Canadian hemp cultivation company Kenex has launched a lawsuit against the US government, charging restraint of trade in violation of Chapter 11 of the North American Free Trade Agreement (NAFTA).
Kenex had a large shipment of hemp seeds seized at the US border and held for four months between August to December 1999. Since then their products have repeatedly been seized or detained by US customs.
In February, Kenex teamed up with the Hemp Industry Association, and won a stay of a Drug Enforcement Administration (DEA) edict that banned edible hemp products that contain any detectable amount of THC. The Ninth Circuit Court of Appeals in San Francisco issued the stay, and is expected to give a final ruling in early 2003.
Kenex is now asking for $20 million in compensation from the US government, for harm to their business. As a private company, Kenex cannot use NAFTA rules to overturn DEA policy. However, a lawsuit by a foreign government, rather than a corporation, could do that. Yet there has been no indication from Canada’s federal government that they would be willing to launch such a lawsuit on behalf of Kenex.
The Kenex lawsuit has gone to a NAFTA panel in Washington DC for arbitration, only the sixth time a case against the US has reached arbitration since NAFTA came into force in 1994.