This JD Supra press release / article came in over the weekend.
California was the first state to legalize marijuana for medical use. In 1996, California approved Proposition 215, the California Compassionate Use Act. Two decades later, California voters approved Proposition 64, the Control, Regulate and Tax Adult Use of Marijuana Act (AUMA). Despite the fact that cannabis has been legal in California since 1996, you still can’t get a trademark in California for marijuana, medical or otherwise. Why is that.
The problem results from a disconnect between California’s trademark statutes and the California laws governing legal cannabis use. California Business and Professions Code Section 14272 provides as follows:
The intent of this chapter is to provide a system of state trademark registration and protection substantially consistent with the federal system of trademark registration and protection under the Trademark Act of 1946 (15 U.S.C. Sec. 1051 et seq.), as amended. To that end, the construction given the federal act should be examined as nonbinding authority for interpreting and construing this chapter.
The USPTO regularly rejects applications to register trademarks related to cannabis on the grounds that such use would not constitute “lawful use in commerce”. The legal reasoning underlying such rejection goes as follows: Under federal trademark law, the registration of a trademark requires use of that mark in connection with the goods or services in commerce. Federal trademark law defines “commerce” as all commerce which may lawfully be regulated by Congress. If the goods or services covered by a mark are unlawful, actual lawful use in commerce is not possible. And in those situations, a mark covering such unlawful goods or services cannot be federally registered.
Cannabis and products that are primarily intended or designed for use in connection with cannabis are federally illegal under the Controlled Substances Act. The federal trademark office has taken the position that if a mark covers a good or services that would be illegal under the CSA, lawful use in commerce is not possible, and as such, the mark cannot be federally registered.
The trademark examiners in Sacramento have gone further than taking USPTO reasoning as nonbinding authority; they have taken the USPTO reasoning as gospel in rejecting state applications for cannabis. However, California’s lawmakers are proposing an amendment to California’s trademark laws that will address this inconsistency.
AB 64 proposes to, notwithstanding those provisions, authorize the use of specified classifications for marks related to medical cannabis and nonmedical cannabis, including medicinal cannabis, goods and services that are lawfully in commerce under state law in the State of California
AB 64 intends to provide a statutory mechanism for allowing the registration of a California trademark for cannabis products. The bill proposes two new classifications of goods and services may be used for trademark marks related to cannabis, including medicinal cannabis that are lawfully in commerce under state law in the State of California. The proposed classes are:
(1) 500 for goods that are cannabis or cannabis products, including medicinal cannabis or medicinal cannabis products.
(2) 501 for services related to cannabis or cannabis products, including medicinal cannabis or medicinal cannabis products.
While AB 64 would appear to solve conflict at the California Secretary of State’s trademark department, the down side is that California state trademark registrations for cannabis products will not be available until January 1, 2018.