Interm Update: Hemp

June 24, 2019

We had hoped to make it all the way to the end of the month before pestering you with legislative news, but no such luck. If you haven’t already heard from your local crime labs and/or your local media about the legislature’s mis-steps with the legalization of hemp, you soon will. Here is some information that may help you determine your plans going forward.

It’s a brave new (hemp) world

As you may have heard, the legislature recently passed HB 1325 to regulate the growth, production, transportation, sale, and consumption of legal hemp products in Texas. In passing that bill, the Texas Legislature joined roughly 40 other states and the federal government in legalizing some form of hemp, industrial hemp, or hemp-related products. However, the implementation of this new law is causing some headaches because the legislation took immediate effect as of June 10, 2019—something that is almost never a good idea when changing criminal law!—and crime laboratories have not been given the time or resources they need to properly equip laboratories with the instrumentation and expertise needed to distinguish legal hemp from illegal marijuana, nor have state agencies been able to implement the regulatory processes required to regulate hemp. We will have a more complete summary of this new law in our 2019–2021 Legislative Update book (which is going to the printer this week), and we will talk about it in detail on our Legislative Update tour (click here to register for a location near you), but because this law has taken effect before we can come tell you about it in person, here is what we can say for now.

Testing

As finally passed, HB 1325 distinguishes between (now legal) hemp and (still illegal) marijuana. Both terms reference the same plant—Cannabis sativa L.—with the sole difference being THC content. Specifically, “hemp” is defined as Cannabis sativa L. and any part of that plant, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry weight basis. That type of cannabis is now excluded from the definition of “marihuana” in the Controlled Substances Act, and hemp and the tetrahydrocannabinols in hemp are also excluded from the definition of a “controlled substance” in that Act. As a result, hemp is no longer prosecutable as marijuana or as a Penalty Group 2 tetrahydrocannabinol other than marijuana. But how can one distinguish between hemp and marijuana? Well, there’s the rub.

The distinction between marijuana and hemp requires proof of the THC concentration of a specific product or contraband, and for now, that evidence can come only from a laboratory capable of determining that type of potency—a category which apparently excludes most, if not all, of the crime labs in Texas right now. Various law enforcement agencies—including DPS—and other local or private crime labs will have to purchase new instrumentation and change certain testing procedures to be able to supply that new information to the courts before criminal cases involving marijuana go to trial. Until then, there will be no easy way to determine whether the weed your officers seized is illegal marijuana. (Interestingly, our post-session research shows at least two other states—Tennessee and Virginia—are experiencing the same problems resulting from their own state legislative bodies passing hemp legalization laws with immediate effect, but apparently no one who helped pass the Texas bill either knew about those problems or thought to mention them to our own legislature.)

The takeaway is that you may have to put your marijuana cases on the same “waiting for lab results” shelf as your felony DNA cases and postpone them until the labs can provide the needed evidence for prosecution. We have been informally told that it should take labs anywhere from four to 12 months to purchase new equipment and adopt and validate the necessary protocols to be able to provide the evidence needed to prosecute a marijuana case at trial. This does not necessarily mean marijuana cases cannot be investigated or charged under the Controlled Substances Act during that time—after all, no one can legally possess or sell hemp when the rules necessary for doing so have not been implemented yet—but unless a defendant stipulates that his cannabis is marijuana and not hemp, any criminal cases may need to wait to go to trial until testing on them can be completed. And if your judges will not grant lab-induced continuances, then you may have to get creative in your disposition of those cases—if you accept them at all.

Prospective Application

Not only did HB 1325 have immediate effect, but it also lacked the usual transition language making a change in criminal law prospectively apply only to offenses occurring on or after that effective date. As a result, the law went into effect on June 10, 2019, but it is unclear whether it applies to previously-filed marijuana cases pending on that date. Y’all are welcome to plumb the depths of the annotations on Government Code §311.031 (Savings Provisions), which is the Code Construction Act statute that provides the default rules for such situations, but we already took that deep dive and there do not appear to be any prior annotations or attorney general opinions that directly apply to this type of decriminalization situation. There are cases relating to drug punishment ranges being reduced—which under §311.031(b) would apply to cases still pending on the effective date in the absence of specific language in a bill stating otherwise—but is HB 1325 a penalty reduction or just a revision/amendment/repeal described by §311.031(a) that does not apply to past violations of the statute? Your guess is as good as ours.

Other Options

Under HB 1325, the growth, production, transport, sale, and use of hemp will be regulated by the state as an agricultural or consumer product, depending on whether the hemp is in a consumable or non-consumable form—but only once the Department of Agriculture (TDA) and Department of State Health Services (DSHS) can get their rules and regulations in place, which will also take several months. That means that for now, no one can legally possess hemp (with one exception noted at the end of this update). House Bill 1325 did enact new Agriculture Code §§122.356 and 122.360 to make it a Class C misdemeanor (up to $1,000 fine) to improperly transport hemp, and improper transportation can also be pursued as a civil penalty (up to $500 per violation) by the attorney general or a county or district attorney (see §122.359). However, any other violation of the new laws relating to the possession, sale, or purchase of non-consumable hemp products are to be handled as an administrative penalty by TDA, and that agency has yet to adopt the rules required to do it.

For consumable hemp products such as oils, lotions, tinctures, and other health products, HB 1325 makes them subject to regulation under Health and Safety Code Chapter 431 (Texas Food, Drug, and Cosmetic Act). That means that a violation of various consumer protection laws—such as those listed in §431.021 (Prohibited Acts) relating to mislabeling, misbranding, adulterating, false advertising, or counterfeiting—when made in regard to the commercial sale of consumable hemp products may subject the violator to:

  • administrative penalties from the Department of State Health Services (DSHS) or the Office of the Attorney General (OAG) under §431.054;
  • civil penalties from OAG or a district, county, or city attorney of up to $25,000 a day for each violation under §431.0585; or
  • criminal penalties of a Class A misdemeanor or a state jail felony under §431.059.

In addition, certain other violations of the new law involving consumer products containing cannabinoid oil, including cannabidiol (CBD), are made actionable under the Deceptive Trade Practices Act (see §443.203). As a result, our friends in the Consumer Protection Division of the Office of Attorney General (OAG) may soon be developing an expertise in hemp regulation, so feel free to call in the “hemp cavalry” if you don’t know what to do with these cases now, because that’s whom the legislature has tasked with regulating hemp products.

Interdiction

The biggest challenge to marijuana interdiction in the post-hemp world is determining what is what on the street. Just as in the courtroom, there is no field test or drug dog qualified to distinguish between legal hemp and illegal marijuana, and many other states that have legalized hemp have run into this same problem.

To provide guidance to those attempting to enforce this new law, HB 1325 enacts Agriculture Code §122.358 (Powers and Duties of Peace Officers). Subsection (b) of that law authorizes a peace officer to detain any hemp in transit and request documentation proving the product 1) is legal and 2) is legally possessed and transported. Subsection (c) also allows peace officers to seize and impound any cannabis product for which there is probable cause to believe that it is marijuana or “any other illegal substance”—such as hemp that does not meet various other regulations required or adopted under HB 1325. However, while subsection (a) says a peace officer may inspect and collect a sample of cannabis found in a vehicle to determine its THC content, there is no easy way to do that right now. Furthermore, that subsection also prohibits the officer from seizing all of the cannabis or arresting the person transporting it unless the officer has probable cause to believe the cannabis is marijuana. Fortunately, that PC threshold should be easy to clear with some logical police work.

First, note that HB 1325 prohibits TDA or DSHS from adopting rules or regulations that would allow the processing or manufacturing of any hemp product in a form suitable for smoking or vaping (see Agriculture Code §122.301(b) and Health and Safety Code §443.204(4)). And second, new Agriculture Code §122.356(b) prohibits a person transporting hemp from transporting any other cargo at the same time, and it also requires that person to provide documentation proving the hemp is legal to any peace officer upon request. So, because legal hemp must be properly documented at all times, cannot be transported with non-hemp products, and cannot be manufactured or produced for the purposes of smoking or vaping, any cannabis plant material found without those documents or in a form meant for smoking or vaping should qualify as probable cause to believe it is not legal hemp. Simply put, if the paperwork is not in order, officers can assume the cannabis is marijuana—or at a minimum, legal hemp being illegally transported, which is also a criminal offense—and proceed accordingly.

Exception

While our statement under “Other Options” that no one can legally possess hemp is technically correct, there is one exception for certain CBD-related products. The transition language of HB 1325 includes language that allows a “retailer” to possess, transport, or sell a consumable hemp product (read: CBD oil) that became part of the retailer’s inventory before DSHS’s rules governing those products take effect (which describes the period in which we currently find ourselves). That means retailers can stock and sell CBD oil products now, without the proper licensure, registration, testing, and labelling required by HB 1325. The only exception to this exception is if the product is unsafe for consumption due to the presence of pesticides, solvents, or the like, or if the product has a THC concentration higher than 0.3 percent. But as we have already discussed, that requires the product to be seized and tested in a laboratory, which can be time-consuming and expensive for local authorities. As a result, there may now be a statutory reason to not prosecute non-smokable, low-THC CBD oil consumer product cases.

Conclusion

We will update you with further information on this topic as we receive it, but this is what we know as of now. Good luck with that!