What Is the Cole Memo, And What Does It Mean?

The Cole Memorandum was a memo issued by the United States Justice Department in 2013. It stated that State Attorneys should not pursue marijuana convictions in states that had legalized any form of cannabis with the exception of behavior that did not align with state regulations.

As cannabis remains illegal under federal law, the Cole Memo attempted to reconcile potential conflicts that could arise due to the stark difference between federal and state laws.

In the decade since the Cole Memorandum was first issued, the impacts of the memo across the cannabis industry have been widespread. The Cole Memo can appear complex at first glance, but understanding the memo and its effects is vital to understanding the cannabis industry today.

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What Is the Cole Memorandum?

The Cole Memorandum was a memo sent by former United States Deputy Attorney James Cole to all State Attorneys in August 2013. The memorandum stated that the United States Justice Department would not enforce the federal prohibition against cannabis in states that had legalized any form of marijuana: medical, recreational, or both.

While the Justice Department would not turn a blind eye to illegal actions involving marijuana-related activity that went against state regulations, such as trafficking or violence, the Department would not spend resources challenging the cannabis industry’s ability to operate in states with legalized cannabis.

The memo aligned with previous statements by then-President Obama, who did not go so far as to endorse cannabis legalization or decriminalization, but stated that it should not be a priority for the federal government to pursue possession charges against individuals in states with legalized marijuana.

Unfortunately, in January 2018, Attorney General Jeff Sessions rescinded the Cole Memo citing the Controlled Substances Act of 1970 and stating that the Cole Memo “undermined the rule of law and the ability of our local, state, tribal, and federal law enforcement partners to carry out this mission.”

What Came Before the Cole Memo?

While the Cole Memo marked a pronounced shift in the federal government’s approach to cannabis prohibition, it was not the first of its kind. In fact, the Cole Memo followed a series of earlier memos issued by the Justice Department in prior years, which reflected the Department’s evolving stance on intervention in states with legalized marijuana.

A 2009 memo released by the Justice Department stated that U.S. Attorneys “should not focus federal resources” on any individuals following state laws regarding medicinal cannabis. The 2013 Cole Memo updated and clarified earlier memos, which were focused mainly on medical cannabis, following Colorado and Washington state voters’ 2012 decision to legalize recreational cannabis, becoming the first states to pass such measures.

The Cole Memo’s Impact on the Cannabis Industry

The Cole Memorandum instilled confidence in those working in the cannabis industry, which allowed the market to grow. In the years following the Cole Memo, the cannabis industry expanded rapidly, with combined sales of medical and recreational marijuana topping $4.6 billion in 2014, the year after the Cole Memo was issued.

The industry continued to grow as more states legalized marijuana, earning over $5.7 billion in 2015 and over $6.5 billion in 2016. In 2022, the legal cannabis industry was projected to top $33 billion, a figure that is expected to continue to rise in 2023 and beyond as additional states legalize cannabis and pre-existing markets expand.

While the Cole Memorandum was not a piece of legislation, the memo provided a measure of assurance to the cannabis industry in 2013. In essence, cannabis businesses that strictly followed the legal guidelines set by the state in which they operated would have no reason to expect any federal indictment, despite cannabis remaining illegal on a federal level.

While prosecutors would still pursue convictions for activity such as the sale of recreational cannabis to minors, or sales benefiting criminal organizations, state law-abiding dispensaries or manufacturers could rest easy knowing that their operations would not face overburdensome interference from law enforcement or the federal government.

Regulating Cannabis in a Post-Cole Memo World

Following the rescission of the Cole Memo in 2018 by Attorney General Sessions, members of the cannabis industry reacted unfavorably to the potential new hurdles they could face without Cole Memo protections, even as the legal marijuana market continued to grow.

These potential challenges included termination of leases or additional hurdles like the inability to receive necessary insurance due to conflict with public policy. Without the expectation of continued stability, government officials in states with legalized cannabis also expressed frustration at the potential disruption of the lucrative industry.

Fortunately, Department of Justice press releases from 2018-2020 do not appear to show a substantial increase in marijuana-related charges stemming from states simply complying with their individual marijuana laws. Most charges involved firearms, trafficking, and criminal enterprises. Despite this, however, certain members of Congress are still fighting for more protections from federal prosecution, including decriminalizing marijuana use nationwide.

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