The “loophole” that for years exempted intoxicating hemp from the prohibitions of the Controlled Substances Act (“CSA”) is set to close on November 13, 2026, following the federal ban enacted earlier this month. Companies that manufacture, distribute, sell, or purchase intoxicating hemp products (“IH Companies”) and are, or anticipate, experiencing financial distress have less than one year to take advantage of the full toolkit available under the U.S. Bankruptcy Code, which offers unique advantages over state insolvency processes and out-of-court workouts.
But IH Companies should not wait. Distressed IH Companies should consider filing for bankruptcy soon to maximize their chances of completing a…