Texas Department of State Health Services John Hellerstedt, in His Official Capacity as Commissioner of the Texas Dshs v. Crown Distributing LLC America Juice Co., LLC Custom Botanical Dispensary, LLC 1937 Apothecary, Llc, 647 S.W.3d 648

Background

In 2019 Texas enacted HB 1325 to implement the federal 2018 Farm Bill: it defined “hemp” by THC concentration (≤0.3%) and created regulatory regimes (Agri. Code chs. 121–122; Health & Safety Code ch. 443).
The statutes and an adopted HHSC rule (25 Tex. Admin. Code §300.104) permit many hemp activities but expressly prohibit the processing or manufacturing of consumable hemp products "for smoking.”
Several Texas hemp businesses (the Hemp Companies) manufacture and sell smokable hemp products and sued the Department of State Health Services and its commissioner, alleging the smoking‑product ban violates the Texas Constitution’s due‑course clause.
The trial court permanently enjoined enforcement of Health & Safety Code §443.204(4) and invalidated rule 300.104; the Department appealed directly to the Texas Supreme Court.
The Department argued the due‑course clause does not protect the asserted interest (manufacturing/processing smokable hemp) because the activity is not a protected ‘‘lawful calling’’ or a vested property right, and the Court considered historical regulation of cannabis in resolving that threshold question.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the Texas Constitution's due‑course clause protects the right to manufacture/process smokable hemp products	Hemp Co.s: ban infringes economic liberty/right to work; the ban lacks rational relation and is oppressive	DSHS: manufacturing smokable hemp is not a protected lawful calling or vested property right; it was long prohibited and is a government‑created privilege	Held: No. The Court concluded the activity is not a liberty or vested property interest protected by the due‑course clause; reversed the judgment except as to distribution/retail portion the Department abandoned
Whether Plaintiffs have a vested property interest in producing smokable hemp	Hemp Co.s: historical treatment of non‑psychoactive hemp parts shows longstanding legality; thus a protected economic interest	DSHS: any expectation was unilateral/temporary; prior law treated flower/buds as illegal marihuana, so no vested right	Held: No vested interest; any brief permissive window was not a vested right and cannot confer constitutional protection
Whether the activity is a ‘‘lawful calling’’ or one of the "common occupations of life" protected by due course	Hemp Co.s: production of smokable hemp is a lawful occupation after Farm Bill and HB 1325	DSHS: longstanding prohibition of smokable flower makes it an activity the state may regulate out of existence; inherently harmful occupations are not protected	Held: The Court treated smokable‑flower manufacture as an unprotected personal privilege, not a protected lawful calling
Standing/redressability given §122.301(b) (statutory prohibition on manufacturing hemp "for smoking")	Hemp Co.s: the injunction against §443.204(4) and rule 300.104 gives at least a partial remedy and thus satisfies redressability	DSHS: because plaintiffs did not challenge §122.301(b) they lack standing; injunction could be ineffective if §122.301(b) bars them	Held: Plaintiffs have standing: injunctive relief enjoining the Department provides a partial remedy sufficient to satisfy redressability (citing Uzuegbunam)

Key Cases Cited

Patel v. Tex. Dep't of Licensing & Reg., 469 S.W.3d 69 (Tex. 2015) (addressing when economic regulation is so burdensome as to be oppressive)
Nebbia v. New York, 291 U.S. 502 (1934) (recognizing states may entirely prohibit certain businesses)
Meyer v. Nebraska, 262 U.S. 390 (1923) (liberty includes right to engage in common occupations)
Dent v. West Virginia, 129 U.S. 114 (1889) (protection for those pursuing a lawful calling)
Murphy v. California, 225 U.S. 623 (1912) (occupations deemed inherently vicious are not constitutionally protected)
Gonzales v. Raich, 545 U.S. 1 (2005) (context on federal cannabis regulation and Controlled Substances Act)
Logan v. Zimmerman Brush Co., 455 U.S. 422 (1982) (two‑part due‑process inquiry: protected interest then process due)
Uzuegbunam v. Preczewski, 141 S. Ct. 792 (2021) (partial remedy can satisfy redressability for standing)
Honors Acad., Inc. v. Tex. Educ. Agency, 555 S.W.3d 54 (Tex. 2018) (must allege a protected liberty or property interest before substantive due‑course analysis)
Tex. S. Univ. v. Villareal, 620 S.W.3d 899 (Tex. 2021) (describing the two‑step due‑course inquiry)
House of Tobacco v. Calvert, 394 S.W.2d 654 (Tex. 1965) (privileges granted by government are generally not constitutionally protected)