CBD companies sue state over cannabis law

CBD companies sue state over cannabis law
CBD companies sue state over cannabis law

CBD Companies Sue State Over Cannabis Law

A recent lawsuit has been filed by a coalition of CBD companies in Maryland, claiming that the state’s new cannabis law will put them out of business and prevent them from participating in the recreational cannabis industry. The civil suit, filed against Governor Wes Moore and two state agencies, argues that certain statutes in the 2023 cannabis reforms have imposed limits on the THC concentrations in hemp-derived products containing CBD.

Previously, CBD products were sold alongside the state’s regulated medical cannabis market without regulation. However, the new cannabis reforms, which came into effect on July 1, have changed the landscape. The plaintiffs in the lawsuit argue that the law’s restrictions on THC concentrations have severely impacted the CBD industry.

While hemp and CBD products are federally legal, the state of Maryland has set a lower potency threshold, effectively requiring a license to sell CBD products. This change has been detrimental to many businesses that have been operating legally for years. The plaintiffs argue that the state’s law, which contradicts federal regulations, not only hinders their business operations but also diminishes the potential for profit.

The lawsuit also highlights the issue of license eligibility in the recreational cannabis marketplace. The state has tied license eligibility to residency or education, effectively restricting many CBD businesses from obtaining licenses. According to court data, the state intended to create a diverse pool of cannabis business licensees by focusing on geographical areas with a higher number of cannabis possession charges. However, this approach has further limited the opportunities for CBD businesses to transition into the recreational market.

Additionally, the lawsuit claims that the state’s licensing system creates an illegal monopoly due to its severe restrictions and limited number of available licenses. The plaintiffs argue that there are not enough licenses to accommodate all interested CBD businesses, ultimately preventing fair competition and stifling industry growth.

The CBD companies involved in the lawsuit express their willingness to participate in the recreational cannabis industry but believe that the state’s current regulations and restrictions hinder their chances of doing so. They argue that lobbying and special interests have influenced the creation of these laws, resulting in a regulatory framework that does not benefit all stakeholders.

The response from the Moore administration acknowledges the state’s commitment to creating a flourishing economy and providing opportunities through equity and restoration. Opening the cannabis market for adult use is seen as an opportunity to boost the state’s economy and address the disproportionate impact of the war on drugs. However, the CBD companies involved in the lawsuit argue that the current regulations fail to promote equity and fairness in the industry.

As the lawsuit unfolds, it remains to be seen how the court and state agencies will respond to the claims made by the CBD companies. The outcome could have significant implications not only for the CBD industry in Maryland but also for the regulation and licensing of cannabis businesses in the state.



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