Emerald Steel Fabricators Inc v. Bureau Of Labor And Indus.

• Decision Date: 15 April 2010
• Docket Number: (BOLI 3004,CA A130422,SC S056265).
• Citation: 230 P.3d 518,348 Or. 159
• Court: Oregon Supreme Court
• Parties: EMERALD STEEL FABRICATORS, INC., Petitioner on Review,v.BUREAU OF LABOR AND INDUSTRIES, Respondent on Review.

348 Or. 159

230 P.3d 518

En Banc.

EMERALD STEEL FABRICATORS, INC., Petitioner on Review,v.BUREAU OF LABOR AND INDUSTRIES, Respondent on Review.

(BOLI 3004; CA A130422; SC S056265).

Supreme Court of Oregon.

Argued and Submitted March 6, 2009.

Decided April 15, 2010.

On review from the Court of Appeals.^*

Terence J. Hammons, of Hammons & Mills, Eugene, argued the cause and filed the brief for petitioner on review.

Janet A. Metcalf, Assistant Attorney General, Salem, argued the cause and filed the brief for respondent on review. With her on the brief were John R. Kroger, Attorney General, and Erika L. Hadlock, Acting Solicitor General.

Paula A. Barran, of Barran Liebman LLP, Portland, filed the brief for amicus curiae Associated Oregon Industries.

James N. Westwood, of Stoel Rives LLP, Portland, filed the brief for amici curiae Pacific Legal Foundation and National Federation of Independent Business. With him on the brief was Deborah J. La Fetra.

KISTLER, J.

The Oregon Medical Marijuana Act authorizes persons holding a registry identification card to use marijuana for medical purposes. ORS 475.306(1). It also exempts those persons from state criminal liability for manufacturing, delivering, and possessing marijuana, provided that certain conditions are met. ORS 475.309(1). The Federal Controlled Substances Act, 21 U.S.C. § 801 et seq., prohibits the manufacture, distribution, dispensation, and possession of marijuana even when state law authorizes its use to treat medical conditions. Gonzales v. Raich, 545 U.S. 1, 29, 125 S.Ct. 2195, 162 L.Ed.2d 1 (2005); see United States v. Oakland Cannabis Buyers' Cooperative, 532 U.S. 483, 486, 121 S.Ct. 1711, 149 L.Ed.2d 722 (2001) (holding that there is no medical necessity exception to the federal prohibition against manufacturing and distributing marijuana).

The question that this case poses is how those state and federal laws intersect in the context of an employment discrimination claim; specifically, employer argues that, because marijuana possession is unlawful under federal law, even when used for medical purposes, state law does not require an employer to accommodate an employee's use of marijuana to treat a disabling medical condition. The Court of Appeals declined to reach that question, reasoning that employer had not preserved it. Emerald Steel Fabricators, Inc. v. BOLI, 220 Or.App. 423, 186 P.3d 300 (2008). We allowed employer's petition for review and hold initially that employer preserved the question that it sought to raise in the Court of Appeals. We also hold that, under Oregon's employment discrimination laws, employer was not required to accommodate employee's use of medical marijuana. Accordingly, we reverse the Court of Appeals decision.

Since 1992, employee has experienced anxiety, panic attacks, nausea, vomiting, and severe stomach cramps, all of which have substantially limited his ability to eat. Between January 1996 and November 2001, employee used a variety of prescription drugs in an attempt to alleviate that condition. None of those drugs proved effective for an extended period of time, and some had negative effects. In 1996 employee began using marijuana to self-medicate his condition.

In April 2002, employee consulted with a physician for the purpose of obtaining a registry identification card under the Oregon Medical Marijuana Act. The physician signed a statement that employee has a “debilitating medical condition” and that “[m]arijuana may mitigate the symptoms or effects of this patient's condition.” The statement added, however, “This is not a prescription for the use of medical marijuana.” The statement that employee's physician signed tracks the terms of the Oregon Medical Marijuana Act. That act directs the state to issue registry identification cards to persons when a physician states that “the person has been diagnosed with a debilitating medical condition and that the medical use of marijuana may mitigate the symptoms or effects” of that condition. ORS 475.309(2).¹ No prescription is required as a prerequisite for obtaining a registry identification card. See id.

Based on the physician's statement, employee obtained a registry identification card in June 2002, which he renewed in 2003.² That card authorized employee to “engage in * * * the medical use of marijuana” subject to certain restrictions. ORS 475.306(1). Possession of the card also exempted him from state criminal prosecution for the possession, distribution, and manufacture of marijuana, provided that he met certain conditions. ORS 475.309(1).

Employer manufactures steel products. In January 2003, employer hired employee on a temporary basis as a drill press operator. While working for employer, employee used medical marijuana one to three times per day, although not at work. Employee's work was satisfactory, and employer was considering hiring him on a permanent basis. Knowing that he would have to pass a drug test as a condition of permanent employment, employee told his supervisor that he had a registry identification card and that he used marijuana for a medical problem; he also showed his supervisor documentation from his physician. In response to a question from his supervisor, employee said that he had tried other medications but that marijuana was the most effective way to treat his condition. Neither employee's supervisor nor anyone else in management engaged in any other discussion with employee regarding alternative treatments for his condition. One week later, the supervisor discharged employee.

Two months later, employee filed a complaint with the Bureau of Labor and Industries (BOLI), alleging that employer had discriminated against him in violation of ORS 659A.112. That statute prohibits discrimination against an otherwise qualified person because of a disability and requires, among other things, that employers “make reasonable accommodation” for a person's disability unless doing so would impose an undue hardship on the employer. ORS 659A.112(2)(e). Having investigated employee's complaint, BOLI filed formal charges against employer, alleging that employer had discharged employee because of his disability in violation of ORS 659A.112(2)(c) and (g) and that employer had failed to reasonably accommodate employee's disability in violation of ORS 659A.112(2)(e) and (f). Employer filed an answer and raised seven affirmative defenses.

After hearing the parties' evidence, an administrative law judge (ALJ) issued a proposed order in which he found that employee was a disabled person within the meaning of ORS chapter 659A but that employer had not discharged employee because of his disability. The ALJ found instead that employer had discharged employee because he used marijuana and ruled that discharging employee for that reason did not violate ORS 659A.112(2)(c) or (g). The ALJ went on to rule, however, that employer had violated ORS 659A.112(2)(e) and (f), which prohibit an employer from failing to reasonably accommodate the “known physical or mental limitations of an otherwise qualified disabled person,” and from denying employment opportunities to an otherwise qualified disabled person when the denial is based on the failure “to make reasonable accommodation to the physical or mental impairments of the employee.”

Among other things, the ALJ ruled that employer's failure to engage in a “meaningful interactive process” with employee, standing alone, violated the obligation set out in ORS 659A.112(2)(e) and (f) to reasonably accommodate employee's disability. The ALJ also found that employee had suffered damages as a result of those violations, and the commissioner of BOLI issued a final order that adopted the ALJ's findings in that regard.

Employer sought review of the commissioner's order in the Court of Appeals. As we understand employer's argument in the Court of Appeals, it ran as follows: Oregon law requires that ORS 659A.112 be interpreted consistently with the federal Americans with Disabilities Act (ADA), 42 USC § 12101 et seq. Section 12114(a) of the ADA provides that the protections of the ADA do not apply to persons who are currently engaged in the illegal use of drugs, and the federal Controlled Substances Act prohibits the possession of marijuana without regard to whether it is used for medicinal purposes. It follows, employer reasoned, that the ADA does not apply to persons who are currently engaged in the use of medical marijuana. Like the ADA, ORS 659A.124 provides that the protections of ORS 659A.112 do not apply to persons who are currently engaged in the illegal use of drugs. Employer reasoned that, if ORS 659A.112 is interpreted consistently with the ADA, then ORS 659A.112 also does not apply to persons who are currently engaged in medical marijuana use. Employer added that, in any event, the United States Supreme Court's opinion in Raich and the Supremacy Clause required that interpretation.

The Court of Appeals did not reach the merits of employer's argument. It concluded that employer had not presented that argument to the agency and thus had not preserved it. Accordingly, we begin with the question whether employer preserved the issues before BOLI that it sought to raise in the Court of Appeals.

Employer raised seven affirmative defenses in response to BOLI's complaint. The fifth affirmative defense alleged:

“Oregon law prescribes that ORS 659A.112 be construed to the extent possible in a manner that is consistent with any similar provisions of the Federal Americans with Disabilities Act of 1990, as amended. That Act does not permit the use of marijuana because marijuana is an illegal drug under Federal Law.”

That affirmative defense is broad enough to encompass the argument that employer made in the Court of Appeals. To be sure, employer's fifth affirmative defense does not refer specifically to ORS 659A.124. However, it alleges that the ADA does not apply to persons who use marijuana, a proposition that necessarily depends on...