The UK Government is being sued by a CBD business for £3.4m, in the latest major challenge to its mishandling of legal hemp.
Ocean Development (Dorset) Ltd. and connected retail business CBD Flower Shop Ltd. are seeking damages from the Home Office amid allegations of ‘unlawful conduct’ after a shipment of hemp was detained by the UK Border Force.
It comes less than a year after Jersey Hemp won a similar landmark case against the UK government, forcing it to concede acting unlawfully with its seizure of hemp products, but failing to provide a precedent for cases like this to be avoided.
While this case could help to further clarify regulation, it comes amid reports of a spike in hemp and CBD shipments being temporarily confiscated by authorities, only to be released months later when the product has expired.
What happened?
The two businesses, owned by Shirley Anne Elizabeth Wood and her son Joshua Wood, have filed a lawsuit against the UK government, alleging that Border Force unlawfully seized 10 shipments of legally imported hemp between August 2023 and May 2024.
The companies, which hold a valid license from the Department for Environment, Food and Rural Affairs (DEFRA) to import hemp for use in tea, claim that Border Force wrongly classified the shipments as controlled drugs despite hemp’s legal status under UK law.
Filed in the High Court of Justice of England and Wales under case number KB-2024-002634, the lawsuit accuses the Home Office of breaching human rights protections and causing significant financial harm.
The claimants argue that the seizures violated their right to peaceful enjoyment of possessions and label Border Force’s classification of hemp as a controlled drug ‘baseless’.
Furthermore, they argue that the system designed to tackle illegal cannabis imports disproportionately impacts legal hemp and CBD businesses.
“A system in which true hemp is only identified as being a legal substance through a lengthy process of seizure and condemnation, throughout which the claimant is deprived [of] its possession, cannot possibly be characterized as a proportionate one,” the claim says.
As a result, the companies are seeking nearly £3.4 million in damages, including over £3.1 million for reputational harm to CBD Flower Shop and additional losses for the seized hemp and goodwill of Ocean Development.
An ongoing issue
The claimants in this case are being represented by Josh Normanton of Trinity Chambers and Robert Jappie of Fieldfisher LLP, who recently also represented Jersey Hemp in its battle to clear its name.
In April last year, Jersey Hemp secured a ‘very significant victory’ against the UK Home Office after the government admitted to unlawfully banning the company from importing CBD products into the UK.
The High Court ruling overturned a decision by the Drugs & Firearms Licensing Unit (DFLU) that had threatened the legality of Jersey Hemp’s operations and posed a broader risk to the UK’s CBD industry.
Despise the victory, the lack of a written court judgment on the application of the exempt product criteria leaves the industry in legal ambiguity. Legal experts, including Mr Normanton, noted that the Home Office’s concession avoided setting a formal precedent, leaving the door open for more cases like this to occur.
Jersey Hemp’s case centered on the “Exempt Product Criteria” under the Misuse of Drugs Regulations 2001, which allows products containing trace amounts of THC to be legally imported and sold if specific conditions are met. Jersey Hemp argued that its CBD products, which adhered to these regulations, were wrongfully classified by the Home Office as designed for administering controlled substances.
The Home Office conceded its error, acknowledging that its interpretation of the regulations was too restrictive and unlawful.
While the ruling is a major milestone for the CBD industry, it came too late for Jersey Hemp. The company lost 95% of its revenue after its license was revoked, forcing it to let go of staff and sell equipment at a loss to pay creditors.
Seizures on the rise
This latest unnecessary legal dispute comes amid reports of an increase in such seizures, with one source informing Business of Cannabis that an increasing number of hemp and CBD shipments are being held by the UK border force.
At least three consignments from multiple businesses are understood to have recently reported their imports being held over minor infractions such as labelling issues, withheld for around six months, then released, by which time the products have expired and are unusable.
Just this week, the UK Border Force reported its highest-ever number of drug seizures, confiscating over 119 tonnes of illegal substances in the year ending March 2024, a 52% increase from the previous year.
Combined with police efforts, a total of 217,644 drug seizures were made in England and Wales, representing a 13% rise compared to 2023. The estimated street value of these confiscations is around £3 billion, marking a record-breaking year for law enforcement.
‘Herbal cannabis’ represented a significant chunk of this, seeing 74 tonnes seized over the period, marking a near 60% rise year-on-year and representing the largest quantity recorded since 1973.
This article was originally published by Business of Cannabis and is reprinted here with permission.
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Author: Business of Cannabis
