The 9th Circuit Court of Appeals issued a heavy blow to the CBD market Monday when by denying to review a rule it left Cannabidiol (CBD) to stand a Schedule 1 controlled substance, per the DEA’s 2016 memorandum.
The court’s three-judge panel ruled against the Hemp Industries Association, stating that they could not petition the court for a rule change because they failed to comment during the rule’s ANPRM in July 2011. Because of that, the court says they are barred by statute from raising an argument on judicial review and their petition for such review was denied.
According to the ruling, the Agricultural Act of 2014 protects industrial hemp growth for research purposes only under an agricultural pilot program or for academic research. Such growth is allowed by an institution of higher education or the state department– and not for profit.
According to trade publication Hemp Industry Daily, the petitioners plan to appeal the ruling. The article also noted the HIA and associated petitioners have 45 days to request a second look at the case, after which time the Supreme Court would be the final resort.
The HIA argument is that by declaring CBD as being a Schedule 1 drug, the DEA scheduled a new substance– which requires Congressional approval. The court rules that no comment in the ANPRM raised that question, meaning the right to question about that basis was waived.
The court also rejected a long-held belief that the Agricultural Act of 2014 supersedes the DEA ruling.
HIA insisted a question raised by a private citizen adequately raised their concerns, about whether “100% pure cannabidiol by itself” was included. The court ruled that the DEA’s response of changing the definition to include such products “put this question to rest.”
The court said the Act preempts the potential conflict with the Controlled Substances Act, and therefor the DEA rule is not a violation.
This decision means that states now allowing the sale of CBD, operate in violation of the same federal law as states that allow the sale of medical or recreational marijuana.