Green Room v. Wyoming: No Private Right Under the 2018 Farm Bill; State Delta‑8/“Psychoactive” Hemp Restrictions Survive Preemption, Dormant Commerce Clause, Takings, and Vagueness Challenges

Introduction

In Green Room LLC v. State of Wyoming, the Tenth Circuit affirmed dismissal of a multi-pronged constitutional challenge to Wyoming’s 2024 overhaul of its hemp regime (Senate Enrolled Act 24, “SEA 24”). SEA 24 narrowed the definition of “hemp,” swept delta‑8 THC into the state’s definition of THC and Schedule I, imposed a combined 0.3% THC cap for delta‑9 plus delta‑8, and excluded “synthetic substances” from what counts as hemp. A coalition of hemp businesses and a proprietor alleged the law was preempted by the 2018 Farm Bill, violated the Dormant Commerce Clause, effected a regulatory taking of their commercial personal property, and was void for vagueness. They also appealed denial of preliminary relief.

Writing for a unanimous panel, Judge Hartz rejected each theory on the pleadings. The court held (1) the 2018 Farm Bill does not confer a privately enforceable federal right that plaintiffs can vindicate through § 1983 preemption litigation; (2) the Dormant Commerce Clause claim fails because plaintiffs neither plausibly alleged discrimination nor carried their burden under Pike balancing; (3) the takings claim fails because regulation of commercial personal property—especially in a heavily regulated sector—does not constitute a compensable regulatory taking; and (4) the vagueness challenge fails because the statute’s use of “psychoactive” provides fair notice and guidance. The court also dismissed as moot the appeal of the preliminary injunction denial in light of final judgment.

Notably, while bound by circuit precedent requiring a “substantive federal right” to bring a preemption claim in equity, the panel expressly signaled discomfort with that requirement, reading Armstrong v. Exceptional Child Center to preserve a freestanding equitable cause of action to enjoin preempted state laws even absent privately enforceable rights—though the court concluded that even under Armstrong, relief would be unwarranted here.

Summary of the Opinion

Preemption under § 1983: Dismissed. Neither the Supremacy Clause nor the 2018 Farm Bill “unambiguously confers” individual rights actionable under § 1983. The Farm Bill regulates, it does not grant private rights to hemp producers. Serna v. Denver Police Department forecloses reliance on the Farm Bill’s transportation‑through clause as a private right.
Freestanding equitable preemption (Armstrong): The panel, bound by Safe Streets Alliance, did not recognize such a claim absent a substantive federal right, but signaled disagreement with that precedent and observed that many circuits allow Armstrong‑style equitable preemption suits. Even if available, relief would be premature given state‑law uncertainty and the lack of concrete allegations about through‑transportation.
Dormant Commerce Clause: No facial discrimination and no plausible Pike showing. Plaintiffs failed to allege or argue that burdens on interstate commerce are “clearly excessive” relative to Wyoming’s asserted safety interests. The court also noted the absence of concrete allegations of interstate “through‑transportation” and invoked Arizona v. United States to avoid preemptive state‑law constructions.
Regulatory takings: No taking. Restrictions on the commercial use and sale of personal property (e.g., products containing delta‑8 THC or synthetic cannabinoids) are within the state’s police power and do not trigger compensation—echoing a line of Supreme Court liquor‑regulation cases and modern lower‑court decisions in highly regulated industries.
Void for vagueness: The term “psychoactive” provides adequate notice and does not invite arbitrary enforcement, especially when read alongside statutory cross‑references and the State’s concession that CBD is not banned. Plaintiffs’ argument that labs cannot distinguish synthetic from natural delta‑8 was waived on appeal.
Preliminary relief: The appeal from the denial of a TRO/PI was moot after dismissal of the complaint.
Eleventh Amendment and proper defendants: Claims against the State and Governor were dismissed; Ex parte Young requires a specific enforcement connection, which was lacking as to the Governor. Only the Attorney General and Agriculture Director remained, and the claims against them were dismissed on the merits.

Analysis

Precedents Cited and Their Influence

Gonzaga Univ. v. Doe, 536 U.S. 273 (2002): Establishes that § 1983 remedies are available only for statutes that “unambiguously confer” individual rights—statutes phrased in terms of regulated entities, not protected beneficiaries, do not create privately enforceable rights. The panel used Gonzaga to conclude the 2018 Farm Bill regulates hemp producers and state plans, but does not vest producers with enforceable rights.
Armstrong v. Exceptional Child Center, Inc., 575 U.S. 320 (2015): Recognizes courts’ traditional equitable power to enjoin unconstitutional or preempted state action, distinct from § 1983. The panel carefully catalogues circuit authority embracing Armstrong’s equitable pathway but is bound by the Tenth Circuit’s contrary reading in Safe Streets Alliance, which requires a substantive-right hook. The panel’s extended discussion signals openness to en banc reconsideration.
Safe Streets Alliance v. Hickenlooper, 859 F.3d 865 (10th Cir. 2017): Controls in the Tenth Circuit: preemption claims require a substantive federal right even for equitable relief. This foreclosed plaintiffs’ preemption theory, notwithstanding Armstrong.
Serna v. Denver Police Dep’t, 58 F.4th 1167 (10th Cir. 2023): Holds the Farm Bill’s “transportation‑through” clause does not create private rights. The panel extends Serna’s reasoning to reject reliance on the clause here and emphasizes that, if any Farm Bill provision could preempt state law, it would be this clause—and even then, plaintiffs failed to allege facts making that conflict ripe.
C.Y. Wholesale, Inc. v. Holcomb, 965 F.3d 541 (7th Cir. 2020): Persuasive authority that the Farm Bill’s only plausible express preemption is the prohibition on blocking through‑shipments. The panel finds this reasoning persuasive, reinforcing its conclusion that Wyoming’s substantive product restrictions are not preempted by federal law except potentially in “through” contexts not alleged here.
Arizona v. United States, 567 U.S. 387 (2012): Cautions against invalidating state laws pre‑enforcement when state courts have not yet construed them. The panel uses Arizona to avoid assuming Wyoming will interpret SEA 24 to prohibit federally protected through‑transportation of hemp.
Nat’l Pork Producers Council v. Ross, 598 U.S. 356 (2023): Reaffirms the core anti‑discrimination focus of the Dormant Commerce Clause and preserves Pike balancing for non‑discriminatory laws, while noting difficulty of balancing incommensurables. The panel applies this framework and finds plaintiffs did not carry the Pike burden.
Pike v. Bruce Church, Inc., 397 U.S. 137 (1970); Kleinsmith v. Shurtleff, 571 F.3d 1033 (10th Cir. 2009): Articulate and apply the Pike test. Plaintiffs did not plausibly allege that any burden on interstate commerce is “clearly excessive” in relation to Wyoming’s putative public health and safety interests.
Kassel v. Consolidated Freightways Corp., 450 U.S. 662 (1981): Illustrates the judiciary’s reluctance to invalidate state safety regulations absent illusory justifications. The panel’s analysis tracks that deference in the hemp‑safety context.
Lingle v. Chevron U.S.A. Inc., 544 U.S. 528 (2005); Penn Central Transp. Co. v. New York City, 438 U.S. 104 (1978); Lucas v. S.C. Coastal Council, 505 U.S. 1003 (1992): Provide the modern takings framework. Critically, Lucas underscores that personal property is subject to broad police‑power regulation, including the risk of being rendered valueless without compensation—a point the panel uses to reject the personal‑property takings theory.
Mugler v. Kansas, 123 U.S. 623 (1887); Jacob Ruppert, Inc. v. Caffey, 251 U.S. 264 (1920); James Everard’s Breweries v. Day, 265 U.S. 545 (1924): Classic alcohol cases rejecting takings claims where regulations eliminated profitable uses of stock on hand. The panel analogizes hemp and delta‑8 regulation to liquor regulation—both lie within the state’s traditional police powers over health and safety.
Holliday Amusement Co. v. South Carolina, 493 F.3d 404 (4th Cir. 2007): Reinforces that in highly regulated and contentious markets (e.g., video poker), shifts between permission and restriction do not trigger takings liability for frustrated business expectations.
Wyoming Gun Owners v. Gray, 83 F.4th 1224 (10th Cir. 2023): Controls the vagueness analysis, emphasizing that undefined terms with ordinary meaning (e.g., “member”) are not inherently vague and do not necessarily invite arbitrary enforcement. The panel applies the same logic to “psychoactive.”
Planned Parenthood of Ind. & Ky., Inc. v. Marion Cnty. Prosecutor, 7 F.4th 594 (7th Cir. 2021): Advises restraint in facial vagueness challenges where state courts have not construed the statute—a principle the panel invokes here.
K.A. v. Barnes, 134 F.4th 1067 (10th Cir. 2025): Clarifies the Ex parte Young “connection to enforcement” requirement for suing state officials. The Governor was dismissed because plaintiffs did not show he enforces SEA 24.

Legal Reasoning

1) Preemption and the absence of a privately enforceable federal right

The court began with first principles: § 1983 provides a remedy only for the violation of an individual “right,” not a mere “benefit” or “interest.” The Supremacy Clause, standing alone, creates no rights. Turning to the 2018 Farm Bill, the panel found no rights-creating language: the statute is framed as a regulatory scheme for hemp production, state plans, and federal oversight—not as guarantees to producers or retailers. That reading accords with Serna’s holding that the Act’s transportation‑through clause is not privately enforceable. Because plaintiffs could not identify any unambiguously conferred federal right, their § 1983 preemption claim necessarily failed.

On equitable preemption, Safe Streets Alliance binds panels to require a substantive-right hook even when plaintiffs seek a purely equitable injunction. The court respectfully voiced disagreement with that rule, reading Armstrong to authorize a freestanding equitable claim unless Congress forecloses it, and collected decisions from across the circuits applying Armstrong that way. Still, the court held that, even under Armstrong, preemption relief would be inappropriate now: the only potentially preemptive Farm Bill provision is the through‑transportation clause, and:

State courts could reasonably construe SEA 24 not to interfere with through shipments, and
Plaintiffs did not clearly allege facts showing they engage in interstate through‑transportation of hemp products.

The court invoked Arizona v. United States and MedImmune to emphasize prudence and ripeness: absent a concrete controversy and a settled state‑law construction, federal courts should avoid premature preemption judgments.

2) Dormant Commerce Clause

Plaintiffs conceded there is no facial discrimination: Wyoming regulates in‑state and out‑of‑state hemp products identically. Accordingly, their only path was Pike balancing. That path failed for two reasons:

Failure of proof/argument: Plaintiffs did not carry their burden to plausibly allege that any burden on interstate commerce is “clearly excessive” relative to Wyoming’s proffered public‑health/safety interests in restricting psychoactive cannabinoids and synthetic analogs.
Factual and interpretive uncertainty: Plaintiffs did not clearly allege through‑transportation activity, and the court declined to assume Wyoming would construe SEA 24 to block such shipments before state courts speak.

The court’s approach reflects National Pork’s renewed emphasis on anti‑discrimination, deference to legitimate safety rationales, and the continuing (but carefully cabined) role of Pike claims.

3) Regulatory takings of commercial personal property

The panel rejected the takings theory at a high level of generality: Supreme Court doctrine has never held that restricting commercial uses of personal property—like hemp derivatives—is a compensable regulatory taking. Lucas teaches that owners of personal property acquire it subject to the State’s broad police powers and the “traditionally high degree of control over commercial dealings,” including the risk that new regulations may “render [property] economically worthless” if its only profitable use is sale. Historical liquor cases confirm that eliminating profitable uses of stock on hand does not effect a taking. The Fourth Circuit’s video‑poker decision, Holliday Amusement, illustrates the same point in a modern, highly regulated space.

Plaintiffs’ reliance on Penn Central’s “investment‑backed expectations” factor could not overcome this structural point: expectations in the delta‑8/cannabinoid market are necessarily tempered by regulatory volatility. The State need not compensate businesses for economic losses occasioned by changes in product safety regulation.

4) Vagueness—“psychoactive,” synthetic substances, and fair notice

SEA 24 defines hemp to exclude “synthetic substances,” in turn defined to include synthetic THC, synthetic cannabinoids, or any other “drug or psychoactive substance.” Plaintiffs focused on the absence of a statutory definition of “psychoactive,” arguing it could sweep in CBD. The court held that:

“Psychoactive” has an ordinary, widely understood meaning—affecting the mind or mental processes—that provides fair notice. It does not readily invite arbitrary enforcement.
Statutory cross‑references reinforce that “psychoactive” tracks mind‑altering effects analogous to marijuana and THC listed in Wyoming’s schedules, cabining the term’s scope.
The State “affirmatively agreed” that CBD is not banned under SEA 24, further undermining vagueness concerns.
Plaintiffs’ “arbitrary enforcement” argument that labs cannot distinguish synthetic from natural delta‑8 was waived.

In line with Wyoming Gun Owners and Planned Parenthood of Indiana & Kentucky, the court cautioned that mere interpretive difficulty does not equal unconstitutional vagueness, and federal courts should be especially hesitant to invalidate state statutes facially before state courts construe them.

Impact and Implications

Immediate effects on hemp and cannabinoid markets

State latitude to regulate delta‑8 and synthetic cannabinoids: States within the Tenth Circuit may set hemp product standards (including combined delta‑9+delta‑8 THC caps and “no synthetic substances” conditions) more stringent than the federal floor, without triggering § 1983 preemption claims.
Limited federal preemption: Outside of the specific “through‑transportation” carve‑out, the 2018 Farm Bill provides scant leverage to invalidate state product restrictions on hemp derivatives. Litigants must plead concrete through‑shipment facts to implicate that clause.
Weakness of Dormant Commerce Clause claims: Absent facial discrimination or a well‑developed Pike record showing clearly excessive burdens relative to safety benefits, DCC challenges to hemp product regulations are unlikely to succeed—particularly post–National Pork.
Regulatory takings unlikely: Businesses holding inventories of newly restricted hemp products cannot rely on the Takings Clause to obtain compensation for lost value; investment‑backed expectations in this sector are highly constrained by the police power.
Vagueness challenges must be concrete: Undefined industry terms with ordinary meaning (e.g., “psychoactive”) will typically survive; successful challenges will require specific showings of indeterminacy and arbitrariness in application.

Doctrinal signals and litigation strategy

Armstrong and equitable preemption in the Tenth Circuit: Although bound by Safe Streets, this panel’s candid discomfort—coupled with its comprehensive survey of other circuits—invites en banc review or Supreme Court clarification on whether plaintiffs may bring Armstrong‑style equitable preemption claims absent a private right. Until then, § 1983 preemption claims premised on the Farm Bill will fail in the Tenth Circuit unless Congress creates express private rights.
Ex parte Young targeting: Plaintiffs must sue officials with a specific enforcement duty and demonstrated willingness to enforce the challenged statute. Naming the Governor or the State itself will fail on sovereign immunity grounds absent that connection.
Pleading through‑transportation: To invoke the Farm Bill’s transportation‑through protection, plead concrete facts showing shipments “through” the state between two other states, and consider seeking state‑law clarifications before asking a federal court to assume a conflicting construction.
Develop Pike records: DCC litigants must marshal facts quantifying burdens (e.g., supply‑chain costs, embargo effects, inability to segregate inventories) and undermining safety justifications, recognizing courts’ reluctance to displace health/safety legislation.
Takings claims for inventory losses: Expect courts to apply the police‑power line of cases (Mugler/Ruppert/Everard’s) and deny compensation for newly prohibited commercial uses of stock on hand.

Complex Concepts Simplified

Preemption: Federal law can displace (preempt) state law. But to sue under § 1983, you need a federal statute that grants you an individual right (not just a regulatory scheme). The 2018 Farm Bill regulates hemp but does not grant producers a right to insist on the federal definition against stricter state rules. Separately, courts may sometimes enjoin preempted state laws using traditional equity (Armstrong), but the Tenth Circuit currently requires a personal right even for that route.
Dormant Commerce Clause: Even when Congress is silent, states can’t discriminate against out‑of‑state commerce. If a law doesn’t discriminate, courts apply Pike balancing: the challenger must show the law’s burdens on interstate trade are clearly excessive compared to local benefits like health and safety. Mere inconvenience or cost usually isn’t enough, especially in safety‑oriented regulations.
Regulatory takings: The Takings Clause usually covers physical seizures or regulations that destroy all value of real property. Regulations of personal property used in commerce (like consumer products) are routinely adjusted under the state’s police power; losing profitable uses of inventory because of new product‑safety rules is not a compensable taking.
Void for vagueness: Laws must provide fair notice of what they prohibit and avoid arbitrary enforcement. Undefined terms with ordinary, commonly understood meanings (like “psychoactive”) typically pass muster, especially when statutory context and cross‑references guide interpretation.
Mootness of preliminary relief appeals: If the district court enters final judgment dismissing the case, an appeal of a preliminary injunction denial becomes moot because there is no longer any live controversy about interim relief.

Conclusion

Green Room cements several important propositions in the Tenth Circuit’s hemp jurisprudence and beyond. First, the 2018 Farm Bill does not confer privately enforceable rights that allow hemp businesses to preempt stricter state product standards via § 1983. Second, in a post–National Pork landscape, non‑discriminatory state restrictions on psychoactive hemp derivatives are likely to withstand Dormant Commerce Clause scrutiny absent a robust Pike showing. Third, longstanding doctrine forecloses treating inventory losses from new product bans as regulatory takings of commercial personal property. Fourth, undefined statutory terms like “psychoactive,” when bearing ordinary meaning and contextual guardrails, are not unconstitutionally vague.

The panel’s thoughtful Armstrong discussion is a conspicuous signal: while bound by Safe Streets’ limitation on equitable preemption claims, the Tenth Circuit recognizes a growing national consensus that federal courts retain traditional equitable power to enjoin preempted state laws even without privately enforceable rights—subject, of course, to ripeness and congressional displacement. For now, however, hemp businesses operating in the Tenth Circuit should calibrate their compliance and litigation strategies to the reality that the Farm Bill largely leaves room for stringent state product controls, with the notable (but narrow and fact‑dependent) exception of federally protected through‑transportation.