As the legal cannabis market expands, a very practical business problem is getting more serious. How can a successful marijuana company protect its brand if it can’t legally patent its products? Cannabis is still different from other businesses in this regard. If you make soda pop, you can’t call it Coca-Cola. If you make a new laundry detergent, you can’t call it Tide. But if you start a new cannabis company, there’s no reason why you can’t name your product after an existing brand, say Moxie 710 or even a celebrity brand like Willie’s Reserve.
That’s because, no matter how many states legalize the stuff, weed is still illegal under federal law. And the U.S. Patent and Trademark Office won’t issue protections to products containing a federally banned substance.
But there is a workaround that several cannabis companies are tooling with: trademarking their brands on other products. The Hi brand, for example, represents a pot shop in Oregon. They can’t apply for a trademark on Hi weed, but they can (and have) applied for a trademark on Hi t-shirts, hats and other non-cannabis products.
“You want to protect what you’re doing with the brand name,” David Tobias, president of publicly traded Cannabis Sativa, Inc. (Hi’s parent company) told the LA Times in a recent piece on the subject. “But you have to dance around it.”
That could work, but San Francisco attorney Mary Shapiro told the Times that the closer the product is to cannabis, the more likely the trademark is to work. That’s because trademarks only apply to specific regions of the marketplace. Dove is a trademarked brand for soap. When Mars makes Dove chocolate (a completely different kind of product), it does not violate the trademark for Dove-brand soap.
But there is something called the zone of natural expansion in trademark law. That means another product that you could reasonably expect a brand to branch out into. The example given in the Times is that you might reasonably expect Dove soap to expand to shampoo while you wouldn’t reasonably expect it to start making chocolate.
As this applies to the cannabis world, you wouldn’t necessarily expect the Hi brand to expand beyond its hats and t-shirts into bud (when and if the federal government starts letting people do that). A better try at this strategy might be what Tommy Chong’s company, Chong’s Choice, is doing, trademarking vaporizers and “tobacco” jars.
That’s still no guarantee, but it’s better than putting in the work to build up a new cannabis company and just letting someone else put your name on their bud without putting up a fight.
Photo via Flickr user Dank Depot