The Rift in Intellectual Property Protection for Cannabis

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By: Daniella Reinbach

Introduction

The recent growth in legalization of marijuana has sparked a variety of development for businesses and products. While legalization has led to patent protection for marijuana products, trademark protection for those some products remains a much trickier terrain.[1] The same federal office, the US Patent and Trademark Office (hereinafter “PTO”), issues both trademark and patents, so why the rift in federal intellectual property protection?  Several factors may reconcile the otherwise contradictory position, or at least explain the present rift. The first is the different requirements for patent and trademark protection. Secondly, is the structure of the law which permit moral discretion in trademarks and lack there of in patents. Finally, there is a difference in purpose and intent of these intellectual property protections which makes it harder to justify issuing trademark protection for an illegal product.

  1. The Requirements for Protection

While issued by the same office, patents and trademarks are very different forms of intellectual property protection, governed by different acts of Congress, with different minimal requirements to warrant protection.[2] A trademark generally protects symbols and other distinctive features which could be used to identify a source of goods.[3] A patent generally protects new scientific processes inventions, and innovations.[4] To warrant patent protection an invention both new and non-obvious, as well as have utility or usefulness. In contrast, a trademark will only receive protection if it’s used to distinguish particular goods in commerce. This means currently active use in commerce, or bona fide intent to use in certain circumstances, in connection with a specific good or goods.

Thus, in order to get a proper trademark on a marijuana product, one would have to demonstrate active use of the mark in commerce in connection with the sale of the marijuana product to the PTO. Because the Controlled Substance Act treats marijuana as an illegal controlled substance, this would essentially require PTO to condone an active and on-going sale of a drug in violation federal law.[5]  Unsurprisingly, the PTO is unwilling to sign off on a trademark based on the sale of, or intent to sell, a federally illegal drug. Doing so would unleash a slippery slope of trademarks for illegal products and make the federal government’s current split-position even harder to explain. The PTO often supports its decision to deny marijuana trademarks with the requirement of “lawful use in commerce.”[6] Patents have no requirement of any use in commerce and a patent holder could simply exclude without actively using the patent. Based on this logic, it seems straight forward why one maybe able to get a patent but not a trademark for marijuana product.

This touted requirement, however, is not a clear-cut requirement of the Lanham Act, but rather it is based on a court interpretation of lawful use in a relatively non-germane case regarding concurrent use of a mark.[7] In fact, section 1051 of the Lanham Act doesn’t mention “lawful” use, just that there must be “use in commerce.”[8] In section 1052, which lists certain prohibitions on trademarks, the only mention “lawful use” is when discussing rights, or lack of rights, for concurrent use of an already registered mark.[9] Finally, there is the broad definition of “commerce” in setion1127 which defines the term to mean “all commerce which may lawfully be regulated by Congress.”[10] Thus, the PTO has done a bit of legal yoga in order to develop a relatively commonsense rule: you can’t have a federal trademark for an illegal product. This begs the question, however, as to why that same yoga wasn’t used to deny patents for marijuana? The Controlled Substance Act could theoretically be used to invalidate a patent application for a marijuana product if the same language flexibility and logic was employed. Patents, again, require an actual utility; this does not mean a mere idea or suggestion that it could one day become useful or work for the purpose intended in the patent.[11] Under the Controlled Substance Act and its scheduling of marijuana as schedule one drug, the federal government has already legally declared that marijuana has no medical benefits or use what-so-ever, cannot even be safely used under a doctor’s supervision, and has a high potential for abuse .[12] If the PTO so desired to deny a patent for marijuana, could it not reject the application the basis of the federally determined schedule which asserts marijuana lacks utility?[13]

  1. The Moral Split

The lack of effort on behalf of the PTO when it comes to denying marijuana patents is not un-explainable. There are fundamental differences in the constructs of the Patent Act and the Lanham Act. One of these differences is the Lanham Act’s discretionary ability for examining attorneys to deny a trademark because its nature is “immoral, deceptive, or scandalous matter,” even though some portions of that section have come under recent scrutiny as a First Amendment violation.[14] Thus, it is plausible even without the prior discussed legal yoga, because trademark law permits moral discretion by the examining attorney, an application could be denied on the basis that marketing an illegal product, and the mark displaying and encouraging use of it, is immoral or scandalous.[15] Patent law has no such discretionary morality criteria allowing denial of immoral patents in its act and has already invalidated the above mentioned legal yoga.[16]

Present day patent law takes an opposite approach of trademarks. Morality and legality are not considerations when the PTO considers applications for patents. It is true that Justice Story once held that patents were subject to the “morality doctrine” and that products designed with immoral intent or illegal purpose could not be useful.[17] This idea dominated in patent law during the 19th and early 20th centuries and was used against patents for things like gambling machines.[18] Patent law, however, has since taken a sharp turn in the opposite direction as there was really no basis for the morality doctrine in Patent law.[19] In the mid-late 20th century courts stopped employing the morality doctrine in patent cases to invalidate patents.[20] This morality doctrine remains in decline in patent law and thus it is unlikely that the immorality or illegality argument would be used to invalidate a patent on a marijuana product based on the modern precedent.[21]

  1. The Intent of Protection

Finally, one should consider the purposes and intent of the respective intellectual property protections. Trademarks and Patent serve very different purposes and protect very different things. Patents help advance the sciences and trademarks are to aid the consumer in purchasing goods. The protections were not made equally, and this is most likely because the subjects of protection are not equally important. The stakes are higher for society in denying marijuana patent protections than denying federal trademark protection.

Trademarks are designed to avoid consumer confusion. In short, trademarks protect consumers from choosing a sub-par product, or mistakenly choosing the wrong product, by making the sources of goods readily identifiable.[22] Trademarks also benefits the companies who sell or make those products by giving them a way to make their product distinctive and identifiable as well as preventing unfair competition. Federal trademark protection, however, was not even available for a good part of American history.[23] Trademark law developed at common-law and state law levels and continues to offer protection.[24] As a result, in terms of trademarks, even if the federal government won’t protect you, you are not absolutely denied protection. In contrast, the founders of the United States government felt protection of the arts and sciences were so important it was included in the United States Constitution.[25] The goal of patents is to encourage scientific advancement and encourage the sharing of those advancements by granting temporary but highly valuable monopolies in exchange for disclosure of the new knowledge.[26] Patent law is exclusively federal, which also means patent law lacks a state fall back, and without federal protections, marijuana developments and advancements would be completely  unprotected.[27]

This isn’t to argue trademarks are not important, but that there is greater harm to society if we were to stifle scientific advancement by denying patents for potentially good products verses denying federal trademark registration. As a result of the risk of harm to scientific advancement and benefits, the PTO may be less likely reject a patent than a trademark.[28]

Conclusion

In conclusion, several factors may contribute as to why there is a rift in the available intellectual property protection for marijuana products. These factors include: the basic requirements for each protection and consistency with other law; the different structuring of the law and whether moral or legality considerations are permissible conversations when granting or denying protection; and finally, the goals of patent protection result in a higher value for society that is more easily stifled by denial of protection than in trademarks. As result, we see a obvious rift in the available intellectual property protection available for marijuana which will only be cured by a change in federal law.

[1] See Alison Malsbury, Marijuana Trademarks, Canna Law Blog (Sept. 29, 2014) https://www.cannalawblog.com/marijuana-trademarks/; cf. Julie Weed,  US Patent Office Issuing Cannabis Patents To A Growing Market, Forbes (July 25, 2017) https://www.forbes.com/sites/julieweed/2017/07/24/us-patent-office-issuing-cannabis-patents-to-a-growing-market/#8a4869f68d40

[2] See Patent Act, 35 U.S.C. §101, 103; cf. Lanham Act, 15 U.S.C. §§ 1051

[3] See Malsbury, supra note 1.

[4] See General information concerning patents, United States Patent and Trademark Office.gov (Oct. 2015) https://www.uspto.gov/patents-getting-started/general-information-concerning-patents (hereinafter “General information concerning patents”).

[5] See Alison Malsbury, Cannabis Trademarks and Legal Use in Commerce, Canna Law Blog (Nov. 2016) https://www.cannalawblog.com/cannabis-trademarks-and-legal-use-in-commerce/.

[6] See e.g., In re Morgan Brown, 119 U.S.P.Q.2d1350 (T.T.A.B. 2016).

[7] See Trademark Manual of Examining Procedure §907, United States Patent and Trademark Office.gov

(Oct. 2017) https://tmep.uspto.gov/RDMS/TMEP/current#/current/TMEP-900d1e1461.html; see generally Gray v. Daffy Dan’s Bargaint8own, 823 F.2d 522 (Fed. Cir. 1987) (considering whether there was “lawful use” of a mark in commerce where the second user admitted to using the registered trademark holder’s mark but contended that jurisdictional limits allowed this to be lawful concurrent use).

[8] Lanham Act, 15 U.S.C.S. § 1051.

[9] Id. at § 1052.

[10] Id. at § 1127.

[11] See General information concerning patents, supra note 4.

[12] Controlled Substance Act, 21 U.S.C.S. § 812.

[13] See Sam Kamin & Viva R. Moffat, Trademark Laundering, Useless Patents, and Other IP Challenges for the Marijuana Industry, 73 Wash & Lee L. Rev. 217, 263-264.

[14] Lanham Act, 15 U.S.C.S. § 1052(a); Lee Rowland, Victory! The Slants Are Officially Rock Stars of the First Amendment, American Civil Liberties Union (June 19, 2017) https://www.aclu.org/blog/free-speech/victory-slants-are-officially-rock-stars-first-amendment; see also Matal v. Tam, 137 S. Ct. 1744 (2017 )(holding the “disparagement clause” of the Lanham Act unconstitutional).

[15] See Robert McVay, Breaking Down Marijuana Patents, Canna Law Blog (Jan. 4, 2015) https://www.cannalawblog.com/breaking-down-marijuana-patents/.

[16] Id.

[17] Omar A. Khan & Richard A. Crudo, Scandalous, Immoral and Disparaging Patents in Light of Tam, Law 360, Feb. 25, 2016; see also Juicy Whip, Inc. v. Orange Bang, Inc., 185 F.3d 1364, 1366-67 (Fed. Cir. 1999).

[18] See Khan & Crudo, supra note 17.

[19] Id.

[20] Id.; see also Juicy Whip, Inc., 185 F.3d at 1366-67.

[21] See Khan & Crudo, supra note 17.

[22] Purpose of Trademark: Everything You Need to Know, UpCounsel (last visited Mar. 11, 2018) https://www.upcounsel.com/purpose-of-trademark.

[23] See Trade – Mark Cases, 100 U.S. 82 (1879) (holding the first trademark act unconstiutuional).

[24] State Trademark Registration in the United States, International Trademark Association (July 2014) http://www.inta.org/TrademarkBasics/FactSheets/Pages/StateTrademarkRegistrationsUSFactSheet.aspx.

[25] See U.S. Const. Art. I, § 8, cl. 8.

[26]  See General information concerning patents, supra note 4.

[27] Id. see also U.S. Const. Art. VI, cl. 2.

[28] These arguments do not take into account that the U.S. Government holds a patent for space reasons.

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