Key Takeaways:
- Texas's attempt to ban hemp-derived THC products failed—for now. Senate Bill 3, which would have banned products like delta-8, was vetoed, leaving current laws in place. A special session beginning July 21 with consumable hemp regulation is at the top of the agenda.
- Arkansas's Act 629 survives federal challenge. The Eighth Circuit ruled that it does not conflict with the 2018 Farm Bill and is not unconstitutionally vague.
- States may continue to diverge on hemp policy. The Eighth Circuit decision reinforces states' authority to tightly regulate or prohibit intoxicating hemp products, adding to a patchwork legal landscape that cannabis and hemp businesses must navigate carefully.
As every reader of this blog should know, on June 21, 2025, Texas Governor Greg Abbott vetoed Senate Bill 3, a measure that would have effectively banned consumable hemp products containing THC and imposed infeasible costs and regulations on other hemp products. In his veto message, Abbott pointed to a then-active federal court decision that had blocked enforcement of Arkansas's similar hemp law, suggesting it demonstrated legal vulnerability in banning these products.
Abbott urged lawmakers to consider an approach he said would be similar to the way alcohol is regulated, recommending potential rules including barring the sale and marketing of THC products to minors, requiring testing throughout the production and manufacturing process, allowing local governments to prohibit stores selling THC products and providing law enforcement with additional funding to enforce the restrictions. The Governor has called the Legislature back into a special session starting July 21 to address intoxicating hemp products regulation.
But there's a twist: just days later, on June 24, the Eighth Circuit U.S. Court of Appeals reversed the Arkansas decision, clearing the way for Arkansas to enforce its restrictive hemp law and casting doubt on the veto's legal rationale.
In its ruling, the Eighth Circuit found that Arkansas's Act 629—which criminalizes many intoxicating hemp-derived cannabinoids like delta-8 and delta-9 THC—does not violate federal law. The Court emphasized that while the 2018 Farm Bill legalized hemp at the federal level, it explicitly allows states to implement more restrictive regulations, including outright bans on certain products.
Outside of the Eighth Circuit, the Fourth Circuit has similarly ruled that states may effectively prohibit intoxicating hemp products, and in May, a federal court in Indiana dismissed a court challenge to that state's enforcement stance. As of 2024, there were in fact 15 states that explicitly prohibit Delta-8 THC hemp products, and nine more that include some or all intoxicating hemp products within their state regulatory frameworks for state-legal marijuana.
These facts directly undercut Governor Abbott's assertion that the Arkansas case was the "only one" on point and highlights that multiple courts have sided with the states' rights to regulate or ban hemp-derived intoxicants.
All of that said, Gov. Abbott is correct in noting the need for common-sense regulation. Without state action, the current version of the federal Farm Bill absolutely allows the sale of intoxicating hemp products, even those identical to marijuana products legal in other states. Consider that a product containing up to 0.3% Delta-9 THC is hemp under federal law. Edible products are capped in many states at 10mg or 20mg of THC—but you can have 25mg of THC in a candy Peep, and that's less than 0.3%.
Whether the Farm Bill's hemp provisions were a Trojan Horse or a happy accident, the fact is that these products can be legally produced and sold into interstate commerce, and are readily available through online distributors. Intoxicating hemp products, especially beverages, have proliferated everywhere. The choice for Texas is really whether to limit these products to an illicit market with no standards or health regulations, or to regulate them along the lines Abbott is suggesting.
Why It Matters:
For cannabis and hemp businesses operating in Texas and nationwide, this legal uncertainty underscores the ongoing need for close monitoring of both legislative actions and ongoing litigation. While Texas maintains its current permissive stance—by default—the veto's shaky legal foundation and the Eighth Circuit's ruling may reenergize future legislative or regulatory efforts to restrict or ban hemp-derived THC products.
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