MBHB wants to quash ‘misconceptions’ with new cannabis group: interview

There is a greater breadth of IP rights available in the cannabis sector than many businesses potentially realise, said the co-chairs of Chicago IP firm McDonnell Boehnen Hulbert & Berghoff’s new specialised cannabis practice.

On Wednesday, February 12 the firm announced that it had launched a new cannabis practice group, aimed at offering full-spectrum IP advice for clients in the cannabis industry.

Speaking to WIPR, partner and co-chair of the new practice Nicole Grimm said that, having advised clients in the sector for a number of years, she saw a need for greater education on the IP rights available for cannabis businesses.

“We came across some misconceptions. For example, there was confusion over whether you could even patent a cannabis plant, which you can,” Grimm said.

“It’s been a long time coming,” added Trey Lyons, co-chair of the practice group, who says it’s now easier than ever before for cannabis owners to protect their IP.

“Before there were so many huge problems for the industry, such as regulatory issues, so that IP was overshadowed,” he said. “But that tide is now definitely starting to turn, and now we can get serious about the IP rights that are available.”

“Four years ago cannabis was not as focused on IP, but that’s changed,” he added. “People weren’t consciously ignoring IP, they just had much bigger fish to fry.”

That wasn’t the only obstacle though. Both co-chairs agree that there is a need for a greater level of understanding on the range of IP rights that are available for cannabis products, particularly beyond federal trademarks, which remain difficult to obtain.

“I think a lot of companies had a bad experience with trademarks and then thought, ‘well you can’t do anything’, but that’s not true,” Lyons said.

There have been a number of legal breakthroughs for the cannabis industry in the US over the past few years. At the federal level, the 2018 Farm Bill removed hemp (cannabis with less than 0.3% THC content) as a schedule 1 illegal substance.

At the state level, medical use of cannabis has now been legalised in 33 states, including 11 where recreational use is now also permitted.

Despite these developments, a number of roadblocks to the commercialisation of cannabis and protection of cannabis-related IP remain.

Grimm said that, despite the Farm Bill opening up a pathway for commercial hemp products, there is still a “big hurdle with the Food and Drug Administration (FDA), because the FDA has authority on anything to do with the ingredients that go into food or medical products”.

“As CBD is an approved active ingredient in a drug product, at the moment it can’t legally be an ingredient in any food products sold in interstate commerce,” she said.

In terms of cannabis patents, Grimm said that “we’re still learning how these can be enforced in federal court as there’s very little case law available”.

This inevitably poses challenges for patent owners and practitioners in terms of formulating a patent strategy.

According to Lyons, the issue of prior art will be “really tough for cannabis patent owners” in the coming years.

He recommends filing broad ‘omnibus’ patents for cannabis-related inventions defensively, rather than offensively.

“For any client who has cannabis patents; the broader your patent is, the more prior art it invites that could potentially invalidate it,” he said.

In light of this, these types of patents, which cover a broad range of material, may be more useful as defensive patents which can be later invoked as prior art.

“There’s a lot of prior art that hasn’t been examined yet,” Lyons added. “We likely won’t really know until these cases are litigated in court.”

The “biggest challenge” for cannabis IP owners, Grimm said, is the difficulty of obtaining a federal trademark related to cannabis plant-derived products.

But, both co-chairs agreed, that shouldn’t deter businesses in the sector from seeing what IP rights are available.

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