Just a quick check-in on cannabis, both marijuana and hemp, regulatory law. This article touches on cannabis brand protection and a recent development in the United States Patent and Trademark Office (USPTO) that relaxes its prior strict approach to cannabis products, including hemp derived cannabidiol (CBD).
Marijuana remains illegal in the United States under federal law due to the Controlled Substances Act. I won’t go into all the details here, but because of the 2018 Farm Bill, companies can now legally grow and sell hemp and its by-products containing CBD. States must also legalize it, and most have already. Ohio hasn’t yet, but Ohio Senate Bill 57, de-criminalizing hemp and CBD in Ohio, looks like it will become law later this year.
Despite its illegality and associated risks, marijuana is big business in states with legalized recreational and medical programs. And like every other business, building and protecting brand equity in cannabis products is a top-priority. For decades, companies have taken steps to protect their cannabis inventions by filing patent applications in the United States Patent and Trademark Office (USPTO). The USPTO has, despite the federal ban on the drug, issued hundreds of patents. Even the U.S. government has a patent on a CBD product. Of course, patent holders cannot enforce the patent U.S. District Courts, the exclusive jurisdiction for patents. Once the U.S. legalizes the drug, however, those with patents could benefit from lucrative licensing deals and enforcement actions.
What about trademarks? Well that’s a whole different ballgame. The trademark office in the USPTO, down the hall from their patent colleagues, takes an entirely different approach. It rejects all trademark applications for brands used in connection with selling cannabis products. Called the “CSA Rejection” by trademark practitioners, the trademark office cites the legality clause of the Lanham Act. Because the brand is used in connection with the sale of an illegal substance, there is no legal use and not afforded protection by the USPTO. This is a problem for several reasons. Because companies cannot protect their brands under federal law, counterfeiting and copy-cat products runs rampant in cannabis. And for something that potentially has psychotropic effects, avoiding consumer confusion (the test under trademark law for infringement) is even more critical. I know, consumer confusion is a forgone conclusion with cannabis products, right? But, seriously, trademark laws are designed to protection consumers, as well as brand owner investment. Companies can also lose return on their marketing and brand equity investment.
Despite the roadblocks, Mansour Gavin has successfully utilized U.S. copyright and state laws to protect marijuana cannabis brands and obtained federal registrations for the non-cannabis related products and services for cannabis companies. But it just got a little easier to protect hemp derived CBD brands, a close-relative to cannabis.
The trademark office now permits owners of hemp derived products to register their brands in the USPTO so long as the filing date is after December 20, 2018, the enactment date of the 2018 Farm Bill. It posted a bulletin in May 2019, advising USPTO trademark examiners of the review process. We now have express guidance on how the USPTO examines cannabis brands. That’s great! The bulletin seemingly signals a relaxation to the USPTO’s strict approach to cannabis related brands. Marijuana cannabis brands are still left out, but again, there are strategies to protect those brands despite the tough approach of the USPTO.
Our attorneys are always ready, willing and able to meet and discuss any questions you may have. Learn more about Mansour Gavin’s Intellectual Property Group.