DEA's Ban on Hemp-Derived Forms of THC Could Wreck the CBD Industry
The DEA wants to block companies from making intoxicating cannabinoids from hemp, but its proposed rules would also make it very difficult for companies to legally produce CBD.
Published on May 5, 2022

Hemp industry attorneys are facing off with the DEA in the latest stage of a years-long battle to clarify the feds' official stance on hemp-derived forms of THC.

The lawsuit stems from DEA regulations intended to stop the proliferation of products containing delta-8-THC or other psychoactive cannabinoids derived from legal hemp plants. The federal government legalized the cultivation, production, and sale of hemp with the 2018 Farm Bill, but this law explicitly states that all hemp plants or products that contain delta-9-THC levels of more than 0.3% remain illegal.

At the time, lawmakers felt that this restriction would allow hemp businesses to create non-psychoactive CBD products while simultaneously blocking them from making products that would actually get people high. Crafty cannabis scientists soon found a way to create psychoactive THC isomers like delta-8 or delta-10 THC from legal hemp, though, creating a loophole allowing these products to be sold anywhere in the US. 

In August 2020, the DEA issued an interim rule stating that all hemp plants, extracts, and products immediately become illegal if they exceed 0.3% THC content, regardless of the specific kind of THC involved. The Farm Bill explicitly dictates that regulation of the legal hemp industry falls under the jurisdiction of the US Department of Agriculture (USDA), though, not the DEA.

Shortly after the rule was issued, the Hemp Industries Association (HIA) and South Carolina CBD company RE Botanicals filed a federal lawsuit arguing that the DEA does not have the authority to impose these regulations on the hemp industry. The lawsuit argues that even if the DEA is specifically trying to crack down on the production of intoxicating THC products, the wording of its rule would also essentially criminalize the production of CBD medicines.

The HIA faced off with the DEA in an appeals court last month for another round of arguments. At the trial, DEA attorney Sarah Carroll told the court that the agency is specifically trying to block hemp producers from making “beverages, food, all kinds of things that contain substances taken from the cannabis plant,” MJBizDaily reports.

“We’re talking about things that are too high in THC to qualify as hemp,” Carroll explained. “If a substance like that is created from a cannabis plant, but the substance itself is high in THC, the substance does not qualify as hemp and is subject to regulation [by the DEA].”

Attorneys for the HIA have tightened their argument to focus on the DEA's assertion that a hemp extract instantly becomes illegal the second it exceeds the 0.3% THC threshold. Hemp manufacturers testified that THC levels regularly “run hot” during the standard extraction process, but added that they can easily reduce these levels in final processing, allowing them to create CBD products that are fully compliant with federal law.

If the DEA rule was allowed to stand, hemp manufacturers would either need to develop a new extraction process that carefully controls for transient THC levels, or apply for a DEA license to handle Schedule I drugs. Either choice would impose such a serious financial burden that it would make it difficult for companies to actually turn a profit.

HIA attorney Shane Pennington illustrated the issue by likening the DEA rule to saying that cake is legal, but eggs and flour are illegal. In this scenario, a baker would be unable to actually create a cake without applying for a permit to handle the illegal ingredients. Pennington added that the confusion over the legality of these substances is convincing banks to refuse loans and other services to legal hemp businesses, for fear of federal retribution.

The court intends to issue its final decision on the case within the next three to six months.

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Chris Moore
Chris Moore is a New York-based writer who has written for Mass Appeal while also mixing records and producing electronic music.
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