Cannabis Patent Litigation Update: The 911 Patent Passes the (Alice) Test!

As promised, here’s an update on the first ever cannabis patent infringement case, which we’ve previously written about here and here.  Since it’s been a little while – plaintiff United Cannabis Corporation (“UCANN”) owns the “911 Patent,” which generally covers liquid cannabinol formulations of a purified CBD and/or THC greater than 95%. Last July, UCANN sued defendant Pure Hemp Collective, Inc. (“Pure Hemp”), alleging that Pure Hemp had infringed on the 911 Patent. UCANN is hoping to secure a permanent injunction against Pure Hemp from infringing on its patent, as well as damages and attorneys’ fees.

As we noted in our last update, Pure Hemp previously filed a motion for partial summary judgment back in November, which if granted, would have ruled some of UCANN’s patent claims invalid. The premise of Pure Hemp’s motion was that UCANN’s claims aren’t actually patentable and such “substantially pure liquid CBD products are ubiquitous” in the marketplace. The defendant’s attempt to invalidate some of the claims was based on an interpretation of Supreme Court cases about “products of nature” being unpatentable. This led the Court to the “Alice” Patentability Test, which requires the Court to go through the below analysis:

1. Are the claims at issue directed to a patent-ineligible concept (i.e., laws of nature, natural phenomena, abstract ideas)?
   1. No: inquiry ends, the claims may be patentable!
   2. Yes: go to question 2.
2. Do the claims in question nonetheless offer “an inventive concept – i.e., an element or combination of elements that is sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the ineligible concept itself”?

At this early stage, if a court gets to the second question, it’s faced with a “fact question” that requires extensive evidence to be resolved. If there’s a genuine dispute of material fact, the Court won’t be inclined to grant the motion.

Unfortunately for Pure Hemp, U.S. District Judge William Martinez didn’t buy their argument. In his 16-page Order denying Pure Hemp’s motion on April 17, 2019, Judge Martinez acknowledged that there were certain ambiguities in the case law regarding patentability, but ultimately wrote he was “convinced under the current state of the case law that the challenged claims of the 911 Patent are not directed at unpatentable subject matter.” Judge Martinez went on to explain why the 911 Patent passed step one of the Alice Patentability Test:

Pure Hemp has failed to establish beyond genuine dispute that a liquefied version of cannabinoids and related chemicals at the concentrations specified in the 911 Patent is anything like a natural phenomenon. … But, as far as the Alice inquiry goes, the 911 Patent is not “directed to” an unpatentable law of nature, a natural phenomenon, or an abstract idea. It is instead “directed to” a non-naturally occurring delivery method of naturally occurring chemicals in (as far as the record reveals) non-naturally occurring proportions and concentrations. Because the 911 Patent does not fail at step one of the Alice inquiry, the Court need not address step two.”

Now that Pure Hemp’s motion is denied, the case will proceed as normal toward a jury trial. It’s likely that there will be more motion practice, and we’ll keep posting regular updates on this case as we receive them.