Month: April 2019

On April 24, 2019, the United States Department of Agriculture (USDA) announced that the Plant Variety Protection Office (PVPO) would begin accepting applications of seed-propagated hemp for plant variety protection.

In the United States, there are three different ways to go about protecting intellectual property associated with plant varieties:

1. Plant Variety Protection – available for seeds and tubers and issued by the PVPO;
2. Plant Patents – available for asexually propagated plants except for edible tubers and issued by the United States Patent and Trademark Office (USPTO); and
3. Utility Patents – available for genes, traits, methods, plant parts, or varieties and also issued by the USPTO.

The PVPO is responsible for implementing the Plant Variety Protection Act (PVPA) and will analyze an application to determine whether the variety specified is new, distinct, uniform and stable. Anyone who is the breeder of a unique variety of a sexually reproduced or tuber-propagated plant can apply for plant variety protection. The PVPO grants certificates to protect plant varieties for 20 years (25 years for vines and trees). According to the PVPO, “[c]ertificate owners have rights to exclude others from marketing and selling their varieties, manage the use of their varieties by other breeders, and enjoy legal protection of their work.”

The basic requirements for submitting an application under the PVPO program are as follows:

1. Completion of all applicable forms;
2. Payment of applicable fees ($4,382 to be paid with the application and $768 upon issuance of the certificate);
3. A variety name that doesn’t conflict with an existing name for that crop; and
4. Deposit of seeds or tissue cultures:
   1. 3,000 viable untreated seeds of the variety; additionally for hybrids, 3,000 seeds of each parent needed to reproduce the variety, or
   2. Live tissue culture samples (for potatoes) of the variety and payment of tissue culture fees. Ten (10) separate in-vitro plants (1 plant per tube) 4 to 6 weeks old, firmly rooted in one percent agar. It is recommended that plantlets be sent by an overnight delivery service to minimize the risk of damage.

Seed samples are important because they serve as a voucher specimen for PVPO’s use should a question arise about the validity of the subscription. According to PVPO, the samples are sent to the National Center for Genetic Resources Preservation (NCGRP) in Colorado. After analysis, seed samples are placed in long-term storage.

In addition to legalizing industrial hemp, the 2018 Farm Bill amended the U.S. Plant Variety Protection Act to add asexually propagated plants, previously not available under the Act. A revision of the U.S. PVPA will be needed and proposed rules are currently under development.

It is also important to note that there are penalties, including fines, for claiming that a variety is plant-variety protected when it is not.

While we are still waiting for the USDA to develop a regulatory framework for hemp under the 2018 Farm Bill, this update from the PVPO is an indication that we will be seeing regulatory changes of many kinds in the months to come.

I’ve written quite a bit on the legality of hemp-derived cannabidiol (“Hemp CDB”) products in California over the past few months (see my posts on Hemp CBD in general and my specific posts about Hemp CBD in foods and hemp cultivation). One of the areas I haven’t explored in great detail is topical products, i.e., cosmetics. I will address the murky status of Hemp CBD cosmetics in this post.

If you haven’t read my earlier posts, the gist is that the California Department of Public Health (“CDPH”) has taken a fairly hardline stance against adding Hemp CBD to foods and beverages via its now-infamous FAQs. These FAQs, notably, are based on federal law (the Controlled Substances Act which has since been amended so that hemp is no longer scheduled), but also on the federal Food and Drug Administration’s (“FDA”) prohibition on CBD in similar products (which definitely is still the FDA’s current position). Notably, the FAQs are silent on cosmetics and topical products.

While a bit less clear from the FAQs’ text, the CDPH has authority over certain products pursuant to the California Sherman Food, Drug, & Cosmetic Law (not to be confused with the federal Sherman Act). The CA Sherman Law gives the CDPH authority over foods and beverages, but notably also over cosmetics, which are defined as:

[A]ny article, or its components, intended to be rubbed, poured, sprinkled, or sprayed on, introduced into, or otherwise applied to, the human body, or any part of the human body, for cleansing, beautifying, promoting attractiveness, or altering the appearance. The term “cosmetic” does not include soap.

Under this law, the CDPH could theoretically initiate enforcement actions or assess penalties against companies who sell adulterated or misbranded cosmetics. But until now, the CDPH hasn’t been extremely vocal about cosmetics in California—as is evident by reading the FAQs which don’t even mention them. We aren’t aware of any explicit enforcement actions against Hemp CBD topicals. So while the CDPH hasn’t said Hemp CBD topicals are prohibited, it hasn’t necessarily ruled that out.

Adding to the lack of confusion is the federal position, which my colleague, Daniel Shortt, recently discussed. In a nutshell, the FDA may view a cosmetic product as prohibited if its ingredients or the product itself is unsafe, or if it is intended to be used in a way that makes it a “drug” (i.e., it is “intended to affect the structure or function of the body, or to diagnose, cure, mitigate, treat or prevent disease”). In other words, the FDA hasn’t taken as hardline of a stance against cosmetics as it has against foods and unapproved drugs, but we still have a sense of the FDA’s willingness to crack down on products that aren’t safe or that make medical claims.

In spite of the general confusion in California and with the FDA’s policy statement, at least some clarity may soon be taken away if a new piece of California legislation, AB-228, is passed. If passed in its current form, AB-228 would state:

A cosmetic is not adulterated because it includes industrial hemp . . . or cannabinoids, extracts, or derivatives from industrial hemp. The sale of cosmetics that include industrial hemp or cannabinoids, extracts, or derivatives from industrial hemp shall not be restricted or prohibited based solely on the inclusion of industrial hemp or cannabinoids, extracts, or derivatives from industrial hemp.

What this would mean is that if passed, CDPH could not use the CA Sherman Law to find that CBD-containing topicals adulterated simply by virtue of containing Hemp CBD (the same would also apply to foods). This may lead to more clarity for California CBD companies who have topical products.

That said, it’s not yet clear whether the CDPH would continue to follow federal law even in spite of AB-228 passing. The state may find itself in a position of ignoring federal positions (like it has done with marijuana), or the CDPH may continue to follow federal agencies. Even the California Attorney General’s office has recognized that this could happen:

Even if it [AB-228 passes], it is not clear whether changing California law on this adulteration issue would be sufficient to alter the decision calculus of the CDPH, which has to this point relied on the FDA’s interpretation of federal law. That is, it might be the conclusion of these agencies that federal law still prohibits adding CBD to food or dietary supplements, even where derived from industrial hemp.

Though this is just speculation, I don’t think that the CDPH will follow the FDA if AB-228 passes. The FDA’s policy guidelines are so broadly written that they would prohibit the introduction of marijuana into food products in California—yet we don’t see any state agencies pulling those products. This includes products that are manufactured by CDPH licensees.

It’s also important to point out that even if AB-228 passes, the CDPH will be able to find Hemp CBD cosmetic products “misbranded”. However, this is also probably less likely to occur except in cases where products make unsubstantiated or false claims or are advertised in a deceptive manner. This may very well happen for some Hemp CBD products, which is why it’s important to consult with an experienced attorney prior to marketing or advertising new products.

In sum, the current state of topical Hemp CBD laws in California is less than clear (which at this point should surprise nobody). Keep following the Canna Law Blog to keep up with all California CBD updates.

Last Friday, the U.S. Department of Agriculture (“USDA”) released a statement, in which the agency clarified that the passage of the 2018 Farm Bill rendered the importation of hemp seeds legal.

As we previously explained, the 2018 Farm Bill legalized hemp, hemp seeds, and other derivatives, by removing them from the Controlled Substance Act. Accordingly, the USDA held that the DEA “no longer has authority to require hemp seed permits for import purposes.”

The agency further explained that the statement aimed to provide assistance to U.S. producers and hemp seed exporters who have repeatedly requested assistance from the USDA.

Indeed, the USDA received numerous comments pertaining to this issue during its March 13 webinar. Senator Jon Tester (D-Montana) was among some of the commentators who requested assistance with hemp importations. According to the Montana senator, the DEA was blocking Montana farmers from importing hemp seeds. USDA Executive Director, Sonny Perdue, explained that while the USDA was in the process of promulgating rules and regulations, farmers registered under an existing state research pilot program, pursuant to the 2014 Farm Bill, were allowed to import and cultivate hemp.

In its statement, the USDA maintained Perdue’s statement and further clarified that the agency now holds authority over hemp seeds and aims “to provide an alternative way for the safe importation of hemp seeds into the United States.” Specifically, the USDA set forth ways in which hemp seeds should be imported from Canada and other foreign countries.

Hemp seeds imported from Canada must be accompanied by:

1. a phytosanitary certification from Canada’s national plant protection organization to verify the origin of the seed and confirm that no plant pests are detected; or
2. a Federal Seed Analysis Certificate (SAC, PPQ Form 925) for hemp seeds grown in Canada.

Hemp seeds imported from countries other than Canada, must be accompanied by a phytosanitary certificate from the exporting country’s national plant protection organization to verify the origin of the seed and confirm that no plant pests are detected.

The agency further explained that “Hemp seed shipments may be inspected upon arrival at the first port of entry by Customs and Border Protection (CBP) to ensure USDA regulations are met, including certification and freedom from plant pests.”

As USDA Commission Purdue has expressed on numerous occasions, the hemp rule making process will take some time given the complex nature of the crop and its close connection with marijuana. However, even if hemp won’t be grown pursuant to the 2018 Farm Bill until regulations are in place, hemp growers who are registered under state pilot programs, and who comply with the newly released importation requirements, are free to import hemp seeds without the risk of DEA enforcement.

For additional information on the importation of hemp and hemp seeds, please contact our team.