JUDGE RULES FEDERAL LAW TRUMPS MONTANA'S MEDICAL MARIJUANA ACT

HELENA - A judge has ruled that Montana's medical marijuana law
doesn't shield providers of the drug from federal prosecution,
delivering a new blow to an industry reeling from a state and federal
crackdown.

U.S. District Judge Donald Molloy on Friday dismissed a civil lawsuit
filed by 14 individuals and businesses that were among more than two
dozen medical marijuana providers raided by federal agents last year
across Montana.

The providers claimed the raids violated their constitutional rights
in part because state law passed by voter initiative in 2004 allows
them to grow and produce the drug for medical consumption.

Molloy wrote in his order that the providers can be prosecuted under
the federal Controlled Substances Act even if they are following
state law. He cited a 2005 U.S. Supreme Court decision that said the
U.S. Constitution's supremacy clause applies in medical marijuana cases.

The supremacy clause says that federal law prevails if there is any
conflict between state and federal statutes.

"Whether the plaintiffs' conduct was legal under Montana law is of
little significance here, since the alleged conduct clearly violates
federal law," Molloy wrote. "We are all bound by federal law, like it or not."

The medical marijuana providers also argued that the Justice
Department had said it would not prosecute them, citing a 2009 agency
memo called the Ogden Memo after its author, Deputy Attorney General
David Ogden.

In that memo, Ogden wrote that federal prosecutors would not pursue
"individuals whose actions are in clear and unambiguous compliance
with existing state laws providing for the medical use of marijuana."

Molloy wrote that Ogden's memo was not a free pass to produce and
consume marijuana, and the memo itself says complying with state law
does not create a legal defense to violations of the Controlled Substances Act.

"A reasonable person, having read the entirety of the Ogden Memo,
could not conclude that the federal government was somehow
authorizing the production and consumption of marijuana for medicinal
purposes," he wrote.

Carl Jensen, the Great Falls attorney representing the medical
marijuana providers, said Molloy's ruling should serve as a warning
to other providers still operating in the state.

"The supremacy clause has been used by the federal government to
hammer anything they want to," Jensen said. "Absolutely, they should
be concerned. If the federal government ever decides it wants to go
after them, it can."

Jensen said a decision has not been made on whether to appeal.

U.S. Attorney spokeswoman Jessica Fehr said federal prosecutors had
no comment on the ruling.

The federal raids in March 2010 placed a chill over Montana's booming
medical marijuana industry, causing several providers to close down
because their inventories had been seized or out from fear that their
businesses would be next. Several raided providers have pleaded
guilty to federal drug charges.

Lawmakers struggled last year to come up with a solution for what
many people perceived to be an industry that at that time was growing
too quickly and with too few rules. The final bill repealed the
original voter-approved law in favor of one that aimed to
dramatically curtail the for-profit medical marijuana industry.

That legislative action is currently under legal review, and will
also appear on the November ballot for voters to endorse or reject.

Portions of the new law have been temporarily blocked by a state
judge, but the result has been a dramatic decline in the number of
medical marijuana patients and providers. There were 18,012
registered marijuana users at the end of December, compared to 31,522
at the end of May, according to the state Department of Public Health
and Human Services.

There were 395 registered marijuana providers at the end of December,
compared to 4,650 at the end of May.

A group of lawmakers meeting Monday in Helena received an update on
the ongoing developments. Many believe it will again require some
sort of legislative action when lawmakers convene in 2013.

Sen. Art Wittich, R-Bozeman, said the federal crackdown could mean
the state has to revisit how it allows distribution of the drug under
its medical marijuana law.

"Is there any value in looking at this question of how you get this
medical marijuana to the patient who is legitimately sick?" Wittich
said. "How do we ensure the product is available for people who are sick?"

Associated Press writer Matt Gouras contributed to this report.