Why the Hemp Loophole Defense Just Failed in Federal Court

Why the Hemp Loophole Defense Just Failed in Federal Court

If you’ve been told that the hemp loophole defense will protect your THCA or “Farm Bill compliant” business in federal court, the Lucas Sirois case out of Maine should make you very uncomfortable.

In November 2025, a federal jury convicted Sirois on every major count—conspiracy to distribute marijuana, possession with intent, bank fraud, tax fraud, and more—after his team tried exactly that strategy: argue it was all legal hemp, attack DEA testing, and lean on the 2018 Farm Bill. The judge let the jury hear some of it—but drew a hard line around what counted as a real defense.

This article walks through what the court actually did, why the hemp loophole defense failed, and what serious operators should be doing now.

The Short Version: What Happened in United States v. Sirois

From at least 2016 to 2020, federal prosecutors say Sirois ran a large, multi-location marijuana enterprise in western Maine. Evidence at trial showed:

• more than 8,000 kilograms of marijuana from a single industrial grow,

• interstate shipments into Massachusetts and New Hampshire,

• millions of dollars routed through shell companies such as Lakemont LLC, Sandy River Properties LLC, and Spruce Valley LLC, and

• bank and tax fraud layered on top of the cannabis activity.

Sirois and related defendants had already asked the courts to shut down the case earlier, arguing they were medical marijuana caregivers operating within Maine law and therefore protected by the Rohrabacher–Farr federal funding rider. The First Circuit rejected that theory, holding they hadn’t shown “substantial compliance” with Maine’s medical program.

So by the time trial started, the legal backdrop already looked bad for any “we were legal under state law” story.

Congress Is Closing the Hemp Loophole. This Case Shows Courts Never Bought It Anyway.

While Congress is now moving to close what people call the intoxicating hemp loophole—rewriting hemps’ federal definition and moving to ban many hemp-derived THC products by 2026—the Sirois case shows that criminal courts were never that impressed with the loophole argument to begin with.

The defense tried to turn the case into a referendum on:

• the 2018 Farm Bill’s hemp definition (≤ 0.3% delta-9 THC on a dry-weight basis),

• THCA and other “non-delta-9” cannabinoids, and

• DEA’s use of gas chromatography in its lab protocol.

The judge allowed a limited science fight, but he refused to let the jury treat “hemp” or state compliance as a get-out-of-federal-prison card.

What the Judge Said About State Law and Jury Nullification

Pre-trial, the government moved to block the defense from using Maine’s medical marijuana rules as a backdoor jury-nullification pitch—essentially, “if this was legal under state law, you should acquit.”

In a detailed order on motions in limine, the district judge:

• found that Maine’s regulatory regime had “only marginal relevance” to the federal drug charges,

• reiterated that state-law compliance does not negate mens rea under the Controlled Substances Act (CSA), and

• agreed it was appropriate to instruct the jury that compliance with Maine’s rules “is not a defense” to federal crimes of distributing or possessing marijuana with intent to distribute.

The judge did leave a small door open: limited, “elements-tethered” discussion of Maine law could come in on narrow issues like state of mind for certain bank fraud or tax counts. But he refused to hold a “trial within a trial” over whether the defendants were good medical caregivers, especially after both the district court and the First Circuit had already found they hadn’t shown substantial compliance. GovInfo+1

Takeaway #1:

The hemp loophole defense collapses quickly once you leave YouTube and walk into a courtroom. State compliance is a fact, not a shield.

What the Judge Did With the DEA’s Gas Chromatography Testing

The more technical part of the defense focused on DEA lab methods, especially gas chromatography. The core complaint:

“When you heat the sample, you convert THCA and other acids into delta-9 THC. The test doesn’t just measure marijuana—it creates it.”

Sirois hired an expert chemist, Dr. Mark Scialdone, to criticize DEA’s protocol and argue that under the Farm Bill, only quantitative testing that directly measures delta-9 THC on a dry-weight basis is acceptable.

The court’s response is a roadmap for future hemp prosecutions:

1. DEA doesn’t need a perfect number, just “greater than 0.3%.”
   The judge accepted that the government must prove the seized material was marijuana, not hemp. But he made it clear the CSA does not require a precise delta-9 percentage—only proof beyond a reasonable doubt that it’s above 0.3%.

2. Qualitative GC/MS can be “good enough” for criminal cases.
   The court signaled it was prepared to treat DEA’s two-step gas chromatography plus mass spectrometry method as sufficiently reliable, even if it isn’t “state of the art” or peer-reviewed in the way academics would prefer.

3. Expert criticism is allowed—but on a tight leash.
   The judge indicated he would likely let Dr. Scialdone testify about scientific limitations and potential conversion of THCA during testing, but would not allow him to:

   • tell the jury that the law requires quantitative testing,

   • dictate what the CSA demands as a legal matter, or

   • opine that DEA’s methods fail the government’s burden of proof.

In other words, the jury can hear that the science is messy. But unless the science is so broken it can’t distinguish hemp from marijuana at all, federal courts are willing to treat DEA protocols as legally adequate.

Takeaway #2:

The hemp loophole defense that leans entirely on testing methodology is fighting on a very narrow—and judge-controlled—slice of the battlefield.

How the Jury Likely Saw the Case

Put yourself in the jury box.

Here’s what you do hear:

• DEA chemists describing a protocol that flags samples above ~1% delta-9 THC.

• A defense expert saying the method isn’t ideal for separating hemp from marijuana and that heating can change cannabinoids in the sample.

• Witnesses and documents showing industrial-scale grows, interstate distribution, pooled caregivers, shell entities, false bank representations, and millions in revenue.

Here’s what you’re told not to treat as a defense:

• “We were following Maine’s medical rules.”

• “If this is legal under state law, you must acquit.”

Add in the appellate backdrop—that the operation had already failed to show substantial compliance with Maine’s regime—and you have a narrative where scale, structure, and intent matter more than labels like “hemp” or “caregiver.”

Takeaway #3:

Once a case looks like a big, organized, profitable marijuana conspiracy, jurors are not going to hang their verdict on a technical reading of the Farm Bill.

What This Means for the “Hemp Loophole Defense”

The Sirois verdict doesn’t mean every hemp business is about to be indicted. It does mean the following talking points are legally dangerous:

• “If it’s under 0.3% delta-9 on paper, the feds can’t touch us.”

• “We’ve got a legal opinion, so we’re safe.”

• “State regulators are fine with it, so DOJ has to back off.”

This case, and the broader federal push to tighten the hemp definition, show a different reality:

1. Testing fights have limits.
   Judges can and will accept DEA’s qualitative methods as reliable enough to distinguish hemp from marijuana, even if defense experts have valid scientific critiques.

2. State compliance is evidence, not immunity.
   Even if you are arguably licensed under state law, federal prosecutors can still charge you, and courts can instruct juries that state legality does not equal federal legality.

3. Scale and structure drive federal interest.
   Shell companies, false bank disclosures, off-book cash, and tax games are what turn a gray-area hemp story into a bright-red federal target.

Practical Lessons for Hemp and Cannabis Operators

Here’s how to translate the Sirois outcome into risk management instead of panic.

1. Stop marketing “hemp” as a magic shield.

If your business model depends on telling investors, customers, or partners that “this is hemp, so the feds can’t do anything,” you’re not selling legal compliance, you’re selling wishful thinking.

Reframe your pitch around:

• actual state licenses,

• actual testing protocols aligned with state and federal guidance, and

• conservative assumptions about future federal enforcement.

2. Audit your testing assumptions.

If you’re hanging your hat on COAs that only report delta-9, or that rely on methods a federal chemist would never use, you have a problem.

Work with labs that:

• can explain their methodology in court,

• understand how DEA and state agencies test, and

• can quantify total THC where required.

Assume that in a criminal case, the government’s expert gets to define the baseline unless your expert can show something is fundamentally unreliable—not just less precise than you’d like.

3. Treat state law as a floor, not a ceiling.

If you’re in a medical or adult-use program, you still need:

• clean corporate structure,

• honest bank disclosures,

• accurate tax filings, and

• written compliance protocols.

Sirois wasn’t just about cannabinoids; it was about bank fraud and tax fraud layered onto cannabis activity. That’s the kind of fact pattern prosecutors love.

4. Plan for the post-loophole world now.

Congress is already moving to close the intoxicating hemp loophole and narrow what counts as legal hemp. That will push more products into either:

• state-licensed cannabis channels, or

• outright illegality.

If your current revenue relies heavily on THCA flower, delta-8 beverages, or other “Farm Bill products,” you should be modeling a pivot now rather than assuming courts will rescue your current structure.

When to Call a Lawyer Instead of a Marketing Consultant

If you are:

• shipping “hemp” products across state lines at scale,

• using multiple LLCs or management companies to move money, or

• telling investors your product is “federally legal hemp” because of THCA or test timing,

you don’t need another loophole video. You need a privileged risk assessment from someone who has actually read the cases and the statutes—and who knows what prosecutors look for when they decide whether you’re a regulated business or a criminal enterprise.

That’s what we do at Cannabis Industry Lawyer.

Final Word: The Hemp Loophole Defense Isn’t Dead—It Was Never Alive

The Sirois case doesn’t mark the death of a robust hemp loophole defense. It shows that in federal court, that defense was mostly a marketing story all along.

• The First Circuit said the operation wasn’t in substantial compliance with state law.

• The district judge told the jury state compliance isn’t a defense to CSA charges.

• The DEA’s gas-chromatography method survived a focused expert attack.

• The jury convicted on every major count.

If you’re building or scaling a hemp or cannabis business, treat this case as what it is: a wake-up call that the line between “hemp” and “marijuana” is going to be drawn by judges, not influencers.

And if you’d like to know which side of that line your company is actually on, get in touch.