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with regard to a bill that was passed two years ago and I've asked Alex Benton from the AG's office andrtie Bjornsen from ABC to come and be able to inform us as to what the status of this law is now what the public and the members can expect going forward and we'll let them go ahead and give our presentation and then we'll
open it up for questions if you'll identify yourself for the record you'll be recognized and at alix if you'll go ahead and and and start this off thank
Speaker 2
1:03
you Mr Chair Alex Benton attorney general's office I'm Chrisie Bjonsson regulatory
Speaker 3
1:09
administrator and I brought with me today director of enforcementrector Potter. Davidark Thank you Mr Chair. so
Representative Johnny Rye
Unverified
1:26
actct629 of2023 amended Arkansas law and it banned hemp derived psychoactive substances what we know is delta 8 delta 9 and some other delta products there's delta 10 delta0 the law also in the 2023 law had a backup that said if for any reason the ban is blocked by the court then this backup regulation will will spring into effect. this law was was championed by the AG by the governor representative Gassaway, Senator
Deeses they've been tireless champions on this issue and and got the law passed by supermajorities in both chambers severalal businesses in the industry filed for an injunction shortly thereafter to stop the state's ban of these of these products they alleged in their lawsuit that Act629 violated the supremacy clause the due process clause takingkings clause and the commerce clause of the United States Constitution
the district court granted that injunction and enjoined enforcement of the entirety of the actc both the ban and then also the backup regulation we appealed that to the eighth circuit and then on Tuesday June 24th 2 weeks from yesterday the court unanimously ruled in the state's favor on every single issue and dissolve the preliminary injunction. Um, so this case as as you guys all know has been going on for a long time about 2 years it's still not totally over, but
there's certainly light at the end of the tunnel. we fielded a number of questions about this case discussed this case with many of you on many occasions that's our job we're we're happy to do it I must say however that that some folks with an interest in the case they did their best to to spread misinformation about it especially the likelihood of their success and the state's failure. we have been confident in the case from the beginning you as the legislature the governor,
our office we have and continue to be on solid ground on this issue. I want to know also that that we're not here to give you our side we're we're here our job the AG's office is it's our job to give you an accu accurate picture of what the law is not what we wish it to be. so what does the opinion say? what are its implications and the eighth circuit found that the farm bill does not preempt our law that also found that our law is not vague those were the two
huge wins in this opinion for the state because the court favor found in our favor on those two material issues they those are directly at issue on the likelihood of their success on the merits of the case. additionally the eighth circuit dismissed the governor and the AG from the case both the governor and AG are entitled to sovereign immunity because they were not material to the enforcement of this law
when the eighth circuit finally does issue its mandate so there there's two things that happened the eighthircuit issued their order but the order does not become effective therefore the band does not spring back into effect until that mandate issues there is no set time frame for when that mandate will come down I will say that as of yesterday the procedural time frame for the plaintiffs to file a motion for reconsideration in front of the eighth circuit was closed
so there won't be any procedural that we can foresee right now there shouldn't be any other procedural hurdles for the band springing back into effect as soon as the mandate issues. I want to read a directly from page 12 of the opinion and I'm happy to provide a copy of the opinion to anybody who would like one but it says it says pretty simply about the theory of the case that especially on preemption that says just because states may legalize hemp
under the 2018 farm bill does not mean that they must. And I think that pretty pretty accurately encapsulates the eighth circuit ruling here I'd be like guess said there were there were portions in here on whether it was preempted by the farm bill it is not whether or not it was vague it was not I mentioned sovereign immunity by by the way it'd be remiss if I didn't say that the the attorney who lost this case is the same attorney who was illegally hired by the board of corrections and attempted to
waive sovereign immunity in their contracts as well but since 2023, we have been vocal about the harms of these delta products. I know this committee has also seen the harm that these delta products pose especially for our children. so'm I'm really proud of the work of the attorneys on our team that argued this case both at the trial level and in front of the eighth circuit, and once the mandate issues and the band springs back into effect if
you're selling these products after the mandate issues you're doing it in violation of the law. that's all I
have subject to your questions does any members have any questions for Alex before we hear from
the ABC. Representative ye you're recognized for a
Representative Johnny Rye
Unverified
7:02
question you just a question for you you know in the last mapping that I've seen as far as cancer is
concerned in the eastern side of Arkansas where our agriculture is it seems like that we have a a a worse of a cancer situation there and I just wonder would that have anything to do with with this No sir that
I don't I guess if you're asking about whether these delta products would have any sort of palliative care for for cancer patients. we have a legal system and framework in Arkansas for medical marijuana in our constitution that would be able
to serve those patients in a legal manner under our framework under our laws. represent
clowney you're recognized for a question thank you Mr
Representative Nicole Clowney
Unverified
7:54
Chair Miss Benton can you just walk me through procedurally? I know you said there was no motion to reconsider is there a chance of an appeal to the supreme court still what are we looking at kind of in terms of certainty once the mandate comes down from the eighth circuit. yes so I I'll
Representative Johnny Rye
Unverified
8:12
I'll repeat something I think I said back in back in March 3 months ago I think that any attorney who looks into their crystal ball and tells you what a court is gonna do is not it is gassing at best so I but to give you kind of an overview, certainly they could seek cert with the United States Supreme Court because there are circuit splits on this issue. but unless there is a stay on this appeal once the mandate issues the ban would go back into effect I can't
anticipate it could go both ways I mean there could be a procedural route where a court attempts or the plaintiff's attempt to appeal this ruling, but this is also an interlocutory appeal this is not a final order from the eighth Circuit so it is being remanded back down to district court for further proceedings that are consistent with this and so after there's a final order that's issued in the district court then they could appeal to the eighth circuit then they could seek cert but on an interlocutory appeal like this I don't foresee that that coming
maybe for another year 2 years maybe
we'll see. right members seeing no other questions I'm going to ask ABC to give give us some information about how they plan on enforcing this Of course thank you for
Speaker 3
9:33
having us I know this is a hot topic our phones have been ringing off the hook for the last two weeks big thank you to our partners at the AG's office for one representing us in the case and to helping us
kind of in the aftermath make sure everyone's notified so right now like Miss Benton said we are waiting on the mandate to go full force in effect of enforcement so right now
Speaker 21
9:57
what we've been doing is courtesy visits and I think directortter Potter may have an exact number of how
Representative Dwight Tosh
Unverified
10:04
many we've completed Yes thank you committee we started just after the ruling came down notifying our permit holders about the ruling as of this morning we've gone just over 1500 permits that our agents have visited
perform a courtesy visits just advising them of the ruling and that these products are going to become illegal very soon directing them to remove them from their stock immediately and we found that
Speaker 3
10:29
was pretty successful to have an in person touch with having our local agents that some of these retailers know and work with already having our agents go in with a letter that we produced that has the exact legal definitions of what will become a controlled substance so we cannot be a lawyer for every single retailer in the state of Arkansas we represent the state
of Arkansas but we can direct them exactly to the rules that they need to follow and that's what we've done so we handed them a letter we've also posted it on our websites if you've attempted to go to the MMC website for marijuana information the ABC website for alcohol information or the tobacco website in the last two weeks you've gotten a big pop up box that says please be notified of this 8th circuit decision and then once we had a letter typed up that directed them to the legal definitions of controlled substances we added that link up
there so anyone whether a permit holder or not has access to that on our website and then with the agents being able to go in obviously we're on the mandate to enforce but as they're going in they're starting to get a feel of who is able to comply whose store is completely full of products that are going to be banned most if not all of the products that some of these people sell may be banned so we're giving them as much fair warning as we can without knowing you know, looking in a crystal ball of when the mandate's going to come down from the court we have no idea but we're trying to do our
best to let people know hey this at any given moment which is what we've been telling them for about two years now at any given moment this could become a controlled substance and it is your responsibility to look at the law, look at your products and make sure you're following the law with these products being unregulated for the last two years some of them are incredibly intoxicating some of them have interesting combinations of multiple of the substances listed as controlled substances so when people are calling us saying can
I sell xyz product we're we're telling them we don't have the ingredients to your product. these have been unregulated for two years you need to look at the legal definition and if it has any of the substances it needs to be removed. So right now heavy on education rather than enforcement but ready to go as soon as the mandate comes down with seizures criminal action and administrative violations we are
Representative Dwight Tosh
Unverified
12:44
seeing that they are being compliant and proactively removing these items from the shelves in most cases that the agents show up and they've
already been removed and so that the permit holders saying we knew you were coming you're about to hemp you're here about the hemp products we've already removed them we're taking them off so
Speaker 3
13:03
we are seeing large scale compliance right now which too will bode well for the future if and when the case is decided on its merits and a new regulatory framework is triggered hopefully with this band being back into effect before then people will get themselves into compliance well in advance of the new framework. that's our hope Represent Mckenzie you
Representative Brit McKenzie
Unverified
13:23
recognized for a question thank you chairman formerly director I guess in regulatory administrator Bjojornsen I appreciate everything you've said we've talked about this subject before but and and kind of relative to what Alex mentioned previous hope's not a strategy so I I really and I get we have to wait on a mandate but I'd hate for a mandate to come on a Friday and you're Mr Potter enforcement agents go in on a Monday. and we start handing out large fines and penalties. so can you
help me understand what type of a glide path what what type of a amnesty zone is going to exist for those who have been selling this product legally because of the injunction on our law that's going to exist for these folks to be able to rightfully and dutifully get these products out of circulation once a mandate comes in I understand that we you know we we hope that these courtesy meetings and interactions do prove out you know we'd love a high percentage of of a take rate there but what's going to
happen to those that again who are who are currently operating within the law or have been for at least the last two years going to be able to get that supply out of their stores and in compliance with
Speaker 3
14:34
our laws that is why we're going out and doing the courtesy visitss now is to go ahead and tell them look we don't want to catch you off guard when the mandate comes out. we want you to know that these products need to be removed and one part that hasn't really been discussed here today too is yes regulatory enforcement has jurisdiction across the state they are law
enforcement officers but every individual county's sheriff's office and elected prosecutors local law enforcement agencies will all have the ability to enforce what will now become controlled substance law so at any time someone is with a controlled substance any officer can get them so as far as an amnesty period after the mandate I don't know that truthfully that would exist that's occurring right now and so we have sent in also an email out to every single permit holder in the state of Arkansas so that's 10,000 plus
individuals if you're looking at alcohol tobacco and marijuana. Now the people who don't have permits from us a lot of them have called and spoken with our either marijuana attorney or tobacco attorney have been directed towards the letter. but as much as we can we're in kind of that what happens to be an amnesty period now to tell them to get it out now we are advising them of
Representative Dwight Tosh
Unverified
15:47
that as well if they're subject to criminal penalties and there's not much of a discretion period once the order is filed and so it immediately becomes a controlled substance
at that point and they're subject to arrest and seizure. so we're we're we're trying to communicate that as
Speaker 2
16:05
clearly as possible to them. and if I may I wanna follow up I
Representative Johnny Rye
Unverified
16:10
think there is often a misconception about What an injunction means the selling those products the the law the ban while while it was held in and there was a preliminary injunction that said that they
could not enforce the law. it was still the law of Arkansas that these products were supposed to be banned it's just that enforcement was enjoined temporarily and it's similar to let's say it you know you pass a law and you have a delayed effective date of that law. I think we've we've seen this in some you know social media laws it's still the law it just doesn't become effective until something happens. So these folks have known that these products were banned since
2023. They successfully obtained an injunction which held in abeyance enforcement, but it was certainly not lawful in Arkansas we just couldn't do anything about it to enforce the law. follow up what can you help describe to
Representative Brit McKenzie
Unverified
17:16
me what work has been done to to communicate the same level of rigor to wholesalers distributors suppliers of this product inside the state are out. Um,
Speaker 3
17:26
they are permitted with us tobacco's permitted in a three
tier system so manufacturers wholesalers and retailers same as alcohol are permitted with us so I know I've had some of the wholesaler beer guys had called me months and months ago and we're like hey what what's going on with the hemp should should we order this? shoulduld we stock this and I said I can't give you business advice but I can tell you that at any given moment once this case is decided that could become a controlled substance so if you want to have that liability of possessing that item in your store at that time that's on you but all the wholesalers have received the
notification letters contacts that we have in our system as well so if they're permitted with us they should know about it by now we have done heavy heavy notification. Representing painter
Representative Stetson Painter
Unverified
18:16
you recognized for a question thank you Mr Chair and appreciate you because that was one of the recipients of
the site visit that you guys had just you know you said you guys have reached out to 1500 in person visits what's what's the goal how many more site visits do you
plan to especially maybe out in the rural areas that always have the greatest internet or may not even check their boxes too and second of all is I can tell you that I can tell you guys have talked to some of the wholesaler distributors because they've come around at least to my store and said hey these products are no longer we're not going to have these anymore so I do appreciate you do communicating but I would like to know just what the overall goal is is to get how many visits do you plan to have? Yes sir thank youpresentative Painter yes we
Representative Dwight Tosh
Unverified
19:04
plan on continuing this until we get an order. we've got roughly5,000 which is the the renewals5,000 permits and so we plan on keeping going until we get to all of those or the order comes down and identifying what to do next at that point yes just stopping follow up and you just want to make sure for the
Representative Stetson Painter
Unverified
19:21
record that's your agents that are ones that are going out there and and and checking and doing the site visits because I got the nice little
letter and then they're ones handing those correct yes sir we are the hand delivering
Representative Dwight Tosh
Unverified
19:35
those as well and asrector Bornson said those were emailed to the permit holders too so we're hoping to get everybody and we're working very quickly as you can tell to before this order actually comes down giving everybody a chance to get compliant
Speaker 3
19:50
ASAP thank you thank you'll follow up too we like I mentioned we've seen these products and all types of different forms some are liquid drinks that some of the beverage distributors have been interested in others are gummy smokable vape type products
majority of them are found in tobacco outlets but that doesn't mean that there aren't any in alcohol outlets either so we are prioritizing a little bit that's for that5000 number comes from that's our tobacco permit number so we are prioritizing tobacco over alcohol we believe have been told that it is a lot easier for the alcohol
Speaker 51
20:22
permittees to comply because they just have less of the products Representative Tosh you're recognized for a question
Representative Dwight Tosh
Unverified
20:37
Thank you Mr Chair. just a quick question for you. I know I've worked with ABC a lot over the years you do it you do a great job you always have and I know we've given given you a lot of responsibility to enforce a lot of laws I'm just want to make sure I know this could be overwhelming to your enforcement part of the ABC do you have the manpower to be able to to meet the challenges that you're that you're going to be faced with this I'm just know we've spread you thin but
is the manpower there and if you are you going to be able to allocate that manpower appropriately to be able
to address these issues thank you for the question Representative Tosh. that's I would answer that and say we're at 100% work capacity with a lot of what we do and so we are pushing off additional assignments to get these done. I would as agency director I'd never tell you that I wouldn't welcome additional resources but that'll be a conversation I have with our cabinet secretary and everything else but we're we're getting the job done right now we we have had some additional mandates through the
25 session that came on us so we're we're we're diligently working at
those. thank you for that Alex, I have a question we passed another bill this Past
session how would that possibly impact this
Representative Johnny Rye
Unverified
22:01
law Yes sir thank you. So as a refresher cause I know we've all slept since since Siy diet and so the 2025 law only
amended this law that we're talking about today this ban with a backup regulation and that amendment will only become effective upon the trigger language being met and there are four different instances in which that can be met and then the AG may certify once he sees that those conditions have been met this does this went on the appeal does not satisfy one of those criteria because it's not a final adjudication but we are much closer to that and and we would have to win on the
merits in this case in a final order and this is merely an interlocutor appeal that we received the order on so still have some work to do obviously I know that there's been a lot of changes with the farm bill and with some of the house of props with some different different definitions of hemp that may satisfy some of the trigger language as well we won't know until USDA promulgates rules with the definitions of hemp and hemp derived psychoactive substances whether or not that would be sufficient to meet the the
trigger language in the 2025 law so not not there yet
Speaker 56
23:19
but but we will certainly keep everybody apprised once we once we get to that point. right seeing no other
Speaker 59
23:47
questions right here ' m sorry sorrypresentative
Mckenzie you recognize her question you just as a
Representative Brit McKenzie
Unverified
23:54
question based on nuance because in the 2025 bill that we talked about and the four triggers that push it push it over and supersede the 2023 law THCA which is again that's what happens when we start to to to pass laws and legislate against what we understand to be common commonly derived definitions and then they change over time THA in the2025
bill would be considered illegal illicit but based on 2023 there wasn't there was no clear enumeration to that strain or or varietal of cannabinoid derived product I do understand the 2023 law that there was a definition of any substance there within which is big and broad basically it's the entire flower. So could you tell me we get a mandate tomorrow based on the opinion of you and I don't want to ask you a specific if you can't give me one but based on the opinion
that the 2023 law that would be in effect Would THCA be also banned
Speaker 2
24:59
Thank youpresentative. I think we anticipate litigation on
Representative Johnny Rye
Unverified
25:04
on this question specifically I have heard a lot of questions about that and that the same trial lawyer is going to probably tried to seek to carve
out a new loophole here so I don't want to say anything publicly that would bind our clients or our legal arguments on anticipated litigation thank you Representative car you recognize her question thank you Mr Chair. I just
Representative John P. Carr
Unverified
25:44
want to go on and say thank you for the quick response Miss Benton for you and all your
team and your clarification that was needed in my district and to get things back in order so I appreciate you taking care of things not only there but throughout the state as well. So thank
you to all. Thank you Mr Chair. right remember seeing no other questions I want to thank you all for coming and giving this explanation so that the members know how to answer any questions they may get from constituents I know you're working hard to inform the the public so that they know what
the the impact of this ban is going to be on their businesses so seeing no other business we are adjourned
Agenda
A. Call to Order
B. Discussion of Recent Eighth Circuit Court of Appeals Ruling
C. Discussion on Enforcement of Ban on Delta-8 Products
D. Other Business
E. Adjournment
Documents
| Title | Type | Pages | Source |
|---|---|---|---|
| Agenda — HOUSE RULES, Jul 9, 2025 | Agenda | 1 | Official source ↗ |
Speakers
Representative Jon S. Eubanks Chair
Unverified
Speaker 2
Speaker 3
Representative Johnny Rye
Unverified
Representative Nicole Clowney
Unverified
Speaker 21
Representative Dwight Tosh
Unverified
Representative Brit McKenzie
Unverified
Representative Stetson Painter
Unverified
Speaker 51
Speaker 56
Speaker 59
Representative John P. Carr
Unverified