Hemp companies in Texas are vowing to fight a ruling that health officials announced last week, declaring that delta-8 THC is a Schedule I controlled substance under state law. Regulators with the Texas Department of State Health Services (DSHS) noted that while hemp products and extracts with less than 0.3 percent delta-9 THC were legalized by the 2018 Farm Bill, the cannabinoid and its variants are still tightly controlled under state rules.

“DSHS posted the clarification below on our website in response to recent requests from hemp growers who said that there was confusion in the industry about what was allowed in consumable hemp products,” Lara Anton, a spokesperson for the agency told the Texas Tribune.

The agency wrote online that consumable hemp products containing amounts of THC consistent with federal law are also legal under House Bill 1325, which was passed by state lawmakers in 2019 to regulate the Texas hemp industry. However, “All other forms of THC, including Delta-8 in any concentration and Delta-9 exceeding 0.3 percent, are considered Schedule I controlled substances,” the DSHS wrote on its website.

Delta-8 THC Ban Catches Retailers Off Guard

The announcement from health officials has come as a surprise to many companies that manufacture or retail products made from hemp, including independent operators of CBD stores and vape shops. Ashley Flood, the owner of a CBD American Shaman franchise in Allen, Texas, says that they were never properly notified of the decision to ban delta-8 THC, which officials say was made last year by DSHS Commissioner John Hellerstedt.

“We didn’t find out from the state; we didn’t find out from law enforcement; we didn’t find out via letter, email—nothing. We found out from one of our suppliers,” Flood said after finding out about the change to the DSHS website.

Ben Meggs, the CEO and cofounder of Houston-based Bayou City Hemp Company, says that the DSHS has exceeded its authority and “failed to abide by state law by banning delta-8 THC products, noting that state lawmakers declined to do so when they had the chance.

“The Texas legislature had an opportunity to pass laws that would have likely banned delta-8 THC and would have provided for less ambiguity, but lacked bipartisan support to get this passed, so it is confusing for consumers and businesses to understand the how the current legal status could have changed,” Meggs wrote in an email to High Times.

“It is our belief that a blank statement surrounding the legal status of delta-8 is not only inaccurate, but irresponsible and short-sighted,” Meggs added. “Not only does DSHS interpretation completely contradict both the Federal Farm Bill and HB1325, we all know that outright bans to anything only further drive the industry underground with less oversight, and we lose the ability to pass fair and balanced regulations.”

CBD Company Files Suit to Block Ban

Hemp products operators including Sky Marketing Corp., the operator of the CBD retailer Hometown Hero, are taking legal action to fight the Texas ban of Delta-8 THC. In a suit filed in state district court, Sky Marketing asked for a temporary restraining order blocking the DSHS from taking any “enforcement action” against companies selling low-THC hemp products. 

The company argued in a court filing that state officials did not give proper notice of the proposed rule, and that the ban would create a financial hardship for companies selling delta-8 THC products.

“After operating legally and consistent with Texas law for several years, Plaintiff and other similarly situated businesses and individuals now find themselves in potentially legal jeopardy, and their businesses and livelihood with an uncertain future,” the lawsuit states.

Sky Marketing was not successful in its attempt to block the DSHS from enforcing the ban, however. In his ruling denying the action released on Friday, Judge Gary D. Harger of the 126th Judicial District in Travis County wrote that the plaintiff had “not met the requirements of a temporary restraining order.”

Meggs, whose company was not involved in the legal action, said that he was “surprised” by the judge’s ruling and vowed to file a new suit “so we can protect the rights and safety of Texans.” He added that regulating the hemp industry, including firms offering delta-8 THC products, will protect the consumers and allow legitimate companies to operate openly and transparently.

“The true concern I have with this decision are the effects it has on farmers, businesses and consumers whose livelihood and well-being depend on it,” Meggs said. “Prohibition doesn’t work; we know that. Banning delta-8 creates a black market with less checks and balances in which the cannabinoid will still be sold underground by bad parties in the industry.”

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