Hemp lawsuit in federal court alleges DEA overstepped on “extracts” rule

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Hemp lawsuit in federal court alleges DEA overstepped on “extracts” rule

federal lawsuit involving hemp is heating up.

Lawyers representing the Hemp Industries Association and hemp businesses have filed an opening brief in a 9th U.S. Circuit Court of Appeals case against the Drug Enforcement Administration, fleshing out claims that a new drug code for marijuana extract violates multiple laws and stands to chill a multibillion-dollar business.

The DEA in December adopted a rule that applies a Controlled Substances Code Number for “marihuana extract,” products containing one or more cannabinoids — chemical compounds found within the plant species Cannabis sativa L. Agency officials previously said the coding was the result of proposed rulemaking put into motion in 2011, is primarily administrative in nature, helps to enable research, and complies with international treaties.

The rule notice did not reflect a change in any control status or the federal drug schedule, the DEA previously told The Cannabist.

The hemp industry argues otherwise.

The new rule opens the doors for potential enforcement actions to be taken against businesses, notably sellers of hemp-derived products that contain cannabinoids, said attorneys for Denver’s Hoban Law Group, representing petitioners Hemp Industries Association and hemp businesses Centuria Natural Foods and R.M.H. Holdings Inc. in the federal case.

“Their final rule is essentially a scheduling action disguised as an administrative rule,” Patrick D. Goggin, a Hoban Law Group attorney, said in an interview Tuesday with The Cannabist.

DEA spokesman Russ Baer could not be reached immediately for comment. Baer previously stated that the agency does not comment on pending litigation.

In the opening brief, Hoban and fellow attorneys utilize case law, congressional testimony and statutes including the Controlled Substances Act to argue that the extracts rule should be invalidated or amended to remove phrasing that indicates cannabinoids are a determining factor of a marijuana extract “and, effectively, a controlled substance.”

“By wrongfully conflating the CSA’s narrow definition of ‘marihuana’ with the entire Cannabis plant, this definition of ‘marihuana extract’ wholly fails to reflect the lawfulness of industrial hemp and non-THC cannabinoids derived therefrom,” attorneys Goggin, Robert Hoban and Garrett Graff wrote in the brief.