State Marijuana Operators Denied Full Status in Schedule III Appeal
News related to:MMJ International Holdings · 2 min read
State marijuana operators were denied a full seat in an appeal to defend the federal government’s Schedule III marijuana order, according to a press release from MMJ International Holdings. The U.S. Court of Appeals for the District of Columbia Circuit rejected the intervention requests from two commercial marijuana companies, MedPharm Iowa, LLC, doing business as Bud & Mary’s, and Tri-Mountain Pure, LLC.
The companies had hoped to take part as full parties, arguing that they would benefit from the Schedule III order, including federal tax relief, expedited Drug Enforcement Administration (DEA) registration, and opportunities for business expansion. However, the court determined that their interests were adequately represented by existing parties.
“State marijuana operators sought a seat at the table as full parties defending the Schedule III order, but the court denied intervention,” said Duane Boise, president of MMJ International Holdings. “They may still offer arguments as amici, but they will not control the litigation, and the legality of the government’s order remains undecided.”
As amici curiae, the companies can present legal arguments supporting the government's position, but they will not have the same procedural authority as full parties. They cannot independently control the defense, determine the litigation strategy, or exercise the complete appellate rights available to a party.
The federal government will continue to defend the April 2026 order that granted direct regulatory and financial benefits to qualifying state medical marijuana businesses. The court's ruling does not decide the legality of the order. The companies' admission of potential benefits from Schedule III treatment provides context for the litigation, as it changes the competitive landscape for marijuana businesses.
MMJ International Holdings, which has invested over eight years and more than $10 million in developing cannabinoid-based medicines through the federal system, sees the issue as a concrete competitive concern. The company’s development programs include investigational new drug applications for Huntington’s disease and multiple sclerosis, an Orphan Drug Designation, a DEA Schedule I analytical registration, and approximately 50,000 defined-dose softgel capsules manufactured through Catalent Pharma Solutions.
“The commercial beneficiaries can explain why they want to keep Schedule III,” Boise said. “But wanting the benefits is not the same as proving that the Attorney General had lawful authority to create them.”
The consolidated litigation includes SAM, Inc. v. United States Department of Justice, Nos. 26-1106, 26-1130, and 26-1136. The D.C. Circuit directed the parties to submit proposed briefing formats within 30 days, encouraging coordinated briefing and warning against repetitive submissions.
In a separate DEA administrative proceeding, the agency is considering whether marijuana should be transferred more broadly from Schedule I to Schedule III. However, the September 9 court ruling did not address this broader DEA proceeding. It focused on the intervention requests and the effort to stay the limited April order while the consolidated appeals continue.