NewsMunchies Post

In the Name of Intellectual Property Rights & Marijuana

Brand loyalty builds businesses. Marijuana is worthy of protection and a name despite what our federal government says. Bud businesses must have a brand name that can be protected through trademark laws.

Yet it is Toys R Us that is going after a dispensary in Bel Air Plaza on Eight Mile in Detroit for using the name “Buds R Us.” Buds R Us recently received a letter from the so-called toy giant’s law firm that it is infringing on its intellectual property rights due to the usage of the name and a logo complete with a giraffe smoking a joint. I think its kind of funny. Would any parent really confuse Toys R Us for selling little Timothy or little Mary Jane some marijuana?  Toys R Us Inc., the largest U.S. toy store chain, filed for bankruptcy protection on September 18.

Buds R Us’ attorney said, “I think that with the tongue and cheek understanding of the logo, I don’t think anybody is going to confuse the two companies.” A trademark is a visual cue, such as a symbol, phrase, or word that industries use to identify and distinguish their products from those of their competitors. Establishing whether a mark infringes on another, hinges on the likelihood of confusing consumers over the product’s source.

Cannabis businesses are put in a precarious – and unfair – predicament. They can’t take their money to federal banks like other businesses but they’re expected to follow copyright, patent, and trademark infringement laws. That ain’t cool.

The USPTO regularly rejects applications to register trademarks related to cannabis on the grounds that such use would not constitute “lawful use in commerce.” 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 that may lawfully be regulated by Congress and remember, cannabis is illegal under the Controlled Substances Act.

We will see this IP issue again and again until the War on Marijuana is O-V-E-R and the feds legalize cannabis. The reason? The legal U.S. cannabis market, which includes medicinal and recreational sales, resulted in an estimated $7.2 billion in revenue, and that number is projected to grow to $21.2 billion by 2021. This rapid growth has led to increasing competition among cannabis brands and a rising need to differentiate themselves from their competitors. For companies and entrepreneurs entering this industry, comprehensive IP protection is vital for their brands and inventions to survive and thrive.

State laws may provide some protection to cannabis business owners, as state registration is enforceable throughout the state. For example, Assembly Bill 64 permits California’s Secretary of State to issue trademarks for cannabis products.  State registrations may provide brand owners with statutory remedies against infringers that are unavailable at the federal level. Moreover, some businesses have been able to use state unfair competition law to sue for misappropriation of a common law trademark where state registration is not available.

The moral of the story is that buds are dope, unique, and represent the efforts of countless persons who helped construct viable cannabis businesses. Protection is great for safe sex and its equally great for cannabis.

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