Fair Lending for Cannabis Banking Justice

(PDF) 55 U. Mich. J. L. Reform Caveat

Benjamin T. Seymour*

I.  Introduction

In the past year, New Jersey, New York, Virginia, New Mexico, and Connecticut joined the growing group of states that have legalized recreational marijuana,1 bringing the share of the U.S. population living in such states to a staggering forty-three percent.2 Unsurprisingly, the legal cannabis industry has grown accordingly, reaching $17.5 billion in sales in 2019 with significant profits expected in these new markets.3

Despite billions in revenue, the legal cannabis industry remains overwhelmingly unbanked.4 Because handling the proceeds of marijuana sales constitutes money laundering under federal law,5 banks have refused to offer services to cannabis businesses, for fear of regulatory and criminal sanctions.6 Instead, the lawful cannabis industry runs almost entirely on cash.7 The costs of marijuana businesses’ reliance on cash are sizable. Theft is a perennial threat, so cannabis dispensaries must invest heavily in security equipment, armed transports, and safes.8 For state regulators, the ubiquity of cash makes monitoring and taxing marijuana businesses acutely challenging.9

Academics, executive policy-makers, and legislators alike have proposed solutions to the cannabis industry’s banking problem.10 With Democrats in control of Congress, marijuana banking reform finally seems feasible.11 Yet, racial justice advocates have raised concerns that federal marijuana reform will fail to address the enormous costs that the War on Drugs inflicted on communities of color.12 Allowing investors and businesses to profit off the new cannabis economy without ensuring some of that wealth goes to those most impacted by decades of disparately enforced prohibition would squander an opportunity to repair prior wrongs and salve the ills of mass incarceration.13

This Comment offers a fair lending solution to promote racial equity in cannabis banking reform: amend the Equal Credit Opportunity Act to ensure individuals previously arrested, charged, or convicted for selling, cultivating, or possessing marijuana will not therefore be precluded from loans to start legal cannabis businesses.14 Given disparities in the criminal enforcement of marijuana laws, this amendment would provide racial justice benefits, while also encouraging entrepreneurship. As a market-based social justice effort, this amendment offers a bipartisan approach to one of the most vexing and contentious issues in marijuana banking reform.

Part II of this Comment briefly surveys the federal statutes that have led to an under-banked cannabis industry and discusses the costs of cash for marijuana businesses. It then examines prior reforms proposed by academics, executive-branch officials, and legislators. Part III explores the racial equity concerns that these proposals fail to address, while Part IV offers a fair lending approach for justice in marijuana banking reform.

Continue reading

Catch and Contain Novel Pathogens Early!—Assessing U.S. Medical Isolation Laws as Applied to a Future Pandemic Detection and Prevention Model

(PDF) 55 U. Mich. J. L. Reform Caveat

April Xiaoyi Xu*

I.  Introduction: Proposing a Modern “Test-and-Isolate” Future Pandemic Prevention Model and Identifying Relevant Legal Issues

As of July 2, 2021, there have been 196,553,009 confirmed cases of the Coronavirus Disease (COVID-19), including 4,200,412 deaths, globally.1 Unfortunately, infectious diseases have been an “unavoidable fact of life” throughout history.2 While the global community looks forward to a gradual return to normalcy from COVID-19 with an increasing number of individuals getting vaccinated on a daily basis,3 the COVID-19 public health crisis has exposed significant inadequacies in many countries’ pandemic responses—the United States included.4 Governing authorities must actively consider more effective solutions to quickly detect and prevent the spread of future pandemics.

One proposed model that offers promising potential, but is not yet developed in greater detail, is a future pandemic detection and monitoring architecture. This Comment will refer to this architecture as the “test-and-isolate model.” In his May 2020 Scientific American article, biochemist Dr. David J. Ecker recommends strategically placing modern high-speed metagenomic sequencing technology in urban hospitals across the United States to flag previously-unknown pathogens before the infectious agents have the opportunity to spread widely and pose threats of a new pandemic.5 Under this model, during a time period without any apparent pandemics (peacetime), the 200 biggest metropolitan hospitals6 in the U.S. would automatically run diagnostic tests up-front for novel causative agents for patients who visit the emergency room with severe respiratory symptoms that are possibly infectious.7 If such a system detects a sufficiently serious pathogen, public health agencies would send out diagnostic tests to all residents in the affected geographical area(s) within weeks and isolate those who test positive.8 This system could be integrated with contact tracing and more standard outbreak response.

This model can be significantly more effective than the system that the U.S. currently has in place, which has not consistently tested and isolated asymptomatic carriers of novel pathogens sufficiently early in the disease spread timeline. Given the exponential nature of pandemics,9 pandemic response will be more feasible and cost-effective the earlier it begins—every day counts in the early stages. Ecker analogizes this system to common forest fire prevention strategies that “survey aggressively for smaller brush fires and stomp them out immediately.”10 The proposed “test-and-isolate” future pandemic prevention model responds earlier than existing status quo systems in two major ways. Firstly, the proactive diagnostic testing in hospitals detects the new pathogen earlier. Secondly, identifying and isolating infected persons within weeks reduces disease spread among other members of society more quickly. Because isolating only those who test positive is less disruptive than more general social distancing measures, the test-and-isolate model would have made it economically and politically less costly to isolate early during the Covid-19 pandemic.11 According to Monte Carlo simulations—a form of computational algorithm that applies “repeated random sampling to obtain the likelihood of a range of results of occurring,”12 there is a “95 percent probability of identifying an emerging infectious disease outbreak if only seven symptomatic patients seek health care in this system.”13

The legal architecture surrounding medical isolation plays an essential role in determining whether test-and-isolate methodology could be successfully implemented in the U.S. in practice. Given that Ecker’s proposed model is relatively new and little explored, especially in the field of law,14 this Comment focuses on the legal issues surrounding the “isolate” portion of the aforementioned “test-and-isolate” model as part of the broader pandemic detection and prevention architecture. Despite the potential of Ecker’s model in preventing the next public health tragedy, there are a number of legal challenges that may obstruct the practical implementation of such a model, as the law strives to balance pressing public health needs with individual civil liberty rights. For a model that prioritizes early detection and early response over exactitude on factors such as the novel disease’s incubation period and severity level, the status quo law in the U.S. is disappointingly insistent on demanding more certainty and rigorous scientific evidence of future public health risks before authorities can legally mandate medical isolations, although there are ambiguities and uncertainties in relevant federal and state law alike.

Having provided an overview of the “test-and-isolate” model, this Comment next zooms in on current pandemic-related medical isolation laws in the U.S., offering an overview of the relevant federal and state laws, a brief survey of recent scholarship in relation to COVID-19, and a summary of an influential recent precedent, Hickox v. Christie.15 This Comment then focuses on applying current laws to the “isolate” part of the proposed pandemic prevention model to determine gaps and challenges for the proposed model given the U.S. legal landscape. Finally, this Comment will conclude with forward-looking recommendations and reform proposals.

Continue reading

How the Supreme Court Can Improve Educational Opportunities for African American and Hispanic Students by Ruling Against Harvard College’s Use of Race Data


(PDF) 55 U. Mich. J. L. Reform Caveat

Genevieve Kelly*


Students for Fair Admissions v. Harvard has not only exposed ways in which Harvard College’s admissions office unfairly assesses Asian American applicants, but it has also revealed that Harvard’s fixation on race per se can disadvantage the very African American and Hispanic students best positioned to bring instructive and underrepresented perspectives to the college. The facts show that Harvard’s “tips” and “one-pager” system values African American and Hispanic students for their ability to boost Harvard’s racial profile more than for their actual experiences confronting racial discrimination. This Comment explains how, by ruling against Harvard (and without overruling Grutter or Fisher II), the Court can force the college to adopt admissions policies that not only treat all applicants more fairly, but that more fully affirm African American and Hispanic applicants. This Comment also offers ways that a ruling against Harvard could benefit disadvantaged African American and Hispanic students at every grade level—whether or not they ever apply to Harvard.

Continue reading