Drug Testers and Pharma Firm Seek to Pause Cannabis Rescheduling

The companies with the most to lose from lax federal cannabis controls are now asking a federal court to stop them.

The National Drug and Alcohol Screening Association (NDASA) and cannabis biopharmaceutical developer MMJ International Holdings — along with its subsidiaries MMJ BioPharma Cultivation and MMJ BioPharma Labs — filed a joint motion on June 9, 2026, asking the U.S. Court of Appeals for the District of Columbia Circuit to freeze Acting Attorney General Todd Blanche’s rescheduling order while the consolidated litigation against it works through the courts. The motion argues that allowing rescheduling to stand during litigation will cause irreversible financial damage to both organizations — damage a later court win wouldn’t undo.

The order at issue, issued by Blanche on April 23, 2026, immediately moved both FDA-approved cannabis products and state-licensed medical cannabis products out of the most restricted federal drug category and into Schedule III of the Controlled Substances Act. A separate DEA administrative hearing on whether to extend that change to adult-use cannabis is set to begin June 29, 2026. The DEA’s regulatory actions page tracks both proceedings.

A Legal Argument Built on a 50-Year-Old Ruling

The challengers’ case rests on a specific constitutional and statutory theory: the attorney general used the wrong legal mechanism to reschedule cannabis without completing the standard notice-and-comment process.

Under federal drug control law, the attorney general normally must secure a recommendation from the Secretary of Health and Human Services and conduct a formal rulemaking before changing a drug’s schedule. A bypass provision in that law allows the attorney general to skip those requirements — but only when the action is necessary to bring the United States into compliance with international treaty obligations. Blanche invoked that bypass to justify acting immediately on medical cannabis without finishing the hearing the DEA had already initiated.

NDASA and MMJ argue that the D.C. Circuit itself addressed the scope of that bypass nearly fifty years ago. The court held then that the bypass cannot be used when the attorney general is simply deciding which schedule a drug belongs in — because the question isn’t treaty compliance, it’s domestic drug policy. Cannabis in Schedule I and cannabis in Schedule III both satisfy U.S. obligations under the Single Convention on Narcotic Drugs, so the treaty provision doesn’t supply authority for one choice over the other. “The Department of Justice complied with this Court’s construction of the CSA for over four decades — until now,” the motion states.

Two Challengers, Two Lines of Harm

NDASA represents employers, labs, and drug-testing professionals whose businesses are tied to workplace cannabis testing. Rescheduling medical cannabis erodes the legal basis employers have relied on for zero-tolerance drug policies, and NDASA argues many will simply drop cannabis from their testing panels rather than navigate the resulting uncertainty. For its members — collection sites, labs, program administrators — that means revenue losses that wouldn’t reverse even if the court eventually rules in their favor.

MMJ’s calculus is different. The company has spent nearly a decade and more than $10 million developing cannabinoid-based treatments under the federal rules that govern Schedule I controlled substances, including securing DEA and FDA approvals to run clinical trials. Moving state-licensed competitors to Schedule III — where the commercial pathway is far less restricted — would let those competitors rapidly enter the pharmaceutical market MMJ has been building toward. Like NDASA’s revenue, MMJ’s competitive position would be effectively unrecoverable by the time the courts finish their review.

A House appropriations subcommittee this week took a parallel route toward the same concern: it voted to block federal agencies from taking further steps to implement cannabis rescheduling while also preserving existing federal drug testing requirements. That provision would need to survive the full appropriations process to become law.

What the Consolidated Case Looks Like Now

The D.C. Circuit has consolidated three separate petitions challenging the April order. NDASA and Smart Approaches to Marijuana filed the first; the attorneys general of Indiana and Nebraska filed the second (Louisiana’s attorney general had joined but has since withdrawn); and MMJ International, along with a recovery services organization and two individual physicians, filed the third.

The same coalition — minus Louisiana — is currently appealing a separate dismissal in a parallel challenge to a federal Medicare hemp-coverage program, also before the D.C. Circuit. The breadth of the litigation signals a coordinated multi-front legal strategy.

For state-licensed medical cannabis operators, the stay request is the central risk to watch. The practical benefits of the April order — relief from the federal business-expense deduction prohibition and access to an expedited DEA registration pathway — could be suspended if the court grants a pause while the underlying fight plays out. Whether the court acts before the June 29, 2026 DEA hearing opens will determine how much practical ground shifts in the months ahead.