Trademarking Recreational Marijuana and Potential Threats to the United States' Treaty Obligations

• Publication year: 2021

Trademarking Recreational Marijuana and Potential Threats to the United States' Treaty Obligations

Charles Wells

University of Georgia School of Law

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TRADEMARKING RECREATIONAL MARIJUANA AND POTENTIAL THREATS TO THE UNITED STATES' TREATY OBLIGATIONS

Charles Wells^*

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Table of Contents

I. Introduction..............................................................................................275

II. Background................................................................................................275

A. The Legal Status of Marijuana Internationally...........275
B. State Legalization of Marijuana............................................277
C. International Intellectual Property Protections......278
D. Intellectual Property Protections For Marijuana in the United States............................................................................280

III. Analysis.........................................................................................................284

IV. Conclusion..................................................................................................288

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I. Introduction

Marijuana is classified as an illegal narcotic drug by the United States federal government and is subject to international restrictions.¹ Some foreign nations have since broken from this consensus and have legalized marijuana use for medicinal or recreational use.² An increasing number of states within the United States have similarly legalized marijuana products for recreational and medical use even though the substance remains illegal under federal law.³ With legalization, a new and highly lucrative market for legal cannabis products may emerge, creating a growing need for cannabis-related intellectual property protections. Currently, federal intellectual property law does not fully provide intellectual property protections to cannabis-related products.⁴

II. Background

A. THE LEGAL STATUS OF MARIJUANA INTERNATIONALLY

The United States first criminalized marijuana under President Nixon with the Controlled Substances Act (CSA) of 1970.⁵ Marijuana is also restricted internationally through United Nations conventions including the Single Convention on Narcotic Drugs of 1961, the 1971 Convention on Psychotropic Substances, and the 1988 United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (1988 Convention).⁶ Specifically, the 1988 Convention requires all parties to ban the cultivation of the cannabis plant for the production of narcotic drugs.⁷ Although the international regimes regulating cannabis production do make allowances for medical and scientific use, the conventions generally require state parties to criminalize recreational

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marijuana.⁸ Despite the international prohibition, several countries and states have decriminalized or legalized recreational marijuana creating tension within the international legal regime.⁹

Uruguay was the first country to fully legalize marijuana for recreational use in 2013.¹⁰ Although other countries allowed limited use, for science and medicine, or simply decriminalized use to the point of almost de facto legalization, recreational marijuana was globally prohibited until uruguay legalized marijuana under strict government regulation.¹¹ canada became the second country to fully legalize marijuana with its Cannabis Act in 2018.¹² The canadian law represents a far more sweeping liberalization of recreational marijuana laws.¹³ Both uruguayan law and canadian law allow limited personal cultivation and use as well as limited commercial sale, but uruguay more heavily restricts where and in what quantities marijuana may be sold.¹⁴ Canadian laws allow licensed private retailers to sell marijuana, thereby allowing private actors to play a far greater role in the marijuana market.¹⁵ Both of the legalization regimes, despite the heavy regulations prescribed by each, represent a deep departure from international standards and with that carry great potential for international legal friction.

The canadian system, in particular, may generate an increasing demand for intellectual property recognition to protect participants in the growing market, because there is more room for private actors to participate in the marijuana market.¹⁶ canadian law only allows sale in specifically licensed stores and strictly limits packaging and advertising of marijuana.¹⁷ Marijuana packaging and marijuana accessories cannot glamorize marijuana use under canadian law and cannot be designed to appeal to young people.¹⁸ The Canadian "Cannabis Act" also contains an absolute ban on the import and export of marijuana products for recreational use.¹⁹ Although the advertising, packaging, and import-export restrictions could negatively affect the development of cannabis-related intellectual property in Canada, the massive retail value of the cannabis market

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will likely drive demand for trademark and patent protections in the newly legalized industry.²⁰

B. STATE LEGALIZATION OF MARIJUANA

Acting in 2012, before Uruguay became the first nation to legalize marijuana use,²¹ Colorado and Washington passed legislation legalizing recreational marijuana.²² Over the next several years, many states and the District of Columbia followed suit legalizing marijuana despite the federal prohibition.²³ Although marijuana remained a schedule I controlled substance under the Controlled Substances Act, the federal government elected not to prosecute marijuana use and sale in states that had legalized marijuana as long as any activity relating to cannabis follows states law.²⁴ The Trump administration rescinded this practice as formal policy in 2018, however federal prosecutions of marijuana offences have fallen rather than increased since that time.²⁵

Although the federal government's recent practice of mostly avoiding prosecution has allowed state markets to develop despite the federal prohibition, the federal government could decide to renew enforcement leaving actors in the marijuana market vulnerable.²⁶ By filing for a patent for a marijuana product, a company could effectively be "admitting to a federal crime."²⁷ Therefore, even though patents for marijuana-related products currently exist, robust protections cannot develop as long as marijuana remains a federal crime.²⁸ The federal government has also declined registration of trademarks relating to marijuana.²⁹ The United States Patent and Trademark Office (USPTO) may refuse registration of trademarks that cannot be legally used in commerce.³⁰ Because marijuana is still illegal federally, the federal USPTo still denies trademarks for business legally producing and selling marijuana products under state law but in violation of federal law.³¹

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C. INTERNATIONAL INTELLECTUAL PROPERTY PROTECTIONS

intellectual property protections are a global concern, particularly given the depth of international commerce. State members of the United Nations established the World Intellectual Property Organization (WIPO) in 1967 as a United Nations body to promote intellectual property protections and ensure administrative cooperation among member states.³² Some states, including primarily the United States, remained deeply concerned about the negative impact of counterfeit products and pushed for further international cooperation to ensure intellectual property protection.³³ These states cited the loss in profits due to copyright and counterfeits as a primary concern, with U.S.-based groups claiming that ineffective copyright laws abroad cost United States industries billions in profit.³⁴ These concerns resulted in a discussion of intellectual property rights at the Uruguay Round of GATT (General Agreement on Trade and Tariffs) negotiations beginning in 1986.³⁵ This discussion ultimately led to the development of the Trade-Related Aspects of Intellectual Property Rights or TRIPS agreement, which entered into effect as an annex to the agreement establishing the World Trade Organization (WTO).³⁶ The substantial preamble of the TRIPS agreement outlines its purpose and scope. This preamble reflects the strongly protectionist concerns that led the United States and other nations to push for the agreement in the first place.³⁷ The TRIPS agreement does not create a fully harmonized system of intellectual property rights enforcement, but rather sets forth minimum standards for intellectual rights protections.³⁸

The TRIPS agreement binds all member states and, as its primary function, extends the three basic trade principles of the GATT to intellectual property rights.³⁹ These three basic principles are: 1) national treatment, 2) most-favored-nation, and 3) transparency.⁴⁰ Article three of TRIPS requires that all WTO member states "accord to the nationals of other Members treatment no less

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favourable than that it accords to its own nationals."⁴¹ This requirement ensures that the extension of intellectual property rights remains neutral so that a nation may not deny an applicant from a foreign jurisdiction in favor of a local applicant.⁴² The national treatment requirement precludes countries from extending greater protections to their nationals but allows for substantial flexibility for countries to set their own protection policy so long as these protections apply evenly to non-nationals and meet the minimum standards called for in other TRIPS provisions.⁴³ Nations can violate this principle either by having formal laws that favor nationals over foreigners or laws that, although formally neutral, have a discriminatory effect.⁴⁴ Based on this principle, even if a nation's laws on marijuana and marijuana-related intellectual property are formally neutral, unequal recognition between domestic and foreign actors could potentially violate the national treatment principle enforced by the TRIPS agreement. The TRIPS agreement also applies the "most-favoured-nation" requirement of the GATT to...