RICHMOND, Va. (CN) — Industry members and users told a Fourth Circuit panel Thursday that Virginia's restrictions on hemp violate federal law.
"The congressional report is clear," their attorney James Markels of Croessmann & Westberg said. "States were not intended to be allowed to redefine hemp however they wanted to redefine it."
The case highlights the growing tension between state autonomy and federal authority in regulating hemp and its derivatives. Virginia and North Carolina-based hemp manufacturers and sellers claim Virginia law makes running a successful hemp business nearly impossible. The other plaintiff, Virginia resident Rose Lane, claims to use hemp products to mitigate her arthritis.
Under Republican leadership, Virginia passed a bill in 2023 that expanded the federal definition of hemp from the standard of THC concentration of no more than 0.3% on a dry-weight basis for only delta-9 products to include delta-8 and other variants. An Alexandria-based federal court rejected the appellants' request for an injunction, claiming Virginia had a merited public interest in protecting its citizens from substances like delta-8.
Former President Donald Trump signed the Agriculture Improvement Act of 2018, commonly called the Farm Bill. Among the sweeping changes aimed at supporting rural prosperity, the act amended the Controlled Substance Act by removing industrial hemp from the federal definition of marijuana.
THC is the primary psychoactive compound naturally found in cannabis plants. Following the Farm Bill, states began seeing an increase in products, like the ones the plaintiffs sell, that contain elevated levels of THC in the form of delta variants, such as delta-8.
"This definition, however, created a loophole that businesses soon began to exploit," attorneys representing the state wrote in a brief. "This loophole soon caused an alarming public health crisis in Virginia."
According to the state, the number of calls to poison control centers involving children under 5 who had consumed edibles containing THC rose from about 207 in 2017 to more than 3,054 in 2021. Markels contended that Congress didn't make a mistake when it singled out only delta-9 for its hemp definition.
"How could Congress allow a brand new intoxicant to be legal?" Markels asked. "The fact of the matter is that is exactly what the Farm Bill allows. Congress is aware of it. The FDA could regulate Delta-8 if it wanted to. Congress can change the law if it wants to, and neither case has happened."
Attorney Erika Maley, representing the state, said the Farm Bill is far narrower than the plaintiffs read it. Maley said the state follows the Farm Bill by allowing federally licensed producers to grow their hemp without concern for Virginia's total THC standard, but that the Farm Bill does not bar states from regulating the sale of hemp products.
"When you are talking about products that are causing serious public health harms, including a dramatic spike in the poisoning of young children, it would be extraordinary to conclude, with nothing in the congressional text, that Congress meant to say the states can't regulate in response to that," Maley said.
Markels said the act significantly injured the Northern Virginia-based hemp manufacturer.
"SB 903 converted approximately 95% of NOVA Hemp's hemp products into banned products, treating them as illegal marijuana under Virginia law even though those products were compliant with federal law," the business argues in its brief. "As a direct result of that change, NOVA Hemp suffered a catastrophic 90% drop in revenue, as consumers were not interested in buying hemp products that were compliant with the total THC standard."
U.S. Circuit Judge Marvin Quattlebaum, a Trump appointee, disputed the business's injury claim.
"Any sort of state action making conduct that it can permissibly make illegal would necessarily create irreparable harm for someone engaged in the now illegal activity," Quattlebaum said. "The fact they may have a lot of harm is kind of beside the point."
Quattlebaum and Markels quibbled over the dangerousness of delta-8. Markels pointed to medical marijuana and alcohol as products that are just as if not more harmful for children to consume.
"Delta-8 is dangerous, they've said," Markels said. "Well, dangerous compared to what? Dangerous compared to bathtubs?"
Quattlebaum said how dangerous a product is isn't up to the panel.
"We're not making decisions based on our view or even Virginia's view of what they decide to be most dangerous," Quattlebaum responded. "That's what elections are for."
The bill also forbids hemp processors from selling their product to anyone, anywhere in the world, who might use it to make a product that violates Virginia's total THC standard — even if it is legal to do so where that buyer is located and even if that buyer has no intention of selling those products in Virginia. The North Carolina-based business claims the prohibition on Virginia-grown industrial hemp has hampered business as it relied on the Commonwealth's growers.
The 2023 bill includes uncontested packaging, labeling and appearance restrictions for hemp products, designed to reduce the risks of children accidentally consuming the products. Cannabis is a hazy subject in Virginia, where possession of small quantities is legal but there is no regulated market so it's illegal to purchase cannabis.
U.S. Circuit Court Judges Stephanie Thacker, a Barack Obama appointee, and DeAndrea Gist Benjamin, a Joe Biden appointee, completed the relatively tame three-judge panel. Virginia's Office of the Attorney General declined to comment, while Markels did not respond.
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