the 4 main areas ip entails.
by liz gold
cannabizcpa.pro
why is protecting your intellectual property important to cannabis business owners? just ask carla quisenberry, an attorney with miller nash graham and dunn in portland oregon, about how she counsels her cannabis clients in protecting their ip assets, as well as helps cannabis clients with state licensing issues and related disputes.
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“i have been an intellectual property attorney for a number of years and part of my business is really helping small businesses protect those non-tangible assets like patents and trademarks,” she said. “the cannabis industry has been growing more sophisticated as the years go on here in oregon and as these businesses are getting more sophisticated they’re realizing the importance of these intellectual property assets.
“so, i started working with the industry simply because i was getting questions. it is such a fascinating and growing industry that i just kind of focused my attention on cannabis in oregon, specifically, and became more familiar with regulatory rules regarding cannabis growth and processing in oregon.”
as a result, that’s been a strong part of quisenberry’s practice for the past two years.
there are four main areas of intellectual property protection, starting with trademarks, which are the brands and what consumers associate with a particular company and product, quisenberry said. “if you are making an excellent product you want to have a strong brand that consumers can look on that shelf, see the brand, know they’re getting a high-quality product and continuously look for that brand again and again.”
another area of protection is patent protection, which is generally more on the technical side. “patents protect innovations within the industry,” she said. “they’re generally pretty difficult to get but once you acquire them they last for about 20 years and basically preclude anyone from practicing your innovation.”
next is copyright, which protects creativity. for example, if you describe your product in a fun, creative way in your marketing materials, that can be protected by copyright. this applies to images as well.
and lastly, there’s trade secret protection. quisenberry pointed to coca-cola’s recipe as an example. a trade secret protection protects aspects of your business that have value because they are kept secret.
quisenberry works with cannabis businesses across the sector – including dispensaries, growers and producers. she said trademark protection is pretty universal among the industry but growers, for example, are more interested in plant patents than a dispensary.
“protecting your intellectual property the sooner, the better,” she said. “if you are in the process of selecting your trademark, it’s to your advantage to get an attorney involved early on because they’ll help you pick a strong mark that no one else is using. and when i say strong mark, i mean a mark that’s not generic or descriptive of the goods that you’re selling or of the services you’re offering. for example, if you’re a marijuana company that’s selling gummies, you don’t want to call your brand can o’ gummies because that’s so very descriptive of what you’re doing.”
she added that you want to make sure that no one else is using your mark because you want to have consumers identify your mark with you rather than another party. there are infringement issues if you’re reusing the mark that was confusingly similar to someone who’s already been using that mark.
with trademark protection, quisenberry said it’s better to get state registration or federal registration, if possible. however, federal registration is not available for any product containing thc, the cannabinoid in cannabis that produces the euphoric feeling or “high.” but if it’s an ancillary good or service related to the marijuana industry or if you’re selling say, vape pens, because vape pens can also be used for tobacco, you could get federal registration for that particular product.
“and then, in the hemp industry, with the passage of the 2018 farm bill, hemp and hemp-derived products are available for federal trademark registration,” she said. “the limit there is that food, drink and supplements including cbd are not available for federal trademark registration because they are still federally illegal under the fda guidelines.”
quisenberry said the cannabis industry is unique among other industries because the rules change often. state and federal regulations change monthly, if not weekly.
“you’re also looking at the difference between marijuana regulations and hemp regulations and the two are right now going to be treated very differently because of the 2018 farm bill,” she said. “it’s a very nuanced area and i would say a tough area for cpas to get into. but again, like lawyers getting into the cannabis industry, it’s a growing industry and i think that growth is going to continue as we get closer and closer to federal legalization.”