Federal judge blocks enforcement of Act 9072 hemp inventory surrender

February 25, 2026. Chief Judge Robert Molloy of the District Court of the Virgin Islands issued a Temporary Restraining Order at 11:35 a.m. blocking the Government of the Virgin Islands from enforcing Act 9072 Section 3, the provision requiring licensed hemp retailers to immediately cease selling intoxicating hemp products and surrender existing inventory to the Department of Health without compensation. The order came six days after Homegrown Bar & Grill, LLC filed its Fifth Amendment Takings Clause complaint.

What the court found

Chief Judge Molloy applied the four-element test for temporary injunctive relief, citing Osorio-Martinez v. Attorney General and Winter v. Natural Resources Defense Council. Homegrown satisfied each element: likelihood of success on the merits, irreparable harm, balance of equities, and public interest. The court wrote that Homegrown “has made a sufficient showing that Defendants’ April 2025 seizure of Homegrown’s inventory lacks a lawful basis, and that Homegrown has a reasonable probability of success on the merits of its claims,” and that it would sustain “immediate and irreparable injury” without emergency relief, particularly in light of the February 12 Department of Licensing and Consumer Affairs notice requiring immediate compliance and the risk that surrendering its entire remaining hemp inventory would force the business to close. Molloy wrote that public interest weighed in favor of the injunction because the case “involves substantial constitutional rights.”

Scope: The ruling prevents enforcement of the Section 3 inventory-surrender requirement against Homegrown “or any other licensed hemp retailer” for 14 days. The TRO does not strike Act 9072. It does not invalidate the prohibition on intoxicating hemp sales. It halts only the Section 3 mechanism that required retailers to turn over existing inventory for destruction without payment. Cultivation, sale, and manufacture of intoxicating hemp products remain prohibited under Section 1 of the Act, and the Office of Cannabis Regulation’s 90-day rulemaking clock for the Intoxicating Hemp Retailer License, which Executive Director Joanne Moorehead said at the February 12 Cannabis Advisory Board meeting runs through April 23, 2026, continues unaffected.

What Section 3 required

Section 3 of Act 9072 reads that retailers “are strictly prohibited from selling or distributing” intoxicating hemp products “until the Office of Cannabis Regulation promulgates regulations and issues retail licenses,” and that they must “notify and coordinate with the Virgin Islands Department of Health for the safe storage” of the products. Act 9072 did not provide any compensation mechanism for retailers required to surrender inventory. The Department of Licensing and Consumer Affairs’ February 17 halt order put that provision into operation. Homegrown’s complaint, filed two days later, argued that applying it to product the retailer had lawfully acquired before Act 9072’s January 23, 2026 enactment violated the Fifth Amendment’s Takings Clause.

Hearing postponed, outcome not yet reported

The District Court originally scheduled an evidentiary hearing on March 11, 2026 at 11:00 a.m. in St. Thomas to determine whether the Temporary Restraining Order should be extended into a preliminary injunction. At the Government of the Virgin Islands’ request for additional time to prepare exhibits and witnesses, Chief Judge Molloy rescheduled the hearing to April 1, 2026. As of the most recent update to this article on April 12, 2026, no local outlet has published a ruling on whether the Temporary Restraining Order was extended into a preliminary injunction, and the Virgin Islands Consortium legal section’s articles through April 9, 2026 do not include any Homegrown follow-up. VIBE HIGH will update this article when the outcome is public.

What to watch

A preliminary injunction would keep the Section 3 surrender requirement on hold for the duration of the underlying constitutional litigation. If the Office of Cannabis Regulation’s April 23, 2026 Intoxicating Hemp Retailer License rulemaking deadline is met and the retail-license framework stands up, much of the open inventory question may be resolved administratively before it reaches trial. The CBD legality guide tracks both the litigation and the rulemaking calendar.