AUSTIN, Texas — A legal dispute before the Travis County 261st Civil District Court could determine whether hemp-derived cannabis products remain available in Texas, as businesses challenge new state regulations and seek to extend a temporary court order set to expire Friday at 5 p.m.
Seven businesses and two trade associations filed a lawsuit asking the court to issue a longer-term injunction against rules adopted by the Texas Department of State Health Services while the case proceeds. The plaintiffs argue the regulations would disrupt the state’s hemp market and force some retailers to close.
Lawyers for the Texas Attorney General’s Office said regulators are clarifying how tetrahydrocannabinol, or THC, is measured to prevent the sale of products that become more potent when heated or consumed.
During a three-day hearing that began Tuesday, Judge Daniella DeSeta Lyttle denied a request from the state to block media recording of the proceedings, stating that courtroom activity is public.
Attorneys for the plaintiffs argued the rules exceed regulatory authority by redefining hemp. Under Texas law, hemp must contain no more than 0.3% Delta-9 THC by dry weight. The new rules include THCA in the calculation of total THC, which could restrict the sale of products such as hemp flower and concentrates.
State attorneys said the approach aligns with existing agricultural testing standards that measure total THC levels before harvest. They argued that some hemp products can exceed legal THC limits when used as intended.
The lawsuit also challenges increased licensing fees, which rose from $150 to $5,000 annually for retailers and from $250 to $10,000 for manufacturers. State officials said the increases are necessary to support inspections and enforcement.
Expert testimony presented by the plaintiffs estimated the Texas hemp industry supports tens of thousands of jobs and generates billions in economic activity. Business owners told the court the rules could affect a range of products, including those used in cosmetics.
A state-licensed medical marijuana provider, Texas Original Compassionate Cultivation, filed arguments supporting the state, saying some hemp products function as high-potency marijuana and compete with regulated medical cannabis.
The court is expected to hear closing arguments before issuing a decision on whether to extend the injunction. Either side may appeal the ruling.
