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Hemp News: Updates on Interstate Travel, Interstate Commerce, and Crop Insurance

The Transportation Security Administration (TSA) recently changed its policy on hemp-derived products.

Products and medications that contain lawfully produced hemp-derived cannabidiol (CBD) are now permitted on flights.  But CBD consumers may still want to avoid headaches and hassle by keeping those CBD products in their checked baggage, when possible.  Possession of marijuana and certain other cannabis-infused products, including products that may contain CBD in addition to unlawful substances, remains illegal under federal law and it may be difficult for TSA officers to tell the difference between those items and their legal counterparts.

The Office of the General Counsel for the United States Department of Agriculture (USDA) issued an important legal opinion on May 28th.  The opinion reinforces the reality that hemp is legal and can be legally shipped or transported between states.  While many believe that the Agriculture Improvement Act of 2018 (2018 Farm Bill) settled questions about the legality of interstate transportation and sale of hemp, issues have persisted and government officials in several states have tried try to criminalize those actions.  In its opinion, the USDA reaffirmed that: (a) hemp is no longer a controlled substance; and (b) while states may prohibit the cultivation of hemp within their borders, they cannot interfere with the interstate transportation or shipment of hemp that is lawfully produced under the Agricultural Act of 2014, state-level pilot programs, or (after the USDA publishes regulations implementing the hemp production provisions of the 2018 Farm Bill) a state or tribal plan or a license issued by the USDA.

A federal disaster relief bill aimed at lessening the impact of Hurricanes Michael and Florence, among other things, was recently amended to require the Federal Crop Insurance Corporation to offer coverage for hemp under whole-farm revenue protection insurance policies beginning no later than the 2020 growing season.  The bill passed the U.S. Senate on May 30th, and it is now in the U.S. House.  While not a perfect fix to the industry's insurance woes, this would provide much needed short-term protections for hemp farmers.

The Federal Food and Drug Administration (FDA) held a public hearing on CBD in Washington, DC on Friday, May 31st.  This hearing was the first of its kind at the FDA, which asserted regulatory control over the CBD industry at the time of its decriminalization on December 20, 2018.  The FDA held the hearing "to obtain scientific data and information about the safety, manufacturing, product quality, marketing, labeling, and sale of products containing cannabis or cannabis-derived compounds."  The FDA also established a docket for public comment that will close on July 2, 2019.  We encourage interested stakeholders to submit their comments for the FDA's consideration, and we hope the FDA will act quickly to issue reasonable and commonsense guidance on the regulatory uncertainties that continue to plague CBD products and companies.

© 2020 Ward and Smith, P.A.. All Rights Reserved.National Law Review, Volume IX, Number 157


About this Author

Tyler Russell, Bankruptcy Attorney, Creditors Rights, Raleigh, North Carolina, Ward and Smith Law Firm
Business and Creditor's Rights Attorney

Tyler's creditors' rights practice encompasses bankruptcy, collections, and lender liability issues.  He concentrates his practice on the representation of creditors in bankruptcy cases and state court litigation, including workouts, reorganizations, Uniform Commercial Code security agreement enforcement, collections cases, and other contested matters.  Tyler has represented national and community lenders, trade creditors, equipment manufacturers, agricultural companies, community associations, contractors, and leasing companies in various reorganization and litigation proceedings. His...

Allen N. Trask III, Litigation Attorney, Ward Smith, Wilmington, North Carolina, business, civil, commercial litigation
Litigation Attorney

Allen focuses his practice on assisting those who own, manage, and invest in real estate and common interest communities.  He regularly works with real estate developers and the residential and commercial community associations that they create to handle all manner of issues, including the preparation, amendment, interpretation, and enforcement of restrictive covenants and governing corporate documents, declarant control transition and disputes, community management, insurance claims and disputes, and collections.  He also frequently represents Real Estate Investment Trusts (REITs) and other commercial landlords in the management of commercial investment properties, including lease negotiation and enforcement, summary ejectment, and collections. 

Allen has been a member of the firm's Litigation Practice Section since he joined the firm.  He has experience in all aspects of civil litigation, including depositions, hearings, mediations, arbitrations, trials, and appeals.  His litigation experience allows him to offer unique insight into risk and liability assessment, insurance coverage, and cost-benefit analyses, and he enjoys working with clients to proactively address these issues to reduce risk and cost.  Allen also is a member of the firm's Land Use and Zoning Practice Group, where he helps clients pursue and challenge special use permits, ordinance changes, and condemnation actions.

As an eastern North Carolina native with family farming roots, Allen has a passion for representing those who work the land.  He is the leader of the firm's Agribusiness Practice Group, where he coordinates the firm's resources to address the specialized issues facing clients in the agribusiness community, such as industrial hemp operations, farmland leases, corporate organization, restructuring, dissolution, and succession planning, equipment financing and leasing, workouts and debt restructuring, environmental regulatory compliance and permitting, and negotiations and interactions with local, state, and federal government.