The DEA HHC ban is now being defended with an argument that deserves to be read twice: the rule changes nothing, therefore nobody is injured, therefore nobody can sue. DEA filed a brief Tuesday in the U.S. Court of Appeals for the Fourth Circuit arguing that Bluestar Operations, LLC lacks standing to challenge the agency’s May rule assigning hexahydrocannabinol its own Schedule I drug code — and that even if Bluestar had standing, it would lose anyway.

In this article

• What the DEA HHC ban rule actually did
• What the hemp companies argue
• The part that should worry the hemp bar
• Watch the full episode
• Original sources

What the DEA HHC ban rule actually did

DEA’s position is that HHC has been Schedule I for decades as a tetrahydrocannabinol, and that May’s rule merely gave it a dedicated tracking code instead of sharing one with THC. In the agency’s words: “All the rule does is assign a tracking code to HHC to facilitate DEA’s administration of the CSA.” Because the change “imposes no new obligations or liabilities,” DEA argues, Bluestar has not identified any injury traceable to the rule that a court could remedy.

Then the closer: “Even if this Court were to grant Bluestar’s requested remedy and vacate the final rule, HHC still would be a schedule I substance as a THC. Bluestar thus would continue to suffer the same alleged injuries, which all stem from HHC’s placement in schedule I.”

It is a tidy piece of lawyering. Win or lose the rule, you are still banned — so there is nothing here to litigate.

What the hemp companies argue

Bluestar’s complaint attacks the underlying premise, arguing DEA is writing criminal law by interpretation: “Congress, not executive agencies like the DEA, defines the scope of federal criminal liability. The DEA lacks authority to narrow Congress’s legalization of hemp cannabinoids through interpretive construction unsupported by statutory text.”

The company leans on circuit precedent holding that hemp-derived THC-O-acetate is federally legal despite DEA’s contrary view. A parallel case brought by IHC Investments, Inc. is pending in the Ninth Circuit, leaning on that court’s ruling that delta-8 THC is legal hemp. Both petitions invoke the major questions doctrine, arguing that banning a category worth billions requires clear congressional authorization rather than an agency memo.

The chemistry sits at the center. HHC occurs in trace amounts in cannabis but is generally produced by hydrogenating CBD. DEA’s stated position is that “only tetrahydrocannabinols in or derived from the cannabis plant—not synthetic tetrahydrocannabinols—are excluded from control,” and that conversion-produced cannabinoids count as synthetic even when hemp-derived. The industry’s answer is that Congress “did not prohibit converted cannabinoids, hydrogenated cannabinoids, or cannabinoids subjected to ordinary commercial processing techniques.”

The part that should worry the hemp bar

DEA told the court the case has a shelf life. Because legislation signed late last year redefines hemp to permit only 0.4 milligrams of total THC per container after November 12, DEA argued Bluestar’s legal theory “will soon be overtaken by events,” and that the recriminalization “will defeat whatever remains of Bluestar’s claims.”

That is the agency openly telling a federal court not to bother, because Congress is about to moot the question. Whether it does depends on whether the House moves the date — the Senate voted to push it to December 11, but that is not law yet.

The Fourth Circuit already denied Bluestar’s request for a stay of the drug code rule in June, so the rule is operative while the litigation runs. Combined with state-level actions like the Virginia THC cap, hemp operators are now defending on two fronts with a federal deadline closing behind them.

Watch the full episode

Prefer to watch on YouTube? The Future of Dispensaries in Schedule III.

Original sources

• DEA filing in the HHC lawsuit (PDF, DocumentCloud)
• Marijuana Moment — DEA Says Hemp Company Can’t Challenge Agency’s Stance On HHC
• Marijuana Moment — Hemp Companies Sue DEA Over HHC

This article is general information, not legal advice.