Are Medical Marijuana Trademarks in the Pipeline?

In what could have conceivably been an April Fool’s Day joke, the U.S. Patent and Trademark Office (USPTO) created on April 1 of this year a new category (also reported here and here) for trademarks: “processed plant matter for medicinal purposes, namely medical marijuana.”

About 3 months later, the category was removed. However, during that time, the USPTO received around 250 trademark applications for strains of medical marijuana, and related products.

This clearly illustrates that medical marijuana is a booming business, and that those who engage in it are eager to ply their trade through the ordinary legal channels that every other legitimate business takes advantage of, such as federal trademark and patent protection. Given the number of applications that the office received when it created this category, it seems clear that the growers and sellers of medical marijuana are chomping at the bit to operate as legitimate businesses. The USPTO received applications to trademark the names of particular strains, like Acapulco Gold. Some food companies applied for trademarks for soda and candy made with marijuana.

Medical marijuana is already legal, to varying degrees, in about 20 states. And every election cycle, it seems like one or two additional states legalize it. California is even flirting with the idea of fully legalizing (along with regulation and taxation) the possession, cultivation, use, and sale of marijuana for recreational purposes. The issue will be decided by that state’s voters through a ballot initiative this November.

Although marijuana is illegal under federal law, with no exceptions for medical use, the Justice Department, under Attorney General Eric Holder, has indicated that it will not arrest or prosecute people who grow, sell, and use medical marijuana when they are in compliance with the laws of their state. This is a major departure from the policies of the Bush administration, which took a hard line against medical marijuana. Earlier this year, a poll by ABC News indicated that 81% of Americans support the legalization of medical marijuana, and nearly half support legalizing or decriminalizing recreational use.

It seems that the U.S. is slowly but surely adopting a more permissive attitude towards marijuana use. If the U.S. is on the gradual road to legalization of medical marijuana (with full legalization for recreational use likely being farther down the line, if it ever happens), it stands to reason that those who are in the business of selling it should get the same legal rights and protections that every other legitimate business enjoys.

A huge benefit that most businesses in the U.S. take for granted is federal trademark protection. Trademark law is what makes modern branding and marketing possible (or at least what allows it to be worth the time and money involved).

Trademark law allows businesses to prevent others from using their names and logos in association with other products.

Suppose you invented Coca-Cola (congratulations, by the way). You spent many years marketing your new product, and it gradually developed a rock-solid reputation among consumers as a delicious and refreshing beverage. Consumers could immediately recognize your product on store shelves by its name, the distinctive shape of its bottle, and its red and white packaging. Many consumers have developed a brand loyalty to your product, and often add it to their shopping carts without even looking at other alternatives. In short, you’re living the dream.

Now, suppose that another company, seeing your success, wanted to take a shortcut. It began making an inferior soft drink, and started selling it under the name “Coca-Cola,” and sold it in packaging that looks identical to yours. This would hurt your business in a number of ways. In the short run, people who would ordinarily buy your product might buy the competitor’s product by mistake, robbing you of sales. Furthermore, because it is selling an inferior product under the name of your product, your product’s reputation among consumers is going to be hurt. And on a moral level, this company is simply freeloading off of you, riding on your years of hard work to make a quick buck for itself. On top of that, consumers are being misled into buying a product which is inferior to the product they wanted to buy.

Trademark law lets producers stop their competitors from doing this through lawsuits, which provide successful plaintiffs with large monetary rewards, serving as a deterrent. Obviously, any business that values the integrity of its brands should seriously consider getting a registered trademark.

However, this presents a major problem for the producers of medical marijuana, who are struggling to get on equal footing with other businesses: to receive federal trademark protection, the product that the mark will be associated with must be legal to sell under U.S. law. As it stands, federal law clearly prohibits the sale of marijuana. Accordingly, every application for marijuana-related trademarks has been denied, and it’s unlikely that any will be granted in the near future.

It seems clear that if legalization of marijuana is going to proceed, far more needs to be done than simply lifting prohibitions on its sale and use. The ultimate goal of legalizing marijuana (either for medicinal or recreational use) should be to bring it on par with any other legitimate business in terms of legal rights, and public acceptance.

Now, I don’t expect marijuana to be legal under federal law any time soon, which pretty much excludes the producers of marijuana getting federal trademark protection. However, unlike other areas of intellectual property law (patents and copyrights), trademark is not, constitutionally, the exclusive domain of the federal government.

There are many circumstances where state law can and does get involved in trademark disputes. Perhaps states which have legalized medical marijuana, and want to remain on the cutting edge of what may well become a booming industry sooner than we think, should adopt more robust trademark registration systems, allowing for cannabis-related products to receive trademark protection. Obviously, the state could only provide protection within its own borders, but almost all growers and sellers of medical marijuana operate exclusively in their state of residence, so this wouldn’t be a huge problem.

It’s obvious that the federal government won’t legalize medical marijuana any time soon, so states that want to turn it into a legitimate, taxable business, shouldn’t bother waiting around.