A group of hemp-related businesses argues that a new state law banning the sale of hemp products in New Jersey stores without a license from the New Jersey Bureau of Cannabis will “criminalize farmers, business owners and consumers.”
The group argues that the legislation would effectively re-criminalize hemp, even though federal law allows some hemp products, which are derived from marijuana and contain less than 0.3 percent delta-9 THC, to be sold over the counter.
The groups are seeking a preliminary injunction from federal court to block most of the law from going into effect. Named as defendants are Attorney General Matt Platkin, Cannabis Control Commission Chairwoman Deanna Hoeno and state Agriculture Secretary Edward D. Wenglin.
Their lawsuit was filed about two weeks after Gov. Phil Murphy signed a controversial bill that was crafted after lawmakers heard concerns from parents and others about how easily minors could get access to hemp products.
Murphy expressed concerns about the bill, saying it could create uncertainty for the cannabis industry, noting that the wording of one provision is too vague and could be interpreted as allowing the sale of cannabis produced outside the state.
But Governor Murphy signed the bill, saying it's important to keep harmful chemicals and unregulated products out of children's hands.
Currently, businesses must remove all hemp-containing products, such as CBD lotions, hemp drinks and Delta 8 gummies, from their shelves by Oct. 12, 30 days after the bill is signed. Under the new law, the state Cannabis Regulatory Commission has about six months to establish new rules and guidelines for issuing licenses to retailers, but that doesn't necessarily mean sales of hemp products will resume within those six months.
The plaintiffs claim that many businesses will be forced to close or lay off employees, potentially leading to thousands of job losses.
The groups suing the state echoed Murphy's criticism of the bill, stressing that last-minute changes made before the bill passed the state Legislature would impose a “dizzying maze of rules that are far too complicated for ordinary citizens to understand.”
Under the law, companies would suffer “immediate and irreparable economic harm,” they said.
The New Jersey law “significantly overhauls the regulatory environment” facing hemp products and runs counter to the federal 2018 Farm Bill, which legalized the sale of hemp, the plaintiffs added.
The lawsuit alleges that the law may violate the Dormant Commerce Clause of the U.S. Constitution by criminalizing certain out-of-state products while allowing in-state production of those same products, and may violate the Supremacy Clause by changing the definition of cannabis products to make them inconsistent with the federal definition.
Parties to the lawsuit include New Jersey-based hemp retailers, out-of-state manufacturers that sell products to New Jersey retailers, and hemp-derived beverage companies that ship products to New Jersey.
They want a judge to declare most of the new law invalid, but agree that a provision banning the sale of hemp products to people under the age of 21 should remain intact.
Spokespeople for the Attorney General's office and the Cannabis Control Commission declined to comment.
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