Authored By: Carly Klein
“It is not impossible to secure IP rights on cannabis-related inventions, but there are a number of factors to consider and a number of complexities…”
The relatively new industry revolving around the legal growth, distribution, and commercial sale of cannabis represents a golden (or, should I say, green) opportunity for emerging entrepreneurs.
According to leading cannabis researchers, the next decade will see spending on legal cannabis worldwide escalate to $57 billion by 2027. Within this figure, the recreational market will constitute 67% of the spending while the medical market will fill in the remaining 33%. The majority of the industry will take place, on both the buying and selling side, in North America.
For the innovators capitalizing on this green movement, the procurement of intellectual property rights can go a long way in the monetization of their cannabis-related ideas, products, and services. As with any new venture, solidifying an IP protection strategy early on can maximize the benefits of a new invention and minimize risk the of potential infringement. This rings especially true in a field where so few patents, copyrights, and trademarks have been issued.
Only a yellow light for green entrepreneurs on the road to IP protection
As one can imagine, given the complicated and controversial history of marijuana legalization, there are many obstacles and complexities that green entrepreneurs face in securing IP rights on their pot products.
This article will specifically focus on the problems and solutions in trademarking, patenting, and licensing cannabis-related inventions.
Conflicting federal and state regulations
The biggest roadblock in securing general IP rights in the cannabis market comes from the fact that marijuana remains illegal under federal law, while many of the more progressive states have wholeheartedly embraced medical and/or recreational marijuana use through legalization.
Cannabis continues to be a Schedule I drug under the Controlled Substances Act, which means that federal law prohibits possession of cannabis. However, 29 U.S. states and the District of Columbia have legalized medical cannabis, while eight U.S. states have legalized recreational cannabis.
Troubles with trademarking
For green innovators seeking IP protection via securing a trademark, these conflicting laws may cause some complications due to lawful use rules. To protect a brand by registering a trademark with the U.S. Patent and Trademark Office, the trademark must be used in a commercial way consistent with applicable laws.
Therefore, before federal registration can issue for a trademark, lawful use and legal applicability must be declared and proven.
Under cannabis, there is a great potential for friction with these lawful use rules. The potential violations that arise here center around the Controlled Substances Act (CSA) and the Food, Drug and Cosmetic Act (FDCA).
Loopholes to lawful use rules
Many inventors have seen a loophole in that goods and services related to cannabis are more likely to be granted patents than inventions for primary marijuana products or services. For example, a website, such as a dispensary search service like Weedmaps or a marijuana delivery service like Eaze, will be easier to to protect as intellectual property as opposed to a specific marijuana strain or growth method.
Another loophole is that while it may be more difficult for a cannabis entrepreneur to obtain a federal patent, there are several states that afford trademark protection to cannabis-related goods and services. These states — including Washington, Oregon, Nevada and Colorado — allow for the registration of cannabis-related trademarks. Cannabis entrepreneurs can therefore turn to these states to carry out their intellectual property considerations rather than combat lawful use rules in obtaining a federal trademark.
Finally, green entrepreneurs can protect their goods or services through common law. This protection happens as soon as the entrepreneur uses their product in commerce with a specific and distinctive mark. There are no lawful use requirements to protect a mark under common law, so this method can eliminate roadblocks for those seeking to innovate in the cannabis space.
Pot and patent protection
There are currently around 60 active patents for cannabis, on everything from methods of hydrogenating cannabis oil, to names of specific cannabis plant strains, to a cannabis-infused milk product. The fact that certain strains are patented demonstrates that it can be done.
Marijuana growers can apply for plant patent applications. These are available for inventors who have found a new species of plant which can be duplicated through asexual reproduction. 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.
Another complication in patenting a plant revolves around the fact that cannabis is a plant that is sexually reproduced, and plants that grow this way are ineligible for patenting. Therefore, the cannabis grower has to prove that their plant can grow without both the male and female plant.
J.D. Houvener, founder & CEO of Bold IP, explains that “an individual has to prove that their plant specimen can be asexually reproduced in a lab setting to get patented. If the seed of the plant is genetically modified in a lab setting, then that plant can be patented. If, however, the seed needs another seed, it cannot be protected under the patent law. This is something that is very difficult to prove.”
The types of cannabis-related patents
To qualify for patentability, the USPTO stipulates that the claimed invention must be new, useful and nonobvious. Cannabis patents and applications are subject to this same standard. Types of that may be patentable under this rule are:
- Cannabis plants, such as new strains of cannabis plants, GMO cannabis, cannabis cultivation methods and equipment, etc.
- Cannabis processing and extraction methods
- Cannabis products, such as cannabis in edible or beverage form, cannabis oils and extracts, and products for animals
- Medical uses for cannabis, such as treatments for a disease or a disorder
Licensing the cannabis leaf
If a grower can demonstrate that their cannabis plant breed is new and novel, they can obtain a licensing agreement that grants them plant breeders’ rights (PBR). PBR’s are a form of intellectual property rights by which breeders can protect their new varieties.
These rights, granted to the breeder of a new variety of plant, can give that breeder exclusive control over the plant material, including over the seed, cuttings, divisions, tissue culture, harvested material, etc.
It is not impossible to secure IP rights on cannabis-related inventions, but there are a number of factors to consider and a number of complexities to be aware of. If you are a cannabis grower seeking to learn more about filing a plant patent application, you can find a patent guide available here.