On May 16, 2024, the Department of Justice (DOJ) submitted to the Federal Register a notice of proposed rulemaking initiating a formal rulemaking process to consider reclassifying cannabis (marijuana) from a Schedule I drug to a Schedule III drug under the Controlled Substances Act (CSA). Despite this potential rescheduling of cannabis, the limited registrability of cannabis-related trademarks with the United States Patent and Trademark Office (USPTO) will remain mostly unchanged.
Regulatory Considerations: Cannabis and the USPTO
Pursuant to the Controlled Substances Act (CSA), cannabis, including tetrahydrocannabinols (THC, Delta-9 THC, Delta-8 THC, etc.), currently remains classified as a Schedule I drug “with no currently accepted medical use and a high potential for abuse.” Accordingly, the United States Patent and Trademark Office (USPTO) refuses to register trademarks that cover cannabis goods and services since they are in violation of the CSA.
Cannabis (marijuana) has been classified as a Schedule I drug since Congress enacted the CSA in 1970. Over 50 years later, in May of 2024, the Department of Justice (DOJ) initiated the rulemaking process to reclassify cannabis as Schedule III drug. This potential rescheduling of cannabis from a Schedule I to a Schedule III drug would not legalize cannabis, but it would recognize and reclassify cannabis as a “drug with a moderate to low potential for physical and psychological dependence” and an “abuse potential [that] is less than Schedule I and Schedule II drugs but more than Schedule IV.” Moreover, the reclassification of cannabis to a Schedule III drug could pave the way for certain federal trademark registrations that cover cannabis goods or services accepted for medical use.
However, as part of the formal rulemaking procedure for rescheduling a controlled substance, such as cannabis, the Drug Enforcement Administration (DEA) must spend several months gathering and considering information and views submitted by the public to determine the appropriate schedule. Thus, until a final rule is established, cannabis remains a Schedule I drug, and the USPTO will continue to refuse to register trademarks that cover cannabis goods and services.
Alternate Strategies for Registering Cannabis, CBD, or Hemp Trademarks
- Hemp or CBD Goods Containing no more than 0.3% THC
On December 20, 2018, the 2018 Farm Bill became law and removed “hemp,” and cannabinoids derived from hemp, such as cannabidiol (CBD), from the CSA’s definition of “marihuana.” “Hemp” is defined as “the plant Cannabis sativa L. and any part of that plant, including the seeds thereof and all derivatives, extracts, cannabinoids…with a delta-9 tetrahydrocannabinol [THC] concentration of not more than 0.3 percent on a dry weight basis.” Thus, properly sourced hemp and CBD are no longer controlled substances under the CSA. The USPTO thereafter removed the CSA as a ground for refusal for registration of trademark applications filed on or after December 20, 2018 (the date the 2018 Farm Bill was enacted), that include lawfully sourced hemp or CBD goods containing not more than 0.3% THC. In turn, the USPTO currently permits registration of trademarks for hemp-infused cosmetic or topical goods that do not make health claims and for smoking accessories derived from hemp that are compliant with the regulations of the 2018 Farm Bill and United States Food and Drug Administration (FDA).
Although the 2018 Farm Bill has led to the USPTO’s acceptance of certain hemp/CBD trademark applications, the 2018 Farm Bill explicitly preserved the FDA’s authority to regulate products falling under the purview of the Federal Food, Drug and Cosmetic Act (FDCA). The FDA maintains that it is illegal to include CBD and THC products subject to the FDCA, including foods and beverages, or to sell CBD and THC products as dietary supplements, because the substances were investigated and approved as active drug ingredients. Consequently, the USPTO, which defers to the FDA’s stance, will refuse registration for any ingestible good subject to the FDCA that contains CBD and/or THC.
- Ancillary Services and/or Blocking Applications
Cannabis companies can seek registration of a federal trademark that covers services that are indirectly related to the cannabis industry, such as consumer information and educational content services in the field of cannabis, CBD, and/or hemp. When applying for such a trademark, astute attorneys will run clearance searches in these classes of ancillary cannabis services to check if there is the same or a confusingly similar trademark. Thus, it is beneficial to seek registration in these classes of ancillary cannabis services for protection against potential infringers.
Further, cannabis businesses can file a blocking application, whereby the applicant applies for a federal trademark that covers ingestible goods containing CBD and/or THC and/or cannabis services in the relevant classes and awaits further legislation and FDA guidance. While this application would not proceed to registration at this time, the blocking application serves as notice to second comers to the market and to stake out a potential priority claim in the event that cannabis gets legalized, or if the FDA lifts its prohibition on ingestible goods and dietary supplements subject to the FDCA that contain CBD and/or THC.
- Registration of State Trademarks
Registering a state trademark can afford the trademark owner protection against potential intrastate infringers and can provide a basis for preventing junior users of the same or a confusingly similar trademark within state boundaries. Moreover, filing for a state trademark is typically much less expensive than filing for a federal trademark, and filing for a state trademark is a beneficial approach under certain circumstances, such as when an individual or business intends on conducting only intrastate business and/or seeks registration covering cannabis goods or services that are considered illegal at the federal level, but legal at the respective state level.
Conclusion
Cannabis and hemp companies should certainly consider filing for a federal and/or state trademark to ensure they can protect their brands. Due to the complexities in obtaining trademarks for the cannabis and hemp industries currently, guidance of counsel is strongly recommended.
Paul Stevenson is a senior associate attorney with Ritter Spencer Cheng PLLC who practices trademark law and represents clients in all facets of the cannabis and hemp industries, including dispensaries, growers, processors, manufacturers, retailers, and more.
Blog Disclaimer: This blog is for informational purposes only, and we are not providing legal guidance, so please consult with an attorney for specific legal advice.