Hemp industry sues DEA over rule implementing 2018 Farm Bill

The Hemp Industries Association (HIA) and a South Carolina-based company recently filed a lawsuit against the Drug Enforcement Administration (DEA) over a rule they allege could produce adverse consequences for the industry.

In a petition filed Sept. 18 with the U.S. Court of Appeals for the District of Columbia Circuit, HIA and hemp manufacturer and retailer, RE Botanicals Inc., requested review of DEA’s interim final rule, “Implementation of the Agriculture Improvement Act of 2018.”

The rule exceeded the authority of DEA and violated the Agricultural Improvement Act of 2018, according to the petitioners.

The Agricultural Improvement Act of 2018—otherwise known as the Farm Bill—removed hemp and its derivatives from the Controlled Substances Act (CSA). But in order to meet the definition of hemp, the plant Cannabis sativa L. and any part of it cannot exceed a delta-9 THC (tetrahydrocannabinol) concentration of 0.3% on a dry weight basis.

According to HIA and RE Botanicals, DEA’s rule clarifies all hemp derivatives or extracts exceeding 0.3% THC remain Schedule I controlled substances. They expressed concerns that the rule could be interpreted to grant DEA jurisdiction over hemp derivatives that temporarily exceed 0.3% THC during processing but contain less than that amount in final products.

“When Congress passed the 2018 farm bill, it explicitly carved hemp and its derivatives out of the Controlled Substances Act so that hemp can be regulated as an agricultural commodity," HIA President Rick Trojan said in a news release. "The DEA’s interim final rule could create substantial barriers to the legal manufacturing of hemp-derived products, a critical component of the hemp supply chain, and devastate the entire hemp industry. Although the DEA states that is not its intention, the rule must be amended to ensure hemp remains an agricultural crop, as Congress intended."

The petitioners also argued DEA administrator Timothy Shea, who is individually named as a respondent along with DEA, issued the rule without following procedures required by law, such as providing the public notice and an opportunity to comment.

Sean Mitchell, a DEA spokesman, said the agency “does not comment on ongoing litigation.”

DEA claimed in its rule that “publishing a notice of proposed rulemaking and soliciting public comment prior to publication are unnecessary in this instance because these regulations merely implement statutory changes over which the agency has no discretion.”

The agency, however, opened a docket to solicit public comment following publication of the rule. To date, the docket includes more than 2,400 comments.