Legal decisions set many precedents for the insurance industry, but frequently those decisions lag behind what's occurring in the real world. A prime example involves the legalized use of marijuana. Approved for medical use in 23 states and recreational use in a handful, the federal government has yet to legalize the use, growth or sale of marijuana.

For many employers who have a zero-tolerance policy on controlled substances, the legalized use of marijuana (even if it is on the employee's personal time) presents some complex issues. As we go to press, the Colorado Supreme Court has upheld the findings of two lower courts in a case involving the use of medical marijuana by an employee who needed it to cope with spasms and seizures related to his quadriplegia.

The unanimous ruling by six justices (a seventh judge had to recuse herself because a family member was involved in a lower court ruling) found that under Colorado's "lawful activities statute" the term "lawful" could only be applied to "those activities that are lawful under both state and federal law." Since there are no protections for such use under federal law, the judges affirmed the previous rulings in the case of Coats v. Dish Network. (This case is cited in our feature on "4 Burning Questions About Medical Marijuana.")