How Hemp-CBD Companies Should Think About Trademark Strategy

It’s been a while since we’ve gone over the basics regarding how hemp-CBD companies should be strategizing to protect their brands. Last year, the United States Patent and Trademark Office (USPTO) issued Examination Guide 1-19: Examination of Marks for Cannabis and Cannabis-Related Goods and Services After Enactment of the 2018 Farm Bill. The guide provided some much-needed clarification around the USPTO’s position with respect to trademarks for domestic industrial hemp products.

Nothing in that guide was earth-shattering, given that the USPTO reiterated what we already knew and have written about for years: that “[u]se of a mark in commerce must be lawful under federal law to be the basis for federal registration under the U.S. Trademark Act.” But this is often a point of confusion for would-be applicants. Even where the goods or services for which protection is sought are legal under state law, if the goods or services violate federal law, including the Controlled Substances Act (CSA), they will not be eligible for trademark protection. And of course, what matters is not necessarily the way in which you craft your specification (although that is important for other reasons), but the goods and services you actually sell or intend to sell in commerce.

For hemp goods to be eligible for U.S. federal trademark protection, the goods must comply with all of the following:

• The Controlled Substances Act, 21 U.S.C. §§801 et seq
• The Federal Food Drug and Cosmetic Act, 21 U.S.C. §§301 et seq (FDCA)
• The Agricultural Improvement Act of 2018, Pub. L. 115-334 (the 2018 Farm Bill), which amends the Agricultural Marketing Act of 1946 (AMA).

The 2018 Farm Bill, which we have written about extensively, removed “hemp” from the CSA’s definition of “marijuana,” meaning that cannabis plants and derivatives such as CBD that contain no more than 0.3% THC on a dry-weight basis are no longer controlled substances under the CSA. Because of this, the USPTO stated:

“[f]or applications filed on or after December 20, 2018 that identify goods encompassing cannabis or CBD, the 2018 Farm Bill potentially removes the CSA as a ground for refusal of registration, but only if the goods are derived from ‘hemp.’ Cannabis and CBD derived from marijuana (i.e., Cannabis sativa L. with more than 0.3% THC on a dry-weight basis) still violate federal law, and applications encompassing such goods will be refused registration regardless of the filing date.”

The other extremely important requirement, and the one that many hemp-CBD businesses get hung up on, is that:

“even if the identified goods are legal under the CSA, not all goods for CBD or hemp-derived products are lawful following the 2018 Farm Bill. Such goods may also raise “lawful use” issues under the Federal Food Drug and Cosmetic Act.”

Those products that raise issues under the FDCA include comestible products that contain CBD, and, for this reason:

“registration of marks for foods, beverages, dietary supplements, or pet treats containing CBD will still be refused as unlawful under the FDCA, even if derived from hemp, as such goods may not be introduced lawfully into interstate commerce.”

Topical products containing CBD, however, are in a much more ambiguous space, since the FDA has indicated that these products may be permissible. However, if a product is marketed as a drug, even if it is a topical product, it may still run afoul under the FDCA. For this reason, when applying for federal trademark protection, it is important to be very clear about the types of topical CBD products you are selling and want to protect. For example, while a cosmetic product in Class 003 may be acceptable and eligible for protection, a CBD-salve intended to relieve muscle soreness in Class 005 will likely not be eligible.

Because of the nuance of the FDCA and its implications for hemp-CBD products, companies selling these types of goods should be aware that obtaining trademark protection and enforcing trademark rights will be somewhat of an uphill battle. Companies in this space should work with a trademark attorney who is well-versed in the hemp, CBD, and cannabis spaces to develop a strategy for protecting their brands to the greatest extent possible.