Virginia Hemp Businesses Sue State Officials Over New THC Product Limits

A coalition of Virginia hemp businesses are suing state officials in federal court over soon-to-be-enacted restrictions on the products they produce and sell.

When lawmakers and the governor passed budget legislation this year, it included provisions that will legalize recreational marijuana sales while also narrowing the scope of what constitutes a legal hemp product in the state.

Specifically, the definition of what constitutes a legal hemp product is being revised by removing a provision from current law that allows those containing more than 2 milligrams of total THC per package if they also have a ratio of CBD to THC that is 25:1 or more. By removing the CBD-THC ratio allowance, no hemp product with more than 2 milligrams of THC will remain legal.

The restrictions are set to take effect on August 15, nearly 11 months before the state’s newly approved retail marijuana sales market is set to launch on July 1, 2027.

Now, seven businesses—Northern Virginia Hemp and Agriculture, Redfern Hemp Co., District Hemp Botanicals, Pure Elkton Manufacturing, Cypress Hemp II, Wellness Warriors and Simply Hemp—have filed suit in U.S. District Court for the Western District of Virginia in an attempt to stop the ban from taking effect.

The complaint, filed on Friday and signed by former state Sen. Chap Petersen (D), who is representing the businesses as their attorney, says that the new restrictions “transform a legalized hemp product into an illegal and penalized substance.”

The legislation “conferred exclusive commercial opportunities upon state-licensed marijuana operators,” it says. “These entities are authorized to market, distribute, and profit from high-potency THC products, whereas substantially similar, lower-potency hemp products in Plaintiffs’ inventory are subject to enhanced restrictions… In effect, it removed Hemp from the same retail marketplace now occupied exclusively by recreational marijuana.”

As a result, the hemp businesses have “suffered substantial losses” without being compensated by the state, which the suit says constitutes a violation of the Takings Clause of the Fifth Amendment of the U.S. Constitution, which prohibits the government from taking private property for public use without providing just compensation.

The filing says the businesses will be forced to terminate employees and reduce or suspend operations or face potential criminal charges, arguing that they “have experienced significant financial loss and should receive just compensation and an injunction to stop enforcement of the statutory amendment.”

The suit—filed against Gov. Abigail Spanberger (D), Attorney General Jay Jones (D) and leaders of the Cannabis Control Authority, as well as commonwealth attorneys in several counties across the states—notes that hemp has played a key role in the state’s history, including a 1619 requirement that citizens in the Jamestown colony were required to grow it and a move by lawmakers in 1633 to mandate the same.

“Between 1763 and 1769, a citizen could be jailed for not growing hemp during particular periods of shortage,” the complaint says. “Even George Washington, the Father of our Country, had hemp growing on his land in Mount Vernon.”

“In sum, the elimination of the ’25:1′ exception has devastated the legal hemp operation, even as the General Assembly has legalized various forms of marijuana, which had not been previously legal and indeed have no history of legality in Virginia.”

Allowing recreational marijuana sales to launch while cracking down on hemp products that have existed in the market for years “creates an arbitrary divide between identical chemical compounds based solely on source or retail channel, rather than public safety,” the suit says,

“If a 3mg THC beverage is banned on a hemp retailer’s shelf for ‘public safety,’ but a 3mg THC beverage is completely legal and deemed safe if purchased at a state-licensed marijuana dispensary, the distinction is not based on the public safety, but on economic protectionism,” it says, alleging violations of due process and equal protection clauses of the U.S. Constitution.

“By replacing federal agricultural standards with economic policies that weaponize the authority to eliminate a distinct, federally compliant market, the path is cleared for a state-monopolized retail marijuana regime scheduled for 2027. Specifically, the Commonwealth has legalized and commercialized the marijuana industry as a whole but selectively singled out and dismantled the independent hemp industry. This contradicts the Commonwealth’s ‘public safety’ rationale in the new Hemp Prohibition which claims independent hemp products pose an intolerable threat to public health while the Commonwealth simultaneously permits and promotes a state-run marijuana marketplace distributing the chemical compounds at significantly higher potencies.”

“The Commonwealth cannot rationally maintain that 2.1 milligrams of THC in a hemp beverage sold by a licensed Virginia hemp business threatens public health, while materially higher doses of the same compound sold through a state-licensed dispensary do not,” the complaint says.

The plaintiffs are asking the court to declare the new hemp product restrictions unconstitutional, issue an injunction against their enforcement and award damages and legal fees.

Meanwhile, federal hemp laws are also in flux.

Hemp derivatives with less than 0.3 percent delta-9 THC on a dry-weight basis were federally legalized under the 2018 Farm Bill that President Donald Trump signed during his first term in office. But late last year, the president signed new legislation containing provisions that will redefine hemp to make it so only products with 0.4 milligrams of total THC per container will remain legal after November 12.

Bipartisan lawmakers in the House and the Senate have introduced or are informally circulating various proposal to delay, alter or prevent the forthcoming hemp product ban, and the White House has also called for reforms on the issue.

That includes a new key spending bill unveiled by Senate Appropriations Committee leaders on Sunday that has provisions to delay the new prohibition on many, but not all, hemp THC products.

Read the full Virginia hemp lawsuit below: