Nation v. Trump, 395 F.Supp.3d 1271

Plaintiff Emma Nation, a California resident, alleges she was evicted from HUD-funded housing after possession/use of medical marijuana and remains homeless.
She sued federal officials and agencies challenging the federal classification and application of the Controlled Substances Act (CSA) to medical cannabis and HUD policies, asserting multiple constitutional claims and seeking declaratory and injunctive relief.
Defendants moved to dismiss for lack of subject matter jurisdiction under Rule 12(b)(1), arguing Plaintiff failed to exhaust administrative remedies required by the CSA.
The FAC alleges that federal Schedule I classification of marijuana caused HUD’s alleged zero-tolerance policy and Plaintiff’s eviction; Plaintiff conceded at hearing she did not petition the DEA and would not plead exhaustion.
The court held that the CSA’s administrative reclassification process (petition to DEA/administrative record and review in court of appeals) is the exclusive means to challenge scheduling, so failure to exhaust deprives the district court of jurisdiction.
Because Plaintiff would not and could not plead exhaustion, the court dismissed the FAC without leave to amend and entered judgment for defendants.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether district court has subject-matter jurisdiction over claims challenging federal marijuana scheduling and its effects	Nation contends she challenges HUD’s application of CSA in California, not scheduling itself	Defendants argue Plaintiff must exhaust the CSA’s administrative reclassification process before suing	Held: No jurisdiction; exhaustion required and not alleged or pursued
Whether the CSA’s reclassification scheme is the exclusive avenue to challenge scheduling	Nation attempted to frame claims as constitutional challenges and HUD-policy challenges that avoid CSA exhaustion	Defendants maintained statutory text and precedent make the administrative process exclusive	Held: The court agrees the CSA scheme is exclusive for scheduling challenges
Whether Tenth Amendment/anti-commandeering doctrine removes exhaustion requirement	Nation argued federal application in California is commandeering/unconstitutional	Defendants relied on Raich and spending-power doctrine to reject commandeering exception	Held: Tenth Amendment and anti-commandeering do not excuse exhaustion; Raich controls
Whether leave to amend should be granted	Nation’s counsel confirmed no DEA petition would be filed and exhaustion would not be pled	Defendants argued amendment would be futile	Held: Leave to amend denied as futile; dismissal without leave to amend

Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375 (jurisdictional burden on party asserting federal jurisdiction)
Gonzales v. Raich, 545 U.S. 1 (1995) (CSA is a valid exercise of Commerce Clause power as applied to locally produced/consumed marijuana)
Safe Air for Everyone v. Meyer, 373 F.3d 1035 (9th Cir. 2004) (facial vs. factual Rule 12(b)(1) challenges)
Tosco Corp. v. Cmtys. for a Better Env’t, 236 F.3d 495 (9th Cir. 2001) (plaintiff must affirmatively plead jurisdictional facts)
Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048 (9th Cir. 2003) (denial of leave to amend where futile)
Americans for Safe Access v. DEA, 706 F.3d 438 (D.C. Cir. 2013) (upholding DEA denial of marijuana rescheduling)
United States v. Burton, 894 F.2d 188 (6th Cir. 1990) (reclassification is for executive/legislative branch, not initial judicial determination)
New York v. United States, 505 U.S. 144 (1992) (spending power allows conditions on federal funds)
Printz v. United States, 521 U.S. 898 (1997) (anti-commandeering doctrine explained)