Top Takeaways:

• The Eighth Circuit Court of Appeals reinstated an Arkansas ban on intoxicating hemp-derived cannabinoids, reversing a two-year injunction.
• Judges ruled that the 2018 Farm Bill does not require states to legalize hemp and allows stricter state regulation, including outright prohibition.
• Arkansas officials and industry advocates hailed the ruling as a major victory for public safety and state authority over hemp products.

A federal appeals court has reversed a lower court’s injunction blocking Arkansas from enforcing its ban on intoxicating hemp-derived cannabinoids, clearing the way for the state to restrict products such as delta-8 THC. The decision could reshape hemp policy across several states and undermine industry reliance on the 2018 Farm Bill’s protections.

The U.S. Court of Appeals for the Eighth Circuit ruled Monday that Arkansas law Act 629, signed in 2023 by Gov. Sarah Huckabee Sanders, does not violate federal law and is not unconstitutionally vague. The court’s opinion, authored by Judge Jonathan A. Kobes, emphasized that while the 2018 Farm Bill legalized hemp at the federal level, it also gave states the authority to regulate — or even ban — hemp products more strictly.

“Just because states may legalize hemp under the 2018 Farm Bill does not mean they must,” Kobes wrote.

Background and Legal Fight

Arkansas passed Act 629 in April 2023 to ban the production and sale of certain synthetic or semi-synthetic tetrahydrocannabinols, including delta-8, delta-9, and delta-10 THC, derived from hemp. The state law classified these compounds as Schedule VI substances, effectively criminalizing their sale or possession.

Hemp businesses quickly challenged the law. Four companies — Bio Gen LLC, Drippers Vape Shop LLC, Cigarette Store LLC (doing business as Smoker Friendly), and Sky Marketing Corp. (doing business as Hometown Hero) — filed suit in federal court, arguing the law conflicted with the federal definition of hemp established under the 2018 Farm Bill.

In August 2023, U.S. District Judge Billy Roy Wilson granted a preliminary injunction blocking enforcement of the law, stating that the plaintiffs were likely to succeed on the argument that federal law preempted the Arkansas statute.

However, the Eighth Circuit’s ruling this week overturned that decision, stating that the Farm Bill allows states to regulate hemp more stringently within their borders, so long as they do not block the continuous interstate transport of legal hemp.

Implications for the Industry

The ruling is seen as a significant victory for Arkansas officials and a major setback for hemp businesses operating in the state.

“This is a huge victory for the state and a great step towards protecting generations of Arkansas’ children from the dangers of synthetic marijuana,” Gov. Sanders said in a statement following the decision.

Arkansas Attorney General Tim Griffin echoed the sentiment, warning retailers that enforcement could begin within weeks. “Our hands have been tied and they’re not anymore,” Griffin said at a news conference, referring to the previous injunction. “You’re talking about almost an unlimited number of dangerous drugs … and who knows what’s in this stuff half the time.”

Chris Lindsey, vice president of policy for the American Trade Association for Cannabis and Hemp (ATACH), welcomed the ruling, stating it provides legal clarity for state lawmakers seeking to regulate hemp-derived products. ATACH had filed an amicus brief in support of Arkansas’s position.

National Ramifications

The Eighth Circuit’s jurisdiction includes Arkansas, Iowa, Minnesota, Missouri, Nebraska, North Dakota, and South Dakota — meaning states in the region may now be emboldened to pass similar restrictions.

Meanwhile, in Texas, Gov. Greg Abbott vetoed a bill earlier this week that would have banned consumable hemp products containing THC. Abbott cited the Arkansas injunction as part of his rationale, arguing that Texas could face years of litigation with no enforcement ability.

However, Lt. Gov. Dan Patrick publicly criticized the veto and cited the Arkansas case as an example of legal footing for such a ban. “As I said yesterday at my press conference, it appeared to my legal team and me that Arkansas would win this case and be able to ban THC,” Patrick posted on X after the decision.

Ongoing Legal Questions

Despite the appellate court’s ruling, questions remain about how hemp products will be regulated at the state level and whether legal definitions can vary from the federal standard.

Renowned cannabis attorney Rod Kight warned in a blog post that the ruling sets a concerning precedent: “The 8th Circuit’s decision opens the door for state-level redefinitions and restrictions that deviate from the federally accepted framework under the 2018 Farm Bill.”

Kight also noted that the court rejected arguments that Arkansas’s law was unconstitutionally vague, writing: “The court found that the savings clause rescues Act 629 from violating federal transportation protections.”