On September 4, 2019, the Ninth Circuit Court of Appeals held that the lower court should have abstained from ruling in Big Sky Scientific LLC v. Idaho State Police and determined that Idaho state court provides a satisfactory venue for Big Sky to raise its federal claims.
As we discussed in an article earlier this year, Big Sky shipped thousands of pounds of unprocessed hemp from Oregon to Colorado. During transport, a semi-truck containing the shipment was stopped in Idaho, which has no hemp program and classifies hemp as marijuana per state law. The driver of the semi-truck was charged with marijuana trafficking and the Idaho State Police seized the entire shipment. Big Sky sued in federal court, arguing that the clear and unambiguous language of the 2018 Farm Bill allowed the transport of hemp through any state or Indian territory. The magistrate judge disagreed and denied Big Sky’s motion for a preliminary injunction.
On August 28, 2019, Big Sky appealed the ruling to the Ninth Circuit and argued its position in front of a three-judge panel. During oral arguments, the judges were primarily concerned with two issues: (1) whether the court should abstain from judgment pursuant to the Younger abstention principle and thereby allowing the Idaho state court to resolve the issues of the case, and (2) if the court were to abstain from judgment, whether counsel for the Defendants could make assurances that the in rem proceeding involving the seized hemp would be decided on the merits before resolving the criminal proceeding involving the driver of the semi-truck, as the outcome of the in rem proceeding would certainly impact whether the driver was acting criminally. Judge Hawkins went so far as to say:
“At least speaking for me, the decision of the state to go forward with the criminal proceeding against the driver before the in rem proceedings are decided in Idaho District Court gives me great pause as to whether to apply Younger. It just makes no sense whatsoever.”
The court was ultimately persuaded by the Defendants’ counsels’ representation that Idaho will immediately move to lift the stay in the in rem forfeiture action and the assumption that, apart from any criminal proceedings, the Idaho District Court will proceed expeditiously with the in rem action.
The outcome of this case leaves many unanswered questions regarding interstate transportation of hemp. While the eventual decision of the Idaho state court in this matter will guide Idaho’s hemp policy, the rest of the states are still left to their own devices. Accordingly, until USDA issues the new hemp regulations, companies shipping hemp across state lines needs to be aware of the hemp laws imposed by whichever state a shipment may enter.
To learn more about this and related CBD regulatory issues, check out our free webinar on Wednesday, September 11, at 12:30 pm Eastern. Click here to go to the registration page.