Should the U.S. Drug Enforcement Administration have authority to treat hemp that temporarily surpasses the legal THC limit during processing as a controlled substance?
That’s the essence of a question before the U.S. Court of Appeals for the District of Columbia Circuit, which heard arguments April 19 from hemp industry attorneys and the U.S. Drug Enforcement Administration.
The DEA is defending its legal authority to take enforcement action when hemp surpasses the current federal threshold: 0.3 percent delta-9 THC.
"If someone takes a cannabis plant that itself would qualify as hemp because it's very low in THC, but then creates some kind of derivative from that plant and the derivative is itself higher in THC, the derivative is controlled marijuana even though it's from a hemp plant,” the DEA’s attorney, Sarah Carroll, argued before the three-judge panel.
The suit was filed by the Hemp Industries Association and CBD maker RE Botanicals in 2020 (see timeline below for details).
The HIA and RE Botanicals contested the rule on procedural grounds, but also said the DEA was wrongly asserting control over naturally-derived THC that doesn’t fit within the legal definition of “hemp” nor that of “marijuana” under the Controlled Substances Act.
That’s because in the process of turning hemp into products like CBD oil, materials may temporarily exceed the trace-level limit of 0.3 percent THC. This could put hemp processors at risk of violation.
Representing the plaintiffs in this case, attorney Shane Pennington argued that the DEA’s rule differed from federal statute.
“Every hemp company inevitably and necessarily handles natural tetrahydrocannabinols,” Pennington said. “The statute excludes from the reference Schedule I tetrahydrocannabinols in hemp. … The interim final rule is what’s at issue here and the interim final rule certainly doesn’t track the statute.”
“The point of this rule is simply to conform DEA’s regulations to the statute,” Carroll later rebutted.
“You’re saying to the court openly, committing the agency, that the regulation is not intended to have any different meaning than the statue?” asked Judge Laurence Silberman.
“Yes. I am saying that,” Carroll said. “… Certainly they have not carried their burden of showing there is some difference between the statute and the rule that would cause a concrete injury to them.”
It wasn’t abundantly clear from the oral arguments whether hemp-derived THC isomers such as delta-8 could be impacted by the rule. These are extracted from hemp as CBD and chemically converted into THC. However, the context of the hearing was based on current federal law, which expressly addresses delta-9 THC.
“These days it’s very common for companies and for different people to make oils and things, beverages, food, all kinds of things that contain substances taken from the cannabis plant," Carroll argued "… DEA was saying that if a substance like that is created from a cannabis plant but the substance is high in THC, the substance does not qualify as hemp and is subject to regulation under the CSA.”
Carroll affirmed to the judges that the DEA did not intend to broaden its reach through the regulation. Representatives of the U.S. Drug Enforcement Administration have previously stated the agency’s stance that hemp-derived THC isomers such as delta-8 THC are legal by the letter of the law.
The judges said they had not been tasked with giving an advisory opinion on the rule, and it seemed to them that’s what the plaintiffs were asking for.
“Some prospective injury down the road is not enough,” Judge Karen Henderson said. “You may win down the road, but it’s too early for us to get there. … Counsel may have wonderful theories. Counsel may even have some substance to the theories, but that's not our role here."
A decision is expected in three to six months.
Timeline
August 2020 — The DEA issues an interim final rule that hemp derivatives over the delta-9 THC threshold would still be considered Schedule I controlled substances.
September October 2020 — The Hemp Industries Association, a nonprofit group of business owners and supporters, and RE Botanicals, a South-Carolina-based hemp company, file a procedural lawsuit challenging the DEA’s interim final rule.
October 2020 — Hemp Industries Association and RE Botanicals file a second suit to stop the DEA from enforcing the interim final rule.
May 2021 — A D.C. federal judge dismisses the complaint citing lack of jurisdiction. Challenges to DEA regulations had to be brought in the U.S. Court of Appeals for the D.C. Circuit.
November 2021 — The DEA asks the court to dismiss the case for lack of standing, arguing that those challenging the law hadn’t shown evidence that they were under threat of DEA prosecution. The agency also filed briefs asserting that the 2018 Farm Bill legalizing hemp didn’t change the agency’s status as the regulatory authority for substances over the 0.3% federal legal THC limit.
April 2022 — Appeals hearing before the U.S. Court of Appeals for the District of Columbia Circuit.