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Guest Blog: Opportunities in Canada: Intellectual Property Protections

By: Christopher N. Hunter, Partner, Norton Rose Fulbright  & Fahad Diwan, Articling Student, Norton Rose Fulbright The expected legalization of cannabis in Canada this summer presents unique opportunities for cannabis companies from Canada, the United States and abroad. Most importantly, cannabis companies can register trademarks in Canada that are expressly associated with cannabis. The Canadian Intellectual Property Office (CIPO), the authority responsible for regulating trademarks, permits applicants to apply for trademarks covering all types of cannabis goods or services. This differs from the U.S., where the United States Patent and Trademark Office bars applicants from expressly identifying or implying the applied-for goods or services that “touch the plant.” With new amendments to the Canadian Trademarks Act (the Act), businesses with a license to produce cannabis and cannabis-based products may apply for trademarks for a wide variety of cannabis products without first having sold the underlying products. The amendments remove the ‘use’ requirement from the trademark registration process (this amendment is expected to come into force in 2019), allowing Applicants to register a trademark without demonstrating that they have used it in association with their goods or services. Accordingly, cannabis businesses will be able to obtain trademark protection on a variety of products without first having to develop the product and test it in the marketplace. Irrespective of the proposed amendments, cannabis businesses presently do not need to wait for legalization to register and protect their trademark rights as Canada allows businesses to file applications based on proposed use. The amendments to the Act will also permit cannabis businesses to register a variety of non-traditional marks. Once the amendments are in...

Guest Blog: Insurance Challenges for Cannabis Businesses

As the cannabis industry grows and business challenges proliferate, there are a variety of legal issues that are increasingly of interest to cannabis operators. Evoke Law specializes in trademark protection and brand licensing for the cannabis industry, and also offers a wide range of consumer protection legal services, including packaging and labeling compliance, recall plans, and counseling to avoid making impermissible product health claims. We also leverage our extensive network of diverse legal specialists to offer our clients information and resources that will bring additional overall value. Our first Guest Blog is by Jason Horst, Esq., Principle at Horst Counsel, on the topic of insurance. Cannabis companies keep hearing that they need to “cover up.” However, California’s regulations only require those holding distributor licenses to carry general liability insurance, and those regulations do not require non-distributor licensees to carry any liability insurance at all.  Nevertheless, many California cannabis operators are finding themselves subject to other requirements that they carry liability insurance. For example, some local jurisdictions have begun establishing their own insurance requirements. In November 2017, Los Angeles rolled out an ordinance requiring that every permitted cannabis operator in the City carry products liability insurance. Complying with these cannabis insurance requirements is both trickier and more fraught than it might appear, so it is critical for operators to be diligent on multiple levels. When it comes to local cannabis insurance provisions, it is important to understand that these requirements tend to vary significantly from jurisdiction to jurisdiction. Los Angeles requires all operators to carry products liability insurance, while Long Beach requires public liability insurance. The City of Coalinga has gone so...

California Trademarks Division Accepting Applications for Cannabis Goods & Services

It was initially announced that licensed California cannabis companies may file service mark applications to register marks for licensed cannabis-related services beginning January 1, 2018. But, in an unexpected shift in position, this changed on January 12. As of January 12, 2018, the California Secretary of State’s Office now accepts trademark applications for cannabis products (in addition to service mark applications). A state registration has a valuable defensive effect as they are public and can be found by others conducting a nationwide search for state registrations. In order to obtain protection for cannabis goods and services, an applicant must (1) be offering the goods or services in California commerce; (2) classify the goods and services in accordance with the same classification system used by the USPTO (the Nice Classification System); (3) have been issued a temporary license or have a trademark license with a license holder; and, for goods; and (4) be fully compliant with MAUCRSA and the emergency regulations, including packaging and labeling requirements. Additionally, while manufacturing, cultivating, or distributing your own branded products is not a protectable service, distributing someone else’s branded products does not preclude you from also distributing your own branded products and manufacturing someone else’s branded products does not preclude you from also manufacturing your own branded products. Similarly, cultivating flower under your own brand and then selling the flower to a retailer who sells it to the consumer under a different brand name would constitute a protectable service. As priority is an issue in any trademark dispute, filing applications sooner rather than later is important for marks for cannabis goods and services that are currently provided to California patients and/or consumers.  ...

Product Recall Plans for California Cannabis Manufacturers

Cannabis products are certainly not immune from a recall, as we have already seen in Colorado, Oregon, and Washington. In most industries, state and/or federal law dictate product recall protocol. Since cannabis remains federally unlawful, neither the Food and Drug Administration or other federal agency has regulations specifically concerning cannabis recalls. For California manufacturers, the California Department of Health’s (DPH) emergency regulations (see Section 40268) provides general parameters for cannabis recall policies. Various circumstances may trigger a cannabis product recall, such as detection of unlawful levels of pesticides, mold, or rot, reports of illness, mislabeled or improperly packaged products, or the product itself being unsafe (e.g., exploding vape battery). How a business conducts itself during a recall can either convey a high level of professionalism or expose inexperienced operational capability. Without a well-thought out and comprehensive product recall plan to help guide a company’s actions, recalls can be unnecessarily stressful and chaotic. If tragedy strikes, businesses must be able to act quickly, efficiently, and confidently to prevent or mitigate personal injury, as well as to limit damage to the brand’s goodwill and bottom line. As a condition of licensure, most states with commercial cannabis regimes require licensees to establish a product recall plan, but few states actually provide substantive guidance on what a recall plan should entail. California requires that manufacturers of cannabis products establish and implement written recall procedures for products determined to be misbranded or adulterated. At minimum, the DPH specifies such written recall procedures must: Identify factors that may necessitate a recall Designate personnel responsible for implementing the recall procedure and notifying the required state authorities...

California Emergency Cannabis Regulations

What’s New? The California Bureau of Cannabis Control (BCC) along with the Departments of Public Health and Food & Agriculture issued emergency regulations to fully implement the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA) and provide guidance for California cannabis businesses heading into 2018. We have focused on the select regulations to generally determine how cannabis businesses will be affected as to: Packaging/Labeling Branding Advertising Product Recall Packaging/Labeling: Packaging and labeling requirements included in the regulations issued by the Department of Public Health require two types of labels for all cannabis products: primary panel and informational panel. Primary Panel The “primary panel” is defined as the part of a label that is most likely to be displayed, presented, shown, or reviewed by a customer at the point of retail sale. The primary panel requires multiple data points, for example: the type of cannabis/cannabis product, total milligrams of THC and/or CBD, and the universal symbol for cannabis: All text on the primary panel must be at least size 6pt font, but may require a larger font size so the primary panel is “in relation” to the size of the container.  Informational Panel The “informational panel” means any part of the label that is not the primary panel. The informational panel must present the requisite warning language as well as other required labeling information, including nutritional information for edibles. Information required by MAUCRSA or by the emergency regulations not specifically designated to the primary panel belongs in the informational panel. All text in the informational panel must be at least size 6pt font, but may require a larger font...

Global Cannabis Marketplace

The United States is viewed as the land of opportunity, prosperity, and innovation. Americans take pride in the country’s historically progressive policies and contributions to advancements in medicine, technology, and science. However, when it comes to cannabis, the U.S. federal government is lagging behind the international marketplace. Over the past decade, individual states have made great progress in creating momentum for legalization of cannabis in America. Currently, 29 states and the District of Columbia allow access to medical cannabis, and more will follow suit. Yet, for the next four years (at least), the outlook on federal legalization is extremely bleak, especially given the key players in the Trump administration, specifically, Attorney General Jeff Sessions. On multiple occasions, Sessions has consistently re-affirmed he is not in favor of legalizing cannabis and has stated that he does not want the Department of Justice (DOJ) restricted from enforcing the Controlled Substances Act. But the administration has not explicitly overturned the Cole Memo . . . at least for now. Bottom line—despite best efforts, federal legalization in America is not likely coming anytime soon. The inability to transport cannabis across state lines and national borders stifles the development of national cannabis brands, and also puts American cannabis businesses at a significant disadvantage internationally. International medical cannabis trade has already begun, and is expected to expand rapidly. In 2017, Germany, Greece, and Poland joined Austria, Britain, Croatia, the Czech Republic, Denmark, Finland, France, Ireland, Italy, Macedonia, the Netherlands, Portugal, Romania, Slovenia, Spain, and Sweden on the list of European countries to have legalized medical cannabis in some form. Additionally, the Prime Minister of Luxembourg...