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Should the Patent & Trademark Office Register Trademarks for Marijuana Products?

Posted by on Wednesday, June 6, 2018 in News, Updates.

Two weeks ago, I had the opportunity to debate the question posed by the title of this post with Shabnam Malek, a pioneering trademark attorney with Brand & Branch, LLP. The debate was organized by the International Trademarks Association (INTA) for its annual meeting in Seattle, and it was expertly moderated by Dean Megan Carpenter of the University of New Hampshire Law School.

The debate drew a large (and lively) crowd in Seattle. INTA members who missed it should be able to access a recording of the debate via the organization’s website (alas, it’s password protected). But for readers who aren’t INTA members, I thought I’d summarize the main points Shabnam and I made during the session. Before doing so, however, let me first provide a little bit of background on the trademarks issue (discussed in the book on pages 406-412).

Under the status quo, marijuana suppliers cannot register trademarks on marijuana products with the federal Patent and Trademark Office (PTO). This is because the PTO has interpreted one key requirement for registration – namely, that an applicant show “use [of the mark] in commerce”— to mean “lawful” use in commerce (see book pages 407-409). Obviously, marijuana suppliers cannot yet satisfy this requirement because the sale of marijuana remains illegal under federal law. Indeed, the PTO has repeatedly rejected trademarks for use on marijuana products (see book pages 407-412).

Shabnam and I debated whether the PTO should change course and register marks for marijuana products, notwithstanding the federal ban on same. Shabnam argued for registration and I argued against. It bears mentioning, however, that INTA urges the debaters to push starkly contrasting positions on the topic – in other words, neither Shabnam nor I necessarily agree with the points we made and which I summarize below:

Shabnam made two main points in support of the PTO registering marks on marijuana products. (Hopefully I’ll do justice to her arguments; I’ve revised them somewhat here for ease of exposition.)

First, Shabnam argued that registering marks on marijuana products protects consumers – the key purpose behind the Lanham Act (the federal trademark statute). The idea is that without national trademark protection, two (or more) suppliers in two (or more) different states could sell two (or more) very different marijuana products with the identical brand name. It’s easy to imagine how consumers could be confused by this state of affairs. Suppose, for example, that a Massachusetts resident likes to buy a brand of local low potency marijuana brownies called “BayBaked.” Now suppose that this consumer travels to California on vacation, where she visits a marijuana shop and sees a “BayBaked” brand of marijuana brownies on the shelves. She might mistakenly believe these are the same brownies she buys back home in Massachusetts — not realizing that the California version contains far more THC than the low potency Massachusetts variety. As a result, she might unwittingly overconsume marijuana on her vacation, potentially putting her health and safety at risk.

Today, most manufacturers of marijuana products (like the fictional producers of “BayBaked” marijuana brownies) can get state protection for their brands. But such protection extends only to the borders of a state; i.e., it does not prevent suppliers from using the same mark in other states, notwithstanding any possible consumer confusion. This is why national trademark registration is necessary.

Second, Shabnam argued that the PTO doesn’t have to wait for Congress to legalize marijuana before registering marks on marijuana products. She noted that the Lanham Act itself doesn’t expressly require use in commerce to be “lawful” use. Rather (as hinted above), the lawfulness requirement stems from the PTO’s interpretation of the Lanham Act. The PTO is thus free to revise its interpretation and to permit registration of marks on products unlawfully used in commerce.

Although I largely agree with Shabnam, I argued against PTO registration for marks on marijuana products – at least while the drug remains illegal under federal law. I gave three arguments for this position.

First, registration seems unnecessary to protect consumer health and safety. After all, legalization states heavily regulate the labeling and packaging of marijuana products. For example, they require manufacturers to print warning symbols and labels on all packages of marijuana products. (Such labeling and packaging requirements are discussed in the book in pages 456-462.) To my mind, these requirements ensure that consumers already get most (if not all) of the health and safety information they need to make wise consumption decisions.

Second, granting national trademark protection for marijuana products could potentially undermine the states’ ability to regulate the types of marijuana products they allow within their borders. As it stands, I don’t think states need to worry too much about an out-of-state marijuana supplier openly advertising its products locally. Without national trademark protection, that out-of-state supplier can’t stop local rivals from using its mark for their own benefit – i.e., from capturing some of the goodwill the advertising campaign generates. But if the PTO were to grant national protection for trademarks on marijuana products, the out-of-state supplier’s incentives change: it would now have an incentive to openly advertise outside of its home state, even in places where its products remain illegal.

To be sure, registering a trademark alone doesn’t give a company the right to sell its product anywhere in the nation. So, to build on the example above, Massachusetts could still ban the sale of California’s BayBaked brand brownies (say, because those brownies are too potent), even if the California company registered a trademark for BayBaked with the PTO. Realistically, however, states probably can’t prevent products from entering their marks once they have a national trademark. For one thing, states probably can’t ban advertising of such products, even if they remain illegal locally; such a ban could potentially violate First Amendment protections for commercial speech (see book pages 501-504 and this new article from Leslie Jacobs). In addition, although states can legally restrict the sale and possession of trademarked products within their borders, practically speaking, they probably couldn’t stop consumers or black market resellers from smuggling a marijuana product into the state. (Indeed, interstate diversion is already a problem, as noted in this earlier post on looping and in an earlier article I wrote on Marijuana Localism.)

In short, the only way to stop a marijuana supplier from successfully selling its product across state lines may be to take away the company’s incentive to advertise outside of its home state.

Third, I think the lawfulness requirement is probably the most reasonable interpretation of the Lanham Act. Indeed, it seems implausible that the Congress that enacted the Lanham Act would have wanted to provide federal trademark protection for illicit products—not just marijuana, of course, but any illicit goods (imagine, for example, someone trying to register Heisenberg® brand pure crystal meth).

For all of these reasons, I think the PTO should wait for Congress to repeal the federal ban on marijuana before registering marks on marijuana related products.

That’s it for now. I’m writing up an article on the lawfulness requirement for trademark registration. If you have comments or thoughts on the topic, I would love to hear from you (robert dot mikos at vanderbilt dot edu).

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