Coats v Dish - CO Supreme Court Decision

Jun 22, 2015

Recent Colorado Supreme Court Ruling – No. 13SC394, Coats v. Dish Network—An Employer’s Right to Terminate an Employee for Medical Marijuana Use Outside of Work

By: Craig Watrous

Following up on a past post written by one of my partners, Reed Morris, last week the Colorado Supreme Court issued its unanimous ruling in the Coats v. Dish Network case. This is an interesting case because it ties in an employer’s ability to prohibit drug use and regulate the activities of its employees outside of work with Colorado’s Medical Marijuana Amendment which makes it legal to consume medical marijuana.  Effectively, this case determined that the use of medical marijuana is not a protected activity in the workplace and consequently an employer can terminate an employee who consumes medical marijuana outside of work in violation of the employer’s drug policy.

The facts in this case are: Brandon Coats is a quadriplegic and has been confined to a wheelchair since he was a teenager. In 2009, he registered for and obtained a Colorado state-issued license to use medical marijuana to treat painful muscle spasms caused by his quadriplegia. Coats consumes medical marijuana at home, after work, and in accordance with his license and Colorado state law. Between 2007 and 2010, Coats worked for Dish Network as a telephone customer service representative. Dish had a zero tolerance drug policy prohibiting marijuana use. In May 2010, Coats tested positive for tetrahydrocannabinol (“THC”), during a random company drug test. Coats informed Dish that he was a registered medical marijuana patient and planned to continue using medical marijuana. On June 7, 2010, Dish fired Coats for violating the company’s drug policy. After being discharged, Coats filed a wrongful termination action against Dish arguing that his consumption of marijuana outside of work was a protected “lawful” activity. 

“Lawful” is the operative term of art in this case. Without getting into too much legalese, Colorado statute § 24-34-402.5(1) generally makes it an unfair and discriminatory labor practice to discharge an employee based on the employee’s “lawful” outside-of-work activities. At the same time, under federal law, the Controlled Substances Act (“CSA”), prohibits medical marijuana use. The CSA lists marijuana as a Schedule I substance, meaning federal law designates it as having no medical accepted use, a high risk of abuse, and a lack of accepted safety for use under medical supervision. Id. at § 812(b)(1)(A)–(C). This makes the use, possession, and/or manufacture of marijuana a federal criminal offense, except where used for federally-approved research projects. There is no exception for marijuana use for medicinal purposes, or for marijuana use conducted in accordance with state law. Mr. Coats argued that because his use of medical marijuana was legal under Colorado law, it was a protected “lawful” activity that he could engage in outside of work.

The Court found unanimously that while it may be legal under state law, marijuana use still remains illegal under federal law and is therefore not a “lawful” activity protected by Colorado statute.  The Court found that in order to be a protected “lawful” activity it must be in compliance with both federal and state law. In sum, because Coats’ marijuana use was unlawful under federal law, it does not fall within section 24-34-402.5’s protection for “lawful” activities. Because medical marijuana use is prohibited by federal law, Dish was within its right to terminate Coats for his use of medical marijuana even though he did so outside of work.  

This case has potentially far reaching implications.  The use of medical marijuana, even if by a state approved license, is not a protected "lawful" activity and an employer may terminate an employee if such use violates the employer's drug policy.  It will be interesting to see how this decision plays out in the next few years.

For the full opinion see the links below:




(Mallon Lonnquist Morris & Watrous PLLC, is a business, employment, real estate, and litigation law firm. Craig T. Watrous is a Colorado business attorney with MLMW, based in Denver, Colorado. Craig can be reached at cwatrous@mlmw-law.com.)

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