NJ Supreme Court Agrees Employer May Be Required to Reimburse for Medical Marijuana

Yesterday, the Supreme Court of New Jersey, in Hager v. M&K Construction, 2021 N.J. LEXIS 332 (April 13, 2021), affirmed a decision of the state’s Appellate Division that earlier had ruled an employer could be required to reimburse an injured worker for the cost of medical marijuana dispensed to him pursuant to the state’s version of the Compassionate Use Act. Finding the worker had established that medical marijuana represented—as to him—reasonable and necessary medical treatment under the New Jersey Workers’ Compensation Act (WCA), the Court also indicated the employer had presented no credible evidence that it might be prosecuted under the federal Controlled Substances Act (CSA).

Background

Hager injured his back in a work-related accident in 2001 while employed by M&K Construction (M&K). For years thereafter, Hager received treatment for chronic pain with opioid medication and surgical procedures to no avail. In 2016, he enrolled in New Jersey's medical marijuana program, both as a means of pain management and to overcome an opioid addiction. Thereafter, a workers' compensation court found that Hager exhibited Permanent Partial Total disability and ordered M&K to reimburse him for the ongoing costs of his prescription marijuana (the Order). The Appellate Division affirmed [Hager v. M&K Constr., 462 N.J. Super. 146, 153 (App. Div. 2020), for my 2020 discussion of the Appellate Division’s decision, click here]. The New Jersey Supreme Court granted M&K’s petition for certification [241 N.J. 484 (2020)].

Employer’s Contentions

M&K contended, in relevant part, that New Jersey’s Jake Honig Compassionate Use Medical Cannabis Act (Compassionate Use Act or the Act) was preempted as applied to the Order by the CSA. Compliance with the Order, M&K claimed, would subject it to potential federal criminal liability for aiding-and-abetting or conspiracy. M&K also asserted that medical marijuana was not reimbursable as reasonable or necessary treatment under the WCA. Finally, M&K contended that it fits within an exception to the Compassionate Use Act and was therefore not required to reimburse Hager for his marijuana costs.

Supreme Court Opinion

Writing for the Court, Justice Solomon said the Court had concluded that M&K did not fit within the Compassionate Use Act’s limited reimbursement exception. It also found that Hager presented sufficient credible evidence to the compensation court to establish that the prescribed medical marijuana represented, as to him, reasonable and necessary treatment under the WCA. Finally, the Court interpreted Congress’s appropriations actions of recent years as suspending application of the CSA to conduct that complies with the Compassionate Use Act. As applied to the Order, the Court, therefore, found that the Act was not preempted and that M&K did not face a credible threat of federal criminal aiding-and-abetting or conspiracy liability. Accordingly, the Court affirmed the judgment of the Appellate Division.