Introduction
In our July article, we chronicled the accelerating federal and state pushback against intoxicating hemp-derived cannabinoids like delta-8 THC and delta-10 THC, compounds that expanded rapidly following the 2018 Farm Bill. Four months later, the crackdown has only intensified. Recent court rulings, gubernatorial actions, and coordinated state advocacy continue to erode the legal foundations of the intoxicating hemp sector, suggesting that the industry’s reliance on what many viewed as a “loophole” may soon come to an end.
A Multistate Coalition Demands Federal Action
Attorneys general from 39 states and U.S. territories recently sent a formal letter to congressional leaders urging them to close the perceived loophole created by the 2018 Farm Bill. While that bill federally legalized hemp containing no more than 0.3% delta‑9 THC, it did not address other intoxicating hemp-derived cannabinoids. The AGs argue that this ambiguity has been exploited by manufacturers creating potent synthetic THC products using chemical conversion processes. The coalition emphasized that a patchwork of state-by-state restrictions cannot curb mail-order distribution and urged Congress to establish a clear national standard outlawing all intoxicating hemp-derived THC products.
Courts Uphold State Crackdowns
Multiple courts across the U.S. have now affirmed states’ broad authority to regulate or prohibit intoxicating hemp products. A Maryland appeals court held in September that hemp-derived psychoactive products 'are now and have always been illegal in Maryland,' overturning an injunction that had protected hemp businesses. The court rejected the argument that the 2018 Farm Bill created a right to sell intoxicating derivatives. Taken together, these rulings reflect a growing judicial consensus that states retain wide authority over intoxicating hemp products and that past lax enforcement offers no legal protection for continued sales.
Texas Chooses Regulation Over Prohibition
Texas presents a contrasting model. Earlier this year, Governor Greg Abbott vetoed legislation that would have banned all intoxicating hemp products, arguing that a regulatory structure—not a ban—was more practical. After lawmakers failed to pass any regulatory measure, Governor Abbott issued an executive order directing state agencies to restrict access to individuals under 21 and to adopt rigorous testing, labeling, and age-verification requirements. Some industry groups praised the approach as a potential national model, while critics considered it insufficiently protective.
Federal Appellate Court Developments
The 10th U.S. Circuit Court of Appeals recently upheld Wyoming’s law regulating intoxicating hemp products, marking the most significant federal appellate ruling on the issue. The plaintiffs raised claims under the Dormant Commerce Clause, federal preemption, vagueness doctrine, and alleged regulatory takings. The court rejected each argument. It found that the Farm Bill creates no private right of action, upheld transportation restrictions, and held that the law’s prohibition on 'psychoactive' compounds was sufficiently clear. This ruling reinforces states' authority to regulate intoxicating hemp without conflicting with federal law.
Looking Ahead
The hemp industry faces significant uncertainty as Congress prepares for the 2026 appropriations and Farm Bill cycles. If Congress adopts the AGs’ recommended prohibitions, the intoxicating hemp market could disappear almost overnight. Alternatively, Congress might adopt a regulatory framework akin to Texas’ model, imposing stringent compliance obligations while maintaining adult access. Either outcome will end the period of ambiguity that has defined the intoxicating hemp industry since 2018.
Authors:
Alexander Malyshev
Email: malyshev@clm.com
Sarah Ganley
Email: ganley@clm.com