SAN FRANCISCO (CBS SF) — The cannabis industry is fighting a ban on CBD oil, a derivative that is used in a wide array of products but doesn’t get users high.

The case that landed before San Francisco’s Ninth Circuit Court of Appeals Thursday

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The half billion dollar U.S. hemp industry is up in arms about a new U.S. Drug Enforcement Agency rule.

The DEA created a brand new drug code for all cannabis extracts, including CBD products. The hemp industry argues this code effectively makes CBD illegal and is suing to get the law tossed out.

Under the new rule, all cannabinoids — including CBD — would be considered Schedule 1 drugs

As the lawyer for the DEA explained, the new rule is simply administrative in nature. It will help to track research and it better complies with international treaties.

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But the hemp industry disagreed.

When the presiding judge asked what the industry was afraid of, attorney Ben Hoban replied, “We’ve seen this drug code utilized week after week since its enactment: to seize, to cause criminal enforcement against lawful operators who require no DEA registration”

CBD is used in a variety of products, including medical oils used to reduce seizures or alleviate anxiety.

The final rule may impact the burgeoning hemp business in California and other states.

“Not only does it affect free trade, not only does it affect commerce in the United States, really and truly its affecting people American people who need to have access to this safe and effective cannabinoid,” said Hemp Industries Association Vice President Joy Beckerman.

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The lawyer for the DEA declined a KPIX 5 request for an interview. A ruling is expected in a few months.