The latest clash in a series of ongoing feuds between the hemp industry and state policymakers is a federal lawsuit in New Jersey, in which six hemp companies argue that a law signed by Gov. Phil Murphy that puts “intoxicating” hemp products under the jurisdiction of marijuana regulators violates the 2018 Farm Bill.
The lawsuit, filed Tuesday in U.S. District Court for the District of New Jersey, argues that lawmakers' new attempt to crack down on “intoxicating” cannabis products is unconstitutional and unlawful both for redefining cannabis products from the 2018 Farm Bill definition and for banning intoxicating cannabis products manufactured outside of the state. The lawsuit alleges that the latter provision of the law discriminates against companies not headquartered in New Jersey and violates the dormant Commerce Clause of the U.S. Constitution.
Plaintiffs in the suit include New Jersey-based beverage maker Loki Brands and retailer Regal Leaf New Jersey, as well as Seattle-based Cycling Frog, Massachusetts-based Cantrip, Colorado-based Apollo Sciences and North Carolina-based CannaAid.
The lawsuit claims the net effect of the new cannabis law will be that “many businesses will be forced to close or lay off employees,” which will “result in thousands of job losses across the state and criminalize farmers, business owners and consumers, even though federal law remains unchanged.”
The lawsuit repeatedly points out that Murphy himself made it clear in his signing statement that he recognized the law had “technical issues” and would likely require “clear legislation” at some point.
The lawsuit alleges that the new state law contradicts the 2018 Farm Bill, which defined hemp as any cannabis plant with 0.3% or less delta-9-THC by dry weight. New Jersey's new law changes that definition, “to rely on the cumulative concentration of all tetrahydrocannabinols, which includes not only delta-9-THC but other chemically similar compounds such as delta-8-THC, delta-10-THC and THCA,” the lawsuit alleges, and argues that such preemption of federal law is not permitted by the state.
The lawsuit alleges that the New Jersey Legislature’s redefinition of hemp has, perhaps unintentionally, created a new type of hemp product called “excluded hemp,” which means a product that “contains no more than 0.3% delta-9 THC on a dry weight basis, but has a concentration of more than 0.3% total THC on a dry weight basis.”
“As a result of the amendment, this form of hemp is no longer 'hemp' under New Jersey law,” the lawsuit claims.
The lawsuit seeks a preliminary injunction to block the new law from going into effect, a court order declaring all hemp products that conform to the definition in the 2018 Farm Bill to be federally legal, and a declaration that the new law is invalid in its entirety, except for the ban on the sale of “intoxicating” hemp products to customers under the age of 21.
The case is scheduled to be heard in federal court on October 21 and November 25.
New Jersey Marijuana Prohibition Lawsuit
