In the Weeds Between Federal and State Law: Brand Name for Legal Marijuana Sales Denied Federal Registration
In a precedential opinion, the Trademark Trial and Appeal Board (TTAB) affirmed a USPTO refusal to register the trademark HERBAL ACCESS on the basis the use of the mark in commerce was unlawful under the Controlled Substances Act (“CSA”). Though not unexpected, as the sale of marijuana is a Class 1 Felony under the CSA, the case is a reminder of the limitation on protection of brands used in connection with the sale of marijuana.
Nevertheless, the decision is troubling for those who run businesses in the 22 states that have legalized the sale of recreational or medical marijuana. The need for branding in the industry is particularly important as those involved in the sale of marijuana and THC-based preparations strive to create and sell reliable strains of product that are controlled for potency, contaminants, moisture and microbiology. Indeed, the underpinning of trademark policy (the protection of consumers) seems to apply with particular force to this industry.
Though the application did not mention marijuana specifically (instead it identified “retail store services featuring herbs”) the mark was refused by the USPTO after Facebook use evidence submitted by the applicant (shown left) reflected that the applicant may sell marijuana – the Examining Attorney note the use of a “green cross has become the symbol of the organized medical marijuana industry. A visit by the Examiner to the applicant’s website, which included the statement “[c]all or stop by today and fine out why people consider our marijuana to be the best of the best!,” confirmed the applicant is engaged in the sale of marijuana under the mark. The applicant acknowledged the HERBAL ACCESS mark was indeed used in the retail sale of marijuana but argued the application and the use of the mark encompassed legal activities (e.g. the sale of legal herbs). The Applicant argued unpersuasively “…the Examining Attorney’s refusal to register the instant trademark in connection with the lawful selling of legal herbs is akin to pronouncing that a specific class of Applicant, namely those who may also sell substances illegal under the CSA but legal in their respective states, may never be the holders of a federal trademark even if the trademark applied for is for use in connection with legal goods or services.” The decision indicates the applicant’s services need only encompass the provision of an illegal substance in violation of the federal CSA as a basis for denying a federal registration with nationwide benefits. This is analogous to USPTO examination of descriptive marks, which requires only a conclusion that the mark would be descriptive of any specified goods/services identified, or even a subset of such goods/services.
The Trademark Manual of Examining Procedure (TMEP) directly addresses the question of legality related to the sale of marijuana by stating “…regardless of state law, marijuana and its psychoactive component, THC, remain Schedule I controlled substances under federal law and are subject to the CSA’s prohibitions.” However, generally the USPTO’s application of TMEP 907 appears to extend beyond applications that claim goods which explicitly violate the CSA (e.g. sale of marijuana) as USPTO procedure is to issue Office Actions to applications covering business to business services, consulting services, software and other goods and services related to the cannabis industry. While many of these rejections can be overcome with a declaration by the applicant that the goods and/or services identified in the application comply with the CSA, many more are simply abandoned. For example, see application for WEEDSHARE (Ser. No. 86653335) covering computer software, computer services and social networking services not specifically related to marijuana or cannabis, abandoned after a request for information from Examining Attorney. Compare with registration for WEEDMAPS (Reg. No. 4943997) covering computer software, computer services, website services and online-services specifically relating to marijuana and cannabis, registered after a request for information and filing of a declaration affirming that the goods and services do not violate the CSA.
Notably, the TTAB declined to address the fact that federal authorities are not yet prosecuting those who legally sell marijuana under state law. Thus, the question remains whether the failure of federal authorities to prosecute the sale of marijuana in states that have made the sale legal has sufficiently rendered the activity lawful to avoid the unlawful use refusal.
In any event, it is worth noting a different result might have occurred if the applicant had submitted a different specimen. Careful consideration of specimens is always advisable.