Placing and accepting advertisements for cannabis products is complicated. There are different legal concerns at the federal and state levels, and different considerations for advertisements in print, broadcast, internet and other media.
No matter what laws apply at the state level, federal law cannot be ignored. Over forty years ago, the United States Supreme Court mentioned in a case that was not about marijuana: “We have no doubt that a newspaper constitutionally could be forbidden to publish a want ad proposing a sale of narcotics or soliciting prostitutes.”
Under federal law, it is unlawful to use a “communication facility” (i.e., “mail, telephone, wire, radio, and all other means of communication”) to facilitate a felony under the federal Controlled Substances Act, which makes marijuana a Schedule 1 drug. The same law makes it unlawful to “place in any newspaper, magazine, handbill, or other publications” a written advertisement “knowing that it has the purpose of seeking or offering illegally to … distribute” a Schedule 1 controlled substance.
The definition of advertisement, however, excludes material that “advocates a position or practice, and does not attempt to propose or facilitate an actual transaction in a Schedule 1 controlled substance.” There are similar restrictions for internet advertising, with an exception for communications that merely advocate the use of a controlled substance “or includes pricing information without attempting to facilitate an actual transaction.”
There are no reported cases interpreting the phrase “facilitate an actual transaction.”
The uncertainty in the interpretation and enforcement of federal law restrains some television and radio broadcasters (but not cable) concerned about their licenses with the Federal Communications Commission. Those licenses are periodically subject to renewal and could be lost if programming and advertisements are not consistent with the “public interest”. In 2015, this worry likely contributed to a Denver television station’s last-minute decision to pull a rather innocuous cannabis advertisement.
Major internet service providers also impose limits on advertising marijuana that arguably go beyond what federal law prohibits. For example, Facebook’s advertising policies prohibit advertisements that “promote the sale or use of illegal, prescription, or recreational drugs.” Facebook warns that advertisers should avoid “using images of either recreational or medical marijuana” and also avoid using images of “bongs and rolling papers.”
Similarly, Google’s AdWords specifically does not allow the “promotion” of marijuana, or “products or services marketed as facilitating recreational drug use.” Similar policies exist for Twitter (prohibiting “promotion of drugs and drug paraphernalia globally”), Bing (disallowing ads for “drugs and related paraphernalia” and “areas of questionable legality”) and Yahoo (prohibiting ads for “drugs which may be legal or decriminalized in some regions, such as marijuana”).
There are limits to the bad news under federal law. The top lawyer for the US Postal Service made clear that publications with cannabis advertisements will be accepted for mailing (even though the publications may be technically “nonmailable” under postal regulations), but the mailers may get referred to law enforcement.
Under an Obama-era policy called the Cole Memo, the Department of Justice (DOJ) will focus its marijuana efforts on eight areas of specific concern, which do not include prosecuting people acting in compliance with state law. Relatively new Attorney General Jeff Sessions is, so far, keeping the Cole Memo as DOJ policy, but he also has indicated that he reads a lot into the Cole Memo’s catch-all allowing the DOJ to prosecute any federal violation of marijuana law.
Right now, however, federal law constrains the DOJ’s ability to prosecute medical marijuana businesses. The Rohrabacher-Farr Amendment has been part of federal spending legislation since it became law in December, 2014, and, according to the federal Ninth Circuit covering many states in the western U.S., it stops the DOJ from using funds to prosecute those acting in compliance with state medical marijuana laws.
Earlier this month, for example, a federal court in San Francisco halted the prosecution of a medical marijuana grower in the case of United States v. Pisarksi. If the DOJ is limited in its ability to prosecute alleged growers, the DOJ should also be restricted from prosecuting medical marijuana advertisers. Sessions asked Congress not to renew the Rohrabacher-Farr Amendment this year, but last month the Senate Appropriations Committee rebuffed him and voted to renew it anyway.
Advertising laws vary by state. For example, California requires special disclaimers for advertising medical marijuana, and expressly contemplates advertisements for recreational cannabis where 71.6 percent of the audience is over 21 years old.
Colorado regulations permit television, radio, internet and print advertisements of cannabis where no more than 30 percent of the audience is reasonably expected to be under 21, and the advertising does not target people out of state. Washington has special disclaimers for its advertising, and, like most states, focuses on preventing sales to minors.
Regardless of state laws contemplating or allowing cannabis advertising, the more precarious landscape comes from federal law. As long as federal enforcement is uncertain, those who wish to place or accept advertising should be cautious and consult an attorney.
Source: Cannabis Business Executive