May 29, 2018

The Good, The Bad and The Ugly

U.S. Hemp Roundtable

While you were enjoying a beautiful Memorial Day weekend, it was an eventful time for hemp. Here’s The Good, The Bad and The Ugly (and The Solution):

The Good:

Last Tuesday, the DEA issued an internal directive to its agents concerning the legality of hemp and hemp-derived products. The key language:

Products and materials that are made from the cannabis plant and which fall outside the CSA definition of marijuana (such as sterilized seeds, oil or cake made from the seeds, and mature stalks) are not controlled under the CSA. Such products may accordingly be sold and otherwise distributed throughout the United States without restriction under the CSA or its implementing regulations. The mere presence of cannabinoids is not itself dispositive as to whether a substance is within the scope of the CSA; the dispositive question is whether the substance falls within the CSA definition of marijuana.

Further, they clarified the controversial “marijuana extract” rule:

This directive does not address or alter DEA’s previous statements regarding the drug code for marijuana extract and regarding resin. See Establishment of a New Drug Code for Marihuana Extract,81 Fed. Reg. 90194 (Dec. 14, 2016); Clarification of the New Drug Code (7350) for Marijuana Extract. As DEA has previously explained, the drug code for marijuana extract extends no further than the CSA does, and it thus does not apply to materials outside the CSA definition of marijuana.

To be clear, the DEA believes that it has no enforcement authority over hemp or hemp products that are excluded from the Controlled Substances Act (CSA). This should include any product derived from hemp grown as part of a Farm Bill-authorized pilot program, since the Farm Bill explicitly “notwithstands” the CSA. (This interpretation was confirmed by the Ninth Circuit Court of Appeals which stated the Farm Bill “contemplates potential conflict between the Controlled Substances Act and preempts it.”) This exemption should also include any “non-psychoactive” imported hemp products as exempted from the CSA by the Ninth Circuit in its HIA v. DEA decision in 2004.

We write “should” because the DEA, yet again, frustratingly fails to specifically list these exceptions. But the absence of them taking any enforcement actions against Farm Bill hemp products signals that they understand that any interference with the interstate sale of such products would violate a clear legal mandate, passed several times by Congress, as recently as this March. And the Roundtable will aggressively address any attempt to violate this law.

The Bad:

As our General Counsel, Jonathan Miller, wrote this weekend for the website Kentucky Sports Radio, a promising young football player was cut by the Auburn Tigers for using hemp-derived CBD for his epileptic seizures. Auburn claims that this use is a violation of NCAA rules that prohibit the use of any product that contains any trace of THC.

The Roundtable finds this an outrageous action and is exploring ways to reverse this decision. It runs directly counter to the recent decision of the World Anti-Doping Agency to drop CBD from its list of prohibited substances. We ultimately hope that this turns into yet another example of a misguided enforcement decision resulting in a popular backlash in favor of hemp and hemp-derived CBD.

The Ugly:

In a report issued by the Centers for Disease Control (CDC) last Thursday, synthetic products falsely labeled as CBD were blamed for 52 Utahans getting sick in late 2017. The CDC recommended that states set up regulatory and control systems “to minimize the risk for recurrences of this emerging public health threat.”

The Roundtable strongly supports law enforcement efforts to crack down on products that are falsely labeled as hemp or as CBD. The bad actor companies who make these products are a black eye on the industry. That’s why the Roundtable is working so hard to develop standards, best practices and self-regulation for the industry.

Any effort to regulate hemp and hemp products, however, should not fall into the trap of over-regulation, in ways that will deny consumers the ability to purchase products, such as legitimate hemp-derived CBD, which the World Health Organization recently has declared as safe and non-addictive. We look forward to working with federal and state officials to honor our special duty to consumers to demonstrate our products are safe, and to law enforcement, to demonstrate our products are legal.The


So many of the issues faced by the hemp industry can be addressed once and for all by passage of the Hemp Farming Act of 2018, which would permanently legalize hemp. Please click the button below to use our portal to contact your Members of Congress. It will only take you a few minutes – and it could make all of the difference.