Tag Archives: Hemp

Neville Bilimoria Quoted on FDA Rules in Cannabis Era

Duane Morris partner Neville M. Bilimoria is quoted in the Law360 article, “CBD Rules In Limbo As FDA Grapples With New Cannabis Era.”

Hemp may have been legalized less than a year ago, but CBD derived from it is already on its way to becoming a multibillion-dollar industry. However, sales of everything from CBD gummies to lattes are occurring in a legal gray area as the U.S. Food and Drug Administration struggles with regulating the largely unstudied ingredient. […]

“This is a watershed year for the FDA and its coming to grips with the increasing demand from the consumer public over marijuana, cannabis, CBD, hemp. It’s trying to catch up to what the consumers are touting as being therapeutic uses for CBD and THC,” Mr. Bilimoria said. “It’s basically saying, ‘Wait, everybody slow down. We’re the FDA. We rely on science before we can approve any uses and regulate any uses of cannabis or CBD.'” […]

Mr. Bilimoria said he can’t blame the FDA for “taking it slow,” but said doing so is frustrating when CBD is already all over store shelves. […]

To read the full article, visit the Law360 website (subscription required).

USDA Issues Regulatory Framework for Hemp Production Under 2018 Farm Bill

Seth Goldberg
Seth A. Goldberg

The long awaited regulations establishing a regulatory framework under the 2018 Farm Bill passed last December were issued today (10/29/19).  An Interim Final Rule will be published in the Federal Register later this week, which will make the U.S. Domestic Hemp Production Program effective.   As explained in the Interim Final Rule: “The program includes provisions for maintaining information on the land where hemp is produced, testing the levels of delta-9 tetrahydrocannabinol, disposing of plants not meeting necessary requirements, licensing requirements, and ensuring compliance with the requirements of the new part.”  USDA has published the Interim Final Rule and Guidelines for Sampling and Guidelines for Testing pursuant to the Interim Final Rule on its website.

Among other key provisions, the new regulatory framework provides for USDA’s approval of State and Tribal Land hemp programs established under the 2018 Farm Bill, which will end debate as to whether hemp activities in a State or Tribal Land receiving such approval are federally lawful.  To be approved, those plans will have to contain stringent requirements for testing the THC content of hemp to ensure it does not meet the definition of marijuana, and contain procedures for the enforcement of violations of the State or Tribe’s hemp program.  Importantly, the regulatory framework provides for USDA’s granting of hemp production permits in states and territories that do not establish hemp programs for approval by USDA.

Duane Morris attorneys will be publishing a more fulsome review of the Interim Final Rule.  Please visit our Alerts and Updates webpage, or our cannabis industry webpage for that information.

 

Federal Court Halts Indiana’s Ban on Smokeable Hemp

On September 13, 2019, a federal district court in the Southern District of Indiana issued an Order regarding Indiana’s treatment of “smokeable hemp” that could have far-reaching consequences for the hemp industry.  C.Y. Wholesale Inc. et al. v. Holcomb et al., 1:19-cv-02659 (S.D. In., Sep. 13, 2019). The court issued a preliminary injunction against the state of Indiana that prohibits the enforcement of certain provisions of a new Indiana law that regulated criminalized the manufacture, finance, delivery, or possession of “smokeable hemp.”  Id.

On May 2, 2019, Indiana Governor Eric Holcomb signed Senate Enrolled Act No. 516 (the “Act”) into law.  Among other things, the Act made it a Class A misdemeanor to manufacture, deliver, finance the manufacture or delivery of, or possess “smokeable hemp.” Ind. Code § 35-48-4-10.1. The Act defined “smokeable hemp” as “a product containing not more than three-tenths percent (0.3%) delta-9-tetrahydrocannabinol (THC), including precursors and derivatives of THC, in a form that allows THC to be introduced into the human body by inhalation of smoke.” Ind. Code § 35-48-1-26.6.

The Act’s prohibition on “smokeable hemp” is not unique.  For instance, Kentucky’s industrial hemp regulations list products that are not to be sold to the public, and those products include “Hemp cigarettes” and “Hemp Cigars.” 302 Ky. Admin. Regs. 50:070. And the North Carolina legislature is considering a bill that would similarly ban “smokeable hemp.” Such bans are viewed as assisting local law enforcement in the performance of their duties.  As federally lawful hemp and federally unlawful marijuana have the same appearance and a virtually identical smell, police officers throughout the country often have trouble distinguishing between the two.  A ban on “smokeable hemp” would help officers and citizens avoid the waste of time and resources that could be caused by confusing unlawful marijuana and lawful hemp.

However, on June 28, 2019, a few days before the Act became effective, a group of Indiana businesses that sell hemp products at wholesale or retail filed a motion for a preliminary injunction to prohibit enforcement of the smokeable hemp ban.  The plaintiffs argued Indiana’s smokeable hemp ban was unconstitutional because it was preempted by the 2018 Farm Bill and because it violated the Commerce Clause of the Constitution. The Court agreed.

First, the court held that Indiana’s “smokeable hemp” ban was impermissible because it was not limited in scope to intrastate activities, and as such interfered with interstate commerce.  The 2018 Farm Bill explicitly provides “No State or Indian Tribe shall prohibit the transportation or shipment of hemp or hemp products produced in accordance with,” federal or state law.  2018 Farm Bill § 10114.  By criminalizing the delivery and possession of “smokeable hemp,” the Act precludes transportation of hemp or hemp products through Indiana “and thus impede[s] the interstate commerce of hemp in contravention of the 2018 Farm Bill’s express prohibition on state laws that do so.” C.Y. Wholesale Inc. et al., 1:19-cv-02659 at 8. For instance, the court explained, “a driver traveling along I-74 from Ohio to Illinois who passes through Indiana with smokeable hemp in the vehicle, including hemp bud or hemp flower, would be in ‘possession’ of smokeable hemp and thus subject to arrest and criminal penalties under SEA 516.” Id.

Second, the court held Plaintiffs had shown a likelihood of success on the merits of their conflict preemption claim.  “[T]he plain language of the 2018 Farm Bill, as well as statements from its legislative sponsors, reflect Congress’s intent to de-stigmatize and legalize all low-THC hemp, including its derivatives and extracts, and to treat hemp as a regulated agricultural commodity in the United States.” Id. at 10. However, Indiana’s smokeable hemp ban would “criminalize the manufacture, finance, delivery, and possession of hemp bud and hemp flower—hemp derivatives of the kind specifically legalized under the 2018 Farm Bill—[which] frustrates these congressional purposes and objectives.” Id. at 11.

Although the dispute has not been finally resolved, in granting the plaintiffs’ motion for a preliminary injunction, the court has given a strong indication of its view on the matter. If the court ultimately finds Indiana’s law unconstitutional, it is likely to impact other federal court analysis of similar state laws across the country. Duane Morris will continue to monitor this case and will provide additional updates as necessary.

Cannabis Vaping Health Claims Should Be Taken Seriously by the Cannabis Product Supply Chain

Seth Goldberg
Seth A. Goldberg

Yesterday, I blogged about a Washington Post article that reported that vitamin E acetate in marijuana vaping products is being considered as possibly being linked to alleged vaping related lung injuries.  I cautioned cannabis manufacturers, processors and dispensaries, i.e., the cannabis supply chain, that articles like WP’s, which referred to vitamin E acetate in cannabis vapor as a “contaminant,” could be the impetus for product liability lawsuits.

Today, WP provided an update to yesterday’s article.  WP now states as many as 450 vaping illness cases have been reported across 33 states.  Up from yesterday’s report of 250 cases across 25 states.  WP’s new article refers to the vaping related health claims as possible a “new lung disease” based on a study by the New England Journal of Medicine that reports about a possible lung disorder being experienced by certain consumers of vape.    However,  WP appears to acknowledge  scientists have not yet identified a specific chemical in vape, or whether vaping of nicotine or marijuana, is resulting in an increased risk of the lung disorder reported by NEJM.  Indeed, scientific research and investigation is needed in this area.

Nevertheless, as I explained yesterday, having represented pharmaceutical companies in product liability matters involving alleged “contaminants,” product liability lawsuits are often, if not usually, filed without any scientific proof of injury causation.   Accordingly, the cannabis supply chain should be careful to ensure the safety of their products, and implement necessary compliance measures.

Likewise, cannabis consumers should be mindful that many of the reports of vaping related health issues concern “black market” vape products, not those manufactured by state-licensed cannabis companies who are required by law to maintain strict standards for their products.

 

Will Cannabis Vaping Lead to Products Liability Lawsuits?

Seth Goldberg
Seth A. Goldberg

Today, the Washington Post reported that federal and state regulators have identified the chemical vitamin E acetate as being contained in certain cannabis vaping products allegedly linked to lung injuries.  According to WP,  215 cases possibly arising out of cannabis vapes containing the chemical have been reported in 25 states, and two deaths have been linked to marijuana vaping.

WP refers to vitamin E acetate in cannabis vapor as a “contaminant,” which is a loaded term that could get the attention of the plaintiffs’ product liability bar.   Articles like this are often the impetus for lawsuits to be filed.  Consequently, products’ liability claims may soon become a reality for the cannabis vape supply chain.

However, as even the WP article makes clear, whether vitamin E acetate in marijuana vapor can cause an increased risk of injury of any kind to vaping consumers is being investigated, and has not been proven.   The article also identifies the fact that many users of marijuana vape also vape nicotine, which is likely one of many confounding factors.  Thus, product liability claims asserting injuries from marijuana vaping brought now are likely to be unsupported by science.

Nevertheless, those in the cannabis supply chain, e.g., manufacturers, processors, and sellers,  should be aware of the likelihood of such claims, as product liability claims are often asserted without any scientific evidence of causation.   Those in the supply chain should know that a range of compliance measures can be implemented to better protect against against such claims.

Ninth Circuit Punts on Interstate Transportation of Hemp

On September 4, 2019, the Ninth Circuit issued its ruling in Big Sky Scientific LLC v. Jan Bennetts et al, the case involving the seizure of an interstate shipment of hemp that occurred after the enactment of the 2018 Farm Bill. In a three-page opinion, the court sidestepped the substantive issues presented on appeal and held that the parties should pursue their claims in state court.

In January 2019, a hemp cultivator in Oregon attempted to ship a truckload of hemp to a processor in Colorado. But as the cargo passed through Idaho, the Idaho State Police seized the shipment and arrested the driver, alleging violations of Idaho state law. The Idaho police charged the driver with a crime and filed a civil complaint in state court against the hemp itself. The Idaho civil case was stayed pending resolution of the criminal proceeding.

View the full Alert on the Duane Morris LLP website.

Ninth Circuit Hears Oral Argument in Landmark Hemp Transportation Case

On August 28, 2019, a three-judge panel of the Ninth Circuit Court of Appeals, Judges Hawkins, McKeown and Bybee heard oral argument in Big Sky Scientific LLC v. Jan Bennetts et al.

To review the background briefly, Big Sky Scientific, LLC, a Colorado-based hemp processor, purchased federally lawful hemp from a state-licensed hemp cultivator in Oregon. The parties arranged to ship the hemp from Oregon to Colorado via motor carrier. En route to Colorado, the shipment entered Idaho, where the Idaho police seized the cargo and arrested the driver, alleging violations of Idaho state law. Idaho initiated a state court criminal proceeding against the driver, and a state court civil proceeding against the hemp itself, to ensure the hemp would not be returned to Big Sky. In response, Big Sky filed a motion for a temporary restraining order and preliminary injunction in federal court to force the Idaho State Police to return the seized cargo and stop seizing hemp shipments that pass through the state. The District Court denied Big Sky’s motion, and Big Sky appealed. That appeal was the basis of the oral argument. Duane Morris filed an amicus brief on behalf of the American Trade Association for Cannabis and Hemp in support of Big Sky, arguing that an adverse ruling would have a serious negative impact on the hemp industry. (Duane Morris is the national law firm partner of the American Trade Association for Cannabis and Hemp.)

View the full Alert on the Duane Morris LLP website.

Ohio Governor Signs Sweeping Hemp and CBD Legislation

On July 30, 2019, Ohio Gov. Mike DeWine signed into law S.B. 57, legislation that overhauls Ohio’s laws concerning hemp. Significantly, the bill also contains an emergency provision, meaning that the bill, some critical aspects of which are discussed below, takes effect immediately.

One of the most important aspects of the emergency bill is its amendment of the definition of the word “marihuana” under the state’s Controlled Substances Act to expressly exclude hemp and hemp products. The bill defines “hemp products” broadly, providing that the term includes “cosmetics, personal care products, dietary supplements or food intended for … human consumption” as well as any other product containing hemp-derived cannabinoids (such as CBD), provided the product contains a THC concentration of no more than 0.3%. Moreover, the bill clarifies that the addition of hemp or a hemp product to any other product does not render the other product “adulterated.”

Further, the bill provides that the state shall issue licenses for the cultivation and processing of hemp in the state. However, because the process of license application and issuance has not yet been established, and further because the regulations implementing the new law have yet to be promulgated, Ohio farmers are unable to start growing hemp for the time being. That said, the Ohio Department of Agriculture stated that its “goal is to have farmers licensed and able to plant the crop by spring of 2020.”

In any event, the delay to be experienced by farmers is not likely to apply to retailers—according to the ODA, “[i]t is now legal to sell properly inspected CBD products in Ohio. The Ohio Department of Agriculture will be testing all CBD products for safety and accurate labeling to protect Ohio consumers.”

FDA Issues Warning Letter to Curaleaf about CBD Products

Seth Goldberg
Seth A. Goldberg

On July 22, the FDA issued a Warning Letter to Curaleaf with regard to Curaleaf’s “CBD Lotion,” “CBD Pain-Relief Patch,” “CBD Tincture,” and “CBD Disposable Vape.”  The Warning Letter explains FDA’s view that Curaleaf’s CBD products are effectively “unapproved new and misbranded human drug products” because the claims Curaleaf has made about them on Curaleaf’s website and social media accounts demonstrate “they are intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease and/or intended to affect the structure or any function of the body,” but Curaleaf has not obtained prior approval from the FDA to market them as such.  The Warning Letter also explains the FDA’s view that the subject products are not “dietary supplements” because (i) CBD has already been approved as an active pharmaceutical ingredient (epidiolex), (ii) CBD was not marketed as a dietary supplement or a conventional food prior to such FDA approval of CBD as an API; and (iii) the subject products are not “intended for ingestion,” which is a requirement of a dietary supplement. The FDA also warned about Curaleaf’s products with respect to animals, which I have not summarized.  The FDA provided Curaleaf 15 days to establish a corrective action plan and to report such plan to the FDA.  The Warning Letter demonstrates the FDA is actively monitoring CBD manufacturer websites and social media for over the line claims, and that CBD manufacturers need to follow the FDA’s guidance given the unsettled regulatory structure with respect to CBD.