In this week’s edition:

• Kamala Harris and the DNC on Cannabis
• Trump and J.D. Vance on Cannabis
• Ohio Officials Approve State’s First Recreational Cannabis Licenses
• Thailand Prime Minister Changes His Mind About Outlawing Cannabis
• Curaleaf Continues Trend of MSO’s Pivoting to Hemp-Derived THC

Federal

Public Comment Period on Cannabis Rescheduling Ends – Stakeholders continued to submitted over 40,000 written comments supporting or opposing the Notice of Proposed Rulemaking that could result in reclassifying cannabis as a Schedule III controlled substance before the public comment period closed on July 22, including governors, members of state and local governments, medical professionals and advocacy groups. The Cannabis Regulators Association—a nonpartisan organization that represents cannabis and hemp regulators in more than 45 U.S. states and territories—did not take a position on the rescheduling proposal itself. Rather, the group called for robust federal guidance on how the change would affect policy, enforcement priorities, and interactions with state and local officials. The American Nurses Association provided comment in support of rescheduling, reaffirming its recognition of the use of cannabis in medical practice and identifying rescheduling as a “critical first step” in changing federal cannabis policies. The City of Denver also advocated for rescheduling, citing to the city’s expertise in regulating state-legal cannabis businesses, as did NORML. Governor of Kentucky, Andy Beshear (D), emphasized in his public comment that cannabis can be an “alternative to dangerous opioids” that plague his home state and communities across the country. Meanwhile, 25 Republican lawmakers and 11 State Attorney Generals condemned cannabis rescheduling.

Kamala Harris and the DNC on Cannabis – While initially not a cannabis reform advocate, Kamala Harris has changed her stance, actively supporting legalization and co-sponsoring several proposed reforms over the last few years. This included supporting the SAFE Banking Act, the Marijuana Justice Act, and the MORE Act. In March 2024, Kamala Harris stated, “[n]obody should have to go to jail for smoking weed,” during a discussion with rapper, Fat Joe, and others who had been pardoned for cannabis convictions. She emphasized that “far too many people have been jailed for simple marijuana possession.” Throughout the presidential campaign, the Democratic National Committee has touted President Joe Biden’s pardons and rescheduling moves, while calling for broader reform to expunge prior records. However, unlike in 2020, the party’s latest draft platform does not promote broader cannabis decriminalization.

Trump and J.D. Vance on Cannabis – GOP senators and House members have been discussing cannabis policy implications of a potential second term for Donald Trump in the White House. While the general theme of the conversations has reportedly been deference to Trump’s largely unknown cannabis policy goals, there are significant divides among GOP members about what they would personally like to see in the future. Donald Trump’s running mate J.D. Vance of Ohio voted against the Secure and Fair Enforcement Regulation Banking Act (SAFER) when it was approved in September 2023, having since signaled his continued opposition. The vice presidential candidate argues the bill would inadvertently make it easier for illicit operators to traffic other drugs such as fentanyl. Following Ohio's November 2023 vote to legalize adult-use cannabis, Vance commented that "[t]he voters of Ohio have made their decisions known and we should respect that and allow it to be an Ohio issue.”

House Committee Considers Allowing Floor Votes to Reverse Position on Funding for Rescheduling and Other Reforms – Bipartisan congressional lawmakers are seeking to remove a section of a spending bill that would block the Justice Department from rescheduling cannabis. Rep. Nancy Mace (R-SC) announced that she introduced the amendment to strike the rescheduling restriction that’s currently included in the 2025 Commerce, Justice, Science, and Related Agencies (CJS) spending bill. Rep. Rashida Tlaib (D-MI) introduced an amendment to the CJS measure that would similarly strike the scheduling restriction section the House Appropriations Committee adopted earlier this month. The House Rules Committee will also consider removing a ban on most consumable hemp products and protecting state medical psilocybin programs.

Department of Justice Argues Allowing Medical Cannabis Patients to Possess Guns Would Endanger Public Safety – Following a U.S. Supreme Court ruling last month that upheld the constitutionality of governments setting certain gun restrictions in a case centered around domestic violence-related prohibitions, the justices remanded a pending cannabis and Second Amendment rights case back to the lower court for reconsideration. In the case, the Department of Justice (DOJ) is reaffirming its position that medical cannabis patients who possess firearms “endanger public safety,” “pose a greater risk of suicide” and are more likely to commit crimes “to fund their drug habit”—justifying, in the government’s eyes, a federal ban on gun ownership by cannabis consumers. In filings submitted to the U.S. Court of Appeals for the Eleventh Circuit, DOJ urged the panel to affirm an initial district court ruling that deemed the cannabis and firearms ban to be constitutional, while appellants are requesting a reversal of the order.

State

DE - The governor of Delaware has signed several cannabis bills into law, including measures that would allow existing medical cannabis businesses in the state to begin recreational sales on an expedited basis, transfer regulatory authority for the medical program, and make technical changes to cannabis statutes. The dual licensing system will let current medical cannabis providers convert to dual-use licensees that could serve both registered patients and adults over 21.

FL – The latest report on medical cannabis sales in Florida from the Office of Medical Marijuana Use (OMMU) showed the number of qualified patients in Florida has increased nearly from 299,044 in January 2020 to 884,531 in July 2024, a significant increase that bodes well for the cannabis legalization amendment that will be voted on in in the November 2024 elections. The number of dispensing locations has more than tripled, from 213 in January 2020 to 656 in July 2024, an increase of 208.5%. Meanwhile, Florida Governor Ron DeSantis has intensified his opposition to the legalization amendment.

IL – Only half of Illinois’ eligible social equity cannabis retailers are operational, just five years after establishing one of the first state-run social equity programs. Dozens of licensees are facing the possibility of losing their conditional licenses as expiration dates on those permits sunset this month and in August. At least 96 licensees are still awaiting final approval, the majority of whom already have seen their deadlines to open their stores pass.

NY - A federal judge on Thursday refused to halt New York City's crackdown on unlicensed sellers of cannabis, citing public safety concerns. New York City has through its "Operation Padlock to Protect" program, closed 640 unlicensed smoke shops since early May, using enforcement powers under a new state law known as the Smokeout Act. Unlicensed shops vastly outnumber licensed shops. A group of 27 sellers accused the city of causing irreparable harm by unilaterally closing shops, including for non-cannabis products, based on an assumption they were unlicensed. U.S. District Judge Paul Oetken in Manhattan held that the 27 cannabis sellers whose businesses were shut down were unlikely to succeed on their claim that the closures violated their due process rights under the U.S. Constitution's 14th Amendment. In a statement, New York City Mayor Eric Adams welcomed the decision: "We are protecting New Yorkers, particularly young people, from the health and safety threats being posed by illegal cannabis shops," Adams said. "If you are operating an illegal cannabis business, our administration is sending a clear message: You will be shut down."

OH – Ohio officials have approved the state’s first adult-use cannabis business licenses, teeing up the launch of recreational sales. One month after its Department of Cannabis Control approved dozens of provisional dual licenses, regulators issued a first round of certificates of operation that will allow some of those businesses to begin dual-use operations to serve both the medical and adult-use markets. Currently, DCC has approved the certificates for 12 growers, 12 processors, and one testing lab. There are over 200 provisional licensees, and no dispensaries have received the certificates to begin operations yet. Regulators have continuously said that they would be prioritizing applications for cultivators and processors to ensure that there’s enough supply for businesses to serve both markets.

PA – Despite initial concerns that recreational cannabis legalization might be postponed until next year due to its exclusion from the state budget, Responsible PA (a local coalition supporting adult-use cannabis) believes there is still an opportunity for legalization to pass in the upcoming fall session. Two bills that would legalize cannabis for adult use remain in consideration with ongoing discussions in the house and senate focusing on the technical details of legalization rather than the concept itself. Meanwhile, legislators were surprised to discover that they accidentally excluded medical cannabis dispensaries from certain tax relief included in the recently passed budget bill. The enacted law allows other licensees, including growers and processors, to take state tax deductions denied under the federal IRS code 280E, but dispensaries were mistakenly left out due to a drafting error.

Hemp

Federal - The U.S. Food and Drug Administration (FDA) and Federal Trade Commission (FTC) recently issued warning letters to companies commanding them to cease selling delta-8 THC edibles resembling brand-name snacks like Skittles and Oreos, claiming the lookalikes mislead children and unsuspecting adults. The agencies, citing over 300 “adverse event” reports of accidental delta-8 ingestion, emphasized the importance of consumer safety and gave the businesses 15 days to respond. The products in question include imitators like "Flamin Hot Cheetos" and "Trips Ahoy." The action follows similar warnings issued last year to vape companies for marketing products that purportedly appeal to children.

IN – An Indiana State Police (ISP) investigation into state retailers selling delta-8 THC products revealed that many products contained delta-9 THC levels exceeding state and federal legal limits, leading prosecutors in two counties to threaten criminal charges. The action follows an investigation by local news highlighting the growth of the unregulated delta-8 market, which comes despite guidance from the state’s attorney general last year stating that delta-8 THC products were illegal.

OH - Republican lawmakers have proposed two bills to regulate hemp intoxicating products. One bill (HB 642), introduced by Rep. Sara Carruthers (R), would require the Ohio Director of Agriculture to issue recommendations on such hemp products (covering, among other things, THC limits, age requirements, testing standards, and advertising restrictions), before potentially adopting the recommendations as temporary regulations. In contrast, Senate Bill 278, introduced by Sens. Kirk Schuring (R) and Stephen Huffman (R) would skip the recommendation/regulatory process and, if passed, impose limits regarding customer age (at least 21), product storage and CBD to THC ratios, among others. The proposals to regulate hemp intoxicating products come months after Gov. Mike DeWine (R) publicly asked the legislature to ban the products.

MN – On July 1, 2024, jurisdiction over hemp intoxicating products was transferred from the Department of Health to the state’s Office of Cannabis Management (OCM). The OCM used the occasion to issue a public letter reminding the approximately 4,000 state-authorized hemp businesses that delta-8 and delta-9 THC were the only intoxicating cannabinoids permitted in products. The letter also noted that, beginning in 2026, businesses will be able to petition the OCM for the commercial use of additional cannabinoids.

NE – The Nebraska Attorney General’s office continues its fight against sellers of synthetic THC products, as six more Nebraska smoke shops have announced they will stop selling such products in response to civil lawsuits filed by the Attorney General. The stores agreed to turn over any remaining products containing synthetic THC to the state within two weeks, where officials will destroy them, according to settlements the retailers reached with Nebraska.  In total, the state has filed against at least 16 retailers in 10 counties since October. Attorney General Mike Hilgers remarked “Our fight continues, and more lawsuits will be filed as we broaden our campaign. We will continue the charge against retailers selling these products which put Nebraskans at risk. We encourage retailers to stop selling these products, whether they have been sued yet or not — our campaign will continue until the industry is cleaned up."

NY – The Office of Cannabis Management (OCM) recently issued a recall of certain intoxicating hemp products, under the brand “Sky High,” that were allegedly manufactured by an unlicensed processor. Sold at licensed cannabis dispensaries throughout the state, the agency urged customers to immediately return the items for a refund.

WY – A Wyoming federal judge has held that Wyoming’s hemp regulations are not preempted by the 2018 Farm Bill, paving the way for Wyoming’s law to regulate hemp-derived intoxicating products. The court reasoned that "The mere fact federal law defines hemp, does not mean it confers a right to hemp under that definition. . . . Federal statutes are replete with definitions. It is farfetched to assume every definition confers a right to a person without some other affirmative congressional expression of intent to confer that right." The lawsuit was among several legal challenges to state policies aimed at limiting intoxicating hemp-derived THC products whose active ingredients can mirror those found in federally illegal cannabis.

International

Bahamas – Prime Minister Phillip Davis announced his support for legislation to legalize cannabis for medical and religious purposes and decriminalize the possession of small amounts of cannabis. According to Prime Minister Davis, the new laws would help those “who simply wanted the ability to legally consume medical cannabis to help them with their medical conditions.”

Brazil – Following a decision by the Brazilian Supreme Court, Brazil became the most populated country to decriminalize the consumption of cannabis. Under the new standard, an individual will not be arrested for possessing up to 40 grams of cannabis (or six female plants), unless there are other indications that the cannabis is for sale. Smoking in public remains illegal.

Thailand – After making a promise to ban cannabis, Prime Minister Srettha Thavisin appears to have changed course, instructing key government officials in Thailand to instead push for reform to regulate the use of cannabis for medical purposes, research, and for certain products.

Business

Tilray Wins First New Cannabis Cultivation License in Germany – Tilray Brands, Inc. announced that its German cannabis cultivation facility, Aphria RX GmbH, received the first new cannabis cultivation license issued under Germany’s new cannabis laws. The license allows Aphria RX to cultivate and manufacture medical cannabis.

Approval of New Guidelines on Allowable Moisture Loss – The National Conference of Weights and Measures (NCWM) approved a proposal outlining the allowable moisture loss in cannabis products to ensure sold products do not weigh less than advertised. The new guidelines—which apply to both hemp and cannabis markets—permit products to lose up to three percent of their weight due to moisture loss.

Ascend Announces $235M Debt Deal - Ascend Wellness announced one of the largest debt deals for a U.S. cannabis company, aimed at refinancing a three-year note and improving financial flexibility. The private placement of 12.75% senior secured notes, due in 2029, marks a significant milestone for the company at an interest rate lower than many other debt financings in the cannabis space.

Curaleaf Announces New Hemp Business Line - Curaleaf Holdings, after previously exiting the hemp market in 2023, re-entered with a new line of hemp-derived THC products under The Hemp Co. brand. This move follows a broader trend among cannabis companies, including Green Thumb Industries, Cookies, Jeeter, and 1906, which are also recently embracing hemp products.

Medicine

NORML Meta-Analysis: Cannabis-Induced Psychosis Rare in Those Without Pre-Existing Mental Health Conditions - A meta-analysis published in Nature: Mental Health found that cannabis-induced psychosis is rare in individuals without pre-existing psychiatric disorders. Reviewing data from 162 studies involving over 210,000 cannabis consumers, researchers concluded that the risk of psychosis is higher in those with mental health issues, while factors such as early age of onset, high-frequency use, and cannabis type did not significantly influence the incidence of psychosis.

CBD Shows Promise for Treatment of Neurological Diseases - Cannabidiol (CBD) shows promise in treating neurodegenerative disorders such as Alzheimer's and Parkinson's diseases by mitigating inflammation, oxidative stress, and protein aggregation, a new review of scientific studies involving CBD shows. The compound’s antioxidant, anti-inflammatory, and neuroprotective effects have demonstrated clinical benefits across various neurological conditions, highlighting CBD's potential as an adjunct treatment for these diseases.

Psychedelics

New Jersey Bill Would Legalize Psilocybin – Under a New Jersey Bill that would legalize psilocybin, the NJ Dept. of Public Health would oversee the licensing of manufacturing facilities, “service centers,” and testing laboratories, similar to the law that recently passed in Oregon allowing for supervised psilocybin use and licensed production. Psilocybin or related products would only be allowed for consumption at licensed service centers (with limited exceptions).

Please click here for more information on the Dentons US Cannabis group.

Authored by associates Malina Dumas, Lauren Estevez, Seena Forouzan, Jacob Raver, and Margo Wilkinson Smith.