It’s going to be a green Christmas in Tennessee after all.
The state’s most popular hemp product can still be sold, at least until February, following a court ruling this week.
Nashville Judge I’Ashea Myles granted an injunction Monday to pause rules from the state’s department of agriculture that would have made smokeable THCa flower and other products illegal to sell in the state.
The rules were supposed to go into effect Dec. 26, following a year of pushback from retailers who have mostly welcomed the other regulations placed on their industry in a 2023 bill.
(READ MORE: Pot or not? Everything you need to know about Chattanooga’s cannabis industry)
“MERRY CHRISTMAS TO TN’S HEMP INDUSTRY!,” the Tennessee Growers Coalition, an industry lobbying group that sued over the rules, said in a social media post after the ruling.
The injunction will last at least until Feb. 18, according to Myles’ order.
“We’re continuing, business as usual,” Josh Manning, chief executive of Chattanooga’s Snapdragon Hemp, said by phone.
The February deadline will fall in the midst of the 2025 legislative session, at which lawmakers are expected to bring bills that would clarify the rules.
“Really what it’s given us time to do is to come up and write a bill that will allow the things that we do to continue,” Manning said.
The order preserves the status quo — keeping THCa products legal — “until all parties can provide additional briefing and affidavits on the proposed testing rules and regulations and particularly how the new proposed test works in regard to the testing of THC, THCa, delta-9 concentration level, mere hemp and the raw hemp flower,” Myles said in the order.
Myles issued the ruling after a three-hour hearing earlier this month with the Growers Coalition and the Tennessee Healthy Alternatives Association, another industry group that sued over the rules.
Both groups alleged the agriculture department’s rules went against the law passed in 2023.
That law only limited the amount of delta-9 THC in hemp products that can be sold in Tennessee. Delta-9 THC is a psychoactive compound found in high concentrations in marijuana, which remains illegal in Tennessee.
The agriculture department’s rules would also limit the amount of THCa, which is delta-9’s chemical precursor. If enforced, they would effectively make THCa products illegal in Tennessee — products that retailers say make up the majority of their sales.
Federal agencies, in the years since the 2018 Farm Bill allowed hemp products to be sold at all, have largely adopted the “total THC” testing model, similar to the one the agriculture department is proposing.
Tennessee’s hemp industry has generated between $280 billion and $560 billion in retail sales to date, Myles wrote in her order.
It also employs an estimated 6,495 people in Tennessee, according to the order. Many of those workers feared losing their jobs if THCa was banned.
The 2023 bill also added onto hemp-derived products a 6% sales tax, which has generated more than $18 million since going into effect in July 2023, according to state data.
“They didn’t really understand how big it’s gotten,” Manning said. “Tennessee does a better job than a lot of these other states … There’s just a few people that don’t want it. That’s just the biggest frustration.”
‘BEGGING THEM’
In the Memphis area, hemp retailer Anna Butler said she stopped stocking THCa products earlier this year.
“I didn’t want to buy a lot of flower because I didn’t want to get stuck with it,” Butler said by phone. “Now I might, because it seems like it might be an option for a minute.”
(READ MORE: Tennessee retailers: $200M hemp industry threatened by imminent rule)
Her Hemp Trails stores closed in the fall, Butler said, partly because a new landlord didn’t want a CBD business in the building. She pivoted to delivery while looking for investments for a new coffee shop-type infusion cafe, Butler said, and still hears lots of demand for THCa products from regular customers.
“That’s what they’re calling for,” Butler said. “When we tell people what the law is, what’s going on, the consensus is usually, ‘Why is this still illegal, I wish they would just legalize this already, this is so dumb.'”
Butler said she hopes that tax revenue helps convince policymakers that hemp products are valuable to the state.
“We are still here, in Tennessee, begging them for anything, something,” Butler said. “So it’s pretty sad.”
‘RESPONSIBLE ADULTS’
Customers coming into Chattanooga’s Grass Roots dispensary on Tuesday were “jubilant” that THCa is still available for now, owner Elisha Millan said by phone.
But the proposed rules would have outlawed more than just THCa flower, Millan said.
The testing method would have put other smokeable products, like non-intoxicating CBD flower, at risk as well, Millan said by phone. She’s a CBD user herself, she said, and many of her customers are veterans who rely on the quick relief that smoking brings.
(READ MORE: Survey: More than half of Hamilton County voters support marijuana legalization)
“Any laws that eliminate smoking disproportionately impact veterans,” she said, “and I’m not sure that everyone understands that.”
Millan said her main concerns are for her 10 full-time employees and for the other sellers supported by their wholesale warehouse in Chattanooga. Warehouse sales dropped 40% starting in November, Millan said, as stores were unsure if they’d be able to carry flower after Dec. 26, though retail sales stayed strong, she said.
Around 85% of Grass Roots’ retail sales are smokeable THCa flower, Millan said. She fears that customers would be sent back to the black market if it was made illegal.
Most lawmakers’ stated concerns could likely be addressed by cracking down on on-site and public consumption and marketing like billboards that advertise intoxicating products, Millan said.
“And still have open access for responsible adults who want to do this at home,” she said.
‘IRREPARABLE HARM’
Before filing suit, the two industry groups had filed petitions with the Tennessee Department of Agriculture seeking a pause on enforcing the department’s hemp rules. The department denied both, according to court filings.
A lawyer representing the agriculture department in the lawsuit could not be reached for comment on the injunction Tuesday. The department was observing Christmas Eve as a state holiday on Tuesday, according to an email in response to questions sent to a spokesperson.
(READ MORE: Tennessee hemp businesses win settlement over wrongful seizure)
Department officials conceded that hemp sellers in Tennessee “would suffer an immediate and irreparable harm to their business interests should the proposed rules take effect,” according to Myles’ order.
The department did not articulate how it would be harmed if the rules were paused, Myles said.
To make a more permanent decision, Myles said the court needs more information on the testing methods, including testimony from experts in the field.
The state’s regulations are also geared toward “hemp-derived” products, which the groups say does not include hemp itself, since it isn’t derived. Myles said there needs to be clarity on that distinction.
“This court is of the opinion that regulation of these products will ultimately protect the public good,” Myles wrote.
Additional information must be filed in the lawsuit by Feb. 5, Myles ruled.
Contact Ellen Gerst at egerst@timesfreepress.com or 423-757-6319.
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