Category: News Feeds

Yesterday a judge in Leon County, Florida enjoined an order that would force Florida’s schools to reopen for in-person instruction next week, handing Governor Ron DeSantis yet another humiliating defeat in his spectacularly bungled coronavirus response.

From disappearing  people off the official death tolls, to barring county health departments from releasing their own COVID mortality data, to firing data scientists, to claiming college football players were safer in the locker room than at home, DeSantis has vanquished all comers in the duel to see which governor can handle this crisis worst. This was no less true in the academic arena, where the governor insisted that schools reopen for full-time, in-person instruction — damn the coronas, full speed ahead!

On July 6, Richard Corcoran, Commissioner of the Florida Department of Education, issued an emergency order that all school districts “must open brick and mortar schools at least five days per week for all students, subject to advice and orders of the Florida Department of Health.” Luckily, DeSantis had already barred the Department of Health from issuing any advice on whether to open schools, restricting its employees to explaining how to open in the safest manner possible. Subtle!

As added incentive to get kids into the classroom, DeSantis threatened to withhold money from schools which didn’t reopen. Specifically, the July 6 order allowed a waiver of the rule which calculates school funding by the number of students physically present at school in October, but only for those districts whose reopening plans were approved by the state.

The teachers union and the NAACP sued, alleging that the order was arbitrary and capricious, trampled local authority under Florida law, and disregarded public safety. And yesterday, Judge Charles Dodson of the Leon County Civil Division agreed.

As Judge Dodson noted, on August 6, Hillsborough County’s school board voted to delay reopening for in-person education on the advice of doctors, despite the fact that the representative from the Health Department refused to weigh in. The next day, Commissioner Corcoran threatened to withhold the waiver if they didn’t reopen fully. Faced with the loss of millions of dollars in state funds, the district reversed its position and agreed to reopen fully, a course of action the state described as “voluntary.”

Judge Dodson took a different view, though, accusing the state of “ignor[ing] the requirement of school safety” and abridging local districts’ rights under the Florida constitution.

Because Defendants cannot constitutionally directly force schools statewide to reopen without regard to safety during a global pandemic, they cannot do it indirectly by threatening loss of funding through the Order.

Worse still, the Department of Education put forth no metric for assessing  reopening plans other than vaguely gesturing toward the very Health Department DeSantis had just muzzled. When forced by the court to explain why Hillsborough’s delayed opening plan was rejected while those of Miami-Dade, Broward, and Palm Beach Counties were approved, the state mumbled that those counties were in Phase 1 of reopening, a standard which is mentioned nowhere in the emergency order.

“Without prescribed standards for approval of plans,” Judge Dodson wrote, “the Commissioner has engaged in ad hoc and unconstitutional decision making without considering local safety and the medical opinions of experts, local or otherwise.” So the language in the order threatening to withhold waivers for the funding calculation from schools which don’t reopen immediately and without regard for student and staff safety was stricken.

Not really a great day for DeSantis (HLS 2005). But never fear, the intrepid bungler has vowed to appeal and cram those kids back into the classroom next week, COVID be damned.

Florida Education Association v. Ron DeSantis
School reopening lawsuit: Judge rules in favor of Florida teachers [Tampa Bay Times]

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Elizabeth Dye lives in Baltimore where she writes about law and politics.

I’m not even a parent yet my social media timeline is clogged with working parents concerned with exactly what is happening for the 2020-21 academic year. COVID-19 is a real bitch, and school districts are struggling to balance the safety and educational goals of students, while frequently under economic threats from state governments that don’t want to admit the reality of a pandemic. It’s basically a mess, and parents are going to be pressed trying to juggle it all. And it’ll be even worse if the parents also have to balance a full-time job on top of it all.

At least one Biglaw firm sees the buzzsaw its employees with children are heading towards, and they want to do something about it. At Fenwick & West, they’re offering a series of new programs to support their employees as they try to tackle this impossible semester:

· Tutoring or Back-Up Care Stipend: Fenwick is providing up to $500 as a reimbursement stipend to Fenwick employees who are parents or legal guardians of children under the age of 18, to help defray some of the costs for tutoring or learning support or back-up childcare.

· Tutoring, Online Resources, Learning Pods: Partnering with Bright Horizons, parents who have enrolled will get a 20% discount on tutoring, schoolwork help and learning pods from the care provider’s partner vendors.

· Parent Support Workshops: They’re offering a Parent Support Workshop with a well-being coach and consultant to help parents create work-from-home health and well-being plans.

· Loaner laptops for students: While many school districts are providing students with technology tools for online learning, we can help bridge shortages for those families in financial need if our employees’ child’s district isn’t providing a needed technology resource.

· Parents Network: They’ve launched an internal Parents at Fenwick group, as an online forum for sharing resources and ideas and for connecting and providing peer support.

So, what are other Biglaw firms doing to support their working parents? We’d love to hear from you. Please don’t hesitate to let us know. Our vast network of tipsters is part of what makes Above the Law thrive. You can email us or text us (646-820-8477).

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Kathryn Rubino is a Senior Editor at Above the Law, and host of The Jabot podcast. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter (@Kathryn1).

Biglaw firms across the country have decided to partially or completely roll back their COVID-19 austerity measures, and this new trend has now been picked up across the pond.

Over in the United Kingdom, Kennedys — a UK top 50 firm that has one office in the U.S. and increased its gross revenue by 9 percent to reach a record £238 million ($312,313,358.00) in 2019 — deferred its performance-based salary increases and bonus payouts earlier this spring thanks to the coronavirus crisis. Staff members were supposed to have their salary reviews in May, while attorneys were supposed to have their salary reviews in September. Thankfully, the firm has decided to “press ahead and reward staff for their work.”

All employees at the firm, both lawyers and staff members, will have their salary reviews in November. Legal Week has additional details:

Nick Thomas, senior partner of Kennedys, said in a statement: “It gives me immense satisfaction and pride to lead a partnership which chooses to reward our staff during what is a challenging time for so many businesses. But the reality is that they’ve earned it and deserve it having demonstrated their ability to maintain productivity remotely, helped by our robust IT platforms.

“As a business we live and breathe by ‘doing the right thing’ for our people and our clients, and we will never lose sight of the fact that our success is down to our people.”

The firm continued in a statement that it would be honouring all staff bonus commitments this year, adding that they had not made any redundancies, pay cuts, or furloughing arrangements during the last few months.

Congratulations to everyone at the firm. Let’s hope more firms get on board with this salary restoration movement — and soon.

If your firm or organization is slashing salaries, closing its doors, or reducing the ranks of its lawyers or staff, whether through open layoffs, stealth layoffs, or voluntary buyouts, please don’t hesitate to let us know. Our vast network of tipsters is part of what makes Above the Law thrive. You can email us or text us (646-820-8477).

Kennedys To Pay Out Salary Increases and Bonuses After COVID-19 Delay [Legal Week]

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Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.

The first night of the Republican National Convention really brought it with Kimberly Guilfoyle hopped up on that Jason Statham Crank while her boyfriend spent his speech crying over the fact that his dad will never love him. Guilfoyle also pegged herself as a first-generation American despite being Puerto Rican which is, you know, AMERICA. They even threw in Herschel Walker, a former professional athlete whose primary career accomplishment was being traded for the roughly 8,000 draft picks that made the Dallas Cowboys insufferable again.

But the highlight was a living room address from Mark and Patty McCloskey.

A true masterpiece of the hostage video genre. This looks so much like they’re begging for ransom I found myself cross-checking their blinks with Morse Code.

Honestly, it’s getting harder and harder not to feel bad for these people. At a certain point, you can only watch Sideshow Bob step on rakes for so long before his own incompetence gets sad. These folks already jumped head first into cartoonish infamy and if people cared about them they’d advise them to lay low until the news cycle moves on. But instead, they’ve decided to try and recast themselves as normal people sitting on their couch and only managed to land themselves in another future comedy skit that will enter the canon of 2020’s greatest hits.

The show gets off the rails within seconds.

We’re speaking to you tonight from St. Louis, Missouri, where just weeks ago, you may have seen us defending our home….

Yeah, it’s not really “defending” when there’s not a threat. People marched down the street. It’s not really a threat unless you enter the discussion from the standpoint that large groups of mostly black people are by definition “a threat.” Spoiler alert, that’s the sentiment of this speech, which will take a wild turn in the middle to complain about housing discrimination laws.

When I first learned that the McCloskeys would speak at the convention, I figured they’d give some sort of bland Second Amendment rah rah speech. But instead they were tagged with pushing all the obscure racist dog whistle policy tweaks. First, the fair housing rule and then Mark garbles something about defunding the police and takes a swing at “ending cash bail so criminals can be released back out on the streets the same day to riot again.” What is it with these people and cash bail reform? It’s such a weird high horse for anyone to get on because cash bail by definition lets defendants — because they aren’t criminals at this point — back on the street. All eliminating bail does is say that we won’t punish poor defendants in ways that we would never punish rich defendants based on setting an artificial price on “risk of flight.”

The campaign seems to think the key to the suburbs is casting the McCloskeys in their restored turn-of-the-century palazzo as typical suburbanites. Imagine believing that suburbanites are more worried about fair housing regulations than what will happen when they send their kids to school next week.

The money line:

Not a single person in the out-of-control mob you saw at our house was charged with a crime. But you know who was?

No, who?

We were.

I’m just spitballing here, but maybe that’s because you were the only people committing crimes.

And, yes, it is a gated community which means the protesters were trespassing, though video of the march entering the area shows them walking through an open and unbroken gate which mitigates the argument that folks knew they were casually trespassing. And even if they were, aiming deadly weapons at people is going to trump trespassing every time. The video includes pictures of the event showing the protesters very intentionally NOT stepping onto McCloskey property. Unless they’ve adversely possessed the sidewalk (and, there are some places where sidewalks are designated as part of the property, but the point remains that these folks are pretty clearly holding at what the reasonable person would assume is the property line).

All this “defending” and “out-of-control” talk would resonate better if they didn’t provide the contradictory photo evidence themselves.

Consider this, the Marxist liberal activist….

This is where McCloskey is going to complain about Cori Bush being on her way to Congress right now. Although he’s not going to give her the respect of calling her by her name, he’s just going to use the word “Marxist” a bunch.

Oooooh. Historical materialism! Hide the kids!

These radicals aren’t content with marching the streets, they want to walk the halls of Congress.

Isn’t that good? Like, wouldn’t that be better than guillotines?

“Trump brought us the greatest economy our country had ever seen.”

Putting aside that this isn’t true, that “had” looms rather large don’t you think? Frankly, it’s shocking that Mark managed to get the past tense in there past the RNC messaging gurus.

Hopefully that doesn’t spoil their ransom efforts.

Earlier: St. Louis Lawyers Wave AR-15 At Protesters Like Totally Normal, Totally Not Bonkers People

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Joe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news. Joe also serves as a Managing Director at RPN Executive Search.

When facing the possibility of prison, some hedge fund managers draw up elaborate contingency plans for that awful potential day. Marble Ridge Capital founder Dan Kamensky, who is on record acknowledging, “maybe I should go to jail” and who now may have to confront a formal evaluation of that assessment for allegedly seeking to screw over his fellow Nieman Marcus bondholders, who he represented as a member of that troubled retailer’s unsecured creditors committee, has chosen to dispense with that need.

The past few months have been somewhat of a topsy-turvy ride when it comes to the issue of gun control. This past June the Supreme Court rejected 10 different cases that could have expanded gun rights. The refusal to take up the expansion of gun rights caught some liberal-leaning organizations by surprise and the “theory that Second Amendment cases are in season” with a solid conservative majority on the Supreme Court seemed to be cast in serious doubt. Just over a week ago, however, the Ninth Circuit gave gun rights advocates reason to hope again.

Before we get into the specifics of the Ninth Circuit decision, it is vitally important to discuss the context in which this decision takes place. Because although we are currently living in an era where major restrictions on gun ownership have been overturned, or lapsed, the rate of violence, including gun violence, has nevertheless steadily decreased. Jacob Sullum at Reason recently summarized this remarkable trend well:

According to the FBI’s numbers, total homicides in the United States fell from 24,700 in 1991 to a low of 14,164 in 2014 — a 43 percent drop. The homicide rate fell even more dramatically, from 9.8 per 100,000 in 1991 to 4.4 per 100,000 in 2014 — a 55 percent drop. Homicides rose in 2015 and 2016, then fell in 2017 and 2018, when the rate was 5 per 100,000, up 14 percent from 2014. The FBI has not published final data for 2019 yet, but preliminary numbers for the first half of the year indicate that homicides fell by 7.4 percent.

The trends for murders committed with firearms are slightly different because the type of weapon used varies over time. Gun homicides fell from a peak of 17,075 in 1993 to a low of 7,803 in 2014 — a 54 percent drop. The number rose in 2015, 2016, and 2017, then fell in 2018, when it was 32 percent higher than in 2014 but still 40 percent lower than the 1993 total. The gun homicide rate in 2018 was about 3.1 per 100,000, half the 1993 rate.

As I have written before, the only thing that could turn the incredibly good news that gun violence is steadily decreasing into something depressing is if nobody actually believes it, which most Americans sadly don’t.

At the risk of going all “both sides” on you here, it must also be pointed out that there is a lot of blame to go around for the current misconception surrounding gun violence. The president’s repeated depictions of “American carnage” are simply not true, but a lot of people believe him anyway. Moreover, as Sullum points out, Joe Biden characterizes gun violence as an “epidemic” that is seemingly out of control when, again, the only notable attribute about gun violence rates lately is that they have gone down, drastically. Thankfully, our courts have largely not taken the bait with either form of misleading political rhetoric, choosing instead to focus on the facts. Which brings us to the recent Ninth Circuit decision.

The Ninth Circuit case focused on whether California’s criminalization of large capacity magazines (LCMs) that hold 10 or more rounds passes “constitutional muster.” As the court noted in its decision, these LCMs are extraordinarily common. In fact, they make up “about 115 million LCMs out of a total of 230 million magazines in circulation” and, perhaps most importantly, are commonly the standard with many handguns. If you are asking why it should matter that these LCMs are common in handguns, well, the Supreme Court has recognized that the handgun is the “quintessential self-defense weapon.” Moreover, like with the First Amendment, courts view the Second as an individual right. Indeed, the Ninth Circuit has recognized that gun-control must be individual-based and that general bans that limit this individual right to self-defense should be viewed with strict scrutiny.

In order to pass strict scrutiny, the government must have a compelling interest. But while the Ninth Circuit recognized that California did advance a compelling interest of “preventing and mitigating gun violence” in its LCMs ban, the decision to categorically criminalize “nearly every weapon that can be reasonably expected for use in self-defense” was not an acceptable means of achieving the compelling interest. Indeed, the Ninth Circuit decision goes into great length about the value of the legal right of self-defense that is essentially being taken away by California’s criminal prohibition, particularly on “those who may not be equally protected by the state.”

I understand that many will not agree with the Ninth Circuit, or me, on the subject of gun control. But we should be able to agree with basic facts about gun violence and acknowledge that these facts make the issue extraordinarily complicated. For example, it is a fact that many people should not be allowed to have guns and that most guns intended for self-defense will never be used. Indeed, bringing a gun into the home is to bring a certain degree of risk. But at the same time, it should be said that there is nothing illogical about courts recognizing the right of psychologically stable people, committed to safe handling, to use common tools such as firearms for their self-defense.

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Tyler Broker’s work has been published in the Gonzaga Law Review, the Albany Law Review, and is forthcoming in the University of Memphis Law Review. Feel free to email him or follow him on Twitter to discuss his column.

Earlier this month, thanks to the recently released Am Law A-List ranking, we found out which U.S.-centric Biglaw firms were the best in America in terms of both finances and culture. As a companion piece to the Am Law A-List, today we’ve got the A-List Female Equity Partner Scorecard, a ranking of the percentage of female equity partners in the Am Law 200.

For this ranking, only equity partners were counted. Because women are often left to languish in the nonequity partner ranks, the Female Equity Scorecard really allows us to see which firms are doing right by the women who work there — and, on the flip side, which firms are being celebrated for doing what looks like the bare minimum.

Without further ado, here are the top 20 to satiate your rankings cravings (with the firms’ total percentage of female equity partners noted parenthetically):

1. Fragomen (48.7 percent)
2. Hanson Bridgett (38.8 percent)
3. Marshall Dennehey (32.5 percent)
4. Littler Mendelson (30.6 percent)
5. Jackson Lewis (30.2 percent)
6. Brownstein Hyatt (29.0 percent)
7. Ropes & Gray (28.8. percent)
8. Davis Wright Tremaine (27.6 percent)
9. Morgan Lewis (27.5 percent)
10. Holland & Hart (26.8 percent)
10. Morris Manning (26.8 percent)
10. Porter Wright (26.8 percent)
13. Ballard Spahr (26.6 percent)
14. Manatt (26.3 percent)
14. Sherman & Howard (26.3 percent)
16. Kutak Rock (26.1 percent)
17. Morrison & Foerster (26.0 percent)
17. Munger Tolles (26.0 percent)
19. Covington (25.8 percent)
19. Greenspoon Marder (25.8 percent)

You may be wondering where the rest of the namebrand Biglaw firms appear on this list. We’ve taken the top 20 of the Am Law 100 and listed where they fall on the Female Equity Scorecard so you can see how they really stack up for women.

1. Kirkland / 112. 18.0 percent
2. Latham / 138. 16.1 percent
3. DLA Piper / 158. 14.5 percent
4. Baker McKenzie / 94. 18.9 percent
5. Skadden / 51. 22.3 percent
6. Sidley / provided no data on female equity partners
7. Morgan Lewis / 9. 27.5 percent
8. Hogan Lovells / 53. 22.0 percent
9. White & Case / 140. 16.0 percent
10. Jones Day / 21. 25.4 percent
11. Gibson Dunn / 100. 18.6 percent
12. Norton Rose / 40. 23.3 percent
13. Ropes & Gray / 7. 28.8. percent
14. Greenberg Traurig / 154. 14.8 percent
15. Simpson Thacher / 61. 21.3 percent
16. Weil / 77. 20.2 percent
17. Mayer Brown / 149. 15.2 percent
18. Sullivan & Cromwell / 97. 18.8 percent
19. Davis Polk / 103. 18.4 percent
20. Paul Weiss / 34. 23.8 percent

As you can see, just a handful of the top firms are anywhere near respectable in terms of the promotion of women to their equity partnership ranks. Kudos to Ropes & Gray and Morgan Lewis for placing in the top 10 of each ranking, and a special shout-out to Jones Day; Paul Weiss; and Norton Rose for placing in the top 50 of the Female Equity Scorecard. (We’ll also acknowledge Skadden and Hogan Lovells here for coming so close. Maybe next year?) As for the rest of the firms listed here, this is pretty embarrassing. Your firms are great at making money, and it’s time to open your eyes and see the value of welcoming women into your equity partnership ranks. You can, you should, and you absolutely must do better.

You can check out the rest of the rankings here.

The 2020 A-List: Female Equity Partner Scorecard [American Lawyer]

Earlier: The Am Law A-List: Ranking The Most Elite Law Firms In America (2020)

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Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.

Borrowing from the late Kenny Rogers, sometimes you’ve got to know when to fold ’em.

Last week, the NYSBA participated in a call designed to provide comfort to emergency diploma privilege advocates that the upcoming online bar exam will not be the unmitigated disaster that everyone following the administration of online exams so far in 2020 suspects it will be. During the call, the NYSBA, which performs a supporting role in the process run by the Board of Legal Examiner listened as the Executive Director of BOLE based his confidence in the upcoming two-day online exam on a smaller, non-proctored, offline test before throwing shade on the online testing guru who declared the exam infeasible and wrapping up by demonstrating that he didn’t even know the techniques used to pass the test he’s running.

This would be the time to fold. The NYSBA decided to raise.

In a letter to representatives of the New York State Law Graduate Coalition & United for Diploma Privilege New York, NYSBA President Scott Karson responded with his takeaway from the meeting. The stakes for this letter were reasonably high because in a world of declining bar association membership, the diploma privilege advocates had proposed a boycott of the NYSBA if it failed to use its position of authority to advocate for a better emergency plan.

The letter is six paragraphs long and the first four — taking up the entire first page — say nothing about the bar exam other than mentioning that the meeting happened and instead outlines how big the NYSBA is and how much it’s tried to convince people to hire graduates left in the cold by the coronavirus. When the first two-thirds of a letter is spent avoiding the point, it’s a red flag to the reader that something is amiss. Bringing us to the first — and only — actually responsive paragraph:

As I said during our discussion, I feel very strongly that the chaos created by the virus cannot be allowed to undermine the vital protections of the public interest provided by ensuring that lawyers licensed in New York are competent to serve. This is particularly important for clients who are members of vulnerable communities and have little or no familiarity with the reputations of lawyers and law firms. These clients rely on the license as proof of an attorney’s competence and ability to represent them fully and fairly.

This of course glosses over the most important issue, which is that there’s no reason to believe this exam will even work! The “vital protections of the public interest” are already compromised when half the examinees can’t log in and because no one can take notes on fact patterns (because what lawyers use pens or paper anyway?) the test loses all semblance of order. The discussion on the table is no longer between the time-tested bar exam and diploma privilege, it’s between diploma privilege and a system that’s meant to give a test in about a month that hasn’t gotten through a test unscathed yet.

It’s also a problem that “vital protections of the public interest” is a hollow defense of the bar exam as a concept. We have hard data that the existence of an exam has no discernible impact on the public’s safety. And while that’s enough to raise questions about the exam in ordinary times, as the first page of the letter lays out in detail, these aren’t ordinary times. Going forward with a woefully compromised test without a compelling justification is just foolhardy. Buzzwords just don’t cut it.

And citing vulnerable communities? The people ripping off these communities now are all licensed. The access to justice gap in New York is staggering and the NYSBA itself expects it to get even worse in the rural areas of the state. If the bar exam isn’t protecting them now and reduces the number of available attorneys to meet the need, it’s hardly a ringing endorsement for pushing ahead with it during a pandemic. Deploying this “widows and orphans” rhetoric to appeal to pathos has a hallowed place in trial advocacy, but in a showdown of written work, it falls flat.

The NYSBA tweeted out its letter listing the applicants who raised the issue. It appears as though they’ve since deleted the tweet. Whether it was intended or not, that certainly gave the appearance of trying to publicize the “troublemakers” in some sort of effort to chill others from raising issues with the current half-cocked bar exam plan.

Not exactly the look the NYSBA wants if it’s trying to avoid a boycott.

Earlier: Bar Examiner Offers Less Than Inspiring Answers In Online Exam Defense

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Joe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news. Joe also serves as a Managing Director at RPN Executive Search.

We love a salary trend here at Above the Law! And when the news is good, so much the better. After salary cuts became the new norm in the springtime of COVID, now that summer’s here and autumn is around the corner, quite a few firms have decided that those cuts aren’t needed anymore, or at least they no longer need to be as severe as the initial haircut.

Back in May, Managing Partner Steven Sonberg of Holland & Knight announced staff furloughs and salary cuts for partners, associates, and staff. Cuts to partner draws averaged 25 percent at the firm, on a progressive scale. Associates, counsel, and senior professionals saw compensation cut by 17.5 percent. Staff making $75,000-$150,000 had a 10 percent pay cut and staff making $150,000+ got a 15 percent reduction.

But now, as reported by Bloomberg Law, Holland & Knight has walked back at least some of the cuts for all employees:

However, the firm said that it had restored 30% to 50% of the original 17.5%, 15% or 10% cuts at the end of June, with all associates receiving a 30% restoration of their salaries. The firm is currently evaluating a further restoration, a spokesperson said.

Let’s hope it’s only a matter of time before full salaries are restored.

If your firm or organization is slashing salaries or restoring previous cuts, closing its doors, or reducing the ranks of its lawyers or staff, whether through open layoffs, stealth layoffs, or voluntary buyouts, please don’t hesitate to let us know. Our vast network of tipsters is part of what makes Above the Law thrive. You can email us or text us (646-820-8477).

If you’d like to sign up for ATL’s Layoff Alerts, please scroll down and enter your email address in the box below this post. If you previously signed up for the layoff alerts, you don’t need to do anything. You’ll receive an email notification within minutes of each layoff, salary cut, or furlough announcement that we publish.

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Kathryn Rubino is a Senior Editor at Above the Law, and host of The Jabot podcast. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter (@Kathryn1).

Last week, the DEA dropped a bomb on the hemp industry when it released an Interim Final Rule (the Rule) on hemp and hemp-derived cannabinoids (collectively referred to as Hemp).

Although the Rule provides that it “merely conforms DEA’s regulations to the statutory amendments to the CSA that have already taken effect, and it does not add additional requirements to the regulations,” the Rule improperly criminalizes intermediary hemp, which is partially processed hemp extract — also known as “wet hemp” — not intended for consumption or end use consumers. This attack on intermediary hemp is hugely problematic in that wet hemp is a vital component of all finished Hemp products.

The Agriculture Improvement Act of 2018 (the 2018 Farm Bill) legalized hemp by removing the plants, its derivatives, extracts, and cannabinoids from the definition of “marihuana” under the Federal Controlled Substances Act (the CSA). However, the 2018 Farm Bill did not address the processing of hemp, neither did the USDA’s Interim Final Rule that regulates the cultivation of hemp. This regulatory gap regarding the processing of hemp is at the center of this Rule and why it has the potential to destroy the Hemp industry.

The 2018 Farm Bill defines hemp as: the plant Cannabis sativa L. and any part of that plant, including the seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry weight basis.” (Emphasis added).

Accordingly, it is clear that the plant, its derivatives, extracts, and cannabinoids are no longer schedule I controlled substances. Moreover, if derivatives, extracts, and cannabinoids are lawful, it logically follows that it is lawful to process the hemp plant into such derivatives, extracts, and cannabinoids. Yet, the Rule ignores this nuance and provides:

[T]he definition of hemp does not automatically exempt any product derived from a hemp plant, regardless of the Δ9 -THC content of the derivative. In order to meet the definition of “hemp,” and thus qualify for the exemption from schedule I, the derivative must not exceed the 0.3% Δ9 -THC limit.

The definition of “marihuana” continues to state that “all parts of the plant Cannabis sativa L.,” and “every compound, manufacture, salt, derivative, mixture, or preparation of such plant,” are schedule I controlled substances unless they meet the definition of “hemp” (by falling below the 0.3% Δ9 -THC limit on a dry weight basis) or are from exempt parts of the plant (such as mature stalks or nongerminating seeds). See 21 U.S.C. 802(16). As a result, a cannabis derivative, extract, or product that exceeds the 0.3% Δ9 -THC limit is a schedule I controlled substance, even if the plant from which it was derived contained 0.3% or less Δ9 -THC on a dry weight basis. (Emphasis added).

Any hemp derivative, extract or product must go through an extraction process. This extraction process inevitably results in the creation of “wet hemp” and in an increase in Delta-9 THC concentrations in excess of 0.3%, even if fleetingly. Therefore, it is reasonable to infer that Congress intended to legalize “wet hemp.”

Nevertheless, the Rule disregards this fact and suggests that hemp processors are handling a schedule I controlled substance, even if the finished product contains no more than 0.3% Delta-9 THC. Consequently, the Rule creates significant criminal risk for anyone processing hemp.

In light of the DEA’s historical control of cannabis and its lack of enthusiasm in the legalization of hemp – USDA Secretary Sonny Purdue has repeatedly blamed the DEA for interfering with the development of hemp regulations — it is clear that the Rule is a pretext for the DEA to maintain its authority over cannabis.

Ultimately, the Rule and the issues raised in this blog post reveal that statutory ambiguities should be addressed by Congress or by the courts before the DEA gets to adopt such regulations. As such, hemp stakeholders should comment on the Rule through October 20 and reach out to their elected officials to help them understand the importance of this issue and the need to clarify the legality of intermediary hemp to help the Hemp industry follow its course and succeed.

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Nathalie practices out of Harris Bricken’s Portland office and focuses on the regulatory framework of hemp-derived CBD (“hemp CBD”) products. She is an authority on FDA enforcement, Food, Drug & Cosmetic Act and other laws and regulations surrounding hemp and hemp CBD products. She also advises domestic and international clients on the sale, distribution, marketing, labeling, importation and exportation of these products. Nathalie frequently speaks on these issues and has made national media appearances, including on NPR’s Marketplace. For two consecutive years, Nathalie has been selected as a “Rising Star” by Super Lawyers Magazine, an honor bestowed on only 2.5% of eligible Oregon attorneys.  Nathalie is also a regular contributor to her firm’s Canna Law Blog.