Advertising and Regulation of CBD and Other Hemp-Cannabinoid Products

Cassia Furman | Vicente LLP

Cassia Furman is an equity partner and Executive Board member of leading cannabis law firm Vicente LLP. In addition to her firm management role, she leads the firm’s California Practice Group based in Los Angeles, where she counsels clients on a wide range of transactional, regulatory, and land use issues related to the cannabis industry.

Cassia specializes in the intersection of local and state regulation and private industry, having worked on both public and private sides of the negotiating table. Her background in public finance, land use planning, local government law, and commercial real estate provides insight into all phases of cannabis permitting and licensed operations. In addition to regulatory work, she focuses on cannabis supply chain transactions, working tirelessly to help her clients meet and exceed their business goals in an ever-changing landscape. Bringing her considerable industry experience to bear, she collaborates closely with licensed operators, brands, investors and landlords to anticipate new market forces and impacts before they occur. She favors a practical, results-oriented approach to the law and understands the nuances of creative problem-solving in heavily regulated industries.

Prior to joining Vicente LLP, Cassia worked with a noted public finance firm where she oversaw the organization and operations of dozens of special districts created to finance and develop complex public infrastructure projects. Cassia also assisted in the representation of numerous Colorado municipalities, where her duties included the drafting and implementation of comprehensive medical marijuana ordinances. She attended the University of Colorado School of Law and Hamilton College.

In addition to client advocacy, Cassia plays an active role in multiple California and national cannabis industry groups and speaks and writes frequently on cannabis legal issues. She is the co-author of “The Cannabis Business: Understanding Law, Finance and Governance in America’s Newest Industry” available in print from Routledge Press. Cassia has been recognized by the prestigious Chambers and Partners as one of the top cannabis lawyers in the United States in 2021 and 2022.

Andrea A. Golan | Vicente LLP

Andrea Golan serves as counsel in Vicente LLP’s Los Angeles office and a member of the firm’s Regulatory Compliance and Hemp and Cannabinoids Departments. Her practice focuses on advising businesses in ensuring compliance with regulatory requirements for cultivating, processing, testing, marketing, and selling cannabis products—including advising businesses with respect to the intersection of federal, state, and local laws.

Prior to joining Vicente LLP, Andrea was an associate attorney at a national insurance defense firm, where her practice focused on commercial and business litigation, public entity defense, catastrophic injury, and medical malpractice.

Andrea graduated magna cum laude from Whittier Law School, where she served as research editor of the Whittier Law Review. Prior to law school, Andrea worked in customs and regulatory compliance, where she handled sourcing, manufacturing, laboratory testing, packaging, labeling, customs compliance, and factory audits and inspections for housewares and consumables. Andrea also worked as a congressional liaison officer for the Federal Emergency Management Agency, where she served as a liaison to Members of Congress and their congressional staffers to ensure they were informed of FEMA policies and programs, in addition to assisting individuals and communities with disaster recovery.

I. What does “hemp-derived cannabinoid” encompass | 2:00pm – 2:10pm

• Definition of hemp
• Definition of “CBD”
• Other cannabinoids extracted from hemp that are ingredients in a variety of product categories (foods, supplements, cosmetics, inhalables)

II. Federal Oversight | 2:10pm – 2:20pm

• Federal Food, Drug, & Cosmetic Act (“FFDCA”): Primary federal law regulating most foods, dietary supplements, cosmetics, drugs, medical devices, tobacco products. Enforced by FDA. 21 USC 352
• Permissible claims based on product type: Is it a food, dietary supplement, cosmetic, medical device, or drug?
  • Disease claims
  • Testimonials/consumer reviews
  • FDA warning letters/enforcement examples, and trends
• FDA/FTC Overlapping Jurisdiction
  • FTC: primary responsibility for the advertising of dietary supplements. broadly prohibits “unfair and deceptive acts and practices”, “false advertising”
  • False, misleading, or unsubstantiated advertising falls under the deception prong
  • Claims must be substantiated. Substantiation required:
    • A reasonable basis consisting of competent and reliable evidence for objective product claims
    • Competent and reliable scientific evidence to support health or safety claims
    • At least one well-controlled human clinical trial to support claims that a product is effective in curing, mitigating, or treating a serious disease
  • April 2023: FTC sends out 670 warning letters putting advertisers on notice that they must be able to substantiate their claims. Why: because FTC cannot impose civil penalties on first-time offenders without providing prior notice unless it goes through some cumbersome procedural steps

III. State Law | 2:20pm – 2:30pm

• Themes and trends in State CBD/cannabinoid advertising regulations
  • Recent legislation regulating hemp product advertising – TN, AR, FL – some good examples, e.g., “no mythical creatures,” “no unicorns”
  • No resemblance to common foods; no shapes
  • Audience composition requirements

IV. Social Media Advertising Policies | 2:30pm – 2:40pm

• Google, Facebook, Twitter, Instagram, TikTok, YouTube
  • Each platform’s policies on hemp products
  • Influencer disclosure requirements

V. AI and Advertising | 2:40pm – 2:50pm

• Using AI to identify disease claims
• Regulators will use AI to root out impermissible claims or false, misleading or unsubstantiated advertising

VI. Best Practices | 2:50pm – 3:00pm

• Review materials both from an FDA perspective and an advertising law perspective
• Identify all express and implied claims. Avoid disease claims
• Look at the net impression of your advertising and promotion
• What are the potential consumer takeaways?
• Keep substantiation files for all products and claims
• Advertising to 21+