It is increasingly apparent that in the current climate of the cannabis industry, businesses will need every tool in their arsenal to compete in a legalized and regulated corporate market. One cluster of issues still being hashed out deal with obtaining rights to intellectual property now that there are legal pathways to ownership. For visionaries thinking ahead, a race that started quietly is beginning to roar.
By Roo Grostein
Risks and Rewards of Braving Uncertainty
This brings up a philosophical question long discussed among the traditional cannabis community. As traditional cannabis entrepreneurs find less traction in legal markets, the topic has become sensitive. I've always heard that the power in the cannabis plant and community lies in the age-old adage, "You can't patent a plant." Apparently, in the United States, that is simply not true.
With "hemp" cannabis officially legal in the U.S. via The Agricultural Improvement Act of 2018 (the "Farm Bill"), the floodgates are open. Full legalization promises an untold potential in the variety of expressions to come from cannabis breeding and growing. The future will undoubtedly reveal an industry unrecognizable to those who have protected and cared for this important plant during its prohibition period. Consequently, obtaining patents to protect your proprietary creations seems not a question of "can" or "should"- -but rather, of "how?".
Depending on your sector of the "green rush," choosing a path to owning intellectual property in cannabis must be navigated wisely. I can see four or five basic options that a business or proprietor might research more in depth--depending on what kind of IP is to be protected.
- For ancillary products such as vaporizers or extraction equipment, a utility patent--or a "patent for invention"--is often ideal. This "covers the creation of a new or improved-and useful-product, process, or machine." Obtaining this legally bars others from "making, using, or selling the invention without authorization."
- A quick Wikipidia search of "plant patents" reveals The Plant Variety Protection Act of 1970 (PVPA), a statute in U.S. law protecting breeders up to 25 years for "new, distinct, uniform, and stable sexually reproduced or tuber propagated varieties."
- However, one can also apply for the more specific "Plant Variety Patent" under the Plant Patent Act of 1930. This U.S. Federal law made it possible to patent new varieties of plants, excluding sexually propagated plants (known to the cannabis community as "clone-only" strains). Samples are submitted to the plant variety office, which grows them for at least one season to ensure uniformity, distinction and stability. If these tests are passed, exclusive rights are granted for a specified period of typically 20-25 years.
- Trademarks are another service the United States Patent and Trademark Office (USPTO) offers: While patents could be offered for a Federally controlled "substance" like cannabis plants, trademarks are limited : "To qualify for federal trademark registration, the use of a trademark in commerce must be lawful. This means the goods and services must comply with all applicable federal laws." Simply put, the The Agricultural Improvement Act of 2018 (the "Farm Bill") legalized hemp trademarks (as long as the companies do not violate FDA rules regarding sales and marketing) and Trademarks pertaining to legal hemp businesses now have clarification.
- A final option is to file a Patent Cooperation Treaty (PCT) application. Many eyes are on the international legalization prize and this 1970 agreement among players in the global economy affords some the means to maintain IP rights while deferring patent costs in multiple countries for up to 30 months. For those testing the U.S. market for success or anticipating a global direction of future markets, this might be a low-cost, high-value investment.
While a search of the USPTO database shows over, 1,470 Patent Cooperation Treaty applications have been filed and published directed to "cannabis" just since the beginning of 2016, so far, only two specific cultivar or "strain" plant patents have been issued.
With the waters by and large untested, some companies have already found that these categories are not all mutually exclusive and rules are ripe to be shaped or tested in this fledgling industry. In 2015, Biotech Institute, LLC was actually able to obtain a utility patent for a chemotype of the cannabis plant by describing in detail "compositions and methods for the "Breeding, production, processing and use of specialty cannabis". Controversy surrounds the issuance of this patent and perhaps it lies in a lack of education within the U.S. government.
Whether the USPTO understood the implications or not, the resulting patent subsequently gave ownership of countless unique strains of cannabis by classifying their "specialty cannabis" very broadly. Patent No. 9,095,554 describes "a non-myrcene-dominant cannabis chemovar that tests at higher than 3-percent CBD content." This is easily extrapolated to mean most plants that don't express a myrcene dominant chemical profile (smell/taste) and produce both THC & CBD. As this applies to a wide array of landrace varieties, it seems that this was issued incorrectly. "Landrace" cannabis, by definition, was not "invented". At the most, human beings had a hand in co-creating the chemovar groupings that historically have grown somewhat naturally in broad regions across the globe. Biotech Institute, LLC definitely did not "invent" those.
Despite the common perception that laws may seem clearly written, the issue of which path to take and what might hold up when these initial filings get challenged in the courts is a web of uncertainty. When it comes to the cannabis plant, this particular legal issue has been left almost untouched for the better part of a century. Further, the unscientific and inaccurate definition of "hemp" the U.S. government relies upon is ignorant, at best. Partially legalizing the cannabis plant without clarification of how that partial legalization will--or even should play out in the realm of commerce has led--and will lead to--a pandemonium of legal confusion.
For those brave enough to weather the unknowns of patents and trademarks, many of these answers simply won't come until court cases become precedents as we co-create the judicial operations surrounding cannabis. But the payoff may be there. And the harsh reality is that the traditional cannabis business community must take steps to protect what they have created. While it may mean working with "the man", it may be an important step to having a say in the future of cannabis.