A federal judge has dealt a blow to parts of New Jersey’s recently enacted hemp law, ruling that certain provisions unfairly restrict interstate commerce and clash with federal regulations. The decision is a partial victory for hemp businesses that challenged the law, though key restrictions remain in place.
U.S. District Court Judge Zahid N. Quraishi ruled on Wednesday that specific sections of the New Jersey Hemp Act Amendments (NJHAA) violate the dormant Commerce Clause and are preempted by the 2018 Farm Bill, which federally legalized hemp. The judge agreed with plaintiffs who argued that the law’s definition of THC and its application unfairly discriminated against hemp producers outside of New Jersey. “The New Jersey Legislature cannot blatantly discriminate against out-of-state economic interests,” Judge Quraishi wrote in his decision.
The NJHAA, signed by Governor Phil Murphy last month, aimed to regulate intoxicating hemp products amidst concerns that minors were easily accessing them. The law banned sales of these products to individuals under 21 and required sellers to obtain licenses through the state’s Cannabis Regulatory Commission (CRC). While the judge upheld these provisions, he struck down parts that criminalized the sale or transport of federally compliant hemp products from other states.
This ruling prevents the enforcement of restrictions on out-of-state hemp, ensuring that products adhering to federal standards can be sold in New Jersey. Adam Terry, CEO of Cantrip and one of the plaintiffs, expressed satisfaction with the ruling. “We are vindicated in the belief that an outright ban on hemp is not the path forward,” he said. “We must work together with lawmakers to develop sensible regulations.”
Critics of the law, including a coalition of hemp businesses, argued that these restrictions not only stifled competition but also violated federal guidelines that allow for the free movement of hemp products across state lines. They warned that the law would harm local businesses and consumers, potentially forcing closures and job losses in the industry. Concerns were also raised about the CRC’s ability to manage additional responsibilities without sufficient resources.
Senate Majority Leader M. Teresa Ruiz, a sponsor of the bill, acknowledged the need for legislative adjustments. “While I am pleased that the court order upheld the ban on selling intoxicating hemp products to minors, we must recognize that, without comprehensive regulation, these substances will continue to present a significant threat to the health and well-being of our communities,” she said.
The judge’s ruling comes as the deadline for businesses to remove intoxicating hemp products from shelves approaches on October 12. Until the CRC establishes new regulations, these products cannot be sold in the state. This decision adds to the ongoing national debate over the regulation of psychoactive hemp products like delta-8 THC, which remain in a legal gray area due to a lack of federal oversight.
