On January 2, 2020, a federal district court judge in Minnesota found that a local hemp farmer had a constitutionally-protected property interest in his hemp growing license, and that the license could not be revoked by the state without adequate procedural protections.  The hemp farmer, Luis Miguel Hummel, had his license revoked by the Minnesota Department of Agriculture (“MDA”) following a report from law enforcement that some of Hummel’s hemp products containing concentrations of THC far exceeding the 0.3 percent maximum allowed by program guidelines and federal and state law.  Hummel requested that MDA conduct an evidentiary hearing regarding the seizure of his hemp products prior to revoking his license.  The MDA denied his request.  As a result, Hummel brought suit in federal court.

In his Complaint, Hummel alleged that MDA and its employees deprived him of property without providing him notice and a hearing, consistent with the U.S. Constitution’s procedural due process prong.  MDA filed a motion to dismiss.  The federal court denied the motion as it related to Hummel’s procedural due process claim.  In doing so, the court found that the MDA did not have “unfettered discretion” to revoke the license.  Instead, the court decided that the “MDA may not revoke a license unless the participant has violated the law or a program guideline.”  Because the MDA did not provide Hummel with procedural safeguards to show whether or not revocation was appropriate, the court held that Hummel had stated a valid claim that he held a constitutionally-protected property interest in his hemp license.

This case, Luis Miguel Hummel, et al. v. Minnesota Dept. of Agriculture, et al., No. 19-CV-1431, marks the first instance since the passage of the 2018 Farm Bill in which a court has ruled that a hemp license provides the holder of the license with a constitutionally-protected property interest, which cannot be arbitrarily revoked.  Hemp producers can now take some comfort knowing that once a hemp license is provided, at least one court has determined that it cannot be readily withdrawn.  As the U.S. Department of Agriculture moves closer toward issuance of a final rule governing the licensing of hemp production, and as various states do the same, the Hummel case suggests that constitutional protections will accompany the issuances of such licenses, likely increasing their value.