The federal cannabis rescheduling process continues to move through both the courts and the Drug Enforcement Administration (DEA), with a new development on September 9. A three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit rejected a request from the National Drug and Alcohol Screening Association (NDASA) and MMJ International Holdings to temporarily block the federal government’s current Schedule III order while litigation over the order proceeds.
The court determined that the petitioners had not met the requirements necessary for a stay pending judicial review. The decision means the existing order placing certain medical marijuana products in Schedule III remains in effect while the broader legal challenge continues. However, the ruling did not resolve the underlying lawsuits or determine whether the broader federal proposal to move marijuana from Schedule I to Schedule III is lawful.
What the Court Decided
The litigation involves multiple challenges to the federal government’s cannabis rescheduling actions. NDASA and MMJ International had asked the D.C. Circuit to pause the current Schedule III order while their legal challenge was considered.
The court declined to do so. As a result, the April 2026 order issued by Acting Attorney General Todd Blanche remains in place. That order placed FDA-approved marijuana products and marijuana products regulated under qualifying state medical marijuana licenses into Schedule III of the Controlled Substances Act.
The court also considered a separate request from two medical cannabis companies, MedPharm Iowa LLC, doing business as Bud and Mary’s, and Tri-Mountain Pure LLC, to intervene in the case in support of the federal government’s position. The court denied their request to become formal parties but allowed them to participate by filing amicus briefs. Cannabis industry attorneys were also permitted to participate in that capacity.
The court has consolidated several challenges to the federal government’s rescheduling actions and directed the parties to submit proposed briefing formats within 30 days. The litigation will therefore continue even though the request for an immediate stay was denied.
Broader Schedule III Rescheduling Remains Under Review
The current medical-marijuana order is separate from the broader administrative process considering whether marijuana generally should be transferred from Schedule I to Schedule III.
The DEA began a new formal hearing on that broader proposal on June 29, following a new notice of hearing issued in April. The hearing was scheduled to address factual evidence and expert opinion regarding whether marijuana should be transferred to Schedule III under the Controlled Substances Act. The proceedings were scheduled to conclude no later than July 15.
The DEA’s regulatory process follows a 2024 proposed rule that originally called for moving marijuana from Schedule I to Schedule III. The federal government restarted the hearing process in April 2026 after terminating the earlier hearing proceedings and issuing a new notice designed to move the rulemaking process forward.
The broader proposal remains separate from the April order that already placed qualifying medical marijuana products in Schedule III. A final change to marijuana’s federal scheduling status would require completion of the applicable administrative process.
What This Means for Cannabis Businesses
For cannabis businesses, the latest court decision does not create a nationwide change in the status of all marijuana products. Instead, it confirms that the existing April Schedule III order will remain in effect while the legal challenges continue.
The distinction is important. The April order specifically covers FDA-approved marijuana products and marijuana products subject to qualifying state medical marijuana licenses. The broader proposal to move marijuana from Schedule I to Schedule III remains part of a separate federal rulemaking process.
Businesses should therefore continue to distinguish between what is currently in effect and what remains proposed or under review. The September 9 court ruling does not itself complete the broader rescheduling process, resolve the pending lawsuits, or establish a final federal Schedule III framework for all cannabis businesses.
The next developments will come from both the ongoing federal litigation and the DEA’s administrative process. Until those proceedings are resolved, cannabis operators should continue monitoring federal and state requirements rather than assuming that a broader Schedule III change has already taken effect.
The Bottom Line
Federal cannabis rescheduling remains an active legal and administrative process. On September 9, the D.C. Circuit declined to temporarily halt the federal government’s existing Schedule III order for qualifying medical marijuana products, allowing that order to remain in effect while litigation continues. The court’s decision did not resolve the underlying challenges.
At the same time, the DEA’s broader administrative process concerning a potential move of marijuana from Schedule I to Schedule III is proceeding separately. For cannabis businesses, the most important takeaway is that Schedule III developments should be evaluated based on the specific federal action involved and whether it has actually taken effect… not simply on the broader discussion surrounding rescheduling.
If you have questions about how federal cannabis rescheduling developments could affect your business, our team can help you understand the changing regulatory landscape and prepare for potential compliance requirements.
