What Happened
On September 14, Virginia’s Attorney General (AG) Jason Miyares issued a letter to the registered agent of the Good Vibes Shop, a Radford, VA store, for selling tetrahydrocannabinol (THC) products without proper labeling and packaging. The AG’s letter alleges that the store’s THC products lacked child-resistant packaging and appropriate labeling, including ingredient lists, THC content, and age restrictions, in violation of the Virginia Consumer Protection Act (VCPA). As we have recently discussed, the AG’s letter is part of a broader effort among states to protect consumers amid the evolving federal and state cannabis regulatory landscape.
The VCPA
The VCPA prohibits the sale, or offer for sale, of any substance intended for human consumption that contains THC, unless (1) it is contained in child-resistant packaging; (2) its label states that it contains THC and may not be sold to persons younger than 21 years of age, lists all ingredients, lists the amount that constitutes a single serving, and lists the total percentage and milligrams of THC in the product and each serving; and (3) it is accompanied by a certificate of analysis.
The VCPA also prohibits the manufacture, retail sale, or offer for retail sale, of industrial hemp extract, food containing industrial hemp extract, or any substance containing THC that depicts or is in the shape of a human, animal, vehicle, or fruit.
The VCPA authorizes the AG to issue civil investigative demands to any person that violates the VCPA and seek civil penalties, among other things, of up to $2,500 per violation.
Recent Regulatory Action
The AG’s action involving Good Vibes Shop is the latest example of Virginia’s regulatory action against businesses selling THC products in the Commonwealth. Last year, the AG settled a case with Blackstone Tobacco & Vape, Inc., a Blacksburg, VA-based store, for $12,500 after similar allegations were made that the store violated the VCPA. The complaint filed in the case alleged that three individuals under the age of 18 experienced adverse reactions to THC-containing, edible gummies purchased at Blackstone Tobacco. Additionally, the AG alleged that some or all of the THC-containing products sold by Blackstone Tobacco did not contain child-resistant packaging, did not have any labeling indicating that the products contained THC, and may have been sold to consumers under the age of 21. Moreover, Blackstone Tobacco’s products also allegedly did not display a list of the ingredients or a recommended serving size, were sold in the shape of an animal to attract children, and did not state the total percentage and milligrams of THC included in the product and in each serving.
Virginia businesses have also been recently hit with penalties as state officials have taken a more aggressive approach to enforcing a new law regulating the sale of intoxicating hemp products to crack down on alternatives to marijuana. The Virginia Department of Agriculture and Consumer Services, the agency responsible for enforcing the new law, collected $433,262 in penalties between July 1, 2023 and June 30, 2024.
Virginia’s Uncertain Marijuana Marketplace
Virginia’s marijuana policy has been in a state of flux for several years. The process began with the 2019 decriminalization of marijuana, followed by its legalization for personal use in 2020. While distribution of marijuana remains illegal under Virginia’s criminal code, efforts to create a regulated marketplace have been underway. These efforts have failed to find a foothold, and the marketplace remains contentious and unsettled. However, one clear development is the addition of hemp-derived THC products to the VCPA, making it illegal to sell these products without proper labeling and packaging and restrictions of THC to not exceed 0.3% total THC.
Despite efforts to create a regulated marketplace for adult-use marijuana, legislative attempts have failed. Recent adult-use marijuana legislation introduced in the 2024 General Assembly Session, aimed to establish a legal retail market for adult marijuana sales, was vetoed by Governor Glenn Youngkin. The governor expressed concerns about public health and safety, citing adverse effects observed in other states with legalized marijuana recreational sales.
Offering some clarity to the murky legal landscape, Miyares issued an opinion to a local Virginia prosecutor in April of 2023, addressing the legality of businesses giving away marijuana as a “gift” with the purchase of other merchandise. The AG opined that while personal possession of marijuana is legal, the distribution of marijuana for recreational use remains illegal. The act allows for “adult sharing” of marijuana, defined as transferring marijuana between persons 21 years or older without remuneration. However, this does not include instances where marijuana is given away contemporaneously with another transaction or contingent upon the purchase of goods or services. According to the AG’s opinion, the practice of “gifting” marijuana with the purchase of other merchandise constitutes illegal distribution.
Concerns Over Copycat Products
Amidst this backdrop, reports of THC products getting into the hands of children and the proliferation of hemp-derived THC products designed to mimic the packaging of popular consumer brands without proper labeling and packaging have raised significant concerns among Virginia policymakers. These products, sold to copy other popular brands, have been called ‘copycat’ products and have been the target of the state AG and other regulators.
In response, the Virginia General Assembly passed legislation to include proper labeling and packaging requirements for hemp products under the VCPA. The move aimed to protect consumers and ensured that products are safe and properly labeled. With the legislation’s passage, enforcement of the provisions of the VCPA now falls to the AG’s office or VDACS, with the assistance of local law enforcement officials.
The VCPA now includes provisions specifically addressing THC products. According to Va. Code Section 3.2-4112, products containing hemp-derived THC must meet stringent packaging and labeling requirements These include child-resistant packaging, clear labeling of ingredients, total THC content limitations of not more than 0.3%, and warnings about age restrictions.
Why It Matters
The AG’s recent action underscores the importance of compliance with consumer protection laws for Virginia retailers selling products containing THC. As the state grapples with regulatory uncertainties, businesses must ensure their products meet strict legal standards to avoid significant fines and legal repercussions. The ongoing efforts to balance consumer safety with market demands will continue to shape the regulatory landscape in Virginia.
Our Cannabis Practice provides advice on issues related to applicable federal and state law. Marijuana remains an illegal controlled substance under federal law.
