In 2018, Congress passed the Agricultural Improvement Act, also known as the “2018 Farm Bill.” This legislation removed hemp, defined as cannabis (Cannabis sativa L.) and its derivatives containing delta-9 THC concentration levels not exceeding 0.3% on a dry weight basis, from being classified as marijuana under the Controlled Substances Act. As of October 2024, 38 states and the District of Columbia have legalized marijuana for medical use. Additionally, 24 states and the District of Columbia have legalized recreational marijuana use. As the cannabis market continues to grow, more cannabis product offerings enter the market, increasing the need for brand awareness and protection. However, because of the current federal landscape, there are numerous pitfalls that need to be avoided to successfully achieve federal protection for cannabis brands.
Marijuana’s federal restrictions impact trademark protections
Even though the federal legalization of marijuana is a hot topic for discussion, marijuana is currently illegal at the federal level and remains a Schedule I substance under the CSA. As a Schedule I substance, the U.S. Patent and Trademark Office will not issue trademark registrations for goods and services directly related to marijuana. To be eligible for federal trademark registration from the USPTO, the primary federal trademark statute, known as the Lanham Act, requires “use in commerce,” which is defined as commerce that can be lawfully regulated and controlled by Congress. The Lanham Act has been interpreted by the USPTO and some courts to only allow for lawful use in commerce. Because the CSA federally prohibits the manufacture, distribution, possession and sale of marijuana, any such use is unlawful use in commerce, and federal trademark priority rights cannot be established.
A federal trademark application related to the manufacture, distribution, possession or sale of marijuana will initially result in the USPTO requiring answers to questions about the legality of the goods or services. Additionally, the USPTO may require the submission of a written statement about the legality of the goods or services. Failure to properly respond to the USPTO’s requests may ultimately lead to refusal of the application.
For many cannabis companies, their brands and trademarks are some of their most valuable business assets. In a restrictive trademark landscape, cannabis companies do have options to secure federal trademarks. Cannabis companies can seek federal trademark registration for non-marijuana-derived products like clothing, hats, posters and lighters. Federal registration can also be granted for goods such as pipes and rolling papers, which have traditionally been used with tobacco products. If the USPTO questions the legality of such goods in a trademark application, the applicant will need to provide documentation that the goods have traditionally been used with tobacco products. It is also advisable for cannabis companies to keep marijuana products separate from non-marijuana products in brick-and-mortar retail stores and on websites. This dividing line between the goods illustrates that the non-marijuana products are not secondary to, nor dependent upon, the marijuana goods.
Another option is to seek state trademark registration. States in which medical and/or recreational marijuana has been legalized generally also allow for state trademark registrations for marijuana products and services. Although a state trademark registration does not offer the same benefits and protections as a federal trademark registration, a state trademark will provide protection within the states where a cannabis company is allowed to legally operate.
U.S. Patent and Trademark Office now covers hemp derivative — with restrictions
Because of the removal of hemp from the CSA definition of marijuana, the USPTO now grants trademark registrations for products derived from hemp and derivatives of cannabis, as long as they do not contain over 0.3% THC on a dry-weight basis and meet applicable federal regulations, such as those established by the U.S. Food and Drug Administration. To fall under the lawful use requirement at the USPTO, CBD products must be naturally occurring and extracted from hemp plants.
Although the USPTO may now grant trademark registrations for CBD and hemp-derived products, not all CBD and hemp-derived products are lawful under federal law and qualify for trademark registration. CBD and hemp-derived products must meet all other federal regulations, including the FDA’s regulatory authority over food and dietary supplements. Currently, under the Federal Food, Drug and Cosmetic Act, it is unlawful to introduce any food, beverage, pet treat or dietary supplement containing CBD into interstate commerce.
Applications that the USPTO suspects of being related to CBD or hemp-derived goods will be examined for compliance with the CSA, FDCA and the Farm Bill. The USPTO may also ask the applicant to submit materials about the goods, such as fact sheets, brochures and/or advertisements. If such materials are not available, the applicant will be required to provide a detailed description of the goods and information that clearly and accurately specifies the nature of the CBD goods. As with marijuana applications, failure to comply with USPTO requests for additional information will likely result in the refusal of the application.
Begin with a preliminary trademark screening
It is recommended, for cannabis and non-cannabis companies alike, to conduct a preliminary trademark screening before using a trademark, at a minimum. A preliminary trademark screening is a search of the USPTO trademark database and the internet for identical or near-identical trademarks. A preliminary trademark screening can be used to assess the risk to the use of, and seeking registration for, a trademark. This is a good starting point to avoid infringing third-party trademarks. It is also advisable to seek out the assistance of a trademark attorney to conduct the screening because they are more familiar with the intricacies of searching the USPTO’s trademark database.
The cannabis industry is a unique, ever-evolving landscape with national and state regulations changing regularly. The marijuana and CBD industry creates unique challenges for cannabis companies with the interplay between various government and market regulators. Nonetheless, steps can be taken to secure rights in marijuana and CBD trademarks.
Paul Hoffer is of counsel in Harness IP’s Detroit metro office. He regularly counsels clients in trademark law in a multitude of industries, including medical devices and cannabis. He can be reached at phoffer@harnessip.com.