Hemp Companies File Federal Lawsuits Challenging DEA’s Move to Classify HHC as Schedule I

Two hemp companies have filed federal lawsuits challenging the Drug Enforcement Administration’s move to classify hemp-derived hexahydrocannabinol (HHC) as a Schedule I controlled substance.

IHC Investments, Inc., and Bluestar Operations, LLC, filed separate petitions for review of final agency action against the DEA, DEA Administrator Terrance C. Cole and acting U.S. Attorney General Todd Blanche. The cases were filed in the U.S. Court of Appeals for the Ninth Circuit and the U.S. Court of Appeals for the Fourth Circuit.

The challenges target the DEA’s final rule published May 4, titled “Specific Listing for Hexahydrocannabinol, a Currently Controlled Schedule I Substance.” The companies argue the agency exceeded its authority by classifying hemp-derived HHC as illegal despite the 2018 Farm Bill’s protections for hemp and hemp-derived cannabinoids.

The petitions argue that Congress removed hemp and its derivatives, extracts, cannabinoids and isomers from the Controlled Substances Act, so long as they contain no more than 0.3% delta-9 THC on a dry-weight basis. The companies contend the DEA’s position unlawfully adds restrictions that Congress did not include.

The lawsuits also challenge the DEA’s claim that commercially produced HHC should be treated as “synthetic THC.” The petitions argue that hemp production commonly involves extraction, refinement, conversion, hydrogenation, distillation and similar manufacturing processes, and that the 2018 Farm Bill did not exclude cannabinoids produced through those methods.

Both cases also invoke the major questions doctrine, arguing that the DEA cannot unilaterally impose major criminal and economic consequences on the hemp industry without clear authorization from Congress.

“This is a coordinated defense of the rule of law and the stability of the American hemp industry,” said David Sergi, lead counsel for IHC Investments. “The DEA is attempting to redefine federal law through administrative fiat, causing immediate and irreparable harm to businesses operating in reliance upon the 2018 Farm Bill. These lawsuits in two different circuits demonstrate that the threat from the DEA’s unlawful overreach is national in scope.”

The Bluestar petition also points to Fourth Circuit precedent, arguing that the legality of hemp-derived cannabinoid products turns on the Farm Bill’s delta-9 THC limit, not on a DEA interpretation that criminalizes cannabinoids because they undergo post-harvest processing.

The petitions ask the appeals courts to review and set aside the DEA action.