justices agreed to take up the case in April.

The company claims that “RICO’s text is clear” – but in the other direction.

“Plaintiffs cannot sue for personal injuries. Plaintiffs cannot avoid this hurdle by providing evidence of the economic costs of personal injuries. “Case closed,” the company said in its latest statement.

A number of prominent groups have filed friend-of-court briefs in the case, including the U.S. Chamber of Commerce, the U.S. Hemp Roundtable and others.

The Chamber of Commerce says the Second Circuit’s previous decision in the case was incorrectly reasoned and warned that an overly broad interpretation of RICO damages could “explode” the law.

“The Second Circuit completely mischaracterized that this case was based on a ‘deficiency…inherent in the statute as written’ that only Congress can remedy,” it said. “Congress did its job in awarding plaintiffs compensation only for damages to ‘business or property’ – not for personal injuries and their indirect economic consequences. The required limits are set forth textually and should be enforced consistent with the established civil RICO focus on economic harm.”

The US Hemp Roundtable, for its part, told the justices in its amicus brief that the hemp industry would be “disadvantaged” if the court’s decision ultimately expanded corporate liability in tort cases.

“RICO targets here are industry participants,” the trade group said, arguing that the hemp industry “is multifaceted and creates a variety of societal benefits.”

“The threat of widespread liability to industry representatives directly jeopardizes the Roundtable and its mission,” the filing states.

In another amicus filing, the American Association for Justice sides with Horn, arguing that Medical Marijuana Inc.’s claims in personal injury cases “have no basis in the real world and cannot justify extending the reach of the law.” to restrict civil RICO.”

Given the Court’s focus on RICO and the disclosure of the limits of this federal law, even groups far from the hemp industry have spoken out. The Human Trafficking Legal Center, for example, rejects Medical Marijuana Inc.’s interpretation of the law because it says a narrow view “could prohibit human trafficking survivors from pursuing RICO claims for economic damages resulting from personal injuries.”

“If petitioners’ rule holds, human trafficking survivors who have suffered similar hardships may not receive adequate compensation for their economic damages,” the advocacy group said in its brief. “Their captors and others like them could engage in human trafficking and extortion without the deterrent of treble damages.”

In a separate case settled in January, the Drug Enforcement Administration (DEA) reinstated a special agent and is paying him back pay after he tested positive for THC, which he attributed to CBD, which he described as an opioid alternative for chronic pain, with the agency reaching a settlement in a lawsuit challenging the termination.

Other cases currently before federal courts are testing the limits of Second Amendment rights when it comes to marijuana users. Earlier this month, for example, lawyers argued in an appeals case over when the government can lawfully take away someone’s guns for using marijuana. The Department of Justice (DOJ) argues that a person’s recent use of the drug alone is enough to prove that they are violating the law and should not legally be able to own a gun.

However, judges on the U.S. Court of Appeals for the Fifth Circuit rejected the government’s position, noting at Tuesday’s hearing that a recent opinion from the same circuit noted that while “some limitations on a currently “The right of an intoxicated person to bear a weapon” may be constitutional, but “the disarming of a sober person because of his or her past drug use” is not.

That is the case USA vs. Danielswhich was set to be considered by the U.S. Supreme Court earlier this year but was among a series of firearms-related cases that were sent back to lower courts following a separate ruling on firearms and domestic violence.

Courts across the country are examining the constitutionality of the government’s ban on gun and ammunition possession for people who use marijuana, which remains illegal under federal law. And in general, legal experts have been skeptical of the Second Amendment’s sweeping restrictions.

The White House press secretary falsely claims that Biden “overturned” the marijuana convictions, a claim that has been repeatedly debunked