In a case of first impression, the Colorado Supreme Court ruled that Dish Network LLC was legally permitted to fire a quadriplegic employee who used medical marijuana even though it was legally prescribed under Colorado state law, and despite Colorado’s “lawful activities statute, which generally makes it an unfair and discriminatory labor practice to discharge an employee based on the employee’s “lawful” outside – of - work activities. §24-34-402.5(1). The Court held that the use of medical marijuana in compliance with Colorado’s Medical Marijuana Amendment, Colo. Const. art. XVIII, § 14, but in violation of federal law, was not a “lawful activity” under section 24 -34-402.5. Coats v, Dish Network, No. 13SC394 (June 15, 2015).

Brandon Coats was a quadriplegic confined to a wheelchair. In 2009, he registered for and obtained a state - issued license to use medical marijuana to treat painful muscle spasms caused by his quadriplegia. Coats consume medical marijuana at home, after work, and in accordance with his license and Colorado state law.  Between 2007 and 2010, Coats worked for Dish as a telephone customer service representative. In May 2010, Coats tested positive for tetrahydro cannabinol (“THC”), a component of medical marijuana, during a random drug test.  Coats informed Dish that he was a registered medical marijuana patient and planned to continue using medical marijuana. On June 7, 2010, Dish fired Coats for violating the company’s drug policy. Coats then filed a lawsuit claiming that Dish violated section 24-34-402.5 by discharging him due to his state-licensed use of medical marijuana at home during nonworking hours, arguing that the Medical Marijuana Amendment makes such use “lawful” for purposes of section 24-34-402.5, even though federal law prohibits medical marijuana use.

The trial court dismissed Coats’s complaint for failure to state a claim after finding that medical marijuana use is not “lawful ” under Colorado state law. Coats appealed, and the court of appeals affirmed. In a split decision, the majority of the court of appeals held that Coats did not state a claim for relief because medical marijuana use, which is prohibited by federal law, is not a “lawful activity” for purposes of section 24 -34-402.5. Coats v. Dish Network, LLC, 303 P.3d 1 47, 152. In dissent, Judge Webb would have held that section 24-34-402.5 does protect Coats’s medical marijuana use, because the term “lawful” as used in the statute refers only to Colorado state law , under which medical marijuana use is “at least lawful.” Id. at 157.

On appeal, the Colorado Supreme Court affirmed, observing that the term “lawful” as it as used in section 24-34-402.5 is not restricted in any way. It rejected Coats’ contention that the Colorado General Assembly intended the term “lawful” to mean “lawful under Colorado state law, ” which, he asserted recognized medical marijuana use as “lawful.”   Instead, nothing in the language of the statute limited the term “lawful” to state law, , thus declined “to engraft a state law limitation onto the statutory term.”

Therefore, an activity such as medical marijuana use that is unlawful under federal law is not a “lawful” activity under section 24-34-402.5.

The Bottom Line.  Several states, including New Jersey and New York, have legalized the use of medical marijuana under certain prescribed circumstances, notwithstanding that federal narcotics law prohibits the delivery, sale, possession and use of marijuana and makes no exception for medical marijuana. These various state statutes have created a great deal of confusion among employers as to whether their zero-tolerance drug policies remain permissible and enforceable. Therefore, counsel should be consulted before taking any action against employees who are found to use medical marijuana because there are differences in state laws. Employers in New Jersey, for example, are not required to accommodate employees who use medical marijuana. However, in New York, employment decisions may not be based on an employee’s or applicant’s use of medical marijuana.