Weeding Out Marijuana From Bankruptcy Proceedings: The Intersection Between State Laws Legalizing Marijuana and Federal Bankruptcy Law

By Brian T. Cumings, Graves, Dougherty, Hearon and Moody (Austin, TX)

Until relatively recently, using or selling or even possessing marijuana was subject to criminal charges in all 50 states.  Colorado and Washington have now made it permissible under state law to use marijuana recreationally.  Numerous states have made provisions in state law for permitting medicinal marijuana.1

However, cannabis remains a Schedule I controlled substance under the Controlled Substances Act, making it a federal crime to use, sell, or possess marijuana.

Among other things, this means that financial institutions must either refuse . . .

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