Cannabis lawyersWalking home one freezing night in December 2014, I was taken aback to look up and see a storefront with a bright neon sign that read “CBD OIL SOLD HERE” in the window. It was not the “what” of the sign that startled me – CBD oil is, of course, a product with many therapeutic qualities and a wide range of uses – but the “where.” Far from cannabis-friendly Seattle, I was home for the holidays in southwest Missouri, a socially conservative state where attempts to even put medical marijuana on the ballot face fierce opposition. Though only a first-year law student at the time, I knew enough to know something did not add up: CBD is derived from the cannabis plant, and marijuana is illegal under federal — and, in Missouri, state law. Therefore, I thought, CBD is illegal. How were they getting away with this?

As I now know – and as we have explained before – the business in question was relying on an ambiguity in the Federal Controlled Substances Act’s definition of “marijuana.” The Controlled Substances Act does not include in its definition of “marijuana” the plant’s “mature stalks.” Mature stalks are the part of the cannabis plant used to make hemp, which is not prohibited by the Controlled Substances Act either. The stalks also contain CBD oil that can be extracted and used just the same as CBD derived from other parts of the plant. The ambiguity was enlarged with the passage of the 2014 farm bill, which allowed some cultivation of hemp with THC levels below 0.3%. Ergo, CBD oil is not technically illegal – right?

Wrong.

Two days ago, the Drug Enforcement Administration issued regulations that effectively put the kibosh on attempts to dance around the Controlled Substances Act’s definition of “marijuana” when it comes to CBD oil. The new rule creates a new “Controlled Substances Code Number” for “Marihuana Extract” and extends that classification to extracts “containing one or more cannabinoids from any plant of the genus Cannabis.” Because CBD is a cannabinoid and hemp is a plant of the genus Cannabis, the rule explicitly applies to the many CBD products currently being widely sold online and in shops like the one I encountered in Missouri. DEA confirmed as much in response to public comment on its initially proposed rule, stating that “[f]or practical purposes, all extracts that contain CBD will also contain at least small amounts of other cannabinoids. However, if it were possible to produce from the cannabis plant an extract that contained only CBD … such an abstract would fall within the new drug code 7350.” DEA justifies its new rule as necessary to fully comply with the UN Convention on Narcotic Drugs and finds its statutory authority to promulgate the rule in the Controlled Substances Act.

What does this mean for sellers of CBD extracts online or in states with unfriendly cannabis laws? It means the DEA is explicitly saying that it considers your product to be illegal under the Controlled Substances Act along with other illicit cannabis products. It also means that they are enhancing their ability to track CBD and enforce its interpretation of the law.

In truth, CBD merchants were probably always on the wrong side of the gray area in DEA’s eyes because CBD extracts almost necessarily contain other cannabinoids. As DEA stated in its justification: “Although it might be theoretically possible to produce a CBD extract that contains absolutely no amounts of other cannabinoids, the DEA is not aware of any industrially-utilized methods that have achieved this result.” The difference now is that the DEA is officially putting CBD sellers on notice that their businesses are subject to enforcement action.

Though our cannabis lawyers are unhappy with the DEA’s statement, we would be remiss if we did not tell you that you would be wise to heed this warning: selling CBD is illegal.

  • Jeff Bess

    Though the Farm Bill certainly does authorize some industrial hemp cultivation, it is not clear the extent to which it covers most existing CBD oil sellers and how the law interacts with the Controlled Substances Act and the Food, Drug, and Cosmetic Act. In a joint Statement of Principles on Industrial Hemp issued by DEA, USDA, and FDA, the agencies construed the law to permit cultivation only for “industrial purposes (fiber and seed)” and not to authorize sales “for the purpose of general commercial activity.” The agencies also said that “drug products” derived from industrial hemp plants are still subject to the CSA and that the Farm Bill “left open many questions regarding the continuing application of drug control statutes.” The Statement of Principles is not itself binding law, but it does reflect how they may approach enforcement and illustrates the limitations of the Farm Bill’s authorization. Similarly, DEA actions like this one are worth paying attention to even if the limits of DEA’s actual authority are set by statute – agency interpretations of the law can be quite impactful.

    Source: https://www.federalregister.gov/documents/2016/08/12/2016-19146/statement-of-principles-on-industrial-hemp

  • Chico Da Hemp Man

    So, Sean since the “Farm Bill” is so clear, would you point me to the language indicating that agriculture pilot program means develop a massive federally unregulated commercial market for cannabinoid extracts? (Seems like its focus is on research.) Or, do the states and the industry stakeholders just get to make that part up because the Farm Bill is so unclear? As an aside, last time I looked administrative law made through the proper notice of proposed rulemaking process was and is law.

  • Dec 23, 2016 Reality Check: DEA Absolutely Wrong In Making CBD Oil Schedule 1 Drug

    Reality Check: DEA Absolutely Wrong In Making CBD Oil Schedule 1 Drug, Why the Agency is Harming Tens of Thousands of Families and Doesn’t Even Have The Authority To Do So.

    https://youtu.be/wmAJ4fI5aAM

  • ChicoDaHempMan

    Sean – Please direct us to the language in the Farm Bill that permits state departments of agriculture to develop programs geared towards distributing and selling (interstate, no less) cannabinoids (and related products) derived from hemp for commercial purposes.

    The Farm Bill seems to be focused on research and development, not interstate commercial sales. I would like to point out that the law defines ‘‘agricultural pilot program as a pilot program to STUDY the growth, cultivation, or marketing of industrial hemp” and the title of the Bill is SEC. 7606. Legitimacy of Industrial Hemp Research. Or, is your comment that the Farm Bill is so enlightening based on its inclusion of the word marketing and that in order to study marketing you must have sales. If so, interesting take on a complex legal issue. Or, perhaps, your theory is that if a pilot program participant is duly registered under a state pilot program, its respective activities are per se lawful under all bodies of law? Or, does the Farm Bill’s clarity somehow stem from the DEA and DOJ current lack of prosecutorial funds?

    I think the ambiguity of the Farm Bill is so incredibly enormous that hemp-extract stakeholders are reading something into the Farm Bill that is not there.

    I find it interesting that a person, you, who makes his living peddling
    information to hemp industry participants is lecturing a cannabis lawyer on
    what an ambiguous, at best, federal law (yes, it is law) means; not to mention
    that cannabis derived cannabinoids and certain synthetics are clearly not legal
    in certain states regardless of what the Farm Bill actually means or says.

    In my view, this unregulated Wild West cannabinoid marketplace is inviting
    regulation. Whether the DEA’s rule is the first step of many towards a regulated market is an interesting question. You are not doing your readers any
    favors by simplifying a complex area of the law. You would be doing them a favor by acknowledging that this is an unclear area of the law and if your readers intend to distribute and sell cannabinoids derived domestically produced cannabis it would behoove them to retain the services of a lawyer.

    As an aside, many agencies, such as the DEA, that have been duly delegated authority and have gone through notice and rulemaking procedures make
    regulations, which are law.

  • Peg E

    I’m SO disappointed in our own government. First they allow the active ingredient in Agent Orange to be sprayed on our crops to the point that 97-98 percent of our population has it in our bodies. This wreaks all kinds of health issues for us, from GI problems to immune system problems to neurological damage and systemic inflammation. Then they cut off our ability to treat a number of those issues, such as systemic inflammation — which is at the root of all kinds of disease processes — through the use of a safe substance derived from the marijuana plant but without psychotropic effects. CBD oil not only helps with systemic inflammation and immune system disorders, but even has anti-psychotic properties! How did CBD oil get added to Schedule I? I thought Schedule I was reserved for substances that had no therapeutic benefits combined with a high risk of abuse. Seems that all the Feds want to do is support big pharm and those with the money, at the expense of its own citizens. What they don’t realize is the immense medical care costs they are creating as well as the harm to our citizens on so many levels, and that the joke will eventually be on them!

    • childrenofthecurse.org

      Good points….Big pharma wants us hooked on the real dope….opiates!

  • Rose

    Just curious, in this statement, it eludes to growers. “Selling CBD is legal under the Farm Bill if one has a license through a state department of ag or institution of higher learning to grow industrial hemp as a pilot project.” How are resellers affected? Should we require more than resellers license to distribute CBD products?

  • Moore Williams

    This is very important information for those who are looking for a very concentrated quality and valued CBD Oil for any serious ailments, I have used it on my son with seizure and it worked wonders. I finally feels his illness is under control and permanently cure using CBD Oil.

  • JR63

    So if CBD is illegal why can I buy it so easily in CO shipping to CA?

  • Frances Hu

    I am thinking of importing Cannabis seeds , or cannabis extract such as CBD(can be 99%) from Asia (China) to USA (california). Is it legal under the current laws??

  • Lara Wiliams

    Yes, some companies are manufacturing CBD products but still they don’t have legal rights to sell. CBD has been legalized in some states including florida and it’s totally legal to buy. There has been companies such as green roads world who are selling good quality CBD products online with 0% THC.

  • Joel Schafer

    This article is completely false, misleading, and should be removed. The DEA does not have the authority to mandate federal law, and has since clarified its statements on the original memo released in December of 2016 ( See here: http://kightoncannabis.com/dea-clarifies-marijuana-extract-rule-and-cbd-legality/ ) . The DEA has since clarified that extracts and cannabinoids derived from marijuana are illegal, but this does not include industrial hemp. As long as companies are sourcing their products with CBD extracted from industrial hemp, it is 100% legal from a federal perspective. Again, the DEA has NO legal authority to implement and mandate federal law. The DEA is free to “classify” substances however they see fit, but this does not change federal law. Federal law does NOT prohibit the sale of CBD or CBD products derived from Industrial Hemp -which is completely legal.

    It’s stunts like this that create confusion in the industry, especially when they are proliferated by reputable legal counselors and law firms. Laws need to be more clear, and definite, so as to not leave things up to vague and ambiguous interpretation by anyone, let alone federal agencies.

    Best to go to the source and see for yourself. Search “cannabidiol”: https://www.fda.gov

    It’s important to keep in mind the source of CBD (whether it comes from marijuana or industrial hemp). This is THE differentiating factor to determining the legality of CBD. If the products are sourced from industrial hemp, and contain less than < 0.3% total THC, they are good to go. In fact, industrial hemp is essentially a separate species of plant within the genus "cannabis". Cannabis does not necessarily mean "marijuana". Cannabis is a family of plants that encompasses both marijuana and industrial hemp. Although both plants are similar in nature, their composition and physical structures are quite different. Industrial hemp plants are much taller, broader, have smaller leaves, and generally grow thicker stalks than marijuana plants. They do not bloom or "bud" in the same way that a marijuana plant might. Industrial hemp was created by breeding the sativa plant over many years so that it had a higher concentration of the fibrous materials used to support industry, while containing as little THC as possible. Thereby, essentially creating a different species of plant entirely.

    So when we understand the basic fundamentals of the cannabis FAMILY of plants themselves, and we understand that we are actually talking about two different plants here (even based on the federally recognized definition of "hemp"), things begin to make a bit more sense.

    It is ^THIS^ type of clarification that needs to be included in the terms and definitions of federal code and state code.

    Take the Indiana code for example. It has done a decent job of laying out and defining the framework for the commercialization, cultivation, and regulation of Industrial Hemp. However, it still needs work. Even though "mairjuana" is accurately defined, the verbiage is not concise enough.

    Industrial Hemp: http://iga.in.gov/legislative/laws/2017/ic/titles/015/#15-15-13-6

    Definitions:Marijuana does NOT INCLUDE INDUSTRIAL HEMP: http://iga.in.gov/legislative/laws/2017/ic/titles/035/#35-48-1-19

    CBD is changing lives for the better and making a positive impact of the world. If we want to make positive change in this landscape, we all need to get on the same page, and that starts with a basic fundamental understanding of the plant itself. We need to make sure the conversations we are having with our representatives are accurate and well informed. I would HATE to see the day when a phyto-nutrient such as CBD is actually banned outright -despite the source.