New Intersections of Intellectual Property and Cannabis
By: Ryan Masters, Strategic Legal Counsel at Cultiva Law
With states across the country, and even the federal government in some respects (see, 2018 Farm Bill), legalizing cannabis, the intersection of intellectual property and cannabis is becoming a more and more important consideration for marijuana and hemp entrepreneurs, as well as existing companies, to take in order to protect the integrity and longevity of their businesses.
Despite the DEA still classifying marijuana as a Schedule-One drug, strategic legal counsel can – and should – secure legal protections for intellectual property (“IP”) at both the state and federal levels with respect to marijuana, hemp, cannabis and ancillary businesses. Cultiva Law is well versed in the substantive requirements, benefits, and limitations, as well as procedural steps required to protect IP under trademark, copyright, and trade secret laws. Below is a brief explanation of each of these three categories and how they can apply to cannabis businesses:
Trademarks
A trademark is a word, phrase, symbol, and/or design that identifies and distinguishes the source of the goods or services of one party from those of others. Examples of strong trademarks are Apple, Nike, and Starbucks.
When thinking of trademarks think of source identifiers. For example, when a consumer sees the Nike Swoosh, he or she knows it is a Nike product; when a consumer see a Starbucks sign (circular green logo featuring mermaid) in Florida, the consumer knows that coffee is going to taste the same as it does at a Starbucks in Oregon. In addition to basic word marks and/or designs, trademarks can also pertain to the overall look and feel of a store front, product packaging, sounds, shapes, and colors.
Trademarks can be registered at the federal (and/) or state levels, providing major advantages to businesses who apply and register their marks promptly and correctly. Within the cannabis industry, it is relatively easy to register a (proper) mark at the state level in states that have legalized cannabis at some level. However, registering a mark at the federal level presents major obstacles — namely, the classification of marijuana as a Schedule-One drug. Despite this classification, there are strategic ways to ensure that your brand is still protected at the federal level.
Prior to starting a new brand or business, a trademark “knockout” search should be ordered in order to determine the viability of your successfully building and leveraging your desired brand and/or mark. Further, by ordering this search, current and future companies are empowered to limit their susceptibility to future litigation from other companies which may already have registered the mark. With respect to existing businesses, if you have not yet, you can and still register your mark, and leverage legal structures which provide protection upon proof of first use, et. cetera.
Additionally, The United States Patent and Trademark Office (“USPTO”), an agency under the U.S. Department of Commerce which issues federal intellectual property registration, recently issued a press release updating and detailing their stance with respect to accepting applications for cannabis trademarks following the Farm Bill. Arguably, the most important portion of this press release relates to CBD used for cosmetic purposes and the ability to obtain a registration for those exact services.
Copyrights
Copyright protects original works of authorship including literary, dramatic, musical, and artistic works. Unlike trademark law, and despite the classification of marijuana as a Schedule-One drug, federal copyright law generally does not prohibit the registration of copyrights pertaining to cannabis – even marijuana. Copyright registrations have been granted to several Cannabis related works, including, recently and notably, cookbooks.
As applicable to the cannabis industry, federal copyright protection is available to protect artwork on labels and packaging, the design of websites and apps, and several other creative and/or branding works. Copyright registration is, and only recently, required to proceed with a copyright infringement lawsuit against another person or entity using that (that is, the Plaintiff’s) copyrighted material, making it all the more important to proceed with any applications to protect potential copyrighted material and promptly as possible.
In the Cannabis industry, copyright protection is especially important to those businesses that use a cannabis leaf in their logo as you cannot trademark such logos. Although it is not as valuable as trademark protection, it is still a valuable step to take in enforcing your intellectual property rights.
Trade Secrets
Trade secrets, simply, is information; trade secrets can include be anything from a formula, to a technique, or even a process. In order to be protectable, the trade secret must not only be used in business, but also must provide an economic advantage over competitors who do not know or use the trade secret. Unlike trademark and copyright, however, protecting trade secrets within your business does not involve registration with the federal government. Instead, protection of trade secrets involves implementing certain procedures within your business.
In the cannabis industry, information such as formulas, production/growing techniques, extraction procedures, and strain recipes can – and should – be protected as trade secrets. Whether you are starting a cannabis company, or operating an existing business, the implementation of procedures to safeguard your business’s trade secrets is essential to maximizing your business potential by preserving your proprietary adventages in the industry.
Protecting Your Business
Current and prospective businesses should discuss with IP experts how to properly and most effectively safeguard their intellectual property rights. Considering the constant evolutions in cannabis regulations, it is important to register and enforce your business’s intellectual property rights properly and consistently. Ensure you strategically craft and promptly submit trademark and copyright registraions to ensure that you have the best protection available under existing, and ever-changing, laws.
