The Fourth Circuit Court of Appeals ruled this week in a wrongful termination lawsuit that “all products” made from hemp that has 0.3% delta-9 THC or less are “unambiguously” federally legal.
At the same time, the appellate court upheld the right of the North Carolina company to fire the worker who filed the lawsuit, and wrote that the plaintiff in the case, Tonya Anderson, had not proven she failed an employment drug test due to federally legal hemp products as she’d claimed, Law360 reported.
The ruling appears to set a new “standard for the legality of hemp products,” particularly as controversy continues to rage in various states over intoxicating hemp products that are federally legal under the 2018 Farm Bill definition, Law360 reported.
In doing so, the Fourth Circuit concurred with the Ninth Circuit in overturning a position held by the Drug Enforcement Administration that products which undergo manufacturing processes cease to be legal hemp and become illegal synthetic cannabis.
“To sum up, under state and federal law, then, certain hemp-derived products – those ‘with a delta-9 (THC) concentration of not more than … 0.3% on a dry-weight basis’ don’t come within the definition of an illegal controlled substance, and instead fall under the umbrella of a legal hemp-derived product,” the ruling stated. “The critical distinction that separates illegal marijuana and THC from legal hemp under both state and federal law is a product’s delta-9 THC concentration.”
The case did not necessarily settle an ongoing policy question of what precisely constitutes synthetic cannabinoids under federal law or in the eyes of the DEA, Judge Julius Richardson noted in a partial dissent.
“Whether synthetic derivatives like THC-O count as excepted hemp is a difficult question. The DEA and Ninth Circuit interpretations did not fully consider the issue. Neither did the parties” in the Anderson lawsuit, Richardson wrote. “I would leave this interpretive question for another day.”
The panel of judges found that the 2021 lawsuit filed by Anderson was already properly decided in favor of her former employer, Diamondback Investment Group, which fired her after she tested positive for marijuana in a drug screening, because Anderson couldn’t back up her claims that she only used hemp-derived CBD products, Law360 reported.
The case was originally thrown out in March in favor of Diamondback for the same reasons, Law360 reported. Her attorney did not respond to a request for comment from Law360.
An attorney for Diamondback told the news outlet, “We are glad that the Fourth Circuit chose to hear oral argument on this matter, especially in light of the fact that it included an issue of first impression. With hemp-based products and synthetic cannabinoids being used more widely, the Fourth Circuit has now provided much needed guidance to employers regarding drug testing policies for its employees.”
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