US District Court Tosses Case Over CBP's Seizure of Hemp

The U.S. District Court for the Western District of North Carolina dismissed a case brought by Oregon-based hemp manufacturer We CBD contesting CBP's seizure of over 3,000 pounds of hemp. In the March 31 order, Judge Frank Whitney said that We CBD's claims were barred by sovereign immunity or moot (We CBD v. United States, W.D.N.C. #3:21-00115).

The hemp was seized in North Carolina after We CBD contracted with shipping company Planet Nine to export it from Oregon to Switzerland. CBP seized the shipment when the flight stopped to refuel in Charlotte, North Carolina. We CBD then sued Planet Nine for neglect (see 2109030056), while also filing a suit against CBP alleging that the agency unlawfully detained the hemp. In another proceeding, We CBD sought to get back around 550 pounds of hemp but recently dropped the claim, citing the fact that the shipment had likely gone bad (see 2203250040).

In the case over CBP's alleged unlawful detainment of the hemp, the U.S. made a move to toss the case, citing a lack of jurisdiction. Whitney agreed, striking down We CBD's tort and constitutional claims in the case. On the tort side, the judge ruled that We CBD's claims clearly fall within the universe of claims stemming from a large exception to the government's waiver of immunity concerning cases over property damage. The exception exempts the U.S. from being sued over the detention of any goods by a customs officer.

The judge also found that the U.S. is barred from facing We CBD's constitutional claims on the grounds that it has sovereign immunity. "Despite Plaintiff’s contentions otherwise, the Court agrees with Defendants that 'Plaintiff’s non-[Federal Tort Claims Act] constitutional/equitable claims are merely components of its FTCA claim for monetary relief disguised as declaratory requests,'" the opinion said. "As such, the Court finds Plaintiff’s constitutional claims amount to exactly the type of relief that the Supreme Court has held falls outside of § 702’s waiver -- substitute relief."

Lastly, Whitney said the claims are moot since there is "no actual, ongoing controversy between the parties because the issues presented are no longer 'live' and the parties lack a legally cognizable interest in the outcome." In all, We CBD requested three types of relief: injunctive relief to find that the government should allow the company to test the hemp, a ruling that says CBP failed to provide notice over the seizure, and a declaration that the hemp should be returned.

On the first two, the court said the plaintiff only seeks an advisory opinion and that the marijuana has already been destroyed. Even if it wasn't, however, We CBD's tort claims would still be barred, the judge said. We CBD also claimed that it should be allowed to test the shipment since it is relevant to its case against Planet Nine. Whitney disagreed, holding that even if it was relevant, there is no case law to back the position that an otherwise moot issue can render judgment since it could help with discovery in another case.