Texas hemp industry groups and businesses have filed a lawsuit to block new state regulations that ban natural smokeable hemp products and increase licensing fees.
The Texas Hemp Business Council, Hemp Industry & Farmers of America, and several Texas-based dispensaries and manufacturers sought a temporary restraining order Tuesday in Travis County District Court against the Texas Department of State Health Services and the Texas Health and Human Services Commission. They argue the agencies exceeded their constitutional authority by redefining hemp beyond the 2019 statutory definitions.
Attorney David Sergi, representing the hemp coalition, said the agencies are “attempting to create new law in direct contradiction to what the Texas legislature intended.”
Texas legalized hemp in 2019, defining it as containing less than 0.3% delta-9 THC. Manufacturers later began using THCA, a different form of THC that produces psychoactive effects when smoked, creating a de facto recreational market. Last year, the legislature voted to ban these products over concerns about youth access, but Gov. Greg Abbott vetoed the measure and instead asked state agencies to impose stricter regulations.
The new rules, effective March 31, include child-resistant packaging, higher licensing fees, updated labeling and testing requirements, age verification at 21, and bookkeeping mandates. Laboratories now measure total THC, meaning products like THCA flower and pre-rolled joints exceed the 0.3% limit and are banned. Violations can result in fines up to $10,000 per day and license revocation.
Licensing fees also increased sharply, from $258 to $10,000 per manufacturing facility and from $155 to $5,000 for retail registrations. The lawsuit does not challenge consumer-safety measures, only the rules that would effectively end in-state production and sales of smokeable hemp.
State officials cited public safety concerns, noting a rise in cannabis-related poisonings among children and teenagers since hemp-derived THC was legalized. The Texas Poison Center Network reported calls increased from 923 in 2019 to 2,669 in 2025.
The hemp industry has previously challenged the state over a 2021 ban on delta-8 THC. The outcome of that case before the Texas Supreme Court could influence the current lawsuit, as both cases contest the authority of state health agencies to regulate hemp without legislative approval.