A federal judge in Maryland has rejected efforts by debtors to reverse a $6.4 million garnishment order under the claim that the associated contract lawsuit falls outside federal court jurisdiction due to its relation to the cannabis industry. Given that marijuana is federally classified as an illegal substance, this case presents a unique intersection of state and federal law.
The case was presided over by U.S. District Judge Brendan A. Hurson of the District of Maryland. Debtors Mackie Barch and Trellis Holdings had sought to vacate the court’s charging order against Trellis’s membership interest in the garnishee Culta. However, Judge Hurson dismissed this motion. He ruled that the charging order was not invalid due to a lack of jurisdiction, thereby supporting application of Federal Rule of Civil Procedure 12(b)(4).
In his March 5 decision, Judge Hurson also noted that the debtors failed to demonstrate the existence of extraordinary circumstances, a necessary condition for providing relief in such legal situations. This decision amplifies the ongoing confusion and debates within the judiciary about how to handle cases involving marijuana businesses. Such businesses often operate legally at the state level while remaining illegal under federal law.
Judge Hurson stated, “The fact that there is considerable disagreement among courts as to how to treat cases that implicate marijuana businesses that are legal at the state level is not an ‘extraordinary circumstance’ that warrants relief under Rule 60(b)(6). For a Rule 60(b)(6) motion to prevail, the relief granted must be necessary to accomplish justice.”
Legal professionals can find more context and details around this case by reading the full story on Law.com.