Jeff Sessions Fired: What It Meant for US Cannabis Policy

Cannabis’ Most Powerful Enemy Loses His Job — And Stocks Surge

Published November 7, 2018 — By Ann Karim, Senior Cannabis Editor

Who Was Jeff Sessions and Why Did Cannabis Advocates Fear Him?

Jeff Sessions, the former Senator from Alabama who became Trump’s first Attorney General in February 2017, was arguably the most cannabis-hostile federal official since Harry Anslinger led the original marijuana prohibition campaign in the 1930s. Sessions had opposed cannabis reform consistently throughout his political career, voting against every cannabis-related amendment in his Senate career and publicly equating marijuana with heroin on multiple occasions.

His most infamous quote — “good people don’t smoke marijuana” — became a rallying cry for cannabis advocates and a symbol of the cultural gap between federal drug policy and the reality lived by millions of Americans in legal states like Colorado and California. When Trump nominated him as AG, cannabis industry executives, investors, and advocates went into crisis mode, fearing a federal crackdown on state-legal businesses that had built up over years under more permissive Obama-era policy.

The threat was real. Under the Controlled Substances Act, cannabis remains Schedule I — a federal crime regardless of state law. Federal prosecutors have the authority to prosecute state-legal cannabis businesses at any time. Sessions’ elevation to the top law enforcement position in the country meant the most hostile possible federal official now controlled those prosecutors. Understanding the current cannabis legal landscape requires knowing this history.

“I reject the idea that America will be a better place if marijuana is sold in every corner store.” — Jeff Sessions, 2016

The Cole Memo: What It Was and Why Sessions Killed It

The Cole Memo, issued by Deputy Attorney General James Cole in August 2013, was the legal cannabis industry’s primary protection against federal prosecution during the Obama years. It instructed US Attorneys not to prioritize enforcement of federal cannabis laws in states with robust regulatory systems, citing limited federal enforcement resources and the states’ primary role in public safety.

Sessions rescinded the Cole Memo on January 4, 2018 — less than a week after California’s recreational market launched. In its place, he issued a one-page memo instructing prosecutors to follow existing federal law and use their own judgment. For the legal cannabis industry, this was a thunderclap. Companies that had borrowed against real estate, hired thousands of employees, and built out cultivation and retail infrastructure suddenly had no informal federal protection.

In practice, the rescission produced no immediate enforcement actions. US Attorneys in legal states largely maintained the status quo, recognizing the political and logistical impossibility of prosecuting thousands of state-licensed businesses. But the uncertainty created real damage: banks that had cautiously started working with cannabis businesses pulled back, cannabis companies struggled to access banking services, and stock prices fell sharply in January 2018 on the news.

November 7, 2018: The Day the Industry Exhaled

Sessions’ resignation letter was brief and politically pointed. He had been at odds with Trump for months over his recusal from the Russia investigation, and Trump had publicly humiliated him repeatedly. When Trump announced Sessions’ departure by tweet the morning after the 2018 midterm elections, cannabis industry observers immediately recognized the significance.

Cannabis stocks reacted dramatically. Canopy Growth Corporation, the largest Canadian licensed producer by market cap, jumped over 10% in Toronto trading on November 7. Aurora Cannabis, Cronos Group, and Aphria saw similar gains. US multi-state operators listed on Canadian exchanges also rallied. The market was pricing in a world where the single most committed federal cannabis enforcement advocate no longer held power over the US Attorney network.

For the broader cannabis reform movement, Sessions’ exit also opened legislative possibilities. Republicans who had privately supported cannabis banking reform had been reluctant to move while Sessions was in office, knowing he would lobby hard against any reform. With his departure, the SAFE Banking Act — which would protect banks serving state-legal cannabis businesses — began gaining serious Congressional momentum. Our US cannabis guide covers how federal policy has evolved since 2018.

What Changed — and What Stayed the Same

In terms of immediate enforcement changes, Sessions’ firing changed very little. His replacement, Acting AG Matthew Whitaker, took no special interest in cannabis. William Barr, confirmed as AG in February 2019, was also personally opposed to cannabis legalization but made clear he would not pursue enforcement against state-legal businesses as a priority. The Cole Memo was never reinstated, but its practical effects were largely maintained through prosecutorial discretion.

What actually changed was the psychological and political environment around cannabis. Investors, who had fled the sector in January 2018 when Sessions killed the Cole Memo, returned with enthusiasm. The cannabis stock bubble that peaked in early 2019 drew billions in investment capital. Startups raised money, established companies expanded, and the industry began looking more like a permanent feature of American commerce than a precarious experiment.

For consumers in legal states like Illinois, New Jersey, and others that passed legalization in the years after Sessions’ departure, the policy environment had genuinely improved. Drug testing in employment remained a major issue, but the existential federal threat to state-legal markets had receded significantly. Sessions’ firing was not legalization — but it was the removal of the single greatest obstacle to legalization’s continued progress.