Zanetich v. Wal-Mart Stores E., Inc.

1

ERICK ZANETICH, on behalf of himself and those similarly situated, Appellant v. WAL-MART STORES EAST, INC., doing business as Walmart Inc.; SAM'S EAST INC., doing business as Sam's Club Fulfillment Center

No. 23-1996

United States Court of Appeals, Third Circuit

December 9, 2024

Argued: March 6, 2024

On Appeal from the United States District Court for the District of New Jersey (D.C. No. 1:22-cv-05387) District Judge Honorable Christine P. O'Hearn Justin L. Swidler [ARGUED] SWARTZ SWIDLER Counsel for Appellant

Misha Tseytlin [ARGUED] TROUTMAN PEPPER Counsel for Appellees

Before: JORDAN, PHIPPS, and FREEMAN, Circuit Judges

OPINION

PHIPPS, Circuit Judge.

In 2021, as part of its efforts to legalize and regulate marijuana use "in a similar fashion to the regulation of alcohol for adults," New Jersey enacted the Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act - referred to herein as 'CREAMMA.' N.J. Pub. L. 2021, ch. 16 (amending N.J. Stat. §§ 18A, 24, 40, and 54). One of the provisions of CREAMMA prohibits employers from refusing to hire a job applicant for the use of cannabis. See N.J. Stat. § 24:6I-52(a)(1). CREAMMA, however, does not expressly provide a private remedy for redressing employment discrimination against cannabis users. And, in 2022, a retailer in New Jersey rescinded an offer of employment to a job applicant because he tested positive for cannabis.

Claiming that the retailer's decision violated CREAMMA, that job applicant initiated this two-count lawsuit individually and on behalf of a putative class. The first count sought redress on the theory that CREAMMA implies a remedy for violations of its employment protections. The second count pursued a claim for pre-employment discrimination in violation of public policy. The retailer moved to dismiss both counts, and the District Court granted that motion on the grounds that neither presented a legally viable claim.

In this appeal, the job applicant challenges that ruling and alternatively seeks certification to the New Jersey Supreme Court of the state-law issues underlying both claims. On de novo review of the District Court's decision, we will affirm the judgment of the District Court, and exercising our discretion, we will not certify either question.

I. Statutory Background

At least as far back as 1933, New Jersey criminalized the use and possession of cannabis. See N.J. Pub. L. No. ch. 186, arts. I-III (1933). That prohibition began to be relaxed in 2010 with the passage of legislation that exempted the medical use of cannabis from criminal liability under New Jersey law. See N.J. Pub. L. No. 2009, ch. 307 (codified at N.J. Stat. §§ 24:6I-1-24:6I-16) (permitting limited medical use of cannabis for "debilitating medical conditions"). In 2019, the New Jersey Legislature broadened the medical-use exception and created a state agency - the Cannabis Regulatory Commission - to oversee the licensing and regulation of medical marijuana distributors. See N.J. Pub. L. No. 2019, ch. 153 (codified as amended at N.J. Stat. §§ 24:6I-1-24:6I-30, 26:2H-12.86, 30:6D5-b, 45:1-45.1, 45:9-27.16, 45:9-27.19, 45:11-49, 52:13D-13, 52:13D-17.2, 2C:35-18, 18A:40-12.22). Then, in November 2020, through a ballot initiative, Garden State voters, by a two-to-one margin,^[1] approved an amendment to the New Jersey Constitution that legalized and regulated the possession and use of marijuana by persons over age 21. N.J. Const. art. IV, § VII, ¶ 13 (effective Jan. 31, 2021). But cf. 21 U.S.C. § 812 (listing "marihuana" as a Schedule I controlled substance); Schedules of Controlled Substances: Rescheduling of Marijuana, 89 Fed.Reg. 44597-01, 44601 (proposed May 21, 2024) (to be codified at 21 C.F.R. pt. 1308) (proposing a transfer of marijuana from Schedule I to Schedule III).

Within a month of the effective date of that amendment, on February 22, 2021, New Jersey enacted CREAMMA, which provides a statutory grounding for the regulation of cannabis in the state. See N.J. Pub. L. No. 2021, ch. 16. The New Jersey Legislature announced and codified three broad purposes of CREAMMA:

1. to adopt a new approach to our marijuana policies by controlling and legalizing a form of marijuana, to be referred to as cannabis, in a similar fashion to the regulation of alcohol for adults . . .

2. [to] prevent the sale or distribution of cannabis to persons under 21 years of age . . . [and]

3. to eliminate the problems caused by the unregulated manufacturing, distribution, and use of illegal marijuana within New Jersey[.]

N.J. Stat. § 24:6I-32(a)-(c).

The New Jersey Legislature also made a dozen factual findings in support of CREAMMA. See id. § 24:6I-32(d)-(o). Several of those related to law enforcement. For instance, the Legislature found that CREAMMA "will divert funds from marijuana sales from going to illegal enterprises, gangs, and cartels," id. § 24:6I-32(d), and that "[controlling and legalizing cannabis for adults in a similar fashion to alcohol will strike a blow at the illegal enterprises that profit from New Jersey's current, unregulated illegal marijuana market," id. § 24:6I-32(h).^[2] Other findings addressed public health concerns, such as the conclusion that "[a] controlled system of cannabis manufacturing, distribution, and sales must be designed in a way that enhances public health and minimizes harm to New Jersey communities and families." Id. § 24:6I-32(1).^[3] In a similar vein, other findings focused on the importance of preventing underage cannabis use. See id. § 24:6I-32(m) (finding that "[t]he legalized cannabis marketplace in New Jersey must be regulated so as to prevent persons younger than 21 years of age from accessing or purchasing cannabis"); id. § 24:6I-32(k) (reasoning that "[controlling and regulating the manufacturing, distribution, and sales of cannabis will strengthen our ability to keep it along with illegal marijuana away from minors"). Finally, one of the factual findings related to the consequences of arrests for marijuana, including the negative effects on future employment:

A marijuana arrest in New Jersey can have a debilitating impact on a person's future, including consequences for one's job prospects, housing access, financial health, familial integrity, immigration status, and educational opportunities . . . .

Id. § 24:6I-32(n).

In furtherance of those purposes and findings, CREAMMA delegated significant authority to the Cannabis Regulatory Commission. It conferred jurisdiction on the Commission over "any person who buys, sells, cultivates, produces, manufactures, transports, or delivers any cannabis or cannabis items within this State." Id. § 24:6I-34(a). Under CREAMMA, the Commission also may "exercise all powers incidental, convenient, or necessary to enable the Commission to administer or carry out the provisions of [CREAMMA]." Id. § 24:6I-34(b)(5). And the Commission is to "oversee the development, regulation, and enforcement of activities associated with the personal use of cannabis." Id. § 24:6I-24(a)(2).

Also, as part of its overall approach to cannabis regulation, CREAMMA prohibited two forms of employment discrimination. First, it outlawed employment discrimination based on a person's use or non-use of cannabis:

No employer shall refuse to hire or employ any person or shall discharge from employment or take any adverse action against any employee with respect to compensation, terms, conditions, or other privileges of employment because that person does or does not smoke, vape, aerosolize or otherwise use cannabis items . . . .

Id. § 24:6I-52(a)(1). Second, it protected employees from adverse employment actions based solely on a positive cannabis drug test:

[A]n employee shall not be subject to any adverse action by an employer solely due to the presence of cannabinoid metabolites in the employee's bodily fluid from engaging in conduct permitted under [CREAMMA].

Id.

CREAMMA also set express bounds for those employment protections. They do not prevent employers from "maintaining] a drug- and alcohol-free workplace." Id. § 24:6I-52(b)(1)(a). Nor do those protections "require an employer to permit or accommodate the use, consumption, being under the influence, possession, transfer, display, transportation, sale, or growth of cannabis or cannabis items in the workplace." Id. As a further limitation, CREAMMA made explicit that its cannabis-related provisions should not be construed to "amend or affect in any way any State . . . law pertaining to employment matters." Id. § 24:6l-55(a).

The Cannabis Regulatory Commission has exercised some, but seemingly not the full extent, of its authority with respect to CREAMMA's employment protections. It has promulgated regulations^[4] and issued guidance documents.^[5] One of those guidance documents, issued in September 2022 to "all employers," explained that a positive drug test when combined with evidence of impairment may justify an adverse employment action:

A scientifically reliable objective testing method that indicates the presence of cannabinoid metabolites in the employee's bodily fluid alone is insufficient to support an adverse employment action. However, such a test combined with evidence-based documentation of physical signs or other evidence of impairment during an employee's prescribed work hours may be sufficient to support an adverse employment action.

N.J. Cannabis Regul. Comm'n, Guidance on "Workplace Impairment" 1 (2022) [https://perma.cc/25WT-DZWP]. The Commission, however, has not taken any formal enforcement action against employers who violate CREAMMA's employment protections.

II. Factual Background

(As Alleged in the Complaint)

In January 2022, less than a year after the enactment of CREAMMA, New Jersey citizen Erick Zanetich...