By on
As usual, Tom Petty was spot on when he sang, “the waiting is the hardest part.” Marijuana rescheduling has tested that proposition all year, and this week it was retested. We’ve spent a lot of ink this year on what happens after marijuana rescheduling lands, on advertising rules, on data breaches, and on what state-licensed medical marijuana operators should be doing to get ready. This week’s news is a reminder that we’re not actually past the rescheduling process itself. We’re still very much in it, and the process just got more interesting.
On September 29, 2026, DEA Chief Administrative Law Judge Derek Julius issued a stay of the marijuana rescheduling hearing, the comprehensive rulemaking proceeding that has been grinding along since testimony wrapped up in June and July. Until this order, the only remaining step anyone expected was for Julius to send his recommendation up the chain to the DEA administrator. Instead, the docket now includes a stay and a briefing schedule, and questions whether the foundation of the government’s entire rulemaking process for scheduling drugs actually holds up. And we wonder if, in light of all the news we have been hearing from clients facing inspections as part of the DEA registration process for medical marijuana operators, the DEA has given sufficient thought to this process and to its guidance to agents in the field.
To be clear, this stay order does not directly impact the AG’s April 2026 order moving DEA-approved medications and state-licensed medical marijuana from Schedule I to Schedule III. What’s paused is the broader rulemaking hearing meant to formalize marijuana’s scheduling more generally, which opponents are now targeting by attacking the process behind DEA’s supporting record.
What Actually Happened
The stay traces back to a report from the Government Accountability Office (GAO) on how DEA and FDA go about evaluating and scheduling controlled substances. That report found that DEA “does not have any policies or procedures regarding how its staff are to conduct evaluations or schedule substances,” and that FDA “does not have policies or procedures specifying how its staff are to conduct evaluations or develop scheduling recommendations for substances.” Three participants in the hearing who oppose rescheduling, the National Drug and Alcohol Association, DUID Victim Voices, and Kenneth Finn, M.D., moved to reopen the hearing record to add the GAO report and to brief its implications.
Julius granted the stay but not the underlying motion, at least not yet. He found “merit in the arguments that, if the record were to be extended to also include the GAO Report, a stay would be warranted to await briefing on it,” and ordered that the matter is stayed pending resolution of the motion itself. DEA now has until October 13 to file up to 20 pages addressing whether the record should reopen.
Why a Stay, and Not Just a Ruling
It’s worth considering what the order says and what it doesn’t. Julius didn’t grant the motion to reopen the record. He paused the case so that the motion can be properly briefed before anyone decides whether the GAO report gets in at all. That’s a fairly conservative, procedurally careful way to handle a request that could otherwise be characterized as opponents trying to relitigate the whole hearing on the back of an audit that came out after the evidence closed.
But conservative and careful doesn’t mean inconsequential. The opponents’ theory, as described in the order, is straightforward: The government’s case for moving marijuana to Schedule III rests on an evaluation, and “an evaluation is only as good as the process that produced it.” If the GAO’s independent audit shows DEA and FDA lack written criteria for the very findings the Controlled Substances Act requires them to make, that’s not a footnote. That’s an attack on the legitimacy of the process itself, not just its conclusion.
That argument is worth taking seriously on its own terms, separate from where you land on rescheduling as a policy matter. Administrative law lives and dies on process. A reviewing court doesn’t ask only whether an agency reached a defensible outcome. It asks whether the agency followed a defensible path to get there. If the path itself has documented gaps — and a federal watchdog just said so in writing — that’s exactly the kind of thing the movants argue a hearing record should absorb before a recommendation goes to the DEA administrator, not something raised for the first time on judicial review after the fact.
The Gaps Aren’t Just Theoretical: Ask the Registration Applicants
To many, the GAO report lands with more force than a typical inspector-general document because DEA’s inconsistent process isn’t confined to the scheduling rulemaking. It’s showing up in real time in a related process, DEA’s own registration and inspection procedure for state-licensed medical marijuana businesses seeking to operate under the Schedule III reclassification that already took effect in April.
Since DEA launched its registration form for medical marijuana dispensaries in April, reports have surfaced that the way the agency carries out post-application facility inspections varies meaningfully between DEA’s own regional divisions. A 26-question form used by DEA’s Rocky Mountain Division, covering Colorado, Montana, Utah, and Wyoming, asks Colorado dispensaries about their suppliers, product types, sourcing across state lines, and disposal of defective or expired product. Businesses in Mississippi visited by agents from DEA’s New Orleans Division described an overlapping but distinct set of questions, including ones about license transfers, state regulatory disciplinary history, and security plans that don’t appear on the Rocky Mountain form at all. Other reports have surfaced that DEA is refusing to communicate with applicants in writing to request supplemental information, while at the same time DEA is issuing express memorandums discussing policy positions in other locations. According to these reports, DEA’s press office did not respond to a request for comment about why the registration process hasn’t been standardized region to region.
We don’t think that’s a coincidence; we believe it’s a separate story from the stay. The GAO report and the registration-inspection variance are two data points that both point to a problem with DEA operating major pieces of its drug scheduling and registration apparatus without documented, agency-wide procedures for staff to follow. One symptom shows up in how the agency evaluates a substance for scheduling. The other shows up in how a regional office decides what a dispensary or manufacturer needs to disclose to get, and keep, its registration. Both are downstream of the same (at least arguably) institutional gap of nobody writing down the rules for the people doing the work, so the work looks different depending on who’s doing it and where.
For state-licensed medical marijuana operators, that’s not an abstract administrative law point. If your registration inspection looks different from what a colleague in another state described, that’s not you missing something. It’s the same lack of standardized procedure that GAO flagged in the scheduling context, just showing up on your loading dock instead of in a hearing transcript.
How This Fits the Rest of the Board
This stay doesn’t exist in isolation. The comprehensive rulemaking hearing has been contentious from the start, with reform advocates complaining that not only were they shut out of participation entirely, but the proceedings were not livestreamed despite promises of transparency. Complicating matters more, a prior Biden-era rescheduling effort stalled last year over allegations of improper communications and witness selection. The current process, and in particular the AG’s April 2026 final rule, is also being challenged in a consolidated set of lawsuits at the D.C. Circuit, brought by state attorneys general, rescheduling opponents, and at least one cannabis-focused biopharmaceutical company, and a congressional committee recently voted to block further rescheduling steps, even though bipartisan members don’t expect that provision to become law.
Critically, none of that litigation or political noise touches the separate track that already produced results. Attorney General Todd Blanche’s April 2026 order already moved DEA-approved medications and state-licensed medical marijuana from Schedule I to Schedule III. That reclassification is in effect and isn’t undone by this stay. What’s paused is the broader, more comprehensive rulemaking hearing, the one meant to formalize marijuana’s scheduling status more generally; that’s the piece opponents are now working to slow down further by attacking the process that produced DEA’s supporting record. Notably, the April 2026 final rule sidesteps the ordinary rescheduling process because it was issued under 21 U.S.C. § 811(d)(1), which directs the attorney general (as delegated to the DEA administrator) to control a substance in whatever schedule he deems most appropriate to carry out U.S. obligations under the Single Convention. Critically, the statute states that such an order must be issued “without regard to the findings required by [21 U.S.C. 811(a) or 812(b)] and without regard to the procedures prescribed by [21 U.S.C. 811(a) and (b)]” — meaning the plain statutory text does not require DEA to request a medical and scientific evaluation or scheduling recommendation from HHS, as would normally occur under standard Section 811(b) rulemaking. This doesn’t mean the plaintiffs in the D.C. Circuit litigation won’t attempt to use the GOA report to their advantage; it just means that report isn’t as applicable to the final rule as it is to the ALJ hearing.
What We’re Watching Next
Here are a few things to keep an eye on:
- First, DEA’s October 13 brief will tell us a lot about how much weight the agency thinks the GAO findings actually carry, and whether it fights to keep the record closed or accepts the report and argues it doesn’t change the outcome.
- Second, watch whether Julius treats this as a narrow evidentiary question or uses it as an opening to examine DEA and FDA’s scheduling methodology more broadly, and whether that scrutiny ends up reaching the registration side of the house as well.
- Third — and this is the one that matters most for state-licensed medical marijuana operators watching this from the outside — a stay is not a reversal. The hearing record can still support DEA’s recommendation to move marijuana to Schedule III once this procedural detour resolves. But every week this hearing spends litigating its own record is a week the comprehensive rulemaking outcome stays unsettled, and unsettled processes, whether in a hearing room or a regional field office, are exactly where inconsistency and opponents’ arguments both get more room to operate. But, hey, what’s new in the cannabis industry?
We’ll keep watching where the briefing goes and what DEA says about its own process on October 13. Given how many separate fronts are now open in the broader rescheduling fight, and how much of the current friction traces back to the same absence of written procedure, we don’t expect this to be the last procedural wrinkle before this hearing reaches its conclusion.
Thanks for stopping by.
Hurry Up and Wait: DEA’s Rescheduling Hearing Hits the Brakes Over Its Own Alleged Process Gaps