In a groundbreaking development, a federal court in Arkansas has issued a significant ruling that has reverberations throughout the hemp industry and potentially sets the stage for future legal battles. This landmark ruling came in response to a lawsuit filed by several hemp companies challenging a newly enacted Arkansas law.
The lawsuit, initiated by Bio Gen LLC, Drippers Vape Shop LLC, The Cigarette Store LLC, and Sky Marketing Corporation (dba Hometown Hero), sought an injunction against Senate Bill 358, known as "Act 629," which was signed into law on April 11, 2023. Act 629 sought to criminalize all hemp products produced through a synthetic chemical process and any hemp-derived psychoactive substances, marking a substantial departure from federal regulations.
The plaintiffs argued that Act 629 was not only unconstitutional but also preempted by the federal 2018 Farm Bill. This landmark federal legislation removed hemp from the controlled substances list, providing states with the authority to regulate hemp production according to their plans. Importantly, it defined hemp as cannabis sativa L. with a delta-9 tetrahydrocannabinol (THC) concentration not exceeding 0.3% on a dry weight basis.
In a sweeping victory for the hemp industry, the court issued a preliminary injunction, effectively preventing the enforcement of Act 629. The court's ruling was based on three crucial findings:
- Conflict Preemption: The court determined that the 2018 Farm Bill's definition of hemp, based solely on delta-9 THC concentration levels, clashed with Act 629's broader interpretation. Under the federal standard, hemp included derivatives, extracts, and cannabinoids, and this definition extended to downstream products as long as their delta-9 THC concentration stayed below the 0.3% threshold. This finding implied that state laws departing from the federal definition were at risk of being deemed unconstitutional.
- Express Preemption: The court highlighted that while states had the authority to regulate hemp production more stringently than federal law, they could not hinder the interstate transportation of hemp products produced under state or tribal plans or USDA licenses, as guaranteed by the 2018 Farm Bill. This was significant because it underscored that state regulations could not impede the free flow of hemp-derived products across state lines.
- Void for Vagueness: Act 629's use of vague terms such as "continuous transportation," "synthetic substance," and "psychoactive substances" rendered it problematic under the Due Process Clause of the Constitution. The court argued that laws must be clear to ensure that individuals can understand them, and Act 629's ambiguity could lead to arbitrary enforcement and criminal penalties.
The implications of this ruling extend beyond Arkansas, potentially affecting hemp laws in numerous states that deviate from federal standards. This victory for the hemp industry reinforces the lawful status of hemp products and strengthens the cannabis legalization movement overall.
Now, as this landmark case unfolds, another legal battle is brewing in Virginia. The state recently implemented stricter limits on hemp products, imposing a maximum THC concentration of 0.3% and 2 milligrams per package. This change has rendered many previously available products illegal and subject to fines.
Northern Virginia Hemp and Agriculture, along with other plaintiffs, have challenged this law, arguing that it causes significant financial harm to hemp businesses and interferes with interstate commerce. Their lawsuit asserts that Virginia's definition of legal hemp products contradicts federal law and places undue burdens on the industry.
The outcome of the Arkansas case carries immense weight as the Virginia hearing approaches. If the federal court's ruling in Arkansas serves as a precedent, it could bolster the arguments of hemp advocates in Virginia and potentially lead to a favorable outcome in their lawsuit.
As these legal battles unfold, the hemp industry is watching closely, hoping for a consistent legal framework that aligns with federal regulations and supports its growth while ensuring the safety and well-being of consumers.