The Texas Hemp Business Council’s lawsuit challenging portions of the Texas Department of State Health Services’ new consumable hemp rules remains active—but the challenged rules are currently in effect and enforceable.
The trial court originally scheduled a final trial for July 27, 2026. That trial did not move forward because the State’s interlocutory appeal is still pending before the Texas Fifteenth Court of Appeals. Before the underlying lawsuit can potentially proceed to trial, the appellate court must first decide whether the trial court properly granted a temporary injunction against DSHS.
Current Status
The temporary injunction previously granted to THBC and the other plaintiffs is not currently in effect.
That means:
- The temporary injunction is not in effect.
- DSHS’s March 31 rules remain active and enforceable.
- The underlying lawsuit cannot proceed to a final trial on the merits.
- Texas hemp businesses should comply with the rules as currently written.
Important: THCa is not included in the list of controlled substances and is still being contested under our lawsuit.
The appeal is pending under Case No. 15-26-00099-CV.
What the State Is Arguing
The State is asking the Fifteenth Court of Appeals to reverse the trial court’s temporary-injunction order and render judgment in its favor, which would dismiss all of the plaintiffs’ claims.
The State’s arguments generally fall into two categories:
- The trial court lacks jurisdiction to hear the plaintiffs’ claims.
- The plaintiffs’ claims have no legal merit.
If the appellate court accepts the State’s arguments in full, the case would not return to the district court for trial unless THBC successfully seeks further review from the Texas Supreme Court.
What THBC Will Argue in the Brief on August 14
THBC and the other plaintiffs will respond to each of the State’s arguments and explain why the trial court acted properly when it granted the temporary injunction.
The plaintiffs will ask the Fifteenth Court of Appeals to:
- Affirm the trial court’s temporary-injunction order
- Reinstate the temporary injunction
- Return the case to the district court
- Allow the plaintiffs to proceed toward a trial seeking a permanent injunction
The August 14 brief is an important opportunity to explain why the State’s legal arguments are wrong and why the plaintiffs should prevail.
However, filing the brief does not make the State’s appeal go away. It is one step in the appellate process, and the challenged DSHS rules will remain in effect unless the court issues a new order reinstating the injunction.
What Happens After the August 14 Filing
After THBC files its brief, the State will have an opportunity to file a reply brief explaining why it believes the temporary injunction was improperly granted and should be reversed.
Once all briefs have been filed, the Fifteenth Court of Appeals will decide how it wants to consider the case.
The court may:
- Schedule the case for oral argument, as the State has requested; or
- Decide the appeal based solely on the written briefs.
This stage is known as the “submission” of the appeal. The appeal may be submitted following oral argument or submitted on the briefs without a hearing.
After submission, the parties will wait for the court to issue its written opinion. That process often takes several months, although there is no guaranteed timeline.
The timing may also be affected by the November judicial elections. If the current three-justice panel remains in office, the court may issue its decision on its own timetable, potentially after January. If the court’s membership is set to change, the current justices may choose to issue an opinion before departing office. This is a timing consideration only and does not predict how the court will rule.
What Could the Appellate Court Decide?
The appeal does not necessarily have to produce an all-or-nothing result. There are three broad possibilities.
1. THBC Prevails
If the appellate court affirms the temporary-injunction order, the injunction could be reinstated and the case would return to the district court.
The district judge would then establish a new schedule for discovery, including the exchange of documents and depositions. A final trial on THBC’s request for a permanent injunction would likely take place several months later.
An appellate victory would not itself permanently invalidate the challenged rules. It would allow the case to return to the trial court for a final decision on the merits.
2. The State Prevails
If the State wins in full, the appellate court could reverse the temporary injunction and render judgment dismissing all of the plaintiffs’ claims.
In that scenario, there would be no remand and no district-court trial unless THBC sought review from the Texas Supreme Court and obtained a ruling allowing the case to continue.
3. The Court Issues a Mixed Decision
The appellate court could also affirm parts of the trial court’s order while reversing other parts.
That could result in some claims being dismissed and others returning to the district court for trial. It could also mean that only certain portions of the temporary injunction are restored.
The ultimate effect will depend on the specific language of the court’s opinion.
How We Got Here
March 31: New DSHS Rules Take Effect
On March 31, 2026, DSHS implemented sweeping changes to the Texas Consumable Hemp Program under 25 Texas Administrative Code Chapter 300.
The rules included:
- Annual licensing fees of $10,000 for manufacturers and $5,000 for retailers
- Inclusion of THCA when calculating total delta-9 THC
- Restrictions on transporting certain hemp ingredients into Texas
- Expanded testing, labeling, packaging and recordkeeping requirements
- Daily penalties for certain violations
THBC supports responsible regulations that protect consumers, establish reliable testing standards and keep hemp products away from minors. The lawsuit challenges whether DSHS exceeded the authority granted to it by the Texas Legislature when adopting certain provisions.
April 7: THBC Files Suit
THBC and other industry plaintiffs filed suit on April 7.
The case is Texas Hemp Business Council, et al. v. Texas Department of State Health Services, et al., Cause No. D-1-GN-26-002511.
The plaintiffs argue that several portions of the new rules exceed DSHS’s statutory authority, conflict with Texas law and impose significant economic consequences that the agency failed to adequately consider.
April 10: Court Grants Temporary Restraining Order
On April 10, a Travis County court issued a temporary restraining order blocking enforcement of key portions of the new rules while it considered the plaintiffs’ request for a longer-lasting injunction.
May 1: Court Grants Temporary Injunction
On May 1, the trial court granted a temporary injunction after finding that the plaintiffs had demonstrated a probable right to relief and a probable, imminent and irreparable injury.
The injunction temporarily blocked enforcement of several challenged provisions while the case proceeded toward trial.
May 7: Appellate Court Temporarily Reinstates the Injunction
The State appealed the trial court’s decision, triggering an automatic stay(lift) of the injunction.
On May 7, the Fifteenth Court of Appeals temporarily reinstated the injunction while it considered the dispute.
June 5: Injunction Is Lifted
On June 5, the Fifteenth Court of Appeals lifted the injunction at the State’s request, allowing DSHS to enforce the challenged rules while the appeal remained pending.
THBC subsequently asked the court to reconsider and reinstate the injunction, citing conflicting information from DSHS regarding enforcement of key provisions.
The court denied that request on June 26.
That decision did not determine whether the challenged rules are ultimately lawful. It only removed the temporary protection while the appeal proceeds.
What Businesses Need to Know
Unless the court issues a new order, businesses should treat all DSHS rules adopted on March 31 as active and enforceable.
Businesses should review their products, testing procedures, labels, packaging, records, supply chains and licensing obligations for compliance with the rules as written.
Businesses should not rely on informal agency statements or assumptions about enforcement in place of published requirements or advice from qualified legal counsel.
This Is Separate From the Delta-8 Case
THBC’s current lawsuit is separate from Sky Marketing Corp. v. DSHS, the case involving DSHS’s 2021 scheduling of delta-8 THC and other non-delta-9 tetrahydrocannabinols.
The Sky Marketing case has concluded. The Texas Supreme Court ruled in favor of DSHS, and the agency reinstated its 2021 controlled-substance definitions effective July 31, 2026.
The current THBC lawsuit challenges portions of the separate consumable hemp rules adopted on March 31, 2026. It remains active before the Fifteenth Court of Appeals.
THBC will provide another update after the August 14 brief is filed and as additional deadlines or court proceedings are scheduled.
Court filings and case materials are available on the THBC Resources page.
This update is provided for general informational purposes and is not legal advice. Businesses should consult qualified legal counsel regarding their individual compliance obligations.
