Cannabis Trademarks: “Deadwood” Policies Could Implicate Cannabis Registrations

Cannabis Trademarks

For the past few years, the United States Patent and Trademark Office (USPTO) has repeatedly expressed concern over eliminating what it deems “deadwood” from the federal trademark registry. “Deadwood” consists of trademark registrations that are not actually in use for the goods or services named in the registration. Under U.S. trademark law, all registrations must be renewed between the fifth and sixth year anniversaries of registration by filing an affidavit pursuant to Section 8 of the Trademark Act declaring that the mark is still in use in commerce, or by filing a declaration of permissible non-use under Section 71. If either of these filings is not made, the registration will be cancelled.

In June of this year, the USPTO announced that it would be creating new rules requiring additional documentation under Section 8 and Section 71 of the Trademark Act to prove the registrant is actually using its mark in commerce for all of the goods or services specified. These new rules will require submitting information, exhibits, affidavits or declarations, and any other additional specimens of use as may be “reasonably necessary” for the USPTO’s examining attorney to ensure that the mark in question is in use on all of the goods or services claimed in the application. The claim and justification here is that there are too many unused registered trademarks, and that unless we clean up the clutter on the registry, trademark clearance will become more and more burdensome for applicants and for examining attorneys.

So how do these changes potentially impact cannabis businesses? As we’ve discussed before, federal trademark protection is unavailable to marks used on federally illegal goods and services, including cannabis. However, one brand protection strategy we’ve recommended is to obtain registration for ancillary goods or services that do not violate the Controlled Substances Act (CSA). For example, if you manufacture a cannabis-infused beverage AND you produce and sell a non-infused version of that beverage, it may be possible to secure a federal trademark registration that covers your non-infused beverages. We have many clients that have been successful using this strategy, although we’ve noticed more push back from the USPTO with respect to these applications in recent months.

Ultimately, the key to registering ancillary goods to protect a mark also used on cannabis-related products is that you must actually use the mark on those ancillary goods. A few token sales, without ongoing use of the mark on those goods, would be exactly the issue the USPTO is looking to address by clearing out “deadwood.” If you are not able to meet the requirements for a Section 8 affidavit or a Section 71 declaration, your mark will be cancelled. We’ve seen a rush by cannabis businesses to register their marks for whatever they can get, but it’s important to carefully consider what goods and services you will actually be providing to avoid the risk of losing your registration altogether. There is oftentimes little point in spending time and money to get a trademark now if you are just going to lose it eventually anyway.

The IP Kat (a fantastic and entertaining source for intellectual property news), wrote a couple of weeks ago about the USPTO’s move to clear “deadwood” from the register, and made a great point: “[W]hen the claim is made that deadwood and resulting clutter on the registry place an increasingly heavy burden on clearance, what is really being said is that the mark under consideration is straddling the divide between being descriptive and suggestive.” The post also notes that the real issue at play is that too many descriptive/suggestive marks are being accepted without having proven secondary meaning. Which raises another issue we’re seeing with proposed cannabis trademarks: most of them are descriptive.

We’ve written about choosing a brand that won’t get you sued, but it’s also important to choose a brand that is eligible for trademark protection. The relative strength or weakness of a mark will fall somewhere on the following spectrum:

  • Fanciful Marks: These marks consist of a combination of letters with no meaning; they are invented words. Some examples of famous fanciful marks are EXXON and KODAK.
  • Arbitrary Marks: These marks are composed of a word or words that have a common meaning, but have no relation to the goods or services to which the mark is applied. Perhaps the most famous example of an arbitrary mark is APPLE, used on computers.
  • Suggestive Marks: Suggestive marks hint at or suggest the nature of a product without specifically describing the product. An example of this type of mark is AIRBUS for airplanes.
  • Descriptive Marks: These marks are comprised of words that actually describe the goods or services provided; descriptive marks are too weak to function as a trademark and cannot be registered. Note that it is possible to register a descriptive mark if it has obtained secondary meaning due to use in commerce for some years – in the nascent cannabis industry, however, it is unlikely many marks would meet these requirements.
  • Generic Words: These words and phrases are so inherently descriptive of a product or service as to be incapable of functioning as a trademark; they are the common names of the product or service in question, and cannot be registered.

Fanciful and arbitrary marks afford the highest level of trademark protection. Often the line between suggestive and descriptive marks is blurry, making suggestive marks, though capable of registration, much weaker. In developing a brand, avoid the use of descriptive or generic marks altogether.

The takeaway here is two-fold. First, make sure that if your cannabis company is looking to register a federal trademark for ancillary goods or services, your company actually intends to sell those ancillary goods on an ongoing basis. Second, carefully consider the strength of your mark before investing heavily into brand development.