Smokable hemp products can be sold in Texas again — at least for now.
A Travis County judge granted a temporary restraining order on Friday that blocks enforcement of some of the state's sweeping hemp regulations that took effect March 31.
The Department of State Health Services (DSHS) rules changed how THC levels are calculated in a way that effectively prohibited the sale of smokable hemp products like flower and concentrate. Those products accounted for the vast majority of the hemp products sold in Texas, according to the industry and economists who study the hemp market.
The DSHS regulations also introduced sharply higher annual fees for hemp retailers of $5,000 per location, which had increased from $150. Manufacturers saw their annual fees rise from $250 to $10,000 per facility.
A group of businesses and industry groups including the Texas Hemp Business Council filed a lawsuit Tuesday, claiming DSHS exceeded its authority and adopted rules that would force hundreds of businesses to close.
Travis County Judge Maya Guerra Gamble blocked the new rules that prohibit the sale of smokable hemp. She declined to block implementation of the higher fees.
More than 13,000 stores are registered to sell hemp products in Texas, according to data posted on the DSHS website. Almost 800 companies are licensed to manufacture hemp products.
During a virtual hearing Friday afternoon, attorneys for the plaintiffs argued the rules were already forcing some businesses to close.
"This is actually irreparable harm that is already occurring and is exponentially multiplying like a wave rolling into a beach that gets bigger," attorney Jason Snell said.
The lawsuit does not seek to upend many of the regulations, including requirements for child-resistant packaging, more detailed product labels and development of recall procedures. Instead, it focuses on issues like the new "total THC" formula, higher fees and rapidly escalating fines for non-compliance.
Zachary Berg with the Texas Attorney General's Office insisted the DSHS rules were simply reflecting existing law.
"The current rule provided clarity," Berg said.
The restraining order remains in effect for two weeks until a hearing can be held on whether the rules should be suspended longer-term while the case plays out in court. A hearing on that temporary injunction is scheduled for April 23 at 9 a.m.
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