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Olsen v. Hamilton

United States District Court, D. Maine

July 10, 2018

JUSTIN OLSEN and NANCY SHAW, individuals doing business as NEW WORLD ORGANICS, JANE DOE, and JOHN DOE, Plaintiffs,
RICKLER HAMILTON, in his official capacity as the Commissioner of the Maine Department of Health and Human Services, Defendant.



         This suit against the Commissioner of the Maine Department of Health and Human Services (“MDHHS” or “the Department”) is a pre-enforcement, facial challenge to the rules implemented by the MDHHS this year under the Maine Medical Marijuana Act (“MMMA”). The operative Second Amended Complaint (“SAC”) seeks declaratory and injunctive relief on three counts. Count One alleges that Section 10 of the MDHHS rule, which relates to compliance and enforcement, exceeded the agency's delegated legislative authority in violation of the Maine Administrative Procedures Act, 5 M.R.S. §§ 8051-8074 (2013). Count Two alleges that Section 10 of the rule authorizes the search and seizure of participants' homes and workspaces in violation of the Fourth Amendment and allows questioning of participants in violation of the Fifth Amendment. Count Three alleges that Section 10 of the rule provides for disclosure of medical marijuana patient information to the MDHHS in violation of the federal Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), Pub. L. No. 104-191, § 264, 110 Stat. 1936 (1996), and its Privacy Rule, 45 C.F.R. §§ 164.502(a) and 164.508(a)(1).

         The motions now before me are the Plaintiffs' motions for a temporary restraining order and a preliminary injunction seeking to restrain the State from implementing Section 10 of the MMMA rule (ECF Nos. 19, 29) and the Defendant's motion to dismiss under Federal Rules of Civil Procedure 12(b)(1) for lack of justiciability and 12(b)(6) for failure to state a claim. (ECF No. 32.) For the following reasons, the Defendant's motion to dismiss is GRANTED and the Plaintiffs' motions are DENIED.


         The MMMA provides for the legal use of marijuana to treat certain debilitating conditions. Under this framework, patients who qualify may obtain marijuana lawfully by: (1) growing limited amounts for themselves, (2) buying it from a registered “caregiver, ” or (3) buying it from a registered dispensary.[1] SAC ¶ 19.

         A “qualifying patient” is defined as “a person who has been diagnosed by a medical provider as having a debilitating medical condition and who possesses a valid written certification regarding medical use of marijuana.” 22 M.R.S. § 2422(9). Although qualifying patients can register with the State, they are not required to do so. 22 M.R.S. §§ 2425(9-A). A “caregiver” is, in essence, a person who is designated by the qualifying patient to provide care to that patient and who is allowed, for the purposes of assisting the qualifying patient, to grow, store, and sell limited amounts of marijuana for up to five patients. 22 M.R.S. §§ 2422(8-A), 2423-A(2); SAC ¶ 20. Caregivers, unless they fall into an exemption for family members of qualifying patients, are required to register with MDHHS. 22 M.R.S. §§ 2425(9-A), 2423-A(3)(C). Caregivers must complete an application indicating the number (but not the names) of the patients that they serve. SAC Ex. D-1 (ECF 18-4). As of 2016, there were 51, 324 qualifying patients and 3, 258 caregivers in Maine. SAC ¶¶ 18-19.

         When the MMMA became law in 2009, it authorized the MDHHS “to adopt rules to carry out the purposes of this chapter.” 22 M.R.S. § 2424. The MDHHS most recently amended its implementing rules in February 2018 through the Maine Medical Use of Marijuana Program Rule (“the 2018 Rule”). (ECF No. 18-1.) The 2018 Rule addresses, inter alia, marijuana cultivation, certification and registration of participants, and compliance and enforcement.

         The authorization to conduct on-site assessments contained in the compliance and enforcement rules found in Section 10 of the 2018 Rule is the focus of this suit. An “on-site assessment” is defined as

the review process to determine compliance. An on-site assessment may include a paper review, interview and inspection of the medical marijuana cultivation, processing and retail sites and administrative locations for the purpose of ensuring compliance with the requirements of the statute and this rule.

2018 Rule § (1)(Q). Section 10 provides that MDHHS “may initiate an on-site assessment . . . to ensure compliance prior to issuing a registry identification card, as a routine review, in response to an allegation of non-compliance or as part of a plan of correction.” 2018 Rule § 10(B). During an on-site assessment, the Department's mission is primarily to: (1) verify information submitted in an application; (2) review records; (3) conduct interviews; (4) ensure that the amount of marijuana is within the specified limits and that it is identifiable and maintained as required; (5) take samples; and (6) assess conduct for compliance with the statute. 2018 Rule § 10(B)(1).

         On-site assessments may occur in areas “reportedly used by a registered primary caregiver for conduct authorized by this rule, ” regardless of whether it is a workspace or a residence, and “areas within a person's residence reportedly used for conduct authorized by this rule.” 2018 Rule § 10(B)(3)(a)-(c). Registered caregivers will not receive advance notice before an inspection, but those who are not required to register (e.g., patients) will receive at least 24 hours advance notice. 2018 Rule § 10(B)(3)(a)-(c). A provision headed “Prior to entry” states:

The Department will show proof of identity when requesting entry to conduct an on-site assessment and to inspect an area reportedly used for conduct described under this rule and the statute. The Department will also provide the reason for the on-site assessment in standard written form developed by the Department prior to entry.

2018 Rule § 10(B)(4).

         If a registered caregiver or qualifying patient refuses to allow the Department entry during an on-site assessment, the 2018 Rule provides that:

the Department will consider such an action a failure to comply with the provisions of this rule.
a. Upon refusal, the Department may refer to law enforcement as a progressive enforcement action when compliance cannot be determined.
b. Additionally, if denied entry by a cardholder, the Department may also take action to revoke the registry identification card or dispensary registration certificate.

2018 Rule § 10(B)(7). Section 10 also states:

Failure to comply with provisions of statute and rule may result in remedial action up to, and including, directed corrective action; suspension, revocation and denial of a registry identification card or registration certificate; civil penalties; and referral to the appropriate agency, department or entity if the conduct is determined to be outside the scope of MMMP, is not appropriate for agency directed corrective action, or has not been rectified through corrective action.

2018 Rule § 10(A)(4).

         The Plaintiffs assert that recent passage of the Maine Marijuana Legalization Act (“MMLA”) makes available marijuana that is less regulated and “will likely entice current medical marijuana patients, and future such patients, to consider foregoing compliance” with the MMMA. SAC ¶ 54. The Plaintiffs fear that this will lead patients to seek marijuana from sources that are not subject to background checks and do not provide careful prescriptions. SAC ¶ 54. The Plaintiffs allege that “[t]his enticement will be substantially greater if the present search-and-seizure provisions under the 2018 Rule that is the subject of this action are not enjoined with the attendant disclosure to the state of Maine of the identity of medical marijuana patients within this state.” SAC ¶ 54.

         There are four plaintiffs in this suit. Plaintiffs Justin Olsen and Nancy Shaw are authorized caregivers under the MMMA who conduct business as New World Organics, Inc. in Belfast, Maine. SAC ¶¶ 9-10. As caregivers, they receive patient designations and certifications from medical providers, including records regarding the patients' medical conditions and symptoms. SAC ¶ 31. They also counsel qualifying patients on the use of medical marijuana and dispense medical marijuana to qualifying patients. SAC ¶ 28. Plaintiffs Jane Doe and John Doe are qualifying patients under the MMMA. SAC ¶¶ 11-12. Jane Doe has cancer, and John Doe experiences pain from injuries sustained in combat while deployed with the U.S. Army. SAC ¶¶ 11-12. Olsen and Shaw “have acted” as the caregivers for Jane Doe and John Doe. SAC ¶ 21. The Defendant is Ricker Hamilton, in his official capacity as the Commissioner of the MDHHS.[2]

         Plaintiffs Olsen and Shaw received a form letter from the MDHHS dated May 10, 2018, with the subject line “Maine Medical Use of Marijuana Program (MMMP) 2018 Rule.” Olsen Decl. Ex. A-1 (ECF No. 47-1). The letter was addressed to “MMMP Participant, ” and stated that “MMMP is implementing its revised rule (original implementation) as of the date of this letter, ” and included a link the MDHHS's ...

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