Dallas attorney Chelsie Spencer specializes in making sure Texas businesses that sell hemp-derived THC products know how to stay in compliance with state and federal rules and regulations, an area that can be very confusing. She offers them a monthly service where her law firm rigorously vets distributors and helps to independently test their products to ensure they are safe and legal to sell in her clients’ stores.
“They pay us a phenomenal amount to stay compliant,” Spencer said.
That is why when Spencer learned that one of her North Texas clients had been raided by local police and the Drug Enforcement Administration, and his home surrounded, like he was a major narcotics dealer, she was shocked.
“They took everything from my client…his children’s cellphones, every computer in the house, took all the vehicles, seized all assets, and froze all cash,” Spencer said of the raid that occurred in July.
Since August 2024, local and federal law enforcement agencies have raided more than 15 businesses across the state that were accused of selling consumable hemp products that had illegal levels of THC, according to attorneys for these cannabis retailers. During these raids, law enforcement officials seized products and cash that businesses have still not recovered, and customers were scared away. Many of those retailers have not yet been found guilty of any crime, according to their attorneys.
“You always see the headlines about the raids, but you never see these huge headlines about charges and indictments,” said Andrea Steel, a Houston attorney for several THC businesses.
Even though they have affected a small fraction of 8,000 hemp retailers registered in Texas, these raids by law enforcement agencies have ramped up over the last two years to help some lawmakers build public support for banning hemp-derived THC products, Steel said. Over the summer, Gov. Greg Abbott vetoed a bill the Legislature passed to ban hemp-derived THC and told state agencies to better regulate those THC products instead.
But, she said her clients fear these types of raids will continue because the new regulations being considered could create THC limits that will be nearly impossible to meet, shuttering THC businesses and deterring businesses from selling THC products.
“The same number of raids are occurring after the veto as before. In fact, there will likely be an increase in raids once the new rules and regulations are finalized because one of them is an increase in licensing fees for enforcement; they are going to need to justify that,” she said.
Law enforcement agencies deny that these raids were politically motivated. They have said these raids were based on concerns that these retailers were selling dangerous products, especially to children, and engaging in other unscrupulous activities such as money laundering, according to a news conference from Allen police, as well as a joint one between Temple and Belton police departments. Allen Police Chief Steve Dyes, whose department raided at least a dozen businesses and warehouses since 2024, was a fixture at the Texas Capitol during the legislative session, warning lawmakers that the hemp industry was corrupt and couldn’t be trusted.
“You have to have a trustworthy industry partner to regulate to know when they put something in a package, it matches the label. We just don’t have that with the THC consumables industry,” Dye said in September after Abbott vetoed the hemp ban and made an executive order for rules and regulations.
Sammy Rippamonti, spokesperson for the Allen Police Department, said the investigation associated with the raids is still ongoing, and couldn’t provide further details. Dye did not respond to a request for comment.
“The Temple Police Department does not conduct enforcement actions based on political developments or media narratives,” said Sydney McBride, spokesperson for the Temple Police Department, which raided seven businesses in June. “Our operations are driven by facts, evidence, and current applicable law. Our focus remains to work in partnership with the community to prevent, reduce, and solve crimes.”
Multiple retailers have sued law enforcement agencies after these raids, alleging they are using a faulty testing method in their crime labs that artificially inflates the amount of THC in their products. Law enforcement agencies have defended their results.
Data provided from the Texas Poison Center Network confirms a sharp increase in cannabis-related poisoning calls starting in 2019, a year after hemp-derived THC was legalized by the federal government, from 923 to a 10-year high of 2,592 in 2024, although those calls dropped last year to 1,485. The majority of these calls involve suspected poisoning of children under the age of five and teenagers.
The Texas Department of State Health Services recently published a set of proposed rules to tighten regulations on consumable hemp products, including new testing requirements that industry members say will eliminate the use of hemp flowers, which is used in many THC products. Hemp businesses worry that this new requirement will be used as another reason to raid them. That, coupled with a proposal to hike licensing fees by more than 13,000%, will force many of them out of business, essentially fulfilling the desires of those who wanted to ban them, businesses say.
“People don’t know what the rules are. They don’t know what is in effect at a certain time. I can’t tell you how many people thought that hemp got outlawed several months ago,” said Steel, who spoke recently at the Texas Cannabis Policy Conference, where increased police raids became a focus of discussion. “There is overall confusion around regulations, and that is the biggest issue.”
Caught in political storm
Spencer said last year’s raid saddled her client with crippling legal fees, disrupted revenue, and damaged his reputation.
“We heard a lot of posturing saying we know what these people are doing, they’re sending money back to the Middle East. The district attorney is giving all these threats, saying these guys are going to jail, then 60 days in, we get a call saying come get all your stuff, take it back. We’re not moving forward,” she said. “We spent over $100,000 to get there.”
In August 2024, Allen police and partnering agencies raided nine hemp shops, prompting the Hemp Industry Leaders of Texas to sue, alleging that those law enforcement agencies illegally seized lawful inventory.
The organization accused law enforcement in the lawsuit of aggressively harassing and intimidating retailers, including being told that the city was going to rezone certain areas in a manner that would prohibit hemp-related businesses.
Although the lawsuit is still tied up in federal court, the Allen Police Department, supported by the DEA, in July raided three warehouses, seizing more than 75,000 pounds of THC products and an estimated $7 million in cash and assets.
When asked by CBS News Texas, which Dye invited to cover the raid, if these raids were timed to pressure Abbott to allow the bill creating a ban to go into effect, Dye denied any connection. However, the news organization noted Dye headed straight to Austin after the raid to meet with Abbott’s staff about the ban.
The DEA department in Dallas told The Texas Tribune law enforcement agencies are still investigating their case against the businesses involved in the August 2024 and July 2025 raids, and no charges have been filed yet.
Many of the raids over the last two years have resulted in lawsuits, and the hemp industry has had some success in obtaining some relief for businesses. Garza County Sheriff’s Office and the city of Post agreed to pay an $80,000 settlement to a Texas smoke shop in October 2024, after the owners accused law enforcement of conducting a “warrantless search.” The city and county insisted the settlement wasn’t an admission of wrongdoing, but rather to avoid the cost of litigation.
State Rep. Drew Darby, a San Angelo Republican who once opposed hemp-derived THC but now supports it, told a room full of hemp businesses during the Texas Cannabis Policy Conference that he understands why politicians have a fear of THC products. He shared a story about a family friend whose grandchild became addicted to THC products. He also said rumors were circulating that these products were controlled by foreign enemies that seek to “infiltrate our country.”
However, he knows that THC products can help elderly people with pain, children with epilepsy and seizures, and veterans with PTSD. He said lawmakers should focus on keeping these products legal and making them safer.
“So we have to keep diffusing that talk and focus on the real issues,” he said.
Testing and waiting
Seven vape and smoke shops in Temple and Belton were also raided in mid-June 2025, with authorities seizing products they claimed were falsely labeled as legal hemp.
Documents provided by the Temple Police Department state that the multi-agency investigation into these vape shops involved purchasing and testing items from these stores, where the “flower” product, such as joints, tested above the legal limit for THC.
Six of the shop owners were charged with manufacture or delivery of a controlled substance, and one shop owner was charged with manufacture, delivery, and possession of marijuana, five to 50 pounds. Temple police say these charges have not been adjudicated yet.
Multiple lawsuits by hemp businesses allege these raids are based on faulty testing methods that the Texas Forensic Science Commission cautioned against in 2022. The commission says the method actually produces more THC than is in the product.
“In other words, a plant or liquid item of evidence containing CBD can arrive at the laboratory with a certain amount of (Delta 9 THC), and that amount can be increased by high heat used in the testing process,” the commission stated in the report.
These faulty testing methods have been used in private and public crime labs across the state, including those used by the Texas Department of Public Safety, according to the HILT lawsuit.
McBride said that for its forensic analysis, the Temple Police Department utilizes laboratories operated by the Texas Department of Public Safety and laboratories approved by DPS.
“We stand behind the laboratory results provided by DPS and its approved affiliate laboratories,” she said. “ Enforcement decisions are made based on the totality of the evidence, including verified forensic findings.”
Peter Stout, president and chief executive officer for the Houston Forensic Science Center, agrees that many crimes labs across the state don’t have a good method right now to test THC levels, but they also don’t have enough funding for training on how to do proper testing and more importantly, they don’t have the time to test cannabis, which is often associated with lower level crimes.
“I can’t with a straight face justify all the costs associated with standing up the capacity to test everything that law enforcement might seize from a dude on the street corner with something green in his pocket. So, no, I am not going to test that. I am equipped with one analyst and one piece of equipment. We deal with it for the large felony kinds of cases,” he said at the cannabis conference.
Stout said the counties that want to prosecute low level THC cases most likely will need to use independent laboratory testers, which can cost $10,000 for each test. However, many local prosecutors don’t have access to that kind of funding, and they send their evidence to the Texas Department of Public Safety crime lab, which is so backlogged that it can take months for the results to return.
Some of those products that were raided get held up in crime lab testing, becoming inventory that these businesses can’t sell, which hurts their bottom line, Steel said.
“I had a client whose business was raided; they seized a substantial portion of their inventory, disrupting their business, based on an outdated test,” she said.
Preparing for the future
When the state health department recently entered Martha Velez’s hemp retail store in Dallas to conduct an inspection, her staff was prepared. She had a binder prepared for everything the agency might be looking for that included certifications, compliance documents, and more and once they found nothing, the agency left.
Her store has been visited multiple times by state agencies over the past two years, and each time it passed due to a level of preparation necessary in an industry under intense scrutiny of local law enforcement and state lawmakers.
Velez said she feels a responsibility to ensure she protects her customers by going above and beyond normal business practices.
“The raids in Dallas were hard for us. We decided to keep that mini binder that had excerpts highlighted, like what is the law in regards to flower? What is the law regarding the .3%?,” she said at the Texas Cannabis Policy Conference, referring to the legal amount of THC allowed in consumable hemp products. “Just to be prepared.”
One of the inadvertent side effects of these raids has been the hemp industry starting to self police as they wait for new state regulations to be adopted.
At the Texas Cannabis Policy Conference, there were panels on how to have documents ready for law enforcement, conduct background checks on products, protect oneself in court, and more.
Steel expects that once the state finalizes regulations, there will be another spike in raids on hemp stores. She encouraged businesses to mitigate risk from future raids and regulatory changes by keeping inventory small.
“Don’t keep something you can’t get rid of on short notice because there are just too many things changing rapidly,” she said. “You have to be ready to pivot.”
Velez said that while the raids have been rough on the industry, there still seems to be an appetite among law enforcement and the hemp industry to understand each other, and if that can be accomplished, then the industry can thrive.
“Funny thing was, we had this one big event, and there were like four officers there who talked to us the entire time, wanting to get educated,” she said.
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