CBD and Hemp Legal and Regulatory Roundup – November 2022

Kelley Drye & Warren LLP

Welcome to our weekly roundup of CBD and hemp-related legal and regulatory news:

FDA explores cannabis rescheduling, but notes DEA has final say

Following a rescheduling review directed by President Joe Biden, the FDA notes its scientific and medical evaluation of cannabis still requires DEA approval on any potential change to the CSA. Furthermore, the law enforcement agency controls access to cannabis by scientists for any studies required to change the statute. In the meantime, the FDA notes it will search for what flexibilities exist to work around any barriers.

Marijuana Moment


Ariz. hemp company receives distribution authorization from four ‘strict’ states

Plant-based skincare products company Endexx received distribution authorization from La., Alaska, Texas and Iowa, which are known to have more detailed and strict CBD and hemp requirements. The company states it’ll continue working toward registration in all 50 states.


NIJ finds most products labeled as hemp fit federal classification of marijuana

An analysis by the National Institute of Justice indicated 49 of 53 samples examined were incorrectly labeled as hemp because they technically fit the federal classification of marijuana. Of the inaccurately labeled samples, virtually all had total THC concentrations under 1%, but above the legal threshold of 0.3%.

National Institutes of Justice

3M explores hemp to reduce topsoil, groundwater it polluted with PFAS

The company became embroiled in a political scandal in Belgium earlier in 2022, when studies for a tunnel project in Antwerp revealed high levels of toxins in the water, soil and human subjects near its factory. Furthermore, initial mass litigation cases against 3M over PFAS-contaminated groundwater in the U.S. are expected to begin early next year. In response, 3M is funding hemp remediation research in Belgium, following the example of the Conn. Agricultural Experiment Station’s efforts to grow hemp on 600 acres of land polluted by PFAS on a former military base in Maine.

Hemp Today

Springbig integrates app with Shopify for CBD, hemp retailers

Through the integration with Shopify, springbig will streamline all loyalty program logistics by providing a seamless enrollment process, a full suite of loyalty functionality inclusive of program design, point calculation, a bonus engine, special offers and promotions for loyalty members. The platform permits the sales of hemp and hemp-derived products that comply with the regulations set in states where the merchant operates. Shopify requires merchants to review and submit an attestation for the sale of hemp and hemp-derived products and ensure the products contain no more than 0.3% THC.



Fla. cannabis company settles with Ferrera in TM infringement case

U.S. District Judge Rodolfo A. Ruiz II approved a consent judgment and permanent injunction barring Akimov from infringing Ferrara Candy’s TM for Nerds and Trolli candies and requiring Akimov to pay all profits it received from the knockoffs infused with high levels of THC. Akimov is also required to destroy any remaining infringing products in its possession, including packaging and advertising or marketing materials, and to notify existing customers and vendors that all remaining inventory must be destroyed.

Law 360 (sub. req.)

Nev. judge orders Board of Pharmacy to remove marijuana from its Schedule I

Clark County District Court Judge Joe Hardy (R) previously determined the Schedule I classification of cannabis was unconstitutional based on the state’s legalization of it for medical and recreational use. However, he withheld judgment at the time about the board’s regulatory authority to give petitioners and respondents time to submit filings in the case. In the latest judgment, the judge notes the Nev. legalization law places significant regulatory authority with the state Department of Taxation and the Board of Pharmacy isn’t provided such authority under the statute.

Marijuana Moment

Jeeter faces proposed class action over inflated THC amounts

Dreamfields Brands, the maker of Jeeter prerolled cannabis joints, is in violation of Calif.’s cannabis labeling regulations requiring levels be within 10% of what’s stated on the box, allege Jasper Centeno and Blake Wilson. They noted the Baby Jeeter Fire OG Diamond Infused 5-Pack Preroll was listed as having 46% THC, but lab testing showed the level was between 23%-27% THC, well outside the allowable 10% margin of error. The pair said they relied on these representations, as higher levels of THC are more desirable to cannabis buyers, and therefore fetch higher prices, with lower-level products being harder to sell.

Law 360 (sub. req.)

Lawsuit alleges realtor hid information about illegal grow prior to lease contract

Plaintiff Yuen Fong Ng said that in early 2014, she entered into a purchase agreement for a property in L.A. County through Bill Tsz Piu Lo as her agent. Ng also hired Lo to manage the property for lease and alleges she discovered the property was used to grow cannabis only after defendants Fengyi Joey Situ and Ken Situ moved out nearly six years later. Ng also discovered Lo was made aware of the smell from the property but didn’t confront the Situs or inform Ng. The illegal grow operation caused over $165,000 in damages. She brought five claims, including one breach of contract claim against Lo and one against the Situs, fraud and intentional misrepresentation against Lo, fraudulent deceit against Lo and breach of fiduciary duty against Lo.

Law 360 (sub. req.)

N.Y. cannabis sellers say tribe can’t evict them without affecting other real estate disputes

Cayuga officials asked Chief U.S. District Judge Brenda K. Sannes to let them off the hook for 13 counterclaims issued by a coalition of cannabis sellers, led by businessmen Paul Meyer and Dustin Parker, filed in response to the tribe’s $15-million lawsuit seeking to force them off its land. However, Meyer and Parker noted their allegations fall within an exception to the Cayugas’ sovereign immunity because they concern a dispute over the possession of real property. Since the tribe didn’t acquire the site of their business until late 2021, the coalition argues it should be considered a private party, not a sovereign nation, for litigation purposes.

Law 360 (sub. req.)

Pa. landlord sues Curaleaf for not trying to obtain regulatory approval

Regent Development alleged it and Curaleaf entered a lease agreement in May 2017 for a medical cannabis dispensary in Pa. According to the suit, Curaleaf had five years to get the dispensary approved by state and municipal regulators and the agreement couldn’t be terminated if the cannabis company didn’t genuinely attempt to obtain that approval. However, the landlord said Curaleaf acquired a company called Grassroots around early 2020, and Grassroots was already approved to operate a local medical cannabis dispensary located a few miles away from Regent property. After the acquisition, Curaleaf allegedly avoided communicating with Regent until telling it that their lease agreement was terminated.

Law 360 (sub. req.)

Pa.-based FarmaceuticalRX denies claims of misclassification by drivers

According to FarmaceuticalRX, the Fair Labor Standards Act doesn’t cover five delivery drivers’ allegations that they were misclassified as independent contractors. The cannabis company urged U.S. District Judge William S. Stickman to dismiss the lawsuit, saying the workers never left Pa. and therefore didn’t engage in interstate commerce. The FarmaceuticalRX drivers are also suing because they were fired after complaining to the company about their misclassification.

Law 360 (sub. req.)

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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