Hemp Trademarks and the Perils of Generic Terms: PanXchange v. New Leaf Data Services

Two companies that provide data to the hemp industry are embroiled in a trademark dispute. New Leaf Data Services (“New Leaf”) sued PanXchange in Connecticut federal court, alleging that PanXchange’s offer of services under marks such as PANXCHANGE® HEMP BENCHMARKS constitutes infringement of New Leaf’s supplemental trademark registration, HEMP BENCHMARKS (Reg. No. 5079914). The case was eventually been transferred to Colorado.

In its answer to New Leaf’s complaint, PanXchange stated that the HEMP BENCHMARKS trademark is generic. PanXchange noted that Merriam-Webster defines “benchmarks” as “something that serves as a standard by which others may be measured or judged.” As a result, PanXchange claims, “the phrase ‘hemp benchmarks’ is not capable of distinguishing New Leaf’s services.” Consequently, PanXchange is asking the court to cancel’s New Leaf’s registration.

The use of the term “capable” is important, as a supplemental registration only requires that a trademark be capable of distinguishing an applicant’s goods or services. It does not require that the trademark actually distinguish said goods or services.

At heart, this case is about trademark basics, with the hemp connection being largely incidental. Nonetheless, the holding could have implications for other companies in the hemp and cannabis space.

If the court agrees with PanXchange and finds that “hemp benchmarks” is a generic phrase, it could lead companies to push the envelope when it comes to marks following the same basic formula (such as CANNABIS BENCHMARKS, for which New Leaf also has a supplemental registration). By contrast, if the court upholds New Leaf’s claim, we could see an uptick in applications for such marks.

What do you think? Should “hemp benchmarks” be considered a generic term like “oranges” or “computers?” Give us your thoughts in the comments section. And if you are a new or growing cannabis business, give some serious thought to your branding. Aside from federal law issues, a generic or descriptive name will always be hard to protect and may create headaches for your cannabis business.