Commercializing Cannabis: Confronting the Challenges and Uncertainty of Trademark and Trade Secret Protection for Cannabis-Related Businesses

Authors

John Mixon

Abstract

Over the last couple of decades, society has become more accepting of recreational cannabis and an ever-growing number of states have passed pro-cannabis legislation. With this change, the cannabis industry has, to some extent, exploded into a booming enterprise in states that have legalized marijuana. Nonetheless, cannabis' status as a Schedule I banned substance under the Controlled Substances Act of 1970 remains unchanged. As a result, businesses in the cannabis industry face the unique challenge of having to toe the line between "legally" operating under state law and violating federal law, which trumps state law. One particular situation in which the challenges of inconsistent state and federal laws is acutely felt by cannabis businesses is when such businesses attempt to protect their trademarks and trade secrets. For trademarks, this challenge is due to trademark law being almost exclusively governed by federal law, which does not recognize the legality of cannabis. To the extent that state law does provide some form of trademark protection it is much more limited than federal law, and thus, cannabis businesses are left largely unable to garner the national protection for their logos and brands that federal trademark law typically provides. As to trade secrets, the challenge comes from the fact that trade secrets have largely been governed by state common law, but more recently have become subject to the federal Defend Trade Secrets Act. This adds uncertainty as to how cannabis trade secrets would be treated under federal law and begs the question of whether cannabis businesses will be able to obtain recourse under federal law if a competitor misappropriates their trade secrets. This paper analyzes recent developments in both trademark and trade secret law as it pertains to protecting cannabis-related trademarks and trade secrets in the ever-growing cannabis industry, proposes various workaround solutions for cannabis businesses looking to protect their trademarks or obtain recourse for misappropriated trade secrets, and proposes a solution for federal courts facing the challenges of applying trademark and trade secret laws in the face of regularly changing state and federal cannabis legislation.

First Page

1

Recommended Citation

John Mixon, Commercializing Cannabis: Confronting the Challenges and Uncertainty of Trademark and Trade Secret Protection for Cannabis-Related Businesses, 16 Wash. J. L. Tech. & Arts 1 (2020).
Available at: https://digitalcommons.law.uw.edu/wjlta/vol16/iss1/2