Probable legal impact on cannabis industry:
This order directs the OLCC and OHA to adopt rules – the order, by itself, does not have the effect of a ban. The real extent of “Flavored vaping products” is not a defined term under the OLCC rules, and the OLCC may have some latitude in how it interprets this term. However, it seems likely that a “flavored” product would necessarily have to be limited to any vaping product that has an added flavor and is therefore classified as a “cannabinoid product” under OAR 845-025-1015(10)(b)(A), because “flavors,” and an example of a flavoring agent, non-marijuana derived terpenes, are included in the definition of “added substance” under OAR 845-025-1015(1). As a result, the Executive Order may not give the OLCC or the OHA the authority to ban “cannabis concentrates” or “cannabis extracts” (as defined in OAR 845-025-1015(7) and (9)), even if they are meant to be vaped.
However, it seems safe to say that we are looking at a ban of all THC and non-THC vaping products which contain an added flavor, such as botanically-derived terpenes (and perhaps even cannabis-derived terpenes). We do not anticipate the OLCC or OHA will act to ban cannabis concentrates or extracts which do not contain an added flavor.
As of this moment, we have not heard responses from the OHA or OLCC regarding what rules they may be preparing to implement. To better serve our clients, who include some of the largest manufacturers of THC and non-THC vaping products in the state of Oregon, if not nationwide, we are currently analyzing potential legal remedies available to industry participants in the event these agencies adopt rules that have the effect of banning all vaped THC, CBD, or other non-“flavored” vaping products, or in some other way go beyond the ambit of what is authorized by Governor Brown’s emergency order.
Additionally, we are aware of and are monitoring the lawsuits brought by nicotine vape industry participants in other states which have instituted bans, which are based on various legal theories including the Dormant Commerce Clause of the United States Constitution and preemption under federal law. Those cases, including Mister E-Liquid LLC v. Governor Gretchen Whitmer, et al., 19-CV-00786-RJJ-RSK (W. Dist. Mich.) and Vapor Technology Association, et al. v. Baker, et al., 19-CV-12048-IT (D. Mass.), are developing.
We will keep you updated when we know more from these agencies.