A new lawsuit alleges Ohio used definitional trickery, interstate discrimination, and possibly an invalid veto process to hand a lawful hemp market to in-state marijuana licensees.
There are only so many ways a government can say, with a straight face, that it supports “regulation” while using the machinery of the state to crush lawful competition and reward politically favored insiders.
Ohio may have just found a new one.
A newly filed lawsuit by North Fork Distribution I, LLC, which does business as Cycling Frog, alleges that Ohio Senate Bill 56 does not merely regulate hemp. It effectively converts federally lawful hemp products into “marijuana” under Ohio law unless they are cultivated, processed, and sold through Ohio’s licensed marijuana system. In plain English, the complaint says Ohio tried to use state law to wall off its market, criminalize ordinary interstate commerce, and give the spoils to existing in-state marijuana operators.
That is not sound policy-making. That is market allocation with a badge and a press release.
The central allegation is straightforward. Congress legalized hemp in the 2018 Farm Bill and protected its interstate transportation. Ohio, according to the complaint, responded by narrowing the state definition of “hemp” so aggressively that many federally lawful hemp-derived products would be treated as “marijuana” once they enter Ohio. The result, the plaintiff argues, is that out-of-state hemp businesses face potential criminal exposure while Ohio’s licensed marijuana businesses receive an exclusive commercial advantage.
And the most revealing evidence may not be in the rhetoric of the complaint at all. It is in the state’s own legislative paper trail.
An attachment to the filing includes the Ohio Legislative Service Commission’s “Synopsis of Conference Committee Amendments,” which states that products falling outside the narrowed hemp definition “will be considered marijuana and sold exclusively in marijuana dispensaries.” That language is politically devastating because it strips away the usual camouflage. This was not merely about labeling, testing, or age gates. According to the complaint and the attached synopsis, Ohio structured the law so that products excluded from the new hemp definition would not disappear from commerce altogether. They would be redirected into a protected channel: licensed marijuana dispensaries.
That is the kind of detail that matters. It tells you what the law does, who it benefits, and who gets shoved overboard.
The lawsuit raises two major constitutional claims. First, it argues that S.B. 56 violates the Dormant Commerce Clause by discriminating against interstate commerce and favoring Ohio’s in-state marijuana industry over out-of-state hemp operators. Second, it argues that the law is preempted by federal law because Congress expressly protected the interstate transportation of hemp and removed hemp from the federal controlled-substances framework. Ohio, the complaint says, cannot simply relabel federally lawful hemp as “marijuana” at the border and pretend the Supremacy Clause does not exist.
That alone would make this an important case. But the complaint goes further.
It also alleges that S.B. 56 was never validly enacted in the first place because Governor Mike DeWine purportedly used the line-item veto in a manner forbidden by the Ohio Constitution. The filing contends that the governor did not merely veto appropriations items. He instead struck substantive policy language and tried to condition approval of the bill on that basis. If true, that is not a hemp technicality. That is a separation-of-powers problem. It means the case is not just about cannabinoid policy. It is about whether a governor can rewrite legislation under the guise of veto authority.
The complaint also does what strong injunction pleadings are supposed to do: it ties the constitutional injury to real-world harm. Cycling Frog’s verification affidavit says the company has substantial Ohio sales, inventory, contracts, retail relationships, and sunk investment tied to the market, and that it stands to lose a significant share of its business if the law takes effect. The company alleges that it cannot practically continue operating in Ohio without risking prosecution once federally lawful products are reclassified by Ohio as “marijuana.”
That matters because this is where many state officials and industry opportunists play games. They talk as though hemp operators are abstract villains and every product is a policy thought experiment. But companies are making payroll, signing leases, building supply chains, and operating in reliance on federal law and existing state frameworks. When a state abruptly rewrites definitions to favor a politically connected channel, the damage is not theoretical. It is immediate, concrete, and often irreversible.
This is why stakeholders in Texas should pay very close attention.
The tactic on display in Ohio will look familiar to anyone who has watched the hemp wars in other states. First comes the moral panic. Then the selective outrage. Then the carefully staged media narrative about “intoxicating hemp” destroying civilization. Then, once the public is softened up, comes the real play: not a neutral safety framework applied evenly across markets, but a commercial carve-up that favors incumbent interests and punishes disfavored ones.
That is what makes this case larger than Ohio.
If a state can redefine lawful hemp into contraband whenever the category becomes economically inconvenient, then the 2018 Farm Bill means whatever a hostile bureaucracy says it means that week. If a state can criminalize out-of-state products while granting in-state licensees exclusive control of the same market, then “regulation” has become a euphemism for economic protectionism. And if governors can carve up substantive law with an improvised theory of veto power, then the constitutional structure itself becomes just another casualty of the culture war.
There is also a political lesson here that the hemp industry needs to learn, and learn fast.
The people trying to destroy this market are rarely content with honest argument. They do not merely say they prefer a different regulatory structure. They inflate, smear, panic, and posture. They wrap commercial self-interest in the language of safety and then dare anyone to notice the transfer of wealth and power underneath. That game works only as long as no one reads the bill language, the committee synopsis, the enforcement hooks, and the market consequences together.
This lawsuit does exactly that.
It forces the question that every honest regulator should have to answer: if your concern is truly public safety, why are the products not banned across the board? Why are they being shifted into a preferred in-state system? Why do existing licensees get protection while interstate competitors get prosecution risk? Why does the law read less like a neutral regulatory framework and more like a franchise agreement for politically approved sellers?
Those are not rhetorical flourishes. They are the questions at the center of the case.
Ohio will, of course, say this is about health and safety. States always do when they are caught red-handed building a moat around favored economic actors. Courts will have to decide whether that explanation survives scrutiny. But on the face of the complaint, this is not a frivolous challenge or a performative filing. It is a serious constitutional case backed by a legislative paper trail and a concrete injury record.
National operators, retailers, compliance professionals, litigators, and investors should watch this closely. So should every Texas stakeholder who still thinks these state fights are isolated skirmishes. They are not. They are part of a coordinated pattern in which lawful hemp is tolerated when it is politically weak, demonized when it grows, and targeted for absorption or elimination when entrenched interests decide the market has become too valuable to leave alone.
That is the broader truth.
The fight is no longer just over cannabinoids. It is over whether law means what it says, whether interstate commerce still exists when a hostile state dislikes the product category, and whether politically disfavored businesses have any protection against governments that rewrite definitions to achieve outcomes they cannot defend openly.
The State Tried to Rewrite the Law Without Passing One
Filed tonight in Travis County, the hemp industry’s lawsuit against Texas regulators is not a routine administrative skirmish. It is a direct challenge to one of Austin’s most corrosive habits: when the Legislature declines to act, agencies act anyway.
That is the allegation — not as rhetoric, but as an unconstitutional structure the court must toss out like a drunk politician from The Cloak Room bar at last call.
To understand how Texas arrived at rules the legislature specifically declined to pass, you have to understand how power actually flows in Austin — and why that flow is far more complex, and far more lopsided toward one office, than most observers outside the Capitol appreciate.
The plaintiffs — trade associations, manufacturers, retailers — are not asking the court to referee competing visions of hemp policy. They are asking a more fundamental question: who governs? Because the constitutional process already answered it.
The Legislature passed Senate Bill 3. The Governor vetoed it. Two special sessions failed. Under the Texas Constitution, that means no new law. Full stop.
And yet, through rulemaking effective March 31, 2026, state agencies imposed the very restrictions the Legislature had declined to enact. The lawsuit is the industry’s answer to that maneuver. To understand why it happened, you need to understand the men behind it — and the institutional machinery one of them has spent eleven years building.
Because Dan Patrick has spent the better part of six years trying to destroy 8,500 licensed businesses, 53,000 jobs, and a $4.3 billion industry that the Legislature created, the Governor preserved, the courts protected, and the overwhelming majority of Texans want to keep — which raises the uncomfortable question of exactly whose Texas he thinks he’s governing.
The Most Powerful Man in Austin You’ve Never Fully Reckoned With
Most people understand that the lieutenant governor presides over the Texas Senate. What they don’t understand is what “presides” actually means in practice.
The man who once tossed THC gummies and cereal bites at reporters like a deranged game show host, then declared that regulated hemp shops were somehow a greater threat to Texas families than the opioids legally dispensed on every corner, has now — having failed four times through the front door — sent his agencies in through the window to do what democracy wouldn’t.
Under Senate rules, the lieutenant governor appoints every committee and every committee chair, refers all legislation to committee, controls the order in which bills come to the floor, and rules on all parliamentary questions at his own discretion. Bills don’t advance because they have the votes. They advance because Dan Patrick allows them to advance. The power of recognition is the power of life and death over legislation, and Patrick has exercised it without apology or restraint since taking office in 2015.
He has gone further than any of his predecessors were willing to go. Soon after assuming office, he persuaded the Senate to drop the threshold needed to consider a bill from two-thirds to three-fifths — a procedural change his predecessors Perry and Dewhurst never attempted because, as one political scientist put it, they had to work with senators on both sides. Patrick had no such compunction. He remade the chamber in his image. He then did something genuinely extraordinary in Texas political culture: he actively endorsed candidates in Republican Senate primaries — building a caucus that is not merely conservative but personally loyal to him, senators who owe their seats, in part, to his imprimatur.
But the lever most people miss entirely is Sunset.
The Texas Sunset Advisory Commission reviews state agencies and recommends to the legislature whether they should survive, be restructured, or disappear. In most cases, agencies are automatically abolished unless legislation is enacted to continue them. The lieutenant governor appoints half the Senate membership of that commission. Every agency director in Texas — every commissioner, every executive — knows that the man presiding over the Senate controls a significant portion of the body that can recommend their agency’s abolition. This is not a subtle pressure. It is an existential one. Agency heads who cross Patrick don’t just face legislative headwinds. They face the prospect of their agency’s continued existence becoming a question mark at the next Sunset cycle.
DSHS is not exempt from this calculus. In fact, it is deeply embedded in it.
Political scientists who study Texas government have noted that the lieutenant governor is considered as powerful as, and sometimes more powerful than, the governor. That assessment, already striking in the abstract, becomes clarifying when applied to the hemp saga — because the entire story of how we got to March 31 is, at bottom, the story of what happens when those two centers of gravity collide.
A Decade of Managed Coexistence, Then a Public Break
For most of their overlapping tenures, Abbott and Patrick maintained a working relationship premised on ideological alignment and careful avoidance of head-on collision. They are different creatures. Abbott is the cautious institutionalist — a former Texas Supreme Court justice who thinks in terms of legal sustainability, constitutional exposure, and long-game political risk management. Patrick is the former radio talk show host and Tea Party insurgent who thinks in terms of political dominance, culture-war momentum, and the next morning’s headlines. They needed each other and mostly behaved accordingly.
Hemp shattered that arrangement with unusual and very public ferocity.
Patrick had made SB 3 his signature priority of the 2025 session — a comprehensive ban on consumable hemp products containing THC. The Senate passed it 30 to 1 in March. He had staked his institutional credibility on it, worked his caucus, and by all accounts believed he had the governor’s quiet assurance that the bill would be signed. Then, just minutes before the veto deadline, Abbott killed it — without even calling Patrick first.
Patrick’s account of their private conversations was specific and damning. He claimed the governor had told him personally, in front of witnesses, “don’t worry about the bill” and had even asked Patrick’s staff lawyers for arguments he could use when signing it. Abbott’s team declined to engage the substance of those claims, which was itself a kind of answer.
The public rupture was immediate and raw. Patrick accused Abbott of wanting to “legalize recreational marijuana in Texas.” He held a press conference in which he described the governor’s late-night veto as a betrayal, questioned where Abbott had been all session, and demanded to know what had changed. It was the kind of performance that plays well on talk radio — which is, after all, where Patrick spent most of his adult life learning how to work a crowd. Abbott, operating in his natural register, issued a veto message that read like a legal brief: constitutional vulnerability, the Arkansas precedent where a similar ban had been enjoined in federal court for nearly two years, economic harm to tens of thousands of Texans who had invested in good faith under existing law.
Two men, two completely different concepts of what governance is for.
Abbott called two special sessions. Patrick refused to pivot toward regulation in either of them, driving legislation in both that mirrored the original ban. The Legislature sent Abbott nothing he could sign. At which point Abbott did what executives do when legislatures fail — he acted unilaterally, issuing Executive Order GA-56 on September 10, 2025, directing DSHS, TABC, and DPS to implement safety regulations: age verification, mandatory testing, labeling requirements, child-resistant packaging, enforcement coordination.
It was careful. It was targeted. And it was, critically, considerably less than what DSHS actually did with it.
The Technical Pivot That Changes Everything
At the center of the lawsuit sits what looks, at first glance, like a technical adjustment — a shift from a delta-9 THC standard to a “total THC” calculation.
It is anything but technical.
Texas law is explicit: hemp is defined, and legalized, based on delta-9 THC concentration not exceeding 0.3 percent. The Legislature chose that metric deliberately and wove it throughout the statutory framework governing commerce, testing, and legality. The new rules retain that definition on paper. Operationally, they replace it.
Regulators now mandate compliance with a formula that converts THCA into delta-9 THC equivalents — expanding the definition of “illegal” without touching the statute. Products lawful under the law become unlawful under the rule. That is not implementation. That is substitution. And in Texas constitutional law, those are very different things.
GA-56 authorized safety measures. It did not authorize a rewrite of the THC testing standard. It did not direct DSHS to adopt a total THC calculation that includes THCA — which has the practical effect of banning the majority of the hemp market that the Legislature had repeatedly declined to ban. That decision was DSHS’s own.
Which brings us back to Patrick, and to Sunset, and to the institutional ecosystem in which DSHS makes its decisions.
The agency didn’t go beyond GA-56 because Abbott told it to. DSHS went beyond GA-56 because it exists in a political environment where the most powerful actor in the building that controls its continued existence had made unmistakably clear what outcome he wanted. Patrick hadn’t merely lost a vote. He had been publicly humiliated by the governor, his signature priority killed in the final minutes of the session. Every career official in Austin understood the temperature.
The total THC formula was the only rulemaking decision that could simultaneously satisfy a governor’s executive order — technically, with careful reading — and deliver substantively the outcome the lieutenant governor had demanded and failed to get through the front door of the legislative process. DSHS chose the formula that closes the market. The rules effectively implement a federal total THC standard eight months ahead of the federal deadline, without the Texas Legislature having adopted that standard through statute. That tells you everything you need to know about whose clock the agency was watching.
A Regulatory Scheme That Collapses the Market
The complaint catalogs, in granular and unsparing detail, how these rules function in practice. The cumulative effect is not incremental regulation. It is market elimination.
Manufacturers cannot reliably source plant material because inputs must now satisfy a non-statutory metric before processing begins. Transport of hemp into Texas for processing is effectively prohibited. Testing requirements force reclassification of compliant agricultural products at later stages of production.
And then there are the fees — a regime that reads less like regulation and more like economic warfare. Manufacturer licenses jump from $250 to $10,000. Retail registrations climb from $150 to $5,000 per location. The agencies’ own record projects more than $200 million in annual economic impact while acknowledging minimal enforcement costs. That mismatch is not accidental. It is central to the plaintiffs’ constitutional claim: that these fees function as an unauthorized occupation tax, not cost recovery.
In a bitter irony, the original proposals were worse. During the public comment process, more than 1,400 comments poured in from businesses and consumers pushing back on rules that initially set manufacturer fees at $25,000 and retail fees at $20,000. Industry advocacy brought those numbers down. The fees that remain, while lower than the opening bid, still accomplish the same structural purpose — pricing out everyone but the most heavily capitalized players, if any survive at all.
Separation of Powers Is Not Optional
The petition’s most important section has nothing to do with THC calculations or licensing fees. It is the constitutional argument — and the one that will outlast this litigation regardless of outcome.
Texas agencies are creatures of statute. They hold no independent policymaking authority. Their mandate is to implement legislative decisions, not override them.
The lawsuit argues regulators crossed that line in every direction simultaneously. They imposed a compliance standard the Legislature rejected. They regulated upstream materials outside their statutory scope. They prohibited conduct the statute expressly permits. They built a fee and penalty structure that functions as economic prohibition dressed up as administrative process.
Taken together, these rules do not interpret the law. They produce a different one.
The plaintiffs frame it correctly: this is not a policy disagreement. It is a structural violation of the separation of powers — the kind that, if left unchallenged, licenses agencies to govern in perpetuity without legislative approval. The Legislature debated, voted, and failed to enact change — twice in regular session, twice in special session. In constitutional government, that sequence of events has a name: democratic outcome. The question the lawsuit poses is whether that outcome still means what it used to mean.
The Governor’s Role — and Its Limits
There is a second layer worth watching closely.
The lawsuit argues that regulators used GA-56 as a pretext to go further than the Governor himself directed. If that claim holds, the case becomes something more consequential than a check on bureaucratic overreach. It reinforces limits on executive implementation as well — and that has implications that travel well beyond this industry.
Abbott is not the villain of this story. His veto of SB 3 was constitutionally well-reasoned, politically courageous given the forces arrayed against him, and arguably the act that preserved the hemp industry’s right to fight this battle in court rather than simply cease to exist. His executive order, whatever its limits, was careful — drafted with an eye toward legal defensibility rather than ideological maximalism.
The problem is that careful executives issue careful orders into political ecosystems they do not entirely control. GA-56 entered an environment shaped by eleven years of Patrick’s institutional accumulation, an agency acutely aware of its Sunset exposure, and a moment of extraordinary political pressure from the most powerful legislator in the state. What came out the other end was not what Abbott put in.
The Real Stakes: Market Structure and Political Power
Strip away the legal architecture, and the stakes come into focus with uncomfortable clarity.
This is a fight over whether a lawful, multi-billion-dollar industry in Texas can be dismantled without a vote — and over whether the constitutional check that a governor’s veto represents can be circumvented by an agency willing to use rulemaking to accomplish what legislation could not.
If the rules stand, much of the current hemp market becomes economically or legally untenable. Manufacturers relocate. Retailers close. Supply chains fracture. The industry the Legislature created in 2019 — and repeatedly declined to dismantle — gets eliminated by administrative formula instead.
If the plaintiffs prevail, the decision does more than preserve the status quo. It establishes that agencies cannot achieve through regulation what they failed to secure through legislation. That precedent reaches far beyond hemp. Austin’s regulatory class, and the political actors who lean on it, know it.
The pattern here is not unique to this industry. Dan Patrick has spent eleven years building a Senate caucus personally loyal to him, controlling the procedural machinery that determines what gets a vote, appointing the oversight commission that reviews whether agencies survive, and relentlessly expanding the informal influence of his office beyond anything his predecessors claimed. When the Legislature failed to deliver his top priority and the governor’s executive order didn’t go far enough, the regulatory apparatus delivered what legislation could not. The agency understood its institutional incentives. It acted accordingly.
That is the dynamic this lawsuit is, at its deepest level, challenging.
What Happens Next
The plaintiffs are seeking immediate injunctive relief to halt enforcement while the case proceeds. The court’s first decision — whether to grant a temporary restraining order — will be the initial signal of how seriously it takes the separation-of-powers claims.
From there, this case will move fast. The issues are clean, the record is extensive, the economic consequences are immediate, and the political backdrop is impossible to ignore. Appellate attention is likely before the trial court finishes its work. The Texas Supreme Court’s pending ruling in Sky Marketing v. DSHS — which questions whether DSHS can reclassify hemp-derived cannabinoids through administrative action rather than legislation — could land at any moment and reshape the entire landscape.
Final Observation
This case is not about whether Texas should regulate hemp more aggressively. It is not about Dan Patrick’s sincerely held conviction that THC products harm children, nor about Greg Abbott’s equally sincere conviction that prohibition was legally indefensible. Reasonable people hold different views on all of it, and the Legislature is the proper place to resolve them.
That is precisely the point.
Four legislative opportunities came and went. The democratic process ran its course and produced an outcome — not the one Patrick wanted, but an outcome nonetheless. The question now is whether that outcome means what it used to mean, or whether it is simply the opening bid in an agency rulemaking process that delivers the same result anyway, steered by the informal gravitational pull of the most powerful office in the Texas Capitol.
In a constitutional republic, the answer has to be that elections and vetoes and failed special sessions mean something. This lawsuit intends to establish that they do.
Senate Health and Human Services Committee given interim charge
The next major fight over hemp-derived THC in Texas is already taking shape, and it is not beginning with a neutral policy review. It is unfolding just as the industry’s legal team prepares to challenge the Department of State Health Services’ permanent hemp rule in court, with lawyers arguing that the agency repeated the same kind of administrative overreach at issue in the Sky Marketing litigation and again tried to do by rule what Texas law did not authorize it to do by statute. In that telling, the state did not simply adopt an aggressive interpretation of its power. It used bureaucratic means to pursue a prohibitionist outcome that critics say could not be cleanly achieved through the ordinary constitutional process. Against that backdrop, Lieutenant Governor Dan Patrick’s new interim charge to the Senate Health and Human Services Committee looks less like an open inquiry than the next move in a coordinated campaign.
The charge directs lawmakers to study the “societal impacts” of THC product consumption, with particular emphasis on increased health care costs, mental health emergency detentions, THC-induced psychotic disorder, and criminal justice burdens. What it does not ask is just as revealing. It does not ask whether Texas has created a workable regulatory framework for lawful hemp products. It does not ask whether patients and consumers retain meaningful access. It does not ask whether DSHS exceeded its statutory authority. And it does not ask whether prohibition would impose costs of its own. The structure of the assignment points in one direction: build a record of harm, quantify the burden, and prepare the argument for a more aggressive legislative response in 2027.
That is why this development should be understood as more than another committee study. In Texas politics, the decisive work often begins long before a bill is filed. Interim charges shape hearings, hearings shape reports, and reports become the respectable-looking foundation for policies whose conclusion was plain from the start. Here, the real question does not appear to be what kind of hemp policy Texas needs. It appears to be how much damage THC can be made to represent on paper.
The Committee Leadership TellstThe Story
Lois Kolkhorst is central to this process not because she is the Senate’s most theatrical prohibitionist, but because she is something more consequential: a disciplined institutional loyalist with a long record of aligning herself with leadership when it matters. Her history on cannabis policy shows occasional room for tightly cabined compassionate-access arguments, but little evidence of any appetite to break with the Senate’s power structure.
As a House committee chair, she allowed a harsher marijuana-related measure to die without advancing it, then later voted for the Compassionate Use Act. That record did not make her a reformer. It made her a politician willing to permit narrow exceptions without becoming the architect of broader change. When the decisive test arrived in the 89th Legislature, she voted for SB 3, the Patrick-backed total THC ban later vetoed by Governor Abbott. There is no indication she tried to soften its essential purpose or publicly distance herself from its prohibitionist thrust.
Just as important, Senator Charles Perry serves as vice chair of the committee. The Texas Senate’s official materials identify Perry as vice chair of Health and Human Services, alongside Kolkhorst as chair. That is not a minor organizational detail. Perry has spent years positioning himself as one of the hemp industry’s most consistent antagonists, and his presence in the committee’s second-ranking role signals that this will not be a neutral venue. If Kolkhorst embodies the institutional discipline of Senate leadership, Perry brings the ideological zeal. Together they form a leadership structure far more likely to treat hemp-derived THC as a target to be suppressed than a market to be sensibly regulated.
That matters because hearings are not passive events. Chairs and vice chairs shape tone, sequence witnesses, frame questions, and decide what kinds of testimony are treated as serious. On an issue as contested as hemp-derived THC, that kind of procedural control can matter as much as any floor vote.
Dan Patrick’s Method Is Becoming Plain
Seen in sequence, the pattern is getting harder to ignore. Since 2025, the anti-THC campaign in Texas has moved on several fronts at once. The Legislature established the rhetoric. The executive and administrative apparatus imposed immediate burdens. Now the interim study process is being positioned to generate the official record that can be cited when lawmakers return in 2027.
This is how a durable prohibition agenda is assembled. First comes the moral panic. Then come the regulatory burdens. Then comes the official study that translates political claims into findings, recommendations, and citations suitable for legislation. By the time the next bill is filed, its supporters can present the outcome not as ideology, but as the sober conclusion of a state-sanctioned review. That is the political value of a charge like this one. It allows a predetermined conclusion to wear the costume of public-health diligence.
Why the Timing Matters
The timing is especially revealing. Texas has just finalized DSHS permanent rules that took effect at the end of March 2026, and those rules are already facing legal challenge over whether the agency exceeded its authority, particularly in its treatment of total THC and THCA. The dispute is not merely technical. It goes to whether an agency can effectively redraw the legal boundaries of the hemp market through rulemaking when the Legislature itself did not clearly do so.
From that perspective, Patrick’s interim charge looks like a hedge as much as a study. If the courts conclude that DSHS overreached, the Legislature will want a ready-made predicate for direct statutory action in 2027. A committee record saturated with testimony about psychosis, emergency detentions, and public cost would serve that purpose well. It prepares the ground for the next prohibition push in case the current regulatory approach proves legally unstable.
Kolkhorst’s Expanded Influence Raises the Stakes
The memo’s most significant observation may be that Kolkhorst’s power now extends beyond this single interim charge. She was also appointed to chair the Sunset Advisory Commission at a moment when agencies including the Health and Human Services Commission and DSHS will be under review. That creates a notable concentration of authority in one senator already closely aligned with Senate leadership and now positioned at the center of both the THC study and the broader institutional review of the agencies shaping hemp regulation.
That dual role matters because it links narrative power with procedural power. The same political ecosystem that will study THC’s alleged harms will also be positioned to evaluate the agencies enforcing the state’s hemp rules. For the hemp industry and for the broader public, the question is whether that concentration of influence will produce meaningful scrutiny of agency overreach or simply a more coordinated effort to ratify it.
Federal Pressure May Tighten the Squeeze
The state fight is also unfolding against a shifting federal backdrop. The memo notes that a federal continuing resolution provision set to take effect in November 2026 could move federal policy toward a total-THC standard and push many intoxicating hemp products back toward Schedule I treatment under federal law. If that happens, the Texas Senate will enter the 2027 session armed with both a state-level prohibition narrative and a harder federal environment to cite in support of further restrictions.
For prohibition advocates, that is politically useful terrain. It allows them to argue that Texas is not overreacting, but merely aligning itself with an emerging trend. Whether that trend is analytically sound or opportunistically invoked is another question. In legislative combat, the appearance of alignment is often nearly as useful as the substance.
The Remaining Openings
None of this means the outcome is fixed in every respect. It means the structure of the fight is becoming clearer. Even in a hostile process, there are still places where the record can be contested and overreach can be exposed.
Kolkhorst’s history suggests some responsiveness to arguments grounded in genuine medical need, especially when voiced by patients, families, and veterans rather than by industry alone. That does not make her a reform ally. It does suggest that a purely commercial defense of the hemp market is less likely to break through than an argument grounded in access, inadequate alternatives, and the real-world consequences of prohibition.
The Sunset process may ultimately matter more than the interim hearings themselves. Sunset review is supposed to examine whether agencies are operating within legislative intent, using public resources rationally, and staying within the limits of their authority. That is a more fact-intensive forum than a THC hearing built around alarming testimony and politically convenient anecdotes. If opponents of overreach can show that DSHS exceeded its mandate, imposed irrational burdens, or failed to justify its regulatory choices, that case may carry more institutional force there than in a hearing designed from the outset to validate alarm.
The interim hearings will still matter, even if no one should mistake them for neutral proceedings. Their importance lies not in the prospect of immediate persuasion, but in the creation of a counter-record. Physicians, economists, public-health researchers, veterans, consumers, and lawful retailers can still inject complexity into a process designed to simplify. In Texas politics, that can make the difference between a one-sided morality play and a record robust enough to support litigation, legislative alternatives, and public skepticism.
What This Moment Really Means
The deeper significance of this moment is not simply that another committee has been assigned another study. It is that Texas leadership appears to be constructing, piece by piece, the procedural and rhetorical architecture for renewed action against THC products. The Legislature supplied the rhetoric. Agencies supplied the immediate pressure. Now the committee process is being positioned to supply the official justification.
For the broader public, that should raise a straightforward question. When lawmakers announce a “study,” are they seeking answers, or are they assembling evidentiary packaging for conclusions already chosen? On hemp-derived THC, the answer increasingly appears to be the latter. And with Lois Kolkhorst in the chair and Charles Perry at her side as vice chair, there is little reason to pretend this committee has been arranged for balance.
The next chapter of Texas hemp policy will not be decided in a single hearing room. It will be shaped in court, in agency review, in committee testimony, and in the wider political fight over whether regulation is still allowed to mean regulation, or whether every controversy must end the same way: with a ban dressed up as public health.
Why the New DSHS Rules Demand Immediate Legal Challenge
The Department of State Health Services has finalized sweeping amendments to 25 Texas Administrative Code Chapter 300, the regulatory framework governing the manufacture, distribution, and retail sale of consumable hemp products in Texas. These revisions, adopted by the Texas Health and Human Services Commission, represent the most aggressive regulatory intervention in the hemp market since HB 1325 legalized the industry in 2019.
The agency presents these changes as a routine response to Executive Order GA-56 issued by Governor Greg Abbott on September 10, 2025, which directed regulators to strengthen age restrictions, testing standards, and compliance requirements within the hemp marketplace. What has emerged, however, is not a modest regulatory update. It is a sweeping administrative rewrite of the legal framework governing hemp commerce in Texas.
The record of the rulemaking itself reveals the depth of concern surrounding these changes. During the public comment period, DSHS received 1,421 comments from retailers, manufacturers, trade associations, advocacy groups, and individual citizens. The overwhelming majority opposed the proposed rules, warning that the measures would exceed statutory authority, impose crushing costs on lawful businesses, and destabilize a market that the Texas Legislature deliberately created. DSHS acknowledged these objections but largely dismissed them, adopting most of the rules substantially as proposed.
The final result is a regulatory package that raises serious constitutional, statutory, and administrative law concerns.
Administrative Overreach Masquerading as Regulation
HB 1325 was enacted with a clear and limited purpose: to establish a lawful marketplace for hemp products consistent with federal law. The statute authorized DSHS to regulate manufacturing, distribution, and retail sale of consumable hemp products. It did not authorize the agency to extinguish the industry through administrative maneuver.
Yet the newly adopted rules risk doing exactly that.
The amendments impose annual licensing fees of $10,000 per facility for manufacturers and $5,000 per location for retailers, dramatically increasing the cost of participating in the hemp marketplace. DSHS justified these increases as necessary to fund inspections, laboratory testing, administrative enforcement proceedings, and cooperative enforcement activities with the Texas Alcoholic Beverage Commission and the Department of Public Safety.
These are not minor adjustments. They represent a structural shift toward an enforcement-heavy regime that treats hemp businesses less like ordinary retailers and more like regulated vice industries. For small operators, particularly independent shops serving rural communities, the new fee structure alone may prove unsustainable.
The THCA Redefinition: A Regulatory End-Run Around the Legislature
The most consequential change lies in the agency’s redefinition of how THC content is calculated.
Under the amended rules, laboratories must calculate “total THC” by including tetrahydrocannabinolic acid (THCA) along with delta-9 THC, accounting for the chemical conversion of THCA into THC during heating.
At first glance, the change appears technical. In reality, it carries sweeping consequences for the marketplace.
Many hemp flower products sold lawfully in Texas contain THCA levels that exceed the 0.3 percent delta-9 THC threshold once conversion is taken into account. By redefining THC to include the theoretical conversion of THCA, regulators have effectively rendered large segments of the hemp flower market unlawful without any vote by the Texas Legislature.
This maneuver illustrates a classic form of administrative overreach. Agencies possess authority to interpret statutes and implement regulations. They do not possess authority to rewrite legislative policy decisions through regulatory interpretation.
A Compliance Structure Designed to Break the Market
The amended rules also impose an expansive network of compliance obligations across the entire hemp supply chain.
Manufacturers must conduct extensive testing for cannabinoid content, residual solvents, pesticides, heavy metals, and microbiological contaminants. Retailers must verify packaging compliance, maintain documentation, and ensure that every product meets detailed labeling requirements derived from federal food regulations.
The rules further authorize unannounced inspections by DSHS and the Texas Alcoholic Beverage Commission, and businesses must consent to these inspections as a condition of obtaining or maintaining licensure.
Taken individually, many of these provisions might appear manageable. Taken together, they create a dense regulatory architecture that will strain even well-capitalized operators. Smaller businesses, which form the backbone of the Texas hemp retail sector, may find the cumulative burden impossible to sustain.
The Political Context Behind the Rulemaking
These regulatory changes did not arise in a political vacuum.
For several years, prohibition-minded officials have attempted to frame hemp as a public safety crisis, despite the absence of credible evidence supporting such claims. Legislative attempts to impose sweeping bans have repeatedly encountered resistance from industry stakeholders and lawmakers who recognize the economic importance of the hemp market.
Faced with those obstacles, policymakers have increasingly turned to administrative rulemaking as an alternative route to impose restrictions that could not easily pass through the legislative process.
This approach carries an undeniable political logic. Regulations can accomplish quietly what legislation struggles to achieve publicly. But that strategy also carries legal risks, because administrative agencies remain bound by the limits of statutory authority.
When those limits are exceeded, the courts provide the proper forum for correction.
Why a Lawsuit Should Be Filed Immediately
The Texas hemp industry now faces a pivotal decision. Businesses can attempt to comply with a regulatory regime that threatens their economic survival, or they can challenge the legality of these rules in court.
A legal challenge is not merely justified. It is essential.
Several fundamental legal questions demand judicial review. One concerns whether DSHS exceeded the authority granted under Texas Health and Safety Code Chapter 443 by effectively redefining hemp through the inclusion of THCA conversion in total THC calculations. Another concerns whether the agency imposed regulatory burdens, particularly licensing fees and compliance requirements, that are disproportionate or unsupported by legislative authorization. A third concerns whether the rulemaking process itself complied with the procedural requirements of the Texas Administrative Procedure Act, which obligates agencies to provide meaningful justification for regulatory changes and to engage seriously with public objections.
These are precisely the kinds of disputes that courts exist to resolve.
The Industry’s Moment of Decision
Texas now stands at a crossroads.
One path leads toward a tightly restricted hemp market dominated by a small number of large operators capable of navigating an increasingly complex regulatory system. The other preserves the open, entrepreneurial marketplace that HB 1325 was intended to create when the Legislature legalized hemp production and commerce.
Moments like this test whether the rule of law remains meaningful in the face of administrative power. The courts exist precisely to address such questions.
For the Texas hemp industry, the moment for hesitation has passed. The rules have been written. Their consequences are already visible.
What remains is the willingness to challenge them.
The Texas hemp industry does not have a marketing problem. It has a credibility problem.
That distinction matters.
When legislators talk about “unregulated intoxicants,” when law enforcement conducts raids with television cameras in tow, when opponents describe the market as a public health emergency, they are not arguing about cannabinoids. They are arguing about discipline. They are arguing about whether this industry behaves like an adult.
Good Manufacturing Practice—GMP—is the answer to that argument.
GMP is not a logo. It is not a slogan. It is not a sticker on a window. It is a system. At its core, GMP means this: products are manufactured in a controlled, documented, repeatable way that ensures consistency, safety, and traceability. It requires written procedures. It requires training. It requires recordkeeping. It requires the ability to answer a simple question without hesitation: “How do you know this batch is what you say it is?”
If you cannot answer that question with documentation, you are not in a regulated market. You are in a hobby.
The federal framework for GMP in the United States exists already. The Food and Drug Administration enforces current Good Manufacturing Practice, or cGMP, standards for foods, dietary supplements, cosmetics, and pharmaceuticals. Dietary supplements, for example, are governed by 21 C.F.R. Part 111. Food facilities operate under 21 C.F.R. Part 117. These are not abstract rules. They cover sanitation controls, supplier verification, batch production records, equipment maintenance, complaint handling, and recall procedures.
Hemp-derived products sit in a complicated regulatory posture, but that does not mean they sit in a vacuum. The scientific principles of GMP apply whether a product contains vitamin C or a cannabinoid.
The core concept is control. Control of raw materials. Control of processes. Control of environments. Control of records.
Consider what that looks like in practice. A manufacturer sources distillate. Under a GMP system, that supplier is qualified. Certificates of analysis are verified and tied to lot numbers. Incoming material is logged. Storage conditions are documented. Production steps are written in standard operating procedures. Employees are trained and their training is recorded. Each batch is assigned a number. Finished goods are tested. Distribution records show where each lot was shipped. If a defect is discovered, there is a documented recall plan.
That is not bureaucracy. That is civilization.
Hemp is a plant. Plants bioaccumulate heavy metals from soil. They host microbes if improperly dried. They degrade if stored in humid environments. Cannabinoids oxidize. Residual solvents can remain if extraction is sloppy. None of this is scandalous. It is chemistry. GMP exists to manage these variables, not to eliminate business.
The uncomfortable truth is that parts of the hemp market grew faster than their infrastructure. Entrepreneurs moved at startup speed. Regulation moved at legislative speed. Public perception moved at cable news speed. Those timelines collided.
When opponents point to mislabeled potency, contaminated products, or products marketed without guardrails, they are not inventing physics. They are pointing to variance. Variance is what GMP is designed to reduce.
Here is the forward-looking reality: industries that survive scrutiny are industries that document themselves into legitimacy. The food industry did not always have Hazard Analysis and Critical Control Points. The pharmaceutical industry did not always have batch validation. They built those systems because crises forced maturity.
Hemp can build them proactively.
This is not about surrendering to overregulation. It is about seizing narrative control. An industry that can show documented SOPs, training logs, supplier verification, sanitation schedules, and traceable batch records is not “the Wild West.” It is a regulated commercial ecosystem waiting for consistent oversight.
Legislators respond to evidence. Regulators respond to structure. Courts respond to documentation.
GMP transforms debate. Instead of arguing in the abstract about “dangerous products,” the conversation becomes concrete: show the batch record, show the COA, show the sanitation log, show the training file.
When you can produce those documents without panic, rhetoric loses oxygen.
There is a deeper point here. Credibility is cumulative. It is built through systems, not speeches. If the hemp industry wants durable access to markets, capital, insurance, and mainstream retail partnerships, it must look and operate like an industry that expects to be around in ten years.
GMP is not glamorous. It is binders and databases. It is checklists and calibration logs. It is the quiet confidence of being able to say, under oath if necessary, “Here is exactly how we made this product.”
In a climate where fear-based narratives move faster than facts, the disciplined operator has an advantage. Documentation is not defensive. It is strategic.
Hemp does not need louder slogans. It needs better systems. The future of the industry will not be decided by how passionately it argues, but by how professionally it operates. Industries that master their processes earn the right to exist. Those that do not are regulated by people who assume chaos. Good Manufacturing Practice is not a burden. It is armor. And the companies that understand that first will shape what this market becomes next.
Texas has a way of clarifying things. You can talk theory all day in a committee room, but sooner or later somebody’s boots hit the ground and you find out what the law actually means. That is where we are with federal cannabis policy right now—caught between a reform signal from the White House and the unmistakable sound of warehouse doors being kicked in.
In December 2025, President Donald Trump signed an executive order directing the federal government to move marijuana from Schedule I to Schedule III. That may sound like a bureaucratic reshuffling, but anyone who has spent time navigating the Controlled Substances Act knows the difference is not cosmetic. Schedule I is the legal fiction that cannabis has “no accepted medical use.” Schedule III acknowledges medical value and relaxes some of the most punitive structural burdens, including the tax regime that has strangled legitimate operators under Section 280E.
That was the signal from Washington: modernization. Alignment. A tacit admission that pretending cannabis belongs in the same federal category as heroin has become an exercise in self-parody.
And then came the raids.
The South Carolina Shock
In South Carolina, state and federal authorities executed sweeping enforcement actions targeting THC distributors under what prosecutors called “Operation Ganjapreneur.” Warehouses were searched. Trucks were seized. Thousands of pounds of product were confiscated. The rhetoric was familiar: highly intoxicating products, threats to children, narcotics charges.
Federal participation reportedly included the Drug Enforcement Administration, reminding everyone that even in a moment of federal policy transition, enforcement muscle remains fully flexed.
That is not an abstract policy debate. That is inventory in an evidence locker and people in handcuffs.
If you are an operator in Texas, that story does not feel distant. It feels like déjà vu.
Texas Has Lived This
We know this movie in Texas. We have watched hemp retailers operate in good faith under statutory language derived from the 2018 Farm Bill, only to find themselves facing seizures based on disputed lab interpretations. We have seen regulators struggle to reconcile evolving cannabinoid science with statutes drafted before anyone outside a chemistry lab had heard of delta-8. We have watched prosecutors test the outer edges of ambiguity because ambiguity is where discretion lives.
The 2018 Farm Bill did not hide its language. Hemp and all derivatives, extracts, cannabinoids, and isomers under 0.3 percent delta-9 THC were removed from the Controlled Substances Act. Congress wrote it. The President signed it. Markets responded. If legislators later decided the consequences were broader than anticipated, that is a drafting problem, not a smuggling conspiracy.
As James Madison warned in Federalist No. 62, “It will be of little avail to the people that the laws are made by men of their own choice if the laws be so voluminous that they cannot be read, or so incoherent that they cannot be understood.” We are living in the incoherence he feared.
The Republican Family Argument
This moment is not a clean partisan fight. It is an internal Republican argument.
Some lawmakers have publicly suggested that the President was “poorly advised” to move toward Schedule III. Their objection is procedural: that rescheduling amounts to an end-run around the FDA’s drug approval framework. Research, they argue, can proceed without altering federal classification.
That position is not merely technical. It reflects a worldview that treats drug scheduling as a cultural boundary marker. If you move the line, you concede ground.
On the other side are voices arguing that rescheduling is simply catching federal law up to political and medical reality. Longtime Trump ally Roger Stone has publicly urged the move, framing it as both substantively defensible and politically savvy. Cannabis reform polls well. Voters across party lines support medical access. The states have already moved.
This is not a debate about botany. It is a debate about governance and narrative.
The Culture-War Reflex
When enforcement rhetoric lumps cannabis together with fentanyl and cartel trafficking, the public hears a simple story: drugs are drugs. But cannabis is not fentanyl. Hemp-derived THC products sold in storefronts are not clandestine meth labs run by transnational syndicates.
Agencies like the Federal Bureau of Investigation understandably focus on dismantling violent criminal networks. That mission is legitimate and necessary. The danger arises when the language of that mission bleeds into areas where regulation, not eradication, is the appropriate tool.
Texas humor has a way of cutting through this. If you treat a mesquite bush like it’s a forest fire, you end up calling in helicopters for a backyard barbecue.
Reform Must Survive Contact with Reality
An executive order is direction. A raid is consequence.
If Schedule III becomes the operative federal posture, enforcement priorities should reflect that transition. That does not mean anarchy. It does not mean ignoring bad actors. It means calibrating response to actual harm rather than political optics.
The lesson from South Carolina is not that reform has failed. It is that reform without alignment creates instability. Businesses do not operate well in twilight zones. Investors do not deploy capital where statutory interpretation shifts by press conference.
Texas has every reason to watch this carefully. Our Legislature, our regulators, and our law enforcement agencies will inevitably confront the same tension between federal signals and state statutes. We can choose clarity through legislation and transparent rule-making, or we can choose episodic enforcement theatrics.
As Sam Houston once observed, “A leader is one who helps improve the lives of other people or improve the system they live under.” Modernizing cannabis policy is not about indulgence. It is about improving a system that has long been riddled with contradiction.
The story unfolding right now is not whether cannabis will remain controversial. It will. The story is whether American law can align itself with reality without swinging from neglect to overreaction.
Policy is not what is announced at a signing ceremony in Washington. Policy is what happens when the warrants are served and the courtroom doors close.
That is where reform proves itself—or exposes itself as rhetoric.
The next chapter of this series will examine what Schedule III actually changes on the ground and whether it meaningfully restrains the enforcement machinery we just watched in motion.
Because in Texas, we do not judge policy by applause lines.
Texas does not have a marijuana industry. It has a hemp industry that Congress legalized in 2018 when President Donald Trump signed the Agriculture Improvement Act of 2018 into law. That statute removed hemp and “all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers” containing no more than 0.3 percent delta-9 THC from the Controlled Substances Act. It was not ambiguous. It was not an accident. It was bipartisan and it was intentional.
Texas responded. Farmers planted. Processors invested. Retailers signed leases. An entire supply chain emerged around what is now a six-to-eight-billion-dollar Texas hemp market. That number is not a fever dream. It reflects retail, wholesale, manufacturing, logistics, and the secondary economic effects of a rapidly scaling consumer sector. Whether one likes the products or not, this is not a hobby economy.
And now we are in a trade war with China.
That matters.
Because if the stated national policy is economic sovereignty, domestic manufacturing, and protecting American supply chains from foreign capture, then the enforcement posture toward hemp deserves scrutiny. Texas entrepreneurs who relied on the text of the 2018 Farm Bill are facing regulatory whiplash and criminal exposure in some jurisdictions. At the same time, there is growing national concern about Chinese-linked criminal networks operating illegal marijuana grows in states with loose licensing systems, and about foreign chemical supply chains that feed gray and black markets in synthetic cannabinoids.
These are separate phenomena. But politically, they are colliding.
The hard question is this: are we protecting American producers, or are we destabilizing them while foreign competitors and illicit networks fill the vacuum?
If aggressive enforcement and regulatory ambiguity suppress domestic hemp operators in Texas, the market does not vanish. Consumer demand does not evaporate because a press conference was held. Markets adapt. Supply shifts. If legitimate, tax-paying Texas businesses are squeezed, the logical beneficiaries are out-of-state actors, offshore chemical suppliers, and illicit networks operating beyond transparent oversight.
That is not conjecture. It is how markets behave.
The intoxicating hemp segment exists because Congress legalized hemp broadly and because chemists learned how to work within that definition. THCa flower, delta-8, and other hemp-derived cannabinoids did not emerge from a conspiracy; they emerged from statutory text and innovation. Whether lawmakers now regret the breadth of that language is a separate political debate. But regret does not rewrite history.
If the United States is serious about economic competition with China, then domestic agricultural and manufacturing sectors should be strengthened, not destabilized through inconsistent interpretation. Texas hemp businesses are American small businesses. They hire locally. They pay Texas taxes. They lease Texas property. They operate under state registration systems.
One can argue for tighter standards. One can argue for clearer labeling. One can argue for age restrictions or potency caps. Those are regulatory debates. But criminalizing ambiguity while foreign supply chains remain fluid is not economic nationalism. It is self-inflicted asymmetry.
The China narrative is powerful because it taps into real anxieties about supply chain vulnerability, intellectual property theft, and chemical precursor markets. But it becomes incoherent if domestic entrepreneurs are treated as expendable collateral damage in the same breath.
Here is the uncomfortable tension: President Trump legalized hemp. Texas built an industry on that legalization. Now, in the middle of an escalating trade conflict with China, enforcement uncertainty threatens to push market share away from transparent American operators and toward actors far less accountable to U.S. regulators.
If we are in an economic war, strategy matters. You do not weaken your own productive base while invoking sovereignty.
Texas is uniquely exposed in this debate because of the size of its hemp economy and the state’s political alignment with national trade rhetoric. A six-to-eight-billion-dollar market is not a rounding error. It is jobs in Houston warehouses, manufacturing equipment in Dallas facilities, retail payroll in San Marcos strip centers, and rural acreage planted with hemp instead of fallow fields.
The question is not whether reform is needed. The question is whether reform strengthens domestic producers or drives capital offshore.
Nationalism, if it means anything, must include coherent domestic policy. Otherwise it becomes theater.
The Texas Department of State Health Services has formally extended the emergency rules governing consumable hemp products through March 30, 2026, as reflected in the February 6, 2026 Texas Register. These rules—first adopted in October 2025—remain in effect without substantive change. No new restrictions were added. No permanent rules were finalized.
This matters because the state had a choice. It could have locked in final rules and forced the issue legally and politically. Instead, it chose to extend temporary authority. That is not an accident. It is a pause.
The emergency extension keeps the current guardrails in place, including age-based sales restrictions, while avoiding a permanent regulatory position that would invite immediate legal challenge and legislative backlash. In plain terms, the state is holding its ground without planting a flag.
What this action does not do is just as important. It does not settle the future of hemp regulation in Texas. It does not expand enforcement authority. It does not criminalize new conduct. It does not resolve disputes over testing standards, product categories, or agency overreach. It simply preserves the status quo—briefly.
That brief preservation is the opportunity.
Emergency extensions are breathing room, not absolution. They create time for the industry to show whether it can operate credibly under scrutiny or whether the state will feel justified in tightening the vise. Every regulator and elected official understands this distinction, even if they do not say it out loud.
This is the moment when voluntary compliance stops being a philosophical preference and becomes a strategic necessity.
Certified training programs, documented age-gating, truth in labeling, truth in testing, verified brands, and clean supply chains are no longer just internal best practices. They are evidence. They are proof points that can be shown to the Governor’s Office and to legislators who are still persuadable. They answer the only question that really matters right now: Can this industry govern itself responsibly if allowed to continue operating?
Everything done during this window will be noticed. Good conduct compounds. Bad conduct will be amplified and used as justification for permanent restrictions that will be far harder to undo. There is no private behavior in this environment. There is only behavior that strengthens the case for rational regulation, or behavior that hands opponents exactly what they want.
Texas has not slammed the door. It has left it cracked open.
Whether that crack becomes a stable regulatory framework or snaps shut into overreach depends on what the industry does next. This window is real. It is short. And it should not be squandered.
The continued use of emergency rule renewals, rather than adoption of final rules, is not accidental and it is not merely procedural housekeeping. It reflects a deliberate choice by the agency to avoid locking itself into a permanent regulatory position while legal, political, and policy variables remain unsettled.
Final rules carry consequences that emergency rules do not. Once finalized, they invite immediate judicial review on a fuller record, expose the agency to greater litigation risk, and signal institutional confidence that the policy is both lawful and durable. By contrast, emergency renewals preserve flexibility. They allow the agency to maintain interim guardrails while avoiding a definitive commitment that could be overturned, enjoined, or politically repudiated.
The repeated reliance on emergency authority is therefore a tacit acknowledgment that the regulatory environment remains unstable. It suggests that DSHS understands its position is being watched closely by courts, the Legislature, and the Governor’s Office, and that moving too aggressively or too permanently could backfire. Emergency renewals buy time. They keep the status quo intact without forcing a showdown.
Politically, this matters. The absence of final rules signals that the industry has not lost the argument, even if it has not yet won it outright. The state is not declaring the matter settled. Instead, it is holding space—narrow space, but real space—while broader questions about statutory authority, public safety, economic impact, and administrative overreach continue to percolate.
That pause creates what amounts to breathing room, and breathing room only has value if it is used deliberately.
From a strategic standpoint, this is the window in which the industry must demonstrate maturity, seriousness, and good faith. Everything being done now—certified compliance education, standardized training for owners and employees, verified brand programs, age-gating protocols, and documentation of best practices—is not just about internal improvement. It is evidence. It is proof of concept. It is the answer to the unspoken question regulators and legislators are asking: Can this industry govern itself credibly if given the chance?
This is particularly relevant for engagement with Greg Abbott’s office and with legislators who remain persuadable rather than hostile. Emergency renewals create space for education. They allow time to show—not merely assert—that the industry has taken concrete steps to address safety, youth access, product integrity, and transparency. They also allow elected officials to absorb that information without having to immediately defend a yes-or-no vote.
At the same time, the moment comes with discipline requirements. The industry should assume that everything it does is being observed—by regulators, by lawmakers, by opponents, and by the press. There is no such thing as a private experiment right now. Good behavior compounds. Bad behavior will be amplified and weaponized. Compliance efforts that are real, documented, and independently verifiable strengthen the case for reasonable regulation. Sloppy conduct, internal infighting, or opportunism weaken it.
Legally, the signal is equally clear. Emergency renewals suggest that the agency is aware its footing is not yet secure. That awareness creates leverage, but only if the industry continues to build a record showing that education, certification, and verification are not theoretical aspirations but operating realities. Courts care about facts on the ground. Legislators care about political risk. The Governor’s Office cares about both.
In short, emergency rule renewals are the state pressing the pause button—not out of generosity, but out of caution. The industry has been given time, not absolution. Used wisely, this period can materially improve the odds of a durable, lawful, and rational regulatory framework. Used poorly, it will be cited later as proof that the opportunity was squandered.
The work now is not defensive panic. It is methodical proof-building. And in this environment, proof has a way of moving people who were previously content to sit on the fence.
For years, kratom existed in a regulatory gray zone—debated, periodically regulated, but rarely confronted through full-scale state enforcement. That equilibrium broke on February 6, 2026, when the Texas Attorney General filed suit in Ellis County seeking an ex parte temporary restraining order, temporary and permanent injunctions, and civil penalties against two smoke shop operators accused of selling illegal kratom products .
The State’s opening claim is blunt and unambiguous:
“Kratom is addictive and deadly.”
According to the petition, Texas health officials and lawmakers are no longer dealing with traditional botanical kratom, but with what the filing describes as “potent and dangerous concentrations of synthetic alkaloids” that bear little resemblance to the plant historically consumed in Southeast Asia .
The lawsuit alleges that products sold at Smokey’s Paradise retail locations contained 7-hydroxymitragynine (7-OH) at levels that “significantly exceed[] the 2% statutory limit” imposed by the Texas Kratom Consumer Health and Safety Protection Act. In some cases, laboratory testing allegedly found 7-OH making up “96% of the tablet”—a concentration the State characterizes as “forty-nine times the legal limit” .
Even more consequential is the State’s allegation that several products contained mitragynine pseudoindoxyl, a compound the petition states “is not a natural alkaloid present in botanical kratom leaves” and “must be synthetically produced” . Under Texas law, the presence of synthetic alkaloids alone is sufficient to render a kratom product illegal.
The petition identifies specific branded products allegedly purchased by investigators and sent for independent laboratory testing, including Dozo Perks 7-OH tablets, 7OHMZ 7-OH tablets, 7Tabz 7-OH tablets, 7O’Heaven 7-OH liquid shots, and Tahi Mahji tablets .
The State does not frame these allegations as technical violations. Instead, it situates them squarely within an opioid-risk narrative. The filing describes 7-OH as “a potent mu-opioid receptor agonist with pharmacological properties similar to morphine and fentanyl” and warns that products containing concentrated 7-OH can cause “respiratory depression, physical dependence, and withdrawal symptoms characteristic of classical opioids” .
From a legal standpoint, the enforcement posture is as aggressive as the rhetoric. The Attorney General argues that when a statute is violated, courts need not weigh competing harms. Citing Texas precedent, the petition states that “the status quo can never be the continuing violation of a law,” and that the State’s “inability to enforce its duly enacted laws clearly inflicts irreparable harm” .
That framing matters. It allows the State to seek immediate injunctive relief without the delays typically associated with protracted litigation. In practical terms, it means retailers can be ordered to stop selling an entire product category before any final ruling on the merits.
For legislators, the lawsuit provides something equally valuable: a ready-made factual record. The petition assembles poison-center data, FDA warnings, DEA classifications, and laboratory findings into a narrative that recasts kratom not as an herbal supplement with compliance problems, but as an emerging synthetic opioid threat. Once that framing is adopted, legislative outcomes tend to follow.
The implications extend beyond kratom alone. Regulators do not evaluate retail compliance in isolation. Stores alleged to sell illegal synthetic products are more likely to be viewed as systemic risks, a perception that can spill over into inspections, licensing decisions, and enforcement priorities affecting other product categories, including hemp-derived THC.
The Ellis County case is therefore best understood not as an isolated dispute, but as a template. It shows how kratom enforcement is likely to proceed and how legislative debates will be shaped going forward. The State has moved past warnings and into injunctions, past regulation and toward elimination.
For an industry accustomed to regulatory ambiguity, the message is suddenly precise. The kratom debate has entered its endgame, and the first decisive move has already been filed in court.
The Texas Supreme Court’s hearing in Texas Department of State Health Services v. Sky Marketing had the calm, deliberate feel of a court doing what courts are supposed to do: strip away the noise, ignore the moral-panic political theatrics across the plaza in the east wing of the Capitol, and read the statute because that’s what matters. The case arrives dressed in administrative-law vocabulary—standing, sovereign immunity, ultra vires, temporary injunction mechanics—but everyone in the room understood the real stakes. Texas legalized hemp in 2019, a regulated market formed in reliance on that law, and then an agency announced a reinterpretation that snapped the market’s spine. The question now is whether that kind of regulatory whiplash can be insulated from judicial review by calling it a “clarification.”
I’ve watched this dispute evolve since the beginning, from district court record-building to today’s argument. That history matters because what looks like a narrow legal fight from a distance is, up close, a case about institutional limits and whether agencies may do by administrative maneuver what the Legislature would not—or could not—do by statute. And this case potentially sets the stage for a challenge to the latest iteration of government by gaslight—the DSHS proposed permanent hemp rules (see previous article.)
The justices’ questions signaled an important choice point. They were not there to referee policy preferences about delta-8, hemp-derived intoxicants, or the cultural anxieties legislators like to launder through “for the children” messaging. They were there to test the boundaries of delegated authority, the coherence of the State’s standing theory, and the legitimacy of using regulatory communication as a substitute for formal rulemaking.
The State’s Framing: “Longstanding Efforts” and a “Clarification”
Arguing for the State, Ryan Scanlon, in his capacity as Assistant Solicitor General, opened with a familiar frame: Texas has long tried to control THC, “the high-inducing substance naturally found in the cannabis plant,” and Texas’s hemp program was never meant to be “a legally permissible vehicle for the proliferation of synthetic and intoxicating forms of that drug.”
That opening is not accidental. It tries to position the case as a continuity story—Texas doing what Texas has always done—so that the agency’s 2021 action reads as inevitable maintenance rather than a material shift. Scanlon pushed that theme hard. On the merits, he argued the Commissioner did not “place delta-8 on the schedule,” because delta-8 is simply “a form of THC,” and “THC has always been on the schedule.” What happened, he insisted, was “a clarification.”
The legal strategy underneath that word choice is obvious. If it was only a clarification, then the case starts to look like an attempt to litigate policy through injunctive relief, rather than a challenge to an agency action that exceeded statutory authority. If it was only a clarification, the State wants the Court to treat the economic disruption as either irrelevant or not fairly traceable to the Commissioner’s action. If it was only a clarification, the injunction looks like an improper universal freeze of “the effectiveness of the amendments,” instead of a conventional restraint on unlawful enforcement.
The justices did not accept that premise as a given. They treated “clarification” as a claim that must survive contact with consequences.
Standing: The State’s Escape Hatch Meets the Real World
Scanlon leaned heavily on standing and sovereign immunity. His core point was that the Commissioner sets the schedules but does not enforce the criminal law. Without criminal enforcement authority, the State argued, challengers cannot establish standing to sue this official, and sovereign immunity bars the suit.
The Court immediately started probing the reality behind that doctrinal posture. One justice asked the basic question any regulated business would ask: if a party may be prosecuted for violating the rule, does it matter who initiates it? Scanlon answered that it does matter, invoking this Court’s 2020 reasoning in Abbott—if the official you sued cannot bring a criminal prosecution, you may lack standing.
That line of argument has a certain internal elegance, but it runs into the way regulation actually works in Texas. Modern regulatory harm does not wait politely for an indictment. It arrives through licensing consequences, market signals, official statements, and the chilling effect of uncertainty.
Justice Rebeca Huddle went straight to that point. “What about the civil side?” she asked. “Don’t they have authority to revoke a license, issue monetary penalties? What about them?”
Scanlon conceded there is civil authority, but then tried to escape it: those allegations, he said, were not pleaded, and in any event the civil licensing scheme “has nothing to do with the Controlled Substances Act.”
That answer prompted something close to the central standing issue in this case: if the Commissioner’s scheduling decision changes what products are treated as lawful, how can the State insist there is no traceable injury to regulated businesses? Justice Crosby pressed that logic, noting the respondents’ evidence that they lost money because they could no longer market certain products. Scanlon’s response was essentially that licensing only applies once the product is already a legal hemp product—and therefore scheduling cannot be the cause of their injury.
The bench treated that as a merits question wearing a standing costume. If the whole fight is whether the Commissioner’s action reclassified what counts as a legal hemp product, then saying “licensing only applies to legal hemp products” just restates the dispute. You can’t resolve standing by assuming your own conclusion.
A separate justice sharpened it further: the Court recognizes “standing for a pocketbook injury,” and if businesses are “losing money because of something your client did,” why isn’t that enough? Scanlon tried to cabin pocketbook standing to rate cases and reimbursement settings where the agency action directly sets a number. He argued this case lacks that directness.
That answer did not appear to satisfy the bench’s concern, because the Court kept returning to consequence: the economic disruption was not hypothetical; it was immediate; and it tracked the agency’s public posture. When Scanlon was asked whether the Commissioner had “threatened enforcement,” he responded bluntly: “The Commissioner has not threatened enforcement.”
That is where the State’s standing theory begins to look like an attempt to convert regulatory power into accountability-free power. If an agency can announce a new interpretation that chills the market, triggers compliance retreat, and collapses investment, and then claim there is no standing because it did not personally make an arrest, the Court is left endorsing a model of governance where the most economically destructive tools are the least reviewable.
The justices’ questions suggested they understand that trap.
The Court Tests the “Clarification” Story
The most important pressure the Court applied today was conceptual. The justices kept returning to the mismatch between the State’s description of its action and the industry’s lived reality.
Justice Bland asked one of the most consequential questions: what is the State’s best argument that treating delta-8 as controlled does not conflict with the definition of hemp in the Texas farm bill?
Scanlon’s response was to double down: delta-8 wasn’t “placed” on the schedule; it is THC; THC was always scheduled; the Commissioner merely clarified after federal changes.
Then came the chemistry and process discussion. Bland asked whether delta-8 is derived or extracted from the cannabis plant. Scanlon answered with a layered explanation: not directly from hemp, he suggested, but from CBD extracted from hemp, with a synthesis process described by CDC and FDA. In other words, delta-8 in commercial form is typically manufactured through chemical conversion rather than extracted as-is at scale.
Scanlon leaned on the DEA observation that in a natural hemp plant under the delta-9 threshold, delta-8 appears only in trace amounts; therefore, when Texas law talks about THCs in hemp, it is talking about naturally occurring trace presence, not manufactured potency.
That framing is politically useful—“trace amounts good, manufactured intoxicants bad”—but it has a legal problem: the Legislature wrote a definition that includes derivatives and isomers and drew the line at delta-9 concentration. If the Legislature intended to prohibit conversion manufacturing or to outlaw certain isomers regardless of delta-9, it had ample opportunity to say so. The State is now asking the Court to infer a narrower legislative intent from federal agency commentary and chemical process descriptions.
That is precisely the sort of move Texas courts scrutinize when assessing ultra vires conduct.
Taylor’s Presentation: Calm, Clear, and Commanding
When Amanda Taylor rose for Sky Marketing, the tonal shift in the courtroom was immediate. Some advocates respond to questions as if they’re being interrupted. Taylor responded as if the justices were doing her a favor by letting her show her work. She framed the case where it belongs: “the bounds of the agency authority expressly delegated by our Legislature.” Policy debates about hemp might be “interesting or controversial,” she said, but the Court’s job is to say what the law means and apply it.
That opening did two things at once. It reduced the State’s moralizing posture to background noise, and it invited the justices to act like judges rather than referees in a culture fight.
Justice Bland asked the key threshold question: is the Commissioner’s decision subject to judicial review? Taylor answered without flinching: yes. Then she did what excellent appellate lawyers do: she took the State’s statutory hook—subsection G—and narrowed it to its actual scope. Subsection G, she explained, addresses the decision whether to conform with federal scheduling changes; it does not authorize the Commissioner to “unilaterally modify the schedule and make it inconsistent with existing Texas law.”
Taylor’s most effective moment came when she confronted the “clarification” label. If the State truly believes no legally significant change occurred, why is the action ultra vires? Taylor’s answer was crisp and procedural: subsection G permits only one type of change—conform or decline. Any “alteration other than the federal conformance change” must proceed under subsection B, which requires notice and hearing on the modification itself, not merely on an objection.
Then she layered in the additional statutory failures: missing findings, failure to notify other agencies with overlapping authority within ten days, and lack of required approval by the Executive Commissioner of HHSC. “None of that occurred.”
Her delivery was exactly what you want when you’re asking a court to enforce limits on agency power: clear, smooth, unruffled, and relentlessly grounded in the statutory roadmap. She sounded like someone who had read the whole record, not just the parts that make her point.
The Legislature’s Hemp Line: Delta-9 as the Bright Line
Taylor also anchored the case in the 2019 hemp framework in a way that forced the Court to confront the Legislature’s design. The statute, she argued, says hemp and THC in hemp are not controlled substances, with legality limited by delta-9: above 0.3% delta-9 is marijuana; below is hemp and not controlled.
That matters because the State’s position tries to smuggle in a different legality test: not the delta-9 threshold, but a broader concept of “THC isomers and analogs” depending on origin or manufacturing method. Once you move away from the statute’s bright line and toward agency-driven categorization, you effectively rewrite the Legislature’s compromise.
Justice Young pressed on delegation—this is an area where the Legislature delegates heavily, so why do we need the statutory limits Taylor was invoking? Taylor’s response was grounded in the 2019 statute’s explicitness: the definition includes derivatives and isomers, and it defines processing and manufacturing in a way that contemplates a regulated consumable market, including conversion and manufacturing.
She also addressed the State’s “synthetics” obsession with a controlled burn. “This lawsuit is not about synthetics,” she said. The State used that word “throughout the State’s brief,” but Sky Marketing did not seek relief tied to that language. This case was brought by businesses and consumers producing and using “legal consumable products made from naturally derived substances.”
That was not mere positioning. It was a strategic narrowing designed to keep the Court from being pulled into a broader political fight the State would prefer to litigate in moral terms.
The Injunction and the Court’s Discomfort with a Universal Freeze
Another line of questioning the Court pressed with particular care concerned the form of the temporary injunction itself. One justice focused on whether the order had slipped from party-specific relief into something broader, noting that it appeared to restrain the “effectiveness of the amendments,” rather than simply prohibiting their enforcement against the plaintiffs. Framed that way, the concern was not semantic but structural: whether the injunction operated in rem rather than in personam.
Taylor met the question head-on. The injunction, she explained, was prospective relief designed to prevent ongoing harm while the merits are litigated, not a judicial repeal of the statute or rules. The language may have been broad, but its function was conventional: to restrain unlawful enforcement of an ultra vires action pending judicial review. She pointed the Court to precedent recognizing that courts routinely prevent continued harm from invalid agency action without purporting to legislate for nonparties.
The State countered that the injunction crossed a constitutional line. By enjoining the “effectiveness” of the scheduling amendments, it argued, the trial court had issued relief that functioned universally, not merely against the named defendants. That, in the State’s telling, transformed a routine injunction into a policy freeze—precisely the sort of relief Texas courts have grown wary of in recent years.
What made the exchange consequential was not the labels, but the Court’s evident concern with how injunctions operate in practice. Texas courts have repeatedly cautioned against orders that look less like dispute resolution and more like administrative suspension. The justices’ questions reflected that unease.
In rebuttal, Scanlon appeared less prepared on this ground. He acknowledged that he had not fully briefed the universal-injunction issue and asked for the opportunity to address it later. That moment lingered, because it reinforced a pattern already visible in the argument: a reliance on formal categorization where the Court was probing functional effect.
The critique of the State’s presentation crystallized there. Scanlon’s advocacy was confident and technically fluent, but it repeatedly assumed that doctrinal labels—“clarification,” “no enforcement authority,” “separate licensing scheme”—were sufficient answers, even when they failed to account for what actually happened to the regulated community. As the bench pressed on scope and consequence, the answers drifted toward procedural abstraction.
Taylor, by contrast, made the Court’s work easier. She offered clean handles rather than evasions: a statute with a clear roadmap, identifiable procedural failures, and a theory of harm that aligned with how regulation actually operates in the real world. That difference in approach mattered, because the Court was plainly less interested in how the injunction was described than in whether it functioned as a proper exercise of equity.The Hearing’s Quiet Theme: Consequences Count
Perhaps the most telling aspect of the argument was how frequently the justices returned to consequences—economic injury, compliance whiplash, and the real-world effects of regulatory signaling. The State tried to confine the case to the absence of criminal enforcement and the formal separateness of licensing from scheduling. The bench kept tugging back toward what happens when an agency speaks and the market believes it must obey.
Taylor captured the point in her standing discussion, emphasizing that the agency’s website statement operates as a threat and that the State has not disclaimed intent to enforce. The record, she noted, showed “immediate economic disruption” once the policy was announced: businesses stopped selling products; reputations were harmed; layoffs were considered.
When the Chief Justice closed the argument, the case was submitted with the sense that the Court had identified the case’s true center of gravity: not whether delta-8 is controversial, but whether the law permits an agency to accomplish a substantive change under the banner of refusing a federal change, without following the statutory procedure for changing Texas law.
Why This Case Matters to the Structure of Texas Government
Texas has lived for years inside a mismatch: the Legislature wrote a definition and a bright line in 2019, the market organized itself around that line, and then agencies and political actors tried to claw back ground through reinterpretation and enforcement posture. That conflict will not end until either the Legislature redraws the statute clearly or the courts enforce the boundaries of delegation.
If the State’s theory prevails, agencies gain a path to reshape statutory meaning through public posture and interpretive maneuvers, insulated by standing doctrine so long as they avoid being the official who files charges. That model expands administrative power while shrinking accountability.
If Sky Marketing’s theory prevails, the Court reaffirms something Texas needs right now: delegated authority has limits, and those limits still bind even when politics gets impatient.
Amanda Taylor argued that position with clarity, smoothness, and a calm command of the record and the law that never wavered. Ryan Scanlon, serving as Assistant Solicitor General, offered a theory that was formally neat but repeatedly struggled to match consequence with characterization. The justices noticed. They pressed. They circled back. They kept asking the same question from different angles until the contradiction could no longer hide behind labels.
Let’s hope that kind of judicial rigor still counts where it matters.
Author
The author was an initial plaintiff and later a witness in this case at the district court level and assisted in recruiting some of the plaintiffs and counsel. At the time, he served as Executive Director of the Texas Hemp Federation and worked closely with the former leadership of Hometown Hero, whose parent company, Sky Marketing, is the named respondent here.
That perspective is offered not to personalize the outcome, but to explain why the Court’s questions resonated so strongly. The author has seen, under oath and in real time, how regulatory ambiguity is created and how quickly it can destabilize manufacturers, distributors and wholesalers, and retailers operating in good faith. The issues before the Supreme Court today are the same ones the trial court confronted years ago, and they remain the right ones.
As the hemp industry approaches the Department of State Health Services’ public comment hearing, the broader context deserves attention. Texas’s system of administrative law was built for moments exactly like this one. The Open Meetings Act, the Public Information Act, and the Administrative Procedure Act reflect a deliberate choice by the Legislature to require transparency, discipline, and accountability when agencies exercise delegated power. Those statutes exist to ensure that regulation proceeds through law rather than impulse, pressure, or improvisation.
Texas adopted this framework after learning hard lessons about secret government and unchecked discretion. The Legislature responded by insisting on process: notice, public participation, reasoned explanation, and a record capable of review. Administrative authority in Texas flows through statute and executive direction, and it carries obligations along with power. Agencies earn legitimacy by following those rules, especially when public controversy and political pressure intensify.
That institutional understanding shaped how many of us learned the Capitol. As a former staffer to Sen. Chet Brooks, who was Dean of the Senate when I worked there in the late 1980s and early 90s, I was taught that transparency statutes function as working tools rather than symbolic commitments. Administrative law preserved legislative authority over time by binding agencies to clear procedures and defensible reasoning. Process mattered because outcomes endure only when built on lawful foundations.
The current DSHS hemp rulemaking places those principles squarely at issue.
The comments submitted by the Texas Hemp Federation and CRAFT address the structure and justification of the proposed rules rather than the concept of regulation itself. The proposal expands financial burdens, inspection authority, and scientific consequence while weakening procedural guardrails that support predictable compliance and judicial durability. That combination raises questions about delegation, justification, and adherence to administrative discipline.
Delegated authority frames the analysis. DSHS regulates hemp pursuant to legislative grants set out primarily in Chapter 443 of the Health and Safety Code. Rulemaking that reshapes market participation through large fixed fees, expanded inspections, and testing definitions that determine legality requires a clear, evidence-based explanation tying each mechanism to a statutory objective. The proposal provides little of that connective tissue. Regulatory structure without demonstrated nexus drifts away from implementation and toward policy substitution, a function reserved to the Legislature.
The proposed fee structure illustrates the point. Manufacturer and retail fees set at levels disconnected from documented program costs operate as threshold barriers rather than calibrated cost recovery. Such structures narrow the regulated market through attrition, reduce visibility, and concentrate enforcement risk. Texas law places taxation authority with the Legislature, and sound administration requires agencies to disclose the basis for substantial financial impositions. Transparency in this context supports both legality and effective oversight.
Inspection authority presents similar concerns. The proposal enlarges access without defining triggers, scope, documentation limits, or escalation pathways. Inspections function best as predictable compliance audits governed by published standards. Undefined discretion produces variance across inspectors and agencies, destabilizes compliance planning, and erodes trust. Texas administrative law developed precisely to prevent enforcement regimes that depend on informal expectations rather than written rules.
The testing framework carries the greatest consequence.
The proposal redefines “total THC,” expands analyte obligations, and removes acceptance and notice provisions that previously stabilized the compliance environment. Laboratory results determine legality under this structure, which places the testing system itself at the center of the regulatory architecture. Method selection, reporting conventions, treatment of measurement uncertainty, and acceptance criteria directly shape enforcement outcomes. Clear decision rules and standardized disclosure support fairness and predictability. Ambiguity produces variance and manufactured noncompliance.
Defining legality through “total THC” while leaving method fitness and interpretive rules unspecified allows identical samples to yield divergent results based on analytical technique and conversion assumptions. Enforcement outcomes then depend on internal expectations rather than published standards. Administrative law addresses this problem by requiring agencies to specify how scientific measures translate into legal conclusions.
Measurement uncertainty underscores the issue. Uncertainty functions as a legal boundary condition. Agencies bear responsibility for articulating how uncertainty is calculated, applied, and audited. Clear rules produce consistency across laboratories and inspectors. Silence transfers decision-making to ad hoc interpretation.
Public participation also plays a central role. The Administrative Procedure Act requires meaningful opportunity to engage, including practical access to hearings and submission processes. Participation improves rule quality by surfacing operational consequences and testing assumptions before they harden into enforcement. Durable rules emerge from records that reflect genuine engagement rather than procedural minimalism.
Executive direction further clarifies the limits of this rulemaking.
Governor Greg Abbott issued Executive Order GA-56 with defined objectives. The order directs agencies to strengthen age verification, testing integrity, and enforcement within the lawful hemp market while preserving a regulated channel that remains visible and auditable. That instruction carries weight within Texas’s single-executive system. Agencies serve under the Governor’s authority and remain accountable to it.
The current posture of DSHS suggests responsiveness to sustained pressure from Charles Perry and Dan Patrick rather than adherence to the Governor’s directive and statutory limits. Senate rhetoric has framed hemp as an industrial fiber program and characterized the cannabinoid market as industry indulgence. That framing conflicts with the statute enacted, the definitions adopted, and the regulatory framework that followed.
Despite a clear legislative record, Perry has repeatedly asserted that HB 1325 authorized hemp solely for industrial fiber. He has presented that view as legislative intent rather than personal interpretation and dismissed the lawful cannabinoid market as industry excess. The statute, its definitions, and subsequent implementation tell a different story. His public statements reflect preference rather than enacted law.
State agencies serve the people of Texas. They also operate within a political environment that invites pressure. Texas maintains a single executive authority. The Governor occupies that role. The Lieutenant Governor wields significant influence within the legislative branch. Executive power remains vested elsewhere. Governor Abbott’s recent veto provided a vivid reminder of where that authority resides. Agencies that align enforcement posture with legislative grievance rather than executive direction assume institutional risk.
Recent history confirms the point.
In Sky Marketing v. Hellerstedt, DSHS faced a temporary injunction after pursuing a de facto Delta-8 ban through administrative maneuvering rather than legislative authorization. The district court focused on process failures and absence of delegated authority. That case remains pending before the Texas Supreme Court. The procedural lesson endures regardless of outcome. Courts examine records.
For that reason, we filed detailed comments and will testify. Administrative records preserve standing. They document who engaged, who explained consequences, and how agencies responded. The industry’s nickname for the Department—Dirty DiSHeS—did not arise in a vacuum. Prior experience informs present caution. The record will speak if litigation follows.
For the hemp industry, these issues carry immediate consequence. Texas’s transparency statutes and administrative law framework structure how regulation acquires legitimacy. Agencies strengthen consumer protection by keeping lawful commerce visible, enforceable, and predictable. Rules grounded in statute, executive direction, and sound process endure.
Texas built this system intentionally. The veto pen remains warm and the boot print across Dan Patrick’s backside is still fresh evidence Gov Abbott means business. The durability of the rules that follow depends on whether the Department remembers its role, its limits, and the authority under which it acts.
The better question is simpler and more unnerving: what happens when a President decides the machinery already sitting on the table should finally be used the way it was built to be used—and staffs the relevant agencies with people who don’t confuse delay with virtue.
According to the Washington Post, Trump has been discussing an executive order aimed at reclassifying marijuana from Schedule I to Schedule III, with HHS Secretary Robert F. Kennedy Jr. and CMS Administrator Mehmet Oz in the room and Speaker Mike Johnson on the phone opposing it. Reuters reported the same expectation and the market reaction, while noting the decision was not yet final.
The story here is not magic presidential power. The story is tempo, personnel, and a rescheduling docket that already exists—complete with the scientific recommendation, the proposed rule, and the procedural knots that kept it from crossing the finish line.
What an executive order can and cannot do
A President cannot personally rewrite the drug schedules by proclamation. The Controlled Substances Act does not hand the Oval Office a Sharpie and a scheduling chart. It hands the executive branch a process, and it places the legal “move the substance” act inside DOJ and the DEA, with HHS supplying the scientific and medical backbone.
What the President can do is command priorities inside the executive branch. He can set deadlines, change leadership, direct litigation posture, and tell DOJ and HHS that the rescheduling project is no longer a file that sits under a coffee mug until the next election. The Post’s reporting makes that managerial theory of power explicit: Trump can’t unilaterally reschedule marijuana, but he can direct the Justice Department to push through the rulemaking—potentially even by bypassing the ongoing administrative hearing.
That distinction matters because it turns the pundit question—“Can he?”—into the real-world one—“How fast will his agencies move, and how clean will the record be when the lawsuits start?”
The rescheduling file is already open and already thick
This did not begin as a Trump brainstorm. It began when President Biden asked for a review in October 2022. HHS conducted its scientific and medical evaluation and, in August 2023, recommended moving marijuana from Schedule I to Schedule III.
In May 2024, DOJ/DEA published a notice of proposed rulemaking to transfer marijuana to Schedule III. That is the formal start of the legal act that changes the schedule: notice-and-comment rulemaking, the kind that lives forever in the administrative record and gets dissected in court.
This is the part commentators routinely skip: the government already did the hardest, slowest work—assembling the scientific recommendation, moving it through DOJ, and publishing a proposed rule. That means Trump isn’t trying to invent a pathway. He’s trying to accelerate a pathway that already exists.
The statutory lever Biden pulled and Trump can yank harder
The Controlled Substances Act sets up a two-agency structure. DEA (through DOJ) has scheduling authority, but before DOJ can move, it must get HHS’s written scientific and medical evaluation and recommendation. The statute then makes HHS unusually powerful in one specific way: HHS’s recommendations are binding on the Attorney General “as to such scientific and medical matters.”
DOJ itself emphasized this constraint in a 2024 memo responding to questions about marijuana rescheduling, noting again that HHS’s scientific and medical determinations are binding on DOJ in the process.
In other words, the science call is already on paper, already transmitted, and already baked into the proposed rulemaking record. Trump doesn’t need to “prove” marijuana has accepted medical use from scratch. He needs his administration to finish the regulatory job that has been marinating in procedure.
Where the Biden process got bogged down
Rulemaking is where Washington goes to “act” while remaining emotionally committed to not acting.
After DEA proposed rescheduling, the agency moved into a hearing posture. A Federal Register notice set the hearing process in motion for the proposed Schedule III transfer.
Then the process hit administrative turbulence. By early 2025, credible policy and legal analysis described the hearings as postponed or cancelled pending an interlocutory appeal and related procedural issues. The Drug Enforcement and Policy Center at Ohio State’s Moritz College of Law tracks that the hearing scheduled to begin in January 2025 was postponed while an appeal was resolved.
This is the “legal limbo” the Post is talking about when it describes a White House considering bypassing the administrative hearing.
So Trump isn’t stepping into a pristine process. He’s stepping into a stalled one, and that stall creates a political opportunity: declare the delay unacceptable, then order DOJ and DEA to produce a final rule on a faster internal schedule.
Why courts sometimes stop executive branch power, and why rescheduling is a different animal
Every serious executive power story eventually meets its natural predator: the federal judge with a calendar.
When courts crush executive action, they usually do it for two reasons. The first is that the President tried to exercise power Congress never granted. Youngstown Sheet & Tube is the canonical case: Truman seized steel mills during the Korean War, and the Supreme Court held he lacked constitutional or statutory authority to do it.
The second reason is procedural: the executive branch claims it is acting under a statute, but it tries to shortcut the legally required process, or it produces a record so thin it fails basic administrative-law review. That is the kind of vulnerability that haunts immigration “big moves,” including the Obama-era DAPA litigation, where courts accepted arguments that the program likely exceeded statutory authority and ran afoul of required constraints, freezing it before it could take effect.
Trump knows this terrain because he has lived it. His original 2017 travel ban was rapidly blocked, revised, and fought through the courts until the Supreme Court ultimately upheld the third iteration in Trump v. Hawaii.
Marijuana rescheduling does not resemble Youngstown in its core authority question, because Congress delegated drug scheduling authority to the executive branch through the CSA. The Congressional Research Service summarizes the two routes clearly: Congress can schedule by statute, or the Attorney General (delegated to DEA), in conjunction with HHS, can schedule via the administrative process in the CSA.
That does not make it immune. It simply shifts the likely battlefield from “you have no authority” to “you did not follow the law’s process” and “your rule is arbitrary and capricious under the Administrative Procedure Act.” Courts reviewing agency action look for reasoned decisionmaking, not vibes. State Farm is a classic reminder that agencies must provide a rational explanation grounded in the record when they act.
That is why the Post’s “bypass the hearing” detail is both the accelerant and the hazard. Speed helps Trump politically. Sloppiness helps his challengers legally.
The Guardrails Myth, and the People Who Actually Pull the Levers
This is where the conversation stops being academic and becomes operational, because Washington has always been run less by constitutional theory than by human beings with badges, budgets, and signature blocks.
During Trump’s first administration, a comforting storyline took hold among donors, columnists, and the “I read The Federalist Papers once on a plane” set: the grownups were in charge. The President would be “managed.” Serious national-security types, conventional Republicans, and institutionalists would keep the guardrails up—protect the system from Trump’s own impulses, or at least sand down the sharp edges before they reached the rest of us. That “adults in the room” idea wasn’t a fringe whisper; it became a mainstream way of reassuring anxious elites that the state would remain on autopilot even if the cockpit was chaos.
Trump’s first term was what happened when that fantasy met a President who treats dissent as disloyalty and disloyalty as a firing offense. The result was not a calm, disciplined executive branch. It was churn. High turnover became a defining feature, and nowhere did the revolving door spin faster—or more publicly—than in the communications and press operation, which cycled through leadership at a rate that made prior administrations look monastic. Brookings tracked the rapid succession of communications directors and press secretaries; Axios, among others, documented the same “revolving door” pattern in real time.
That history matters because it explains what “personnel is policy” really means in Trump-world. The first-term model—hire people to restrain him, then punish them when they try—left behind a trail of burned reputations, abrupt departures, and cautionary tales that every ambitious appointee in Washington has been studying ever since. The institutionalists who thought their job was to manage the President discovered that, in this White House, the job description is simpler: execute the President’s priorities, on the President’s timeline, and don’t confuse your conscience with a veto.
The second-term environment has only intensified that lesson—not just through political appointments, but through the broader effort to “optimize” government itself. Trump signed orders pushing agencies toward workforce reductions and reorganizations tied to the “Department of Government Efficiency” effort associated with Elon Musk, a campaign framed as cost-cutting and anti-waste but experienced inside agencies as disruption with real institutional casualties. Government Executive reported on orders requiring agencies to plan layoffs and coordinate workforce reductions through DOGE.
And people did not merely grumble. They left. In February 2025, resignations by federal technologists connected to the former U.S. Digital Service became a national story because the departing staff described the DOGE shift as incompatible with protecting core systems and public services; the Associated Press covered the resignations and the language of the protest letter, and Politico reported the same episode as an internal revolt over how DOGE was being carried out. The Washington Post simultaneously reported sharp concerns about DOGE’s access to sensitive data and the legal and security alarms it triggered, along with litigation and judicial intervention.
In any other country, a wealthy private actor barreling through state systems, slashing capacity, and grabbing data would invite vocabulary Americans are trained to avoid saying out loud. Here we call it “efficiency” and argue about the font on the organizational chart. Either way, the practical takeaway is the same: the second-term executive branch is structured—and scarred—by the memory of what happened to people who mistook themselves for guardrails.
That brings us back to marijuana rescheduling, because this is not a policy that executes itself. If the White House decides to push Schedule III quickly, it will be done by the people sitting at the choke points.
Pam Bondi, as Attorney General, sits atop DOJ and therefore above DEA in the chain of command, and DOJ publicly documents her swearing-in. Robert F. Kennedy Jr., as HHS Secretary, controls how aggressively HHS defends and reinforces the existing scientific and medical evaluation that already undergirds the rescheduling effort. HHS documents his swearing-in. Terrance C. “Terry” Cole, as DEA Administrator, leads the agency that ultimately issues the final rule that changes the schedule; DEA documents his swearing-in. Mehmet Oz, as CMS Administrator, doesn’t decide scheduling, but he matters to the politics and downstream health-policy posture that will be used to sell and normalize the shift; his confirmation and swearing-in are documented in public reporting and official coverage.
One detail has to be stated cleanly because precision is armor in a fight like this: Sara Carter is not the sitting ONDCP Director. Her nomination was withdrawn, and contemporaneous public materials identify Jon E. Rice as the senior official performing the duties of director in an acting capacity.
None of this “guarantees” rescheduling. Courts exist. Procedure exists. Opposition exists. But it does change the internal physics. Trump’s first term trained Washington that appointees hired to “manage” him do not last. His second term has added a broader lesson: disruption is not an accident; it is a governing style. In that context, when the White House decides a stalled rulemaking must move, the people in the relevant seats are far less likely to treat delay as a virtue—and far more likely to treat it as insubordination.
How the move would unfold in the real world
Assuming Trump issues the order described in the Post and Reuters reporting, the near-term mechanics are straightforward.
The White House would frame the executive order as a directive to DOJ and HHS to complete rescheduling expeditiously. The legal work would not be done by the President’s signature; it would be done by the final rule published by DEA/DOJ.
HHS’s role would largely be to stand behind the existing scientific and medical evaluation and to ensure the record remains coherent. Because the CSA makes HHS’s scientific and medical determinations binding on DOJ “as to such scientific and medical matters,” HHS is not window dressing in this process; it is the statutory spine.
DOJ and DEA would then have to decide how to resolve the existing hearing posture and produce a final rule. The final rule is where the schedule actually changes. The administrative posture matters because it shapes the record that courts will review. The Moritz Drug Enforcement and Policy Center timeline and other legal analyses reflect that the hearing has already been postponed and the proceeding snarled by appeal.
This is why the “bypass the hearing” concept is so politically attractive: it treats the stalled hearing track as a problem to be cleared, not an altar to be worshiped. It’s also why opponents will sue. They will argue the agency failed to provide required process, ignored objections, or violated the APA. Trump’s DOJ will argue the core statutory prerequisites were satisfied—HHS delivered the scientific recommendation and DEA followed rulemaking requirements—while insisting the executive branch has discretion to manage its internal proceedings and move to final agency action.
If Trump’s team moves carefully, it can publish a final rule quickly while keeping the record defensible. If it moves recklessly, it may still publish a final rule quickly, but it could lose the first emergency motion in federal court, buying opponents months of delay and a narrative that the administration cut corners.
Why this feels inevitable, even though it is not automatic
The strongest argument that Trump can pull this off is not ideological. It is bureaucratic.
The rescheduling project already has the fundamental prerequisites: a written HHS recommendation, a published NPRM, and a process that is already deep into the administrative pipeline.
The strongest argument that Trump will try is political: this is a high-salience move that can be framed as modernizing federal policy without “legalizing marijuana,” and it can be pitched as freeing research while shifting enforcement focus toward fentanyl and other lethal drugs. That framing fits neatly inside Trump’s preferred “tough on the real poison” posture, while offering real economic and regulatory consequences for the cannabis industry.
The strongest argument that he could still get slowed down is legal: the rule has to survive judicial review. Authority is the easy part here because Congress built a lane for the executive branch. Procedure is the hard part because courts can freeze agency action when the record looks rushed, incomplete, or internally contradictory.
That is the whole story. Not whether Trump owns a magic pen. Whether the executive branch he commands can move fast, stay inside the statutory guardrails, and absorb the litigation that comes with trying to make federal marijuana policy match the country it governs.
For the first time, the nation’s biggest cannabis corporations—multi-state operators with headquarters, licenses, and major market share in Illinois and other key states—are lining up for a limited number of medical cannabis licenses here. These are the companies that dominate Chicago’s cannabis economy and reach deep into markets across the country. They are not unknown quantities. Their names appear again and again in court dockets, OSHA files, enforcement notices, ethics decisions, and class-action complaints.
If Texas chooses to let them in, it will be importing that history along with them.
DPS’s Scoring System: A Framework Without a Process
The Texas Department of Public Safety has published what it claims is a scoring rubric for Compassionate Use applicants. In reality, it is a handful of headings—security, financial responsibility, operations, and technical capability—devoid of detail. The document does not explain what constitutes a strong submission in any of those categories. It does not say how points are assigned, what makes a deficiency fatal, or whether out-of-state violations are considered at all.
Nowhere does DPS tell Texans whether a history of mislabeling products in Illinois matters. Nowhere does it say whether pesticide violations, unaccounted-for inventory, or OSHA findings from other states affect an applicant’s standing. There is no guidance on how regulators will treat companies accused of gaming potency limits, misclassifying products to evade state caps, or letting contaminated products reach patients.
The public is effectively asked to take DPS’s word for it that the agency is doing its job. That might be acceptable if DPS had a track record of transparent, scientifically grounded decision-making in this space. It does not.
The Armstrong Labs Warning Texas Has Not Heeded
The Armstrong Labs episode remains the clearest example of what happens when DPS makes critical decisions behind closed doors. A lab favored by law enforcement used a testing method that critics, attorneys, and the Texas Forensic Science Commission all said could convert THCA into delta-9 THC during analysis—transforming lawful hemp into apparent contraband. Retailers were raided, products were seized, and businesses collapsed, not because those businesses set out to break the law, but because DPS chose a contractor whose methodology could not withstand scientific scrutiny.
The Forensic Science Commission’s involvement underscored how serious the problem was. But DPS never gave Texans a full accounting of how it selected that lab, why it trusted that method, or how it planned to prevent similar failures in the future. It simply closed the door and moved on.
That kind of opacity might be survivable in a small program. It is reckless in a licensing round involving some of the largest and most legally exposed operators in the American cannabis industry.
The Illinois MSOs: A Record of Misconduct That Leads the Nation
To understand the risk Texas is facing, it is necessary to start where so much of the American cannabis business is headquartered: Illinois. The state has become a hub for multi-state operators, and the misconduct tied to those operators is now a matter of public record.
Cresco Labs, based in Chicago, is at the center of multiple lawsuits in Illinois accusing it of manipulating labels and product classifications to evade THC limits established under state law. In Matthews v. Cresco Labs and related cases, plaintiffs allege that Cresco mislabeled certain vapable oil products and deliberately classified infused products as “concentrates” so they could carry higher THC levels than Illinois law allows. These cases go to the heart of market integrity: if a medical cannabis company will not tell the truth on its labels, it cannot be trusted to protect patients or comply with dosage limits.
Green Thumb Industries, another Chicago-based giant, is facing its own THC-potency class action in Illinois, with plaintiffs alleging that GTI and its subsidiaries misrepresented the strength of their products. The company has also appeared in enforcement actions beyond Illinois. In New Jersey, regulators fined Green Thumb and Verano for rule violations, including failures around packaging, testing, and record-keeping. Together, these cases paint a picture of operators that routinely push or cross regulatory lines and then resist accountability when challenged.
Verano, also rooted in the Chicago market, shows up repeatedly in litigation and enforcement records. It was a co-defendant in an $860 million lawsuit tied to a failed acquisition, a case that highlighted aggressive, boom-time deal-making and the fallout when stock prices collapsed. Verano has been fined in New Jersey and has faced scrutiny in other states over compliance and rule adherence. It has settled complex litigation with another operator, Vireo Growth, after years of dispute, underscoring how much time and money these companies are willing to expend fighting over deals rather than focusing on stable, compliant operations.
PharmaCann, whose parent entity is organized as an Illinois LLC based in downtown Chicago, has faced worker-safety enforcement from OSHA and disciplinary action in Maryland. OSHA cited PharmaCann for potential workplace hazards at a greenhouse in New York; the company paid a fine to settle the case. In Maryland, regulators issued a consent order addressing violations of company code of conduct, including misappropriation and related misconduct. This is an operator that has struggled not just with regulatory compliance, but with internal culture and control.
Ascend Wellness, another major player with a strong Illinois footprint, has found itself simultaneously entangled in litigation and ethics concerns. In Illinois, Ascend has been hit with a class-action lawsuit alleging its vape products misled consumers—part of a broader wave of potency and labeling suits hitting the state’s largest operators. Separately, the Illinois Office of Executive Inspector General found that a deputy director of the state’s cannabis regulation office accepted employment with Ascend while still serving in his government role, flagging the kind of revolving-door risk that can erode public trust in any licensing regime. Ascend has also drawn enforcement in Massachusetts, where regulators have named it alongside other national firms in disciplinary actions.
These are not marginal actors. Cresco, Green Thumb, Verano, PharmaCann, and Ascend together represent the core of Illinois’s MSO tier. Their violations span mislabeling, misclassification to evade potency caps, worker-safety hazards, rule violations in multiple states, and ethics concerns involving former regulators.
They are also exactly the kind of companies now looking toward Texas.
Curaleaf and Trulieve: National Patterns of Risk
Outside Illinois, other large MSOs with designs on national expansion—including into Texas—have compiled their own disturbing records.
Curaleaf has been accused in Oregon of one of the most notorious mislabeling blunders in the industry: selling products advertised as CBD that in fact contained significant THC. The company settled at least ten lawsuits, paid regulatory fines, and endured a license suspension over the incident, then paid an additional $100,000 to resolve a separate class-action suit. More recently, a former regional compliance director has alleged in federal court that Illinois regulators flagged “systemic diversion” at Curaleaf’s Litchfield, Illinois facility, citing vast amounts of unaccounted-for inventory. That combination—dangerously mislabeled products in one state and suspected diversion in another—should alarm any regulator.
Trulieve has become a national case study in how worker-safety failures can turn deadly. In Holyoke, Massachusetts, a 27-year-old employee died after an occupational asthma attack triggered by inhaling ground cannabis dust. OSHA cited the company; Trulieve ultimately settled with a reduced fine after the agency withdrew some of its initial citations. The Massachusetts Cannabis Control Commission later imposed a $350,000 fine for noncompliance connected to that death. The incident has helped spur new workplace-safety legislation for the cannabis sector in Massachusetts and is widely recognized as the first officially reported occupational asthma death in the U.S. cannabis production industry.
This is the caliber of operator lining up at Texas’s door: companies with histories that include worker fatalities, systemic diversion allegations, pesticide penalties, mislabeling scandals, ethics violations, and repeated efforts to stretch or evade state rules.
DPS has given no public indication that it views any of this as relevant.
How Texas Conservatives Once Understood Good Government
This failure of process would sting less if it did not contradict forty years of Texas conservative doctrine. When I was young—long before I stepped into policy or politics—I absorbed a mantra that shaped Texas Republican identity: government should be run like a business. It was the rallying cry of the era, a promise of efficiency, accountability, transparency, and discipline.
Ross Perot built an entire political movement around this ideal. His charts, his data obsession, his blunt insistence that government should be audited, measured, and forced to justify its decisions—these were the qualities Texans admired because they reflected the sensibilities of a state that expected competence.
Texas governors echoed the theme whenever an agency faltered. Ann Richards invoked business discipline when restructuring TDCJ and modernizing mental health oversight. George W. Bush reorganized agencies around performance metrics and measurable outcomes. Rick Perry spoke frequently about efficiency reforms in workforce development, procurement, and human services. Greg Abbott has demanded data-driven performance from state agencies and has publicly rebuked those that failed to meet clear operational standards.
For decades, Texans were told that government must be transparent, accountable, and grounded in expertise—because those are the principles that guide successful businesses.
DPS has abandoned all of them.
No business evaluates multi-billion-dollar proposals without publishing evaluation criteria. No business refuses to examine the track record of a potential partner. No business exposes its advisors to suspicion by refusing to define their roles. No business hides its scoring methodology from its own stakeholders. And no business treats the past behavior of applicants as irrelevant to future performance.
Ross Perot once said, “If you see a snake, don’t appoint a committee—kill the snake.” DPS is simply refusing to open the box.
An Agency Built to Interdict, Not to Regulate
There is a deeper structural problem. DPS is a law enforcement agency being asked to run a highly technical licensing program for a plant it has spent decades trying to intercept and destroy.
For generations, the mission of Texas DPS has been to stop drug trafficking, enforce criminal statutes, and treat cannabis as contraband. Training, culture, and institutional memory have all reinforced the same bedrock assumption: marijuana is bad, and the people who cultivate, process, or distribute it are on the wrong side of the law. In recent years, federal agencies and some state and local departments have begun to adjust to a world in which cannabis is regulated, taxed, and—in many cases—treated as medicine. DPS has not undergone that transformation. Texas never created a dedicated health or science-oriented cannabis regulator. It simply handed the job to the state’s primary law-enforcement agency and walked away.
At the same time, the Legislature that made this decision is populated by talented people whose backgrounds are in law, business, real estate, entertainment, consulting, and advocacy—not in pharmaceutical manufacturing, lab science, agricultural regulation, or medical program design. Expecting them to build a sophisticated, transparent licensing regime without dedicated subject-matter expertise was unrealistic from the outset.
Layered on top of this design flaw is the predictable gravitational pull of insider dealing that follows every limited-license cannabis program. Wherever a small number of highly valuable licenses are at stake, politically connected players look for an angle. Texas has already seen early evidence of attempted preferential positioning and overlapping business relationships. None of this is surprising. What is surprising is that DPS and legislative leadership chose to build a system that invites suspicion by shrouding the entire process in secrecy.
A law-enforcement agency with a cultural bias against cannabis, operating without true regulatory expertise, following a blueprint written by non-technical policymakers, and administering a closed-door licensing process is not equipped to keep powerful MSOs in check. It is, instead, exactly the kind of environment those companies have learned to exploit.
What a Well-Regulated Licensing System Would Look Like
A sound licensing regime in Texas would start by acknowledging reality: the companies applying for licenses have long, complicated histories, and those histories matter. A competent regulator would publish detailed scoring criteria in advance, explain how out-of-state violations affect eligibility, and specify how issues like mislabeling, potency fraud, OSHA findings, and diversion allegations will be weighed.
It would separate advisors from decision-makers and make both roles visible to the public. It would release redacted versions of applications, publish scores and the reasoning behind them, and provide written explanations to both successful and unsuccessful applicants. It would subject MSOs with heavy violation histories to enhanced oversight once licensed, with regular audits, surprise inspections, and public reporting of compliance events. And it would treat patients, caregivers, and Texas small businesses as stakeholders rather than bystanders.
That is what a serious state does when it confronts national operators with this kind of record.
Texas Cannot Pretend Not to Know Who These Companies Are
The time when Texas could plausibly claim ignorance about MSO misconduct is over. Illinois has documented mislabeling and misclassification schemes tied to major operators. Oregon, Massachusetts, New Jersey, Maryland, New York, and other states have issued fines, consent orders, and disciplinary actions that describe in detail how these companies have behaved when they thought no one was looking too closely.
Texas now knows—or should know—that many of the MSOs seeking licenses here have treated rules in other states as obstacles to be navigated rather than standards to be honored. DPS and the Legislature cannot say they believe in running government “like a business” while ignoring the most basic business principle of all: you evaluate a partner by its track record.
If Texas chooses to hand the keys of its medical cannabis program to companies with this history, without transparent standards, without serious scrutiny, and under the supervision of a law-enforcement agency unprepared for the job, the outcome is not hard to predict. It will look like Illinois, Massachusetts, Oregon, New Jersey, and every other state that thought it could keep these operators in line without doing the hard work of real regulation.
The harm will not fall on Cresco, Green Thumb, Verano, PharmaCann, Ascend, Curaleaf, or Trulieve. They have already built systems to absorb fines, settle lawsuits, and move on. The harm will fall on Texas patients, Texas workers, and Texas businesses who were told they could trust a program overseen by DPS.
Companies do not reinvent themselves at the Texas border. Their past follows them. The only question now is whether DPS and the Legislature will pretend not to see it—or finally take it seriously enough to protect the people they serve.
For more than fifty years, the federal government has maintained a position about marijuana that almost everyone involved understood to be false. Not unsettled, not ambiguous, but false in the ordinary sense of the word. Since 1970, cannabis has been classified under federal law as a Schedule I controlled substance, a category reserved for drugs deemed to have no accepted medical use and a high potential for abuse. Heroin sits there. LSD sits there. Marijuana was placed there as a purportedly temporary measure, pending further study.
That study never came.
What followed instead was a long period of institutional pretense. Decades of crime-and-punishment and the warping of society—which supposedly the Founders based on the proposition of being classless and upwardly mobile for everyone. And eventually? States legalized medical marijuana. Doctors recommended it. Patients relied on it. Universities studied it. Courts acknowledged its use. Congress quietly funded research. Federal agencies carved out exceptions and workarounds that allowed cannabis to exist in practice while remaining forbidden in theory. Through all of this, the federal government continued to insist—on paper—that marijuana had no accepted medical use.
The lie persisted not because it was persuasive, but because abandoning it would have required admitting that an entire regulatory and enforcement architecture rested on a premise everyone knew was untrue.
To understand why that admission took half a century, it helps to return to the moment the lie was chosen deliberately.
By the time Richard Nixon took office, the promise of the civil-rights era was already unraveling. The assassination of Dr. Martin Luther King Jr. did more than remove a moral leader; it marked the point at which the federal government’s commitment to racial justice felt to many as though it receded from urgency into abstraction. No justice, no peace, cities burned, Black men wore their anger along with their black berets, black gloves and the arms our Constitution gave us an inalienable to carry for self defense—for the very first time in inescapable confrontational terms demanding justice and equality—and looking back, maybe the default decision by the “Silent Majority “ of White Americans to criminalize as many of these things as possible because fear and loathing are the natural first reaction to riots but the ability to empathize and act on that empathy by hearing and seeing and making things right—yeah, that was never gonna happen. Millions of hijacked amygdalas chose the tough talking authoritarian as a substitute for thinking and taking accountability. So, what followed was not reconciliation, but reaction. The language of reform gave way to the language of control. Equality was replaced with order.
“Law and order” was not a neutral governing philosophy. It was a reactionary response to social change, deployed to reassure a frightened majority that the upheavals of the 1960s would be contained. Nixon understood this, and he understood who would pay the price. In private conversations, he acknowledged that marijuana was “not particularly dangerous” and that the scientific case against it was weak. His concern was not public health. It was symbolism.
Marijuana had become associated—politically and culturally—with groups Nixon viewed as destabilizing: young people, antiwar activists, Black Americans, and other minorities already framed as threats to social order. Criminalizing cannabis at the highest level of federal law provided a tool that could be applied broadly, selectively, and with devastating effect. It allowed the state to exert control without formally repudiating the civil-rights commitments it had just made.
When Nixon appointed the National Commission on Marihuana and Drug Abuse, the Shafer Commission, he did so knowing the evidence was unlikely to support harsh criminalization. When the commission reported back in 1972, it confirmed precisely that. Marijuana did not warrant its treatment under federal law. Decriminalization was the rational course.
Nixon did not dispute the findings. He did not rebut the science. He ignored the report.
The decision to keep marijuana in Schedule I was not a misunderstanding; it was a choice. Nixon believed that moving marijuana would send “the wrong signal” at a moment when his administration was invested in reasserting authority. Law-and-order politics required visible enforcement and blunt tools. The War on Drugs supplied both. What followed was not subtle. It was blunt-force trauma as policy—aggressive policing, prosecutorial overreach, mass incarceration, and the degradations that fell predictably on the same communities the civil-rights movement had sought to protect.
The foundational lie—that marijuana had no accepted medical use—provided moral cover. Over time, that expedient falsehood hardened into doctrine. Administrations changed. Evidence accumulated. States adapted. Courts worked around it. Yet the classification remained, repeated long after belief in it had vanished.
This is where the analogy to Chernobyl becomes unavoidable.
By the mid-1980s, the Soviet Union was already operating inside a closed informational system. Official narratives bore little relationship to reality, but the system persisted because accuracy mattered less than conformity. Bad news was softened as it moved upward. Problems were tolerated as long as they could be managed on paper. The system functioned not because it was honest, but because honesty had become dangerous.
When Reactor No. 4 failed, the instinct was not to confront the truth, but to preserve the narrative. Engineers hesitated. Officials delayed. Ministries reassured superiors that everything was under control. Radiation spread anyway. What ultimately destabilized the system was not the explosion alone, but the revelation that the state had organized itself in such a way that telling the truth posed a greater risk than continuing to lie.
Federal marijuana policy followed the same structural logic, if at far lower human cost. The insistence that cannabis had no accepted medical use survived long after it ceased to convince doctors, patients, researchers, judges, or regulators. The system adapted not by correcting the falsehood, but by building increasingly elaborate workarounds around it. Enforcement became selective. Research was constrained. Tax policy became punitive to the point of absurdity. Banking and payment systems warped around legal fiction.
For a time, the damage was containable because it was diffuse. It affected particular industries, particular states, particular people. The broader system absorbed the stress.
Rescheduling marijuana to Schedule III marks the moment when that containment strategy fails. The gap between what the law said and what the world demonstrated grew too large to manage through euphemism and exception. Continuing to insist that cannabis had no accepted medical use began to impose greater institutional risk than abandoning the claim. Like radiation readings that could no longer be ignored, the consequences of the lie became measurable and undeniable.
This is not legalization. It is not absolution. It is the federal government quietly conceding that it can no longer maintain a position everyone knows is untrue.
History rarely turns on dramatic confessions. More often, it shifts when institutions admit—without ceremony—that denial has become more dangerous than truth. Chernobyl marked that moment for a system built on managed reality. Federal marijuana rescheduling, if it occurs, will be remembered the same way: not as the end of prohibition, but as the moment when the lie finally escaped containment.
Inside DPS’s High-Risk Bet on Nine MSOs—and Why the Industry Pushed Back
Texas has quietly crossed a threshold that will define the future of its medical cannabis program—and possibly its broader cannabis policy—for years to come.
On December 2, the Texas Department of Public Safety (DPS) announced that nine multistate operators (MSOs) had been conditionally selected to move forward in the expansion of the Texas Compassionate Use Program (TCUP). Those companies are now advancing through a due-diligence phase that, had it been applied properly from the beginning, might have prevented many of the red flags now troubling regulators, lawmakers, and the industry.
The nine conditionally selected MSOs are:
Verano Texas, LLC
Trulieve TX, Inc.
Texas Patient Access, LLC
Lonestar Compassionate Care Group, LLC
Lone Star Bioscience, Inc.
PC TX OPCO LLC (PharmaCann)
Texa OP dba TexaRx
Story of Texas, LLC
Dilatso, LLC
These selections mark the most aggressive structural shift in Texas medical cannabis since the program’s creation. But the way DPS handled the first phase of licensing raised immediate concern—because much of the verification that should have preceded these awards did not occur until after public scrutiny forced it.
TEACUP Licensing: What DPS Did—What It Missed—and What It Was Forced to Fix
In Phase I of the TEACUP selection process, DPS advanced nine MSOs based largely on self-reported applications—business plans, organizational charts, security narratives, and financial projections—without publicly demonstrating that it had independently verified:
Long-term financial stability
Federal tax exposure under IRS §280E
True capitalization and debt structure
Corporate ownership
Or meaningful out-of-state compliance histories
Even more troubling, several applicants did not appear to have active, properly registered Texas business entities at the time of application—a deficiency that would normally be considered a baseline operational requirement for doing business in the state.
Only after the initial awards were made did DPS announce that the nine MSOs would now be subject to “additional due diligence”—including reviews of disciplinary history, litigation, and financial suitability.
That sequence matters. It briefly reversed the logic of licensing itself. Instead of verify first, select second, Texas drifted into select first, verify later.
What Changed—and Why
This story was first broken by Blazed News under the byline of Jay Maguire, Political Editor of Blazed News, detailing the structural deficiencies in the TEACUP licensing process—specifically the lack of front-end financial verification, tax exposure analysis, and meaningful compliance vetting.
That reporting was subsequently picked up by the Dallas Morning News, bringing mainstream scrutiny to a process that, until then, had unfolded largely outside public view. DPS altered its trajectory literally the same day as that coverage, announcing that the nine MSO selections would now be subject to formal additional due diligence before any final licenses would be issued.
The timing was not coincidental. It stands as a clear example of what happens when good advocacy and serious reporting intersect: the public gets better answers, regulators get sharper questions, and policy changes in real time.
Tomorrow’s Hearings: The Rules That Will Decide What Texas Cannabis Looks Like for the Next Decade
While TEACUP licensing has drawn headlines, an equally consequential regulatory fight is unfolding in parallel.
Tomorrow, both the Texas Department of State Health Services (DSHS) and the Texas Alcoholic Beverage Commission (TABC) will hold public hearings on proposed rules that will reshape the regulatory structure for consumable hemp and THC-containing products statewide.
These hearings represent the first serious attempt to impose uniform, enforceable standards on a market that has operated for years on inconsistent lab practices, unverifiable COAs, and frontline officers forced to guess legality in the field.
Mandatory 21+ Age Verification—With Enforcement Power
Both agencies are moving to lock in a 21-and-up age requirement for consumable hemp and THC products. Emergency rules already exist, but the hearings determine:
Who must verify IDs
What qualifies as acceptable ID
What systems retailers must use
And what penalties attach to violations
TABC now has the authority to suspend or revoke alcohol permits for violations. DSHS holds parallel power over hemp retailers. For the first time, Texas is treating THC age enforcement with the seriousness of alcohol and tobacco law.
Lab Testing & COA Standards—The Most Overdue Reform in Texas Cannabis
For years, Texas has suffered under a broken enforcement contradiction:
Labs use different methods
COAs vary wildly in format and credibility
Officers cannot verify legality in the field
And courts struggle to rely on inconsistent test data
The hearings offer the first real chance to impose:
Standardized testing protocols
Uniform lab accreditation requirements
Defined COA formats
Mandatory data retention
And enforceable verification standards
Without these reforms, Texas remains trapped in guesswork enforcement.
Enforcement Architecture: Who Survives This Market
The rules under consideration also establish penalty structures that include:
Administrative fines
License suspensions
Permit revocation
And permanent market exclusion
For many businesses already barely surviving regulatory uncertainty, these rules will determine who adapts—and who disappears.
Yet even with stronger age gates and lab requirements, Texas still lacks a state-run system to guarantee the authenticity of COAs or track chain-of-custody between lab, distributor, and retailer.
That missing piece is exactly where CRAFT enters the picture.
Why CRAFT Exists—and Who Actually Founded It
CRAFT—the Cannabis Retailers Alliance for Texas—was co-founded by Rhiannon Yard, owner of Hemp Gaia in Waco, Texas, and Jay Maguire, Political Editor of Blazed News and Executive Director of the Texas Hemp Federation.
This matters, because CRAFT did not emerge from a political campaign or a corporate boardroom—it emerged from the front-line compliance battles that defined the first years of the Texas hemp industry.
Under Jay Maguire’s leadership, the Texas Hemp Federation played a central role in defending the legality of hemp products during the industry’s earliest and most fragile years, including the litigation that produced the Sky Marketing injunction—the ruling that preserved the legality of smokable hemp and effectively kept the Texas hemp market alive when state regulators attempted to shut it down.
CRAFT was built as the next-generation infrastructure layer on top of those legal victories—not as a slogan, but as a technical compliance solution to the problems that litigation alone cannot solve.
And a framework for safe-harbor immunity for good-faith retailers and consumers
The goal is strictly evidentiary, not ideological:
To make truth provable at the point of sale, not litigated months later after businesses are seized, employees are arrested, and families are financially destroyed.
CRAFT’s proposal will soon be headed to the Governor’s office, outlining a framework that includes:
Product-level verification
Mandatory lab-result authentication
Chain-of-custody transparency
Immunity for innocent retailers and consumers acting in good faith
And a regulatory level-set grounded in proof, not presumption
CRAFT exists because Texas finally reached the limit of what lawsuits can protect—and entered the phase where infrastructure must replace injunctions.
The Bigger Pattern
Texas once again stands at a familiar crossroads:
Let big money move first—or let verification come first.
If “licensed” does not mean “verified,” the market will fracture.
If “approved” does not mean “audited,” the program will destabilize.
And if due diligence only happens after exposure, public trust will not survive the next collapse.
The Question Texas Still Hasn’t Answered
The uncomfortable truth is this: Texas did not arrive at this moment because the system worked—it arrived here because the system was forced to correct itself after being exposed. Nine MSOs were advanced before the public ever saw proof of financial stability, tax integrity, corporate legitimacy, or clean compliance histories. Only after scrutiny did the state pivot to “additional due diligence.” That is not proactive regulation. That is damage control.
If even one of these operators collapses under tax exposure, litigation, compliance failure, or capital stress, the consequences will not fall on DPS executives or political appointees. They will fall on patients who lose access, retailers who lose inventory, employees who lose jobs, and communities that trusted the word “licensed.”
Texas still has time to prove that this expansion will be governed by verification instead of influence, by audit instead of assumption, and by proof instead of press releases.
But that window is closing fast.
And when the next failure comes, the only real question won’t be who broke the story.
