The overview: the Idaho State Police hemp seizure case

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Idaho State Police seized of 6,701 pounds of a “THC-containing substance” on January 24th from a semi-truck during a Port of Entry inspection along I-84. Police say the product is marijuana by definition, according to Idaho law, because it contains tetrahydrocannabinols, also known as THC.

However, the company which owns the product argues Idaho’s definition of the product doesn’t apply because a new federal law made industrial hemp legal, as long as it contains less than 0.3 percent tetrahydrocannabinol. And thus, they argue, the seizure of the hemp product was unlawful.

As a result, two court cases are in motion: one criminal and one civil.

 

State of Idaho v. Denis Vladimirovich Palamarchuk

This criminal case involves only the driver of the truck and only addresses the charge of drug trafficking. The 36-year-old man driving the truck with the hemp in tow was arrested and charged with felony drug trafficking. If convicted, the mandatory minimum sentence is five years in prison and a $15,000 fine. Palarchuk could face up to 15 years in prison and a fine of up to $50,000.

Palarchuk posted a $100,000 surety bond and was appointed a public defender. Attorneys stipulated to continue the preliminary hearing to March 7th, 2019, when a Russian interpreter will assist Palarchuk during proceedings.

Big Sky Scientific LLC v. Idaho State Police

Whether or not the State of Idaho had the authority to prohibit the transportation or shipment of hemp (and a few other related issues) is a civil matter. This case, filed in federal court, is far more complicated than the criminal case because what’s at issue isn’t just a specific crime, but whether state or federal law should take precedence in all cases like this one.

The Plaintiff: Big Sky Scientific LLC is a Colorado company which was incorporated just one week before the seizure. The business purports to purchase and manage the processing the isolates of industrial hemp and then “sell the CBD powder to consumer products manufacturers who add the CBD powder to a diverse range of products,” according to filings in the case. Big Sky claims it purchased industrial hemp from Boones Ferry Berry Farm in Hubbard Oregon and made arrangements for the hemp to be shipped from Oregon to Colorado.

The Defendants: Idaho State Police, Ada County, and Jan M. Bennetts, in her official capacity as Ada County Prosecuting Attorney, still have a little over two weeks to provide their answers to the court. In documents submitted to the court, legal counsel for one of the defendants argued that Idaho law takes precedence on this issue, at least on the date the product was seized.

 

Some of the issues

Big Sky maintains they have fully complied with federal and state laws and the seizure of the hemp product was unlawful.  According to court documents, Elijah Watkins, legal counsel for Big Sky, delivered letters to the Defendants, Idaho State Police and Ada County prosecutors, which described the high value of the industrial hemp, its perishable nature, and requested the cargo be released promptly. In the letters, Watkins argued “the seizure of the cargo was interference with interstate commerce,” which is expressly prohibited by Section 10114 of the Act:

“No state or Indian Tribe shall prohibit the transportation or shipment of hemp or hemp products produced in accordance with subtitle G of the Agricultural Marketing Act of 1946 (as added by section 10113) through the State…”

Watkins argued that “any such interference violated the 2018 Farm Bill and the Supremacy Clause of the United States Constitution.”

The federal law is brand new.  At the time of the seizure, the new federal law was just over a month old and it made an illegal product legal. Thus, implementation of the law will take time.

It’s so new, however, that the Defendants’ legal counsel “set out their position that the regulatory framework for industrial hemp required by the 2018 Farm Bill had not yet been created, such that the hemp that had been seized could not have been ‘produced in accordance with subtitle G of the Agricultural Marketing Act of 1946’ as is required.”

Defendants’ counsel wrote to Plaintiff’s counsel and argued, “Assuming for the sake of argument that the 2018 Farm Bill even applies, the contraband could not have been produced in accordance with subtitle G and Idaho is free to prohibit its transportation or shipment through the state.” (See Memorandum Decision and Order, p. 5-7)

Other state or local laws could apply.  In a document prepared by the Congressional Research Service which highlighted changes to the law at that time, §11701 of the Act “prohibits any state or local government from setting standards or conditions on the production or manufacture of agricultural products from other states if the products are produced or manufactured according to federal law or the laws of the state or locality” (emphasis added).

Big Sky argues that the hemp product was produced in accordance with federal laws and/or the laws of the state of Oregon. Big Sky provided Idaho State Police and Ada County Prosecutors with a copy of an “industrial hemp license” for Boones Ferry Berry Farm in Hubbard, Oregon, asserting that the Oregon grower is licensed with the Oregon Department of Agriculture, but that didn’t persuade the Defendants to return the hemp to the Plaintiff.

There is scarce information about the requirements states must meet to exercise primary regulatory authority over the production of hemp under the new federal law due to the infancy of the implementation of the law.

(To read more about the conflicting state and federal laws on hemp and the newly proposed legislation to legalize hemp production in Idaho, click HERE.)

What’s next in the Big Sky case?

A hearing on the Motion for Temporary Restraining Order and Preliminary Injunction is set for Monday, February 11th at 9:00 AM.

Answers from Ada County, Idaho State Police, and Jan M. Bennetts are due to the court on February 25th, 2019, according to the U.S. District Court calendar.

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