As more businesses enter the CBD market, brand identity plays an ever-increasing role. Trade mark offices around the world all appear to be adapting to the relaxation of existing cannabis regulations, and permitting applications for CBD related goods and services, provided certain criteria are met.
Earlier this year, the Unites States Patent and Trademark Office (the "USPTO") issued guidance on the examination of marks for cannabis and cannabis related goods and services in wake of the enactment of the 2018 Farm Bill. The Farm Bill decriminalised hemp and specifically allowed interstate commerce of hemp products. This had a significant impact on the legal status of CBD and forced the USPTO to move away from its longstanding practice of refusing any trade mark application that was connected to cannabis outright on the ground the goods or services could not be used lawfully in commerce (which is a requirement for a US federal registration).
The USPTO will now allow therefore certain lawful CBD products to register their brands. What constitutes a lawful CBD product is largely determined by the US Food and Drug Administration (the "FDA"). At present, their regulations stipulate that adding CBD to food, beverages, dietary supplements and pet treats is unlawful. As such, these categories of goods and services cannot be included in a trade mark application. Conversely, CBD is an active ingredient in some FDA-approved drugs. Although the list of permitted CBD products may seem limited at present, changes are expected. If the FDA changes its position on CBD products, this will open the door to much broader trade mark protection in the US.
In Canada, the rules are much more relaxed. Canada legalised the possession and consumption of cannabis for recreational purposes in 2018 and, as a result, hundreds of trade mark applications have followed for cannabis related goods and services including CBD. For CBD brand owners interested in the Canadian market, they should move quickly to consider protection there, or risk the dilution of their brand or losing their brand to third parties altogether.
The position at both the UK Intellectual Property Office and the EU Intellectual Property Office is probably somewhere in the middle of the US and Canada. There is no harmonised law across the EU relating to cannabis or CBD specifically, however recreational use of cannabis remains illegal in most EU member states. On the other hand, in a number of European countries, cannabis has been available for some time for medicinal purposes.
The relevant legal test for registration of a trade mark in the UK and EU is that it must not be "contrary to public policy or to accepted principles of morality". This absolute ground for refusal is intended to prevent registration of marks that could induce public disorder or the likelihood of criminal or other offensive behaviour. For CBD brands, a mark is likely to be rejected if the words or images used in the sign have any criminal connotations, such as being associated with illegal drugs. For example, just recently the General Court of the European Union confirmed that the following figurative mark was contrary to public policy because the terms 'Amsterdam' and 'Store' in conjunction with the prominent word 'Cannabis' and images of marijuana leaves evoked references to an Amsterdam coffee shop where the purchase of the illegal form of the plant has been decriminalised.
The decision provides an insight into the current mind-set of the EU courts. The applicant of the mark had tried to argue that the leaves depicted were not part of the plant containing THC and the goods and services applied for included such goods as "chocolate and deserts, soft drinks, beer". Despite this, the Court was more interested in the meanings the public would infer from the figurative mark and concluded that the leaves were the cultural emblem of the illegal form of the plant.
It can also be the goods and services themselves and not the mark that is contrary to public policy, particularly if the specification is so broad that it could relate to recreational use of cannabis. For example, in 2018, the EUIPO rejected the mark BLOODY SKUNK which covered 'hemp seeds' alone. It decided that these goods could be used in connection with the illegal cannabis market and there was no limitation of the goods to pharmaceutical or medical use that would make it legal. Therefore, it was against public policy to grant registration.
Despite the above, a review of the trade mark registers at the UKIPO and EUIPO does reveal a number of registrations for marks with goods and services relating specifically to CBD in cosmetic preparations, foodstuff, and for medical purposes. In fact, the number of applications at the UKIPO and EUIPO for marks covering medicinal cannabis or goods containing CBD has risen dramatically in the past 12 months. Many of the applicants are Canadian and US businesses, reflecting heavy investment following law and regulation changes in those jurisdictions. One Canadian business, Spectrum Cannabis Canada Ltd, already has a portfolio of 19 EU registrations, 8 UK registrations and multiple applications under examination.
There seems real potential for businesses in the CBD industry to gain substantial trade mark protection, provided their brand (including any imagery) and specification of goods and services are carefully considered. A registration could prove a valuable asset in a fast-moving environment, both in licensing arrangements and to prevent others from using similar brands.