A state district court in Travis County will hear evidence Thursday, April 23, in a suit challenging new rules from the Department of State Health Services (DSHS) that effectively ban Texas businesses from manufacturing and selling most hemp-based consumable products.
The new rules have been under a temporary restraining order since April 10. That restraining order is set to expire this Friday. The plaintiffs — who include several hemp-related businesses and trade organizations — are seeking a temporary injunction to extend the deadline until the case comes to trial.
"[The] Plaintiffs have demonstrated that they will suffer probable, imminent, and irreparable injury if [the] Defendants are not immediately restrained," Judge Maya Guerra Gamble wrote in her order. "These injuries include immediate and significant economic harm, disruption of ongoing business operations, loss of customer relationships, damage to goodwill, and interference with established supply chains, all of which are difficult or impossible to quantify and cannot be adequately remedied with money damages."
The DSHS rules, currently blocked, would also dramatically increase the licensing fees for businesses selling those products that remain legal.
The agency issued the rules in March, after the Texas Legislature tried, and failed, to pass a law last year banning consumable hemp products that would withstand a veto by Gov. Greg Abbott.
"Taking 40% of my business away and then making me pay $4,845 more is extreme," said Melanne Carpenter, owner of Serenity Organics and one of the plaintiffs. "And so we are hoping that we get ... the temporary injunction and then a permanent injunction on the key points that we're suing the state for."
Andrew Alvarado is an attorney with the law firm of Dickinson Wright. He represents the Hemp Industry and Farmers of America, another of the plaintiffs challenging the rules. Alvarado stressed that, while the rules are often described as applying to smokable hemp products, they have a much wider application in practice.
"Essentially, they're going to cause a systemic supply chain disruption that will shut down the manufacturing and processing and growing of hemp and creating hemp products in Texas," Alvarado said. "One of the arguments we made to the court is we demonstrated that some products, such as a topical ointment that is currently legal under the Texas statute, would be illegal under these new rules."
Alvarado said the focus of the legal challenge is not on the question of whether hemp products are beneficial or dangerous. Instead, it argues that DSHS overstepped its regulatory authority, enacting rules so different from the statutes they were meant to interpret that they amounted to new laws.
"What this lawsuit is really about is a narrow issue," Alvarado said, "whether the agencies had the authority to implement these new rules and change the legal definition for what constitutes hemp."
A spokesperson for DSHS responded to a request from Houston Public Media by saying the department does not comment on pending litigation. Texas Attorney General Ken Paxton is also a defendant in the case. The Office of the Attorney General of Texas has not responded to a request for comment.
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