The 2023 cannabis reforms lowered the legal potency threshold for CBD products.

A Maryland coalition of hemp businesses filed a lawsuit Tuesday against the governor and two state agencies over creating a law that they say will put them out of business and bar them from joining the state’s recreational cannabis industry.

The civil suit filed by the Maryland Hemp Coalition in Washington County Circuit Court claims certain statutes in Maryland’s 2023 cannabis reforms capped the limit on THC concentrations in hemp-derived products containing cannabidiol, or CBD. Gov. Wes Moore, a Democrat, several members of the Maryland Cannabis Administration and the Maryland Alcohol, Tobacco, and Cannabis Commission are named as defendants.

The suit’s plaintiffs have CBD business interests. The product has sold unregulated for years alongside the state’s regulated medical cannabis market. But that all changed on July 1 once the cannabis reforms went into effect, and legal sales of recreational cannabis opened.

“We’re still talking here about something that’s federally legal,” Young said, referring to the federal definition of hemp, which does not fall under the Controlled Substances Act, which classifies cannabis as illegal.

The U.S. Drug Enforcement Agency defines cannabis products with a delta-9-tetrahydrocannabinol concentration of not more than 0.3% on a dry weight basis as hemp.

But Maryland’s law lowers that potency threshold, crushing the CBD industry, Young said.

“Basically almost all of the [CBD] products that are presently being sold, would fall under the new statute and would require a license to be sold,” Young said.

“Whereas the state has gone and made something that’s federally illegal, legal under the state law,” he said. “And not only that takes a profit from it.”

Young said his clients would welcome the chance to become licensed in the recreational marketplace, but pointed out the state has tied license eligibility to where an applicant has lived or has gone to school, restricting most, if not all, of his clients from even trying for one. The state intended to create a diverse pool of cannabis business licensees by attaching license eligibility to geographical areas which suffered an above-average number of cannabis possession charges, according to court data.

The state has also limited the total number of cannabis business licenses. Young alleges in the suit the restrictions have created an illegal monopoly under state law.

“The licensing regime that the state has implemented is so severely restrictive, that there aren’t enough licenses for all of them,” Young said.

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“There’s been a lot of lobbying and a lot of special interest involved,” Young said. “And this is the law we get.”

Moore administration spokesperson Carter Elliott IV said in a statement: “The governor is proud of the state’s continued commitment to create a flourishing economy, establish necessary guardrails, and to create opportunity with a focus on equity and restoration.”

Opening the market to adult use also will bolster the state’s economy “while directly benefiting those who were disproportionately affected by the war on drugs because of the commitment to equity from the Moore-Miller Administration,” Elliott said.

A spokesperson for Maryland’s Attorney General Anthony Brown, who received the lawsuits on behalf of the governor and the agencies, said that the state’s chief legal officer could not comment on active litigation.

The state agencies named as defendants in the suit did not respond to requests for comment before publication.

This story may be updated.

brenda.wintrode@thebaltimorebanner.com

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