9th Circuit Says Dormant Commerce Clause Does Not Apply To Cannabis, Sparking Circuit Split

The 9th U.S. Circuit Court of Appeals kicked off 2026 by deepening one of the most consequential fault lines in US cannabis law. Its January 2 decision in Peridot Tree WA, Inc. v. Washington State Liquor & Cannabis Control Board, 162 F.4th 1179 (9th Cir. 2026), held that the Dormant Commerce Clause — a constitutional doctrine barring states from discriminating against interstate commerce — does not apply to state cannabis markets because cannabis remains federally illegal under the Controlled Substances Act (CSA).

Out-of-state operators frozen out of lucrative cannabis markets have f iled suit in federal courts across the country, pressing a deceptively simple constitutional question: Can states play favorites in a market that Congress says should not exist at all?