On January 21, 2020, an Idaho state court held the Idaho State Police had the authority to seize a shipment of federally lawful hemp that was transported through Idaho in January 2019. Idaho State Police v. One White 2013 Freightliner Commercial Vehicle et al. Although the hemp businesses involved had turned to federal courts for help, when we last left off with the story, the Ninth Circuit had held that the federal courts should abstain from hearing the case until the Idaho state courts fully resolved both the pending criminal and civil actions. Big Sky Scientific LLC v. Jan Bennetts et al.[1]
Big Sky Scientific, LLC, a Colorado-based hemp processor, had purchased hemp from a state-licensed hemp cultivator in Oregon after passage of the 2018 Farm Bill. 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 federal District Court ruled in favor of the Idaho State Police, and on appeal, the Ninth Circuit declined to rule on the merits of the case, and instead sent it back to state court. Shortly after the Ninth Circuit’s ruling, prosecutors announced the state reached a plea deal with the trucker that had been charged with illegally transporting hemp through Idaho. With the criminal case resolved, only the civil proceeding against the hemp itself remained.
In the state court civil proceeding the state police “implicitly conceded that the plant and plant parts it seized were entirely low-THC C. sativa.” With this fact established, the court turned to the statutes at issue—the 2014 Farm Bill, the 2018 Farm Bill, and the Idaho Controlled Substances Act—to consider whether federal law regarding an entity’s ability to transport hemp in interstate commerce preempted Idaho state law. Central to this argument is a provision in the 2018 Farm Bill that provides “No state or Indian tribe shall prohibit the transportation or shipment of hemp or hemp products produced in accordance with” the Agricultural Marketing Act.
It was undisputed that the hemp seized by the state police was cultivated prior to passage of the 2018 Farm Bill. Therefore, in order for Big Sky to prevail, the court would need to find the provision of 2018 Farm Bill that protects hemp transportation applied retroactively to hemp cultivated under the 2014 Farm Bill. The Idaho police argued it did not, and the court agreed: “the plain language of the [2018] Farm Bill . . . applies only to low-THC C. sativa grown after the enactment of the 2018 Farm Bill and after the various regulations . . . have been promulgated.”
The court then turned to the question of whether the hemp at issue, which was grown in accordance with Oregon state law, was even compliant with the 2014 Farm Bill. The court held that Oregon’s 2014 hemp program was non-compliant for two crucial reasons.
First, Big Sky argued that the Oregon cultivator’s sale of his hemp crop “may be considered research into the marketing” of hemp—a common assertion among hemp businesses that sell their crops and are licensed pursuant to a 2014 Farm Bill program. But the court scoffed at that rationale. “That argument is absurd on its face. . . . he wasn’t growing the crop to help the Oregon Department of Agriculture do research, he was trying to make money.”
Second, the court found Oregon’s hemp law was so dissimilar to both the 2014 and 2018 Farm Bills that hemp cultivated under Oregon’s program could not be considered compliant with federal law. The 2014 and 2018 Farm Bills define hemp as only those Cannabis sativa L. plants with a THC concentration of 0.3% or less, but the Oregon hemp laws only require the 0.3% THC concentration to apply crop wide. “Through the miracle of legal linguistics and basic math, C. sativa plants that would be ‘marijuana’ under Oregon law if grown individually, suddenly became ‘hemp’ if grown in the right field.” Additionally, while federal law defines hemp only with respect to Cannabis sativa L., Oregon law does not limit the definition to only that strain of cannabis. Thus, a field of Cannabis indica with a crop-wide average of 0.3% THC would be lawful hemp in Oregon, but illegal federally. Accordingly, the Court found there is insufficient evidence that the hemp at issue was botanically within the federal definition of cannabis permitted under the 2014 Farm Bill
This last holding could portend continued problems for hemp transportation through Idaho, and perhaps elsewhere. For example, while this litigation was ongoing, in November 2019, Idaho Governor Brad Little issued executive order 2019-13, which ordered “the State of Idaho permit, on and after October 31, 2019, the interstate transportation of hemp produced in accordance with the 2014 Farm Bill or the 2018 Farm Bill and the rules and regulations promulgated thereunder.” Although clearly intended to prevent future litigation on this issue, under the Idaho state court opinion, if a state in which the hemp was grown has a definition of hemp not identical to the federal definition, the grower/transporter might be required to offer proof that the its hemp meets the federal definition. Stay tuned.
For Further Information
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[1] 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.). Duane Morris has previously written about the oral argument before the Ninth Circuit and the court’s subsequent decision that remanded the case to state court.
