Texas hemp companies are fighting against the recent state ban on delta-8 THC.

The ban stems from a statement by the Texas Department of State Health Services (DSHS) in late October that delta-8 is a Schedule I controlled substance and is illegal under HB1325 – a signed law by Governor Gregg Abbott in 2019 to legalize the cultivation of hemp in Texas, Hemp producer Previously reported.

The DSHS statement reads: “Chapter 443 of the Texas Health and Safety Code (HSC 443), established by Bill 1325 (86th Legislature), permits consumable hemp products in Texas that do not exceed 0.3% delta-9 tetrahydrocannabinol (THC). All other forms of THC, including Delta-8 at any concentration and Delta-9 exceeding 0.3%, are considered Schedule I controlled substances.

The companies have since filed lawsuits to try to overturn that ban, and they have temporarily succeeded. But the state and the attorney general have been pushing to reverse that, leaving the parties to resolve the issue through lawsuits now in court.

The state’s tumultuous history with Delta-8 began even before the DSHS intervened.

The Delta-8 Legal Debate in Texas

Since HB 1325 does not specifically address delta-8, many retailers and manufacturers assumed the substance was legal and continued to sell such products until DSHS released its statement.

Shane Pennington, legal advisor to Vicente Sederberg LLP, a national cannabis law firm, says it’s not clear if Delta-8 was not already illegal in Texas before DSHS released its statement for a “number of reasons”.

He says he heard that law enforcement has arrested citizens for possession of Delta-8 under Texas Health and Safety Code 481.103 (1). Pennington says the measure includes synthetics, derivatives, extracts, isomers and more, and also includes an “such as” section, where it lists “delta-6 cis or trans tetrahydrocannabinol and their optical isomers.”

“It’s a bunch of organic chemistry that I can’t claim to be an expert on, but I know it at the time, delta-6 [trans] was another term or another way of saying the chemical name for delta-8, ”he says. “So I think it’s important because, like I said, these other arrests took place under that,” and not because of the new DSHS statement, says Pennington.

However, Jay Maguire, executive director of the Texas Hemp Federation, disagrees and says the claims surrounding the delta-8 ban in Texas are “stupid.”

“The idea that Delta-8 has always been illegal is simply a lie,” says Maguire. “Hemp is legal in Texas for the first time since 2019. DSHS has made public statements that delta-8 has been illegal for 40 years. They are confusing two different types of delta-8. What they are referring to there has delta-8 derived from marijuana, not delta-8 derived from hemp. ”

As the legality of Delta-8 in Texas ahead of the DSHS statement comes into question, Shawn Hauser, partner and co-chair of the Hemp and Cannabinoids department at law firm Vicente Sederberg, says she believes DSHS released the statement. in response to this: industry confusion.

© Courtesy of Hauser

“The notice [from the] I think the state health services department was really responding to the confusion reported in the industry, and I think [confusion] among state regulators as to the legal status of delta-8, as there has been increasing demand in the market, especially in states where there are no strong regulated cannabis programs, ”said Hauser said.

However, in some ways, the DSHS statement appeared to create more confusion and frustration in the industry, leading some to take legal action.

Fight the ban

Shortly after DSHS released its statement, Sky Marketing Corp., which operates as Hometown Hero, filed a lawsuit in Travis County District Court seeking a temporary injunction to block the ban by the state of delta-8 THC.

Maguire, who is working with Hometown Hero on the case, says the trial arguments relate specifically to how “the DSHS violated the Administrative Procedures Act and other aspects of the Texas code, [and] deliberately hid the decision they were going to make. “

Specifically, the complainants allege that DSHS did not follow the proper procedures to make such changes, such as holding an appropriate public hearing, and did so discreetly instead.

“I think part of the complainants’ claim is that it was not clear,” Hauser said. “[The notice] was on an image instead of text, [making] it is difficult to find by the public. … But the state claims there was sufficient notice and comment, including [a] hearing in October, and that this notice in the register was not the only one in question.

“[DSHS is] required to post a Notice of Public Hearing, and that Notice of Public Hearing is meant to be written in plain English, describing exactly what action they are going to consider, “Maguire said. “Texas law would have required [DSHS] consider medical and scientific evidence, for example. So not only did they fail to give public notice — we still don’t know where they posted their public notice if they have already done so — they did not gather any testimony or evidence. In fact, the state itself admits that no one showed up on the 7-minute Zoom call that the commissioner arranged. [in October]. “

According to Hometown Hero CEO Lukas Gilkey, nearly 1,200 people watched the district court hearing in November, compared to zero who appeared at the public comment hearing in October.

“It was obvious that this was kind of a sham,” Gilkey said. “… DSHS basically broke its own rules to do something against cannabis, that’s kind of the root of the story.”

Overall, Hauser says she thinks both parties have a legitimate case.

“In view of some of these hearings the state has had on this matter, the state has a legitimate argument here as to the need for proper procedure. But, I think there are compelling arguments as to [the state] in accordance with the law on administrative procedures, ”said Hauser.

The saga continues

After Hometown Hero filed its lawsuit, state District Judge Gary Garger dismissed the retailer’s request to block the ban in late October, stating that “the plaintiff failed to meet the requirements of a temporary restraining order “.

Vape City, another Texas-based CBD retailer, this year filed a separate temporary restraining order against DSHS ‘position on delta-8, which was also denied.

Shortly after Garger rejected Hometown Hero’s claim, State District Judge Jan Soifer banned the state from listing delta-8 as a Schedule I drug, making the compound cannabis again legal under a temporary injunction.

However, the legality was short-lived, as the state quickly retaliated and filed a notice of appeal on Nov. 10, putting delta-8 and the hemp-derived isomers back on the Texas Controlled Substance List.

“Texas law basically allows the attorney general’s office to stay an injunction,” Hauser said. “So even if the court banned the rule, the attorney general’s office can temporarily suspend this ban. ”

In response to the appeal, Hometown Hero “filed an emergency motion to uphold his temporary injunction,” which was approved by the Texas Third Court of Appeals on Nov. 28, according to a press release.

Reinstating the injunction means delta-8 products are legal again in Texas, Hauser said. “The temporary injunction will remain in place until there is a final trial on the merits, which is scheduled for January 28, 2022,” she adds.

Look ahead

Gilkey says Hometown Hero will continue to fight and push for the legality of Delta-8, especially for people who use such products as medical treatment.

“Something I wasn’t really expecting with this case [is] the amount of awareness we’ve had with people saying, “Look, these products save my life.” I’m not trying to get high. I actually need these products to survive as a human being. I think, for me, that’s the most revolutionary part of the business, “Gilkey says.” We all knew it was a part of it, but in fact thousands of people are telling us [that], … I don’t understand how you could fight this. These are the people that Jay [Maguire] and I feel like at this point no one else is fighting for them, and we have to fight for them. “

Additionally, Maguire says Hometown Hero is ready to “pass reasonable regulation” in the next state legislature if it’s something the government is willing to have an honest conversation about.

“We will push for this. We will propose legislation that creates regulations that allow the use of delta-8 and other cannabinoids under reasonable conditions,” Maguire said. “So we’re not looking for a free-for-all here. We are not seeking to ask for any special treatment. But what you need to understand is that Texas has been so anti-drug. [and] the system here is so small that people here have to look to alternatives.