Cannabis regulation and taxation lead today’s developments, with Alabama aligning itself with the federal Schedule III framework and TerrAscend mounting a procedural challenge in a closely watched Section 280E dispute. In Los Angeles, two art-restitution lawsuits are testing recently strengthened protections for Holocaust victims and their heirs.
Alabama Withdraws Objection to Federal Marijuana Rescheduling
The governing body of the Alabama Department of Public Health voted unanimously to withdraw its objection to the federal reclassification of state-licensed medical marijuana from Schedule I to Schedule III. State officials had filed the objection in May to allow additional time to examine how the federal change would operate under Alabama law.
State Health Officer Dr. Scott Harris said the department’s legal team had resolved its concerns, including questions involving pharmacies and patients. Alabama law generally adopts federal scheduling changes unless the State Committee of Public Health objects within 30 days.
Why It Matters: Analysis: Withdrawing the objection removes an important state-level implementation barrier as Alabama’s newly launched medical cannabis market expands. Schedule III treatment can materially improve the operating environment for qualifying medical cannabis businesses by allowing ordinary federal tax deductions currently blocked by Section 280E and broadening access to cannabis research.
Source: Alabama Reflector
TerrAscend Seeks Dismissal of $8.36 Million Federal Tax Case
TerrAscend USA asked a federal judge in New Jersey to dismiss the government’s lawsuit seeking repayment of an $8,360,683.19 tax refund connected to the company’s amended 2020 return. The underlying dispute concerns deductions previously disallowed under Section 280E because of TerrAscend’s marijuana-related operations.
The company’s motion does not ask the court to decide the broader merits of Section 280E. Instead, TerrAscend argues that the government named a consolidated tax group that is not itself a legal entity, selected an improper venue and made jurisdictional and service errors. It is seeking dismissal with prejudice, which would prevent the government from correcting the complaint through an amended filing if the request is granted as presented.
Why It Matters: Analysis: The case illustrates the substantial litigation exposure surrounding cannabis companies’ attempts to recover taxes paid under Section 280E. Even a procedural dismissal could affect the timing and strategy of federal refund enforcement, although it would not by itself establish that cannabis operators are legally entitled to the disputed deductions.
Source: U.S. District Court Filing
Los Angeles Lawsuits Test New Protections for Holocaust-Era Art Claims
Jewish heirs and their representatives filed two California lawsuits seeking artworks held by the Norton Simon Museum in Pasadena and the Auschwitz Memorial in Poland. The Jewish Federation of Greater Los Angeles is pursuing the return of Lucas Cranach the Elder’s paired paintings “Adam and Eve,” while the daughters of Holocaust survivor and animator Dinah Gottliebova Babbitt are seeking watercolors she was forced to create while imprisoned at Auschwitz.
The cases are described as the first filed after California and Congress strengthened the ability of Holocaust victims and their heirs to pursue restitution claims. Both museums maintain that they legally possess the works or have compelling grounds to retain them for public display and historical documentation.
Why It Matters: Analysis: The lawsuits could help define how far the new restitution protections extend when heirs’ ownership claims conflict with prior court rulings, museum title assertions and arguments about preserving evidence of Nazi crimes. The outcome may influence provenance reviews and litigation strategies at museums well beyond Southern California.
Source: Associated Press
What We’re Watching
Over the next 24–72 hours, watch for implementation guidance following Alabama’s withdrawal, additional filings or disclosures in the TerrAscend tax dispute, and early scheduling or institutional responses in the Los Angeles art-restitution cases. Broader movement around Schedule III remains especially important for cannabis operators evaluating tax positions, research opportunities and state compliance requirements.
