CBD, Hemp, and the “Curse of a Valid Defense”

Oral arguments in the Hemp Industries Association v. DEA case wrapped up a few minutes ago. Attorney Bob Hoban argued on behalf of the Hemp Industries Association (HIA) and the other co-Plaintiffs. For those who have been following the case, today was a crucial stage of the litigation. (For those of you who have not been following the case, I’ve written about it here and here.) The Court has read briefs by the HIA, the DEA, and unexpectedly, by 28 members of Congress in support of the HIA. Today was an opportunity for the parties to argue their points directly to the Judges and for the Judges to ask pointed questions.

Arguing a case before a panel of Federal Circuit Court Judges is an unnerving and difficult thing to do. Bob Hoban did an excellent job and was quick on his feet. For example, during one exchange in which he brought up DEA raids on hemp-derived CBD products in Tennessee on Monday, one of the Judges asked if this was material that was outside the record (ie, not part of the official court documents). Bob replied that it was but that he brought it up “for color”. He got a good chuckle from the audience and the Judges, which allowed them to hear his point, namely, that the DEA is continuing to raid legitimate CBD businesses and that the Marihuana Extract Rule (Rule) is being used by local law enforcement to justify raids on lawful businesses.

The DEA attorney was composed but clearly nervous. (I don’t blame her.) She did not bring up anything new or unexpected. The DEA’s stance was that the Rule was properly enacted and that it, combined with the DEA’s Clarification of the Rule, is sufficiently clear to law enforcement. Interestingly, she stated that if someone in possession of a lawful hemp product was charged with a crime that the person could use the fact that the product was lawful to defend themselves in Court. This is cold comfort for law abiding individuals. It also sidesteps the fact that the Rule (not to mention DEA statements and actions in the wake of it) has created enormous confusion. Fortunately, Judge Hawkins picked up on this tactic. He said that the DEA’s argument “sounds like the ancient curse: ‘May you have a lawsuit with a valid defense.‘”

The DEA wrapped up its oral arguments before the end of its allotted time and mostly relied on procedural points for its position, such as the fact that the HIA did not timely challenge the Rule. (This is for a number of reasons, including the fact that the comments period closed before the industrial hemp provisions of the 2014 Farm Act were even enacted.)

Some members of the Court appeared to be confused by the complexity of the issue and at times had difficulty formulating questions or using appropriate terminology. At the conclusion of the arguments one of the Judges said that they would all go back and puzzle through the briefs to try and get a ruling as quickly as possible. This is a little unsettling, although the HIA and Congressional briefs are well written and clearly set out the issues.

I’ll discuss this case more as it develops, but wanted to report on the oral arguments today. I’ll also be reporting on this weeks’ raid in TN (and other states) in another post.

Rod Kight is a lawyer based in Asheville, NC. He is licensed in North Carolina and Oregon and represents legal cannabis businesses. You can contact him by clicking here.