As Congress continues to debate the SAFE Banking Act, cannabis business and financial institutions should pay close attention to the bill’s potential to transform the accessibility of banking and payment processing solutions within the cannabis industry. In May, a national group of state banking regulators issued open letters to Congress urging passage of the bill. This action by state banking regulators builds upon prior support from groups like the American Bankers Association as well as dozens of state governors and attorneys general. Here, we check in on the status of the SAFE Banking Act and look ahead for its implications if passed.

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On May 19, 2022, the U.S. Circuit Court of Appeals for the Ninth Circuit issued an opinion holding that Delta-8 THC products are legal at the federal level and eligible for intellectual property protection. The Ninth Circuit held that the “2018 Farm Bill was silent with regard to Delta-8 THC,” writing that “regardless of the wisdom of legalizing delta-8 THC products, this Court will not substitute its own policy judgment for that of Congress.” According to the Court, if the bill “inadvertently created a loophole legalizing vaping products containing delta-8 THC, then it is for Congress to fix its mistake.”

 The case involved two companies selling products both labeled under “Cake” branding. Manufacturer AK Futures argued that a competitor was selling counterfeit “Cake” Delta-8 THC products. The competitor did not contest that it was selling counterfeit “Cake” products, but instead it argued that AK Futures could not hold a valid trademark because Delta-8 THC was illegal under federal law.

Continue Reading Ninth Circuit Rules on Legality of Delta-8 THC Products

On May 13, the FDA issued a public warning regarding reports of accidental ingestion of food products containing tetrahydrocannabinol (THC) by children. The FDA warned that edible products containing THC “can be easily mistaken for commonly consumed foods such as breakfast cereal, candy, and cookies, and accidentally ingested.” The agency was particularly concerned as some

California enacted statute AB 45 in October 2021, authorizing the use of hemp and hemp-derived cannabidiol (CBD) in food, beverages, dietary supplements, and cosmetics at the state level. Now, state regulators have proposed new regulations to govern the state’s hemp-derived CBD market. Comments on the proposed regulations are due by May 31, 2022.

California’s proposed regulations primarily address new registration requirements for in-state industrial hemp manufacturers and out-of-state industrial hemp extract manufacturers. In-state manufacturers of extract, human foods (including beverages and dietary supplements), cosmetics and processed pet food products containing industrial hemp will need the appropriate registration for their respective products. Manufactures may be required to hold multiple registrations for each type of product manufactured if the proposed rule is adopted.

Continue Reading California Proposes New CBD Regulations & Registration Requirements