7 hours ago
Missouri Attorney General threatens legal action against 18 hemp companies; more to come
(Rebecca Rivas/The Missouri Independent)
Missouri Attorney General Andrew Bailey has sent several cease-and-desist letters to companies selling a hemp product called THCA flower that looks exactly like marijuana flower sold at dispensaries.
Bailey's letters threaten legal action, including injunctions, civil penalties and attorney's fees if the companies continue to sell the products.
'When purchasing products, Missourians deserve to know if they are being exposed to dangerous side effects like psychotic episodes, hallucinations or other life-threatening risks,' said Attorney General Bailey in a statement to The Independent. 'We have issued 18 cease and desist letters so far, and more are forthcoming.'
Cannabis lobbyist Eapen Thampy said about a dozen smoke shops in St. Louis received the letters, and in some cases, THCA flower makes up 60% to 80% of the companies' inventories.
Thampy said he's working with the companies to put together a response to the letters and preparing for potential litigation.
The action is the first major move since Bailey created a new specialized unit last fall, with the aim to assist the state's alcohol and tobacco regulators in cracking down on intoxicating hemp products.
In September, Bailey vowed his new unit would work with the Missouri Alcohol and Tobacco Control Division to bring legal action against licensees selling unregulated psychoactive cannabis products that violate the Missouri Merchandising Practices Act.
'The ATC will assist by making its investigators available as witnesses for legal proceedings resulting from actionable referrals,' Bailey said in September. 'Our enforcement toolkit will be robust from cease-and-desist letters and investigations to subpoenas and lawsuits to referrals for criminal prosecution where appropriate.'
The letters that went out last month state that the companies are 'directed to cease and desist from selling' hemp products that contain more than 0.3% THCA on a dry weight basis. THCA is a naturally abundant cannabinoid that transforms into Delta-9 THC when smoked or heated.
However, this is not what an official cease and desist order looks like, said Jefferson City-based attorney Chuck Hatfield.
'It is an informal cease and desist,' Hatfield said. 'It is not a letter that has the force and effect of law. It's more in the nature of a request to stop.'
Under state law, if Bailey wanted to issue an official cease and desist order – as he did for Planned Parenthood in March – Hatfield said Bailey would have to issue a notice of intent first. The company would have the right to appeal through an administrative hearing, as well as challenge the order in court.
'But he hasn't done any of that,' Hatfield said.
Bailey could also file a lawsuit under Missouri Merchandising Practices Act, and that doesn't require a cease and desist order, he said.
Charles Alovisetti, a cannabis attorney with Vincente law firm in Boston, said the lack of a state law to support the action could put Bailey in a tricky spot.
'If the goal is to control THCA flower sales, states should regulate hemp products in their final form, including THCA flower, through clear legislation,' Alovisetti wrote in a LinkedIn post. 'Letters like this may not hold up in court.'
For the third year in a row, state lawmakers failed to pass legislation to regulate intoxicating hemp products by the end of the session in May.
At issue in Bailey's letters is THCA, which is not intoxicating in its natural state. Most marijuana flower found in dispensaries contains about 20-40% THCA, which would not get a person high if they consumed it without heating it. It has to be smoked to transform it into Delta-9 THC, which produces the desired high for consumers. The process of heating is called decarboxylation.
Legal action against THCA hemp flower raises a dizzying debate about distinction between hemp and marijuana under federal law.
Cannabis attorney Rod Kight, who has represented hemp businesses in lawsuits nationwide, said Bailey's letter accurately states that the sole distinction between legal hemp and illegal marijuana is the concentration of delta-9 THC, which cannot exceed 0.3% for hemp.
The part Bailey gets wrong, Kight said, is claiming that THCA is part of the calculation for determining whether harvested hemp or a hemp product is lawful.
'Given that Missouri law does not address THCA at all, it is clear that the attorney general is relying on recent letters from the DEA in support of its position that the concentration of THCA must be taken into account when determining the legal status of harvested hemp and hemp products,' Kight said.
However, he said the U.S. Drug Enforcement Administration's interpretation has caused a lot of confusion.
'Hemp growers must account for THCA before harvesting their hemp crops,' Kight said. 'Thereafter, the THCA concentration does not matter under federal law or the laws of Missouri and the 'post-decarboxylation' test does not apply to harvested hemp or hemp products sold by wholesalers or retailers.'
Since the 2018 Farm Bill legalized hemp, botanists have figured out how to breed cannabis plants capable of passing the only federal checkpoint required on hemp plants — a visit from U.S. Department of Agriculture inspectors 30 days before harvest.
At that point, the levels of Delta-9 THC and THCA are below the federal threshold, but both increase before being harvested 30 days later. Kight said he believes there's lots of marijuana flower sold in dispensaries that would probably meet this standard of hemp as well. It's a point that's being argued in court, he said.
'THCA is the most abundant cannabinoid that cannabis produces,' he said. 'If there's any cannabinoid that humans have truly ingested for thousands of years, it's THCA. The hemp industry is moving kind of back towards this more natural sort of state of affairs, and I'm very pleased with that.'
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