Although cannabis (marijuana) remains an illegal substance under federal law, companies in the cannabis industry are not exempt from complying with federal laws in general. A recent flurry of complaints filed in federal courts and with federal administrative agencies have highlighted the obligation of companies in the cannabis industry to comply with Title VII of the Civil Rights Act of 1964 (“Title VII”), the Age Discrimination in Employment Act of 1967 (the “ADEA”), and the Americans with Disabilities Act (the “ADA”). These employers must also remain compliant with state and local anti-harassment training regulations. Not only are such trainings required in many jurisdictions, but when considering the factual scenarios in the cases below, one can readily understand how the trainings can help reduce the risk of exposure to claims of harassment and discrimination. 

Recent Discrimination Complaints Against Cannabis Companies

On July 29, 2020, in Soule v. New England Treatment Access LLC, plaintiff, a transgender woman with post-traumatic stress disorder (“PTSD”) and brain trauma injuries related to her service in the military, as well as diagnoses of depression and anxiety, sued her marijuana dispensary employer alleging that it engaged in discrimination in violation of Title VII, the ADA, and the Massachusetts Fair Employment Practices Act. Specifically, the plaintiff alleged that the dispensary’s supervisors and coworkers subjected her to a wide range of sexist and transphobic workplace comments and conduct, including, among other things:

• the human resources department’s making public the knowledge of the plaintiff’s transition, after which the plaintiff was passed over for promotion;

• asking the plaintiff about personal and medical information about her transition, and sharing the information in the workplace without the plaintiff’s permission;

• denying the plaintiff access to her preferred bathroom and locker room facilities;

• addressing the plaintiff by the wrong pronouns;

• failing to change the plaintiff’s name and picture on her work badge following her transition;

• subjecting the plaintiff to inappropriate touching; and

• subjecting the plaintiff to intentional exacerbation and mockery of her PTSD, anxiety, and depression.

The plaintiff also claimed that upon requesting accommodations and leave from work for her disabilities, symptoms of which had worsened due to the alleged harassment, the company did not accommodate her medically supported request for extended Family and Medical Leave Act leave. When the plaintiff requested to return to work, the company allegedly told her that the job was no longer available and offered her a different position that interfered with her medication schedule. The employer has answered the complaint, and the case remains pending in the trial court.

On September 16, 2020, in Dieffenback v. Greenleaf Compassionate Care Center, Inc., a former medical marijuana dispensary accountant filed a complaint against his former employer, alleging violations of the ADEA, the ADA, and the state’s parallel anti-discrimination statutes. The plaintiff, a 71-year-old man, alleged that, among other things, after blowing the whistle on misappropriation of funds and conflicts of interest, executives referred to him as a “silver fox” and harassed him about his “antiquated” record-keeping methods. He also claimed that executives asked him about his health, specifically a perceived lung illness, and age. After reporting the alleged harassment to human resources, the plaintiff claimed, the company retaliated against him by gradually reducing his job duties and transferring his work to a younger employee who did not have a perceived disability. The dispensary ultimately terminated plaintiff’s employment. The dispensary has not yet filed an answer to the complaint.

On September 24, 2020, in EEOC v. AMA Investment Group, LLC, the Equal Employment Opportunity Commission filed a complaint on behalf of several current and former employees against their employer, a marijuana dispensary, and its Arizona-based parent corporation. The marijuana dispensary employees claimed that the employer had engaged in sex-based discrimination in violation of Title VII by creating a sexually hostile work environment. Women and a gay man who worked at the dispensary alleged that their manager had made sexualized comments and engaged in sexualized behavior, including inappropriate touching toward them, but not straight male employees. The complaint alleged that the defendant employer did not have an anti-harassment or anti-discrimination policy in place for at least a year after the alleged discriminatory behavior began. When the company eventually established a policy, it allegedly required harassment complaints to be directed to either the aforementioned manager, or the human resources department located within the Arizona parent company’s offices. The complaint alleged that the policies, however, failed to provide the contact information for the Arizona-based human resources department. It also alleged that the employees feared making forTmal complaints to the aforementioned manager, who told employees that he was key to their access to employment opportunities in the cannabis industry. The defendants have not yet filed an answer to the complaint.

Considerations for Employers in the Cannabis Industry

These cases provide a harsh reminder to cannabis industry employers that even companies in a new, growing, and progressive industry are not immune from the risk of discrimination litigation. As the end of the year approaches, employers are reminded that many states and localities, including California, Connecticut, Delaware, Illinois, Maine, and New York require anti-harassment training.