In 2018, Congress enacted the Agricultural Improvement Act of 2018, referred to as the 2018 Farm Bill, legalizing the production and sale of hemp-derived cannabinoids at the federal level. Since doing so, the sale of food and beverages containing hemp-derived THC have exploded. In some instances, State governments have attempted to fill the void, passing legislation to regulate these products at the state level. The cases listed below highlight recent litigation relating to these states’ efforts to prohibit the sale of hemp-derived food and beverage products.
California
In 2021, the California Legislature passed Assembly Bill 45 which authorized the “retail sale of food, drug, and cosmetic products containing industrial hemp.” The bill, however, did not limit the age of the consumer, serving size of the product, or the amount of THC allowed in each product. Bill 45 therefore prompted backlash from California residents. In response, the Department of Public Health (Department) issued an emergency regulation which: (1) limited the amount of hemp allowed in an individual product; (2) implemented an age restriction of 21 for purchasing these products; and (3) limited the serving and packaging size for these products.
The U.S. Hemp Roundtable, Inc. and individual manufacturers (petitioners) filed a petition challenging this emergency regulation. Additionally, the petitioners filed a temporary restraining order (TRO), asking that the Court stop the enforcement of the emergency regulation until the Court made a decision on the overall enforceability of the emergency regulation. The Court denied the TRO, allowing the emergency regulation to be implemented. The Court based its decision on two categories of arguments. First, the Court found that protecting the health and safety of California residents, especially children, outweighed any potential economic harm these restrictions would have on hemp manufacturers. Second, the Court preliminarily decided that the Department was acting within its constitutional power as an administrative agency when it implemented this emergency regulation. On November 20, 2024, the petitioners filed a request for dismissal without prejudice before the Court could make a decision regarding the overall enforceability of the emergency regulation. If granted, the request will leave the door open for the Petitioners to challenge the emergency regulations again in the future.
Missouri
Meanwhile, the Missouri Hemp Trade Association (MTHA) has filed suit against the Missouri Department of Health and Senior Services (DHSS) in response to Executive Order 24-10, signed August 1, 2024. Order 24-10 labels hemp-derived food and beverages as “adulterated” substances and instructs the DHSS to “embargo and condemn” these products. The case arose in response to violations of Order 24-10 found against VFW Post 2661 in Washington, Missouri, for offering hemp-derived beverages for sale to its members.
The MHTA filed for a temporary restraining order, challenging the authority of the DHSS to label all hemp-derived food and beverages as adulterated. In response, the DHSS issued a letter clarifying that it would only seek to enforce Executive Order 24-10 on products that were “misbranded” or otherwise marketed and offered to children. The Court then ruled against MHTA’s motion for a temporary restraining order, finding that the September 17 letter mooted the dispute. The DHSS filed a motion to dismiss on January 3, 2025. As of June 3, 2025, MHTA has not responded to DHSS’ motion to dismiss.
New Jersey
In 2019, the New Jersey legislature adopted the New Jersey Hemp Farming Act, largely mirroring the language of the 2018 Farm Bill. Five years later, on June 8, 2024, New Jersey amended the Hemp Farming Act to regulate the sale of hemp-derived products that are deemed “intoxicating,” defined as those products made and sold in New Jersey and containing a total THC content greater than 0.5 mg per serving or 2.5 mg per package.
A group of hemp businesses brought suit in the Federal District Court for the District of New Jersey on September 24, 2024, seeking a preliminary injunction to halt enforcement of the 2024 amendments. With the law scheduled to go into effect on October 14, 2024, the Court fast-tracked the case, converting the Plaintiffs’ Motion for Preliminary Injunction into a Motion for Summary Judgment. The Court issued its ruling on October 10, 2024, largely upholding the 2019 amendments. In doing so, the Court found that provisions prohibiting the transportation of hemp-derived products outside of New Jersey are preempted by the 2018 Farm Bill, and that another provision that granted favorable treatment to New Jersey hemp producers violated the dormant commerce clause. While the majority of the law was upheld, New Jersey has since announced that it will only enforce two of the 2019 amendments’ prohibitions: the prohibition on the sale of intoxicating hemp products to those under 21, and the prohibition on the sale or distribution of hemp products or cannabis items that are not derived from “naturally occurring biologically active chemical constituents.”
Virginia
In 2023, Virginia enacted a provision similar to S.B. 903, which prohibits hemp products that contain greater than 0.3 percent total tetrahydrocannabinol concentration, including THC delta-8 and delta-9. Additionally, S.B. 903 further restricts the sale of industrial hemp to a person or processor that the seller knows or has reason to know will use the hemp to create such products. Three plaintiffs, including both retail sellers of hemp-derived products and a citizen who used the now-restricted hemp products to treat arthritis pain, brought suit to challenge S.B. 903.
In their motion for preliminary injunction, the plaintiffs argued that S.B. 903 was preempted by federal law, and that the restriction on sales of hemp violated the dormant commerce clause, which prohibits anti-competitive practices between the states. The District Court ruled against the plaintiffs, who then filed an appeal before the United States Court of Appeals for the Fourth Circuit. The Fourth Circuit’s opinion upheld the ruling of the District Court, finding that S.B. 903 was not preempted by federal law. However, the Fourth Circuit declined to address the merits of the plaintiffs’ challenge under the dormant commerce clause, finding that the plaintiffs had not put forth sufficient evidence to show that they were processors of hemp affected by S.B. 903’s prohibition on the sale of hemp. The case was remanded to the District Court, and all parties jointly filed for, and were granted, dismissal without prejudice on February 19, 2025.
