DEA RULES THREATEN TO STRANGLE HEMP BUSINESS

If the U.S. Drug Enforcement Administration has its way, Athens County
retailer Don Wirtshafter could soon be out of business.

"On Oct. 9, I went from being a entrepreneur to being one of the biggest
drug dealers in the U.S.," complained Wirtshafter, who runs the Ohio
Hempery, a Guysville company that sells hemp-based products including food
and clothing items.

It's the food products that have become a problem since a decision last
year by the DEA to change how it looks at hemp merchandise.

On Oct. 9, the DEA announced it was "clarifying" its interpretation of its
rules on the legality of hemp-based products. Until then, the drug agency
had focused enforcement efforts on the parts of the cannabis plant -- buds,
leaves and resins -- that produce marijuana. The "hemp" parts of the plant
(stalks and sterilized seeds), which contain very little of marijuana's
active ingredient THC, were not specifically outlawed.

With its new "interpretive rule," however, the DEA says that if a hemp
product contains even minute amounts of marijuana's active ingredient THC,
and if using the product introduces THC into the user's body, then it is
illegal to sell.

While the new interpretation was adopted without public input, the DEA also
has begun official rule-adoption procedures, including soliciting public
comment, on a new rule that would formalize the outlawing of hemp food
products. The comment period closed Dec. 10.

According to a DEA press release, products that are now illegal if they
contain even trace amounts of THC include hemp-based varities of beer,
cheese, coffee, corn chips, energy drinks, flour, ice cream, snack bars,
salad oil, soda and veggie burgers. Exempted are bird seed mixtures with
sterilized cannabis seeds, clothing items, cosmetics, lotion, paper, rope,
twine and yarn, shampoo and soap.

Agency administrator Asa Hutchinson is quoted as warning that "many
Americans do not know that hemp and marijuana are both parts of the same
plant and that hemp cannot be produced without producing marijuana." The
agency advises consumers who are uncertain of whether a hemp product they
want to buy is legal to check the ingredient label, or ask the manufacturer
or distributor, to find out if the product contains THC. "If it does, it is
illegal," the DEA warns.

Until Feb. 6, it is not against the law to possess consumable hemp
products, only to sell them. By that date, however, the DEA wants those in
possession of such products to dispose of them. Anyone who doesn't will be
subject to charges of possessing illegal drugs, confirmed DEA spokesperson
Susan Feld from the agency's Detroit field division, which covers Ohio. The
aggressiveness of enforcement, she said, will be "really up to the
individual offices."

The Ohio Hempery markets hemp products ranging from candles to wallets to
shampoo to twine, and including consumables such as coffee, brownies and
toasted hemp seeds. According to Wirtshafter, two of his biggest-selling
items are hemp seeds and hemp seed oil, which are both now technically
illegal. He said he currently has about $800,000 worth of inventory in such
products sitting in Canada, and that "according to the DEA, we're supposed
to throw it away."

Wirtshafter said the DEA has caused trouble for his business before. Two
years ago, for instance, the agency seized a load of birdseed mix
containing hemp seed and held it for months, during which time it became
contaminated and worthless. The Ohio Hempery has had to move its operations
that handle hemp seed products to Canada, a friendlier legal environment,
and now maintains only a shoestring operation in Athens County. "We've been
forced out of the county," Wirtshafter said. And though the hemp products
industry is mounting a legal challenge to the new DEA rules, he added, if
the DEA manages to make the rules stick, the Ohio Hempery may have to shut
down.

Feld of the Detroit DEA office said Friday that the rule change by the DEA
merely "clarified the difference between hemp and marijuana." Though hemp
industry advocates argue that hemp products contain so little THC they
could never induce a marijuana "high," Feld said that "it doesn't matter.
As long as it has a trace of THC, then it's considered a product that is
illegal."

Asked whether the DEA has any suggestions on how distributors should best
dispose of hemp products they already have, Feld replied, "It doesn't
matter. Just so they dispose of them."

The DEA's new rule announcement triggered quick reaction from the industry,
including public demonstrations outside DEA headquarters in 22 U.S. cities
on Dec. 4. The Hemp Industries Association, along with a number of hemp
companies, is fighting the DEA rule change in the U.S. Sixth Circuit Court
of Appeals, and has asked for a stay of its enforcement. Arguments the
industry group has used in its written comments on the rule change include
claims that:

* Consumption of hemp products, "even in amounts vastly exceeding normal
use, cannot possibly have any psychoactive effect," and won't even raise a
person's THC levels enough to affect a drug screening.

* Adoption of the rules would threaten the existence of numerous companies
marketing hemp-based products and "would also harm environmentalists,
farmers and others who have spent years to research, develop and
commercialize industrial hemp food and beverage products, and create
markets for these products."

* The new rules would probably violate international trade agreements such
as NAFTA and the WTO, because the United States' trading partners and
foreign companies had no chance to offer input.

The DEA has responded in a court filing that its new reading of the rules
on hemp is not, as its critics claim, an illegally adopted legislative
rule, but rather, an "interpretive rule" that doesn't require a formal
adoption process. The agency also notes that none of the hemp companies
opposing the rule has suffered any injury, because the DEA has not yet
seized any of their products.

Wirtshafter, meanwhile, says with all the continued attention from the
federal government, he's seriously thinking of getting out of the hemp
industry. "We've been battered by this thing over the last three or four
years," he said. "But this is the final blow."