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Many Cannabis Entrepreneurs “Caught In The Weeds” When Trying To Protect IP

Written by: Danielle Keller

The legal growth, distribution, and commercial sales of cannabis has created an opportunity for many entrepreneurs. However, experts in the industry note several barriers to obtaining protection along with some possible solutions. While it is not impossible to secure IP rights on cannabis-related inventions, there are a “number of factors to consider and a number of complexities.”[1] Some issues the industry is currently running into include:

  • Regulatory complexities: Many state laws that legalize the production and sale of cannabis products conflict with federal law which lists cannabis as a “Schedule 1” drug under the Controlled Substances Act, making possession of cannabis illegal.[2]
  • Troubles with Trademarking: Federal trademark protection is not achievable with the requirement that the thing sought to be trademarked must have a “lawful use in commerce” Under the Federal Trademark Act.[3]
  • Undeveloped Industry: The cannabis industry has been likened to the “wild west”[4] as the industry grows and businesses are working to establish broad protection of their products and processes in gaining a competitive advantage.
  • Patenting a Plant: As with any patent, the inventor bears the burden of proving that their cannabis plant is not a naturally occurring substance as is– rather, they have altered a natural substance so that the invention is new and novel. This is an added level of complexity as developer in this instance must show that the plant can be asexually reproduced.[5]

While this list is not exhaustive, there are certainly a number of factors to consider and a number of complexities to be aware of. Experts urge entrepreneurs to hire an IP attorney early on to navigate these complexities, and to assist in the development of an IP strategy. Businesses should also act fast to submit applications to the USPTO, “I always recommend applying for federal or state trademark registration at the outset of starting a cannabis business,” Jeffrey D. Welsh (founder of Frontera Law Group, a boutique law firm specializing in the legal cannabis industry). [6]

 

[1] Carly Klein, The Complicated Relationship Between IP Law & CannabisIPWatchdog, Nov. 10, 2018, https://www.ipwatchdog.com/2018/11/10/complicated-relationship-ip-law-cannabis/id=102941/.

[2] Id.

[3] Alison Malsbury, The Anatomy of a Cannabis Trademark TTAB DecisionCanna Law Blog, June 16, 2018, https://www.cannalawblog.com/the-anatomy-of-a-cannabis-trademark-ttab-decision/.

[4] Javier Hasse, Protecting Your IP Is (No Surprise) Even Harder in the Cannabis BusinessGreenEntrepreneur, Jan. 2, 2019, https://www.greenentrepreneur.com/article/324845.

[5] Klein, supra note 1.

[6] Hasse, supra note 4.