Final summer time, we reported on the trademark infringement lawsuit filed by Veritas Advantageous Hashish (“VFC”) towards Veritas Farms here and here. In late August, I had reported Veritas Farms filed a movement to dismiss on the premise VFC doesn’t really possess the widespread legislation federal logos it seeks to implement. Because the movement was filed, VFC filed an amended criticism, and Veritas Farms filed a second movement to dismiss, largely on the identical grounds but in addition together with arguments primarily based on the illegality doctrine (which we’ve beforehand written about here).
Sadly for VFC, Justice of the Peace Decide Michael E. Hegarty issued a beneficial order that the Court docket grant Veritas Farms’ movement to dismiss – and to dismiss the trademark infringement and associated claims with prejudice (that means, VFC can’t amend or attempt to deliver these claims once more). However, for the cannabis-ancillary trade, the order clarifies the illegality doctrine isn’t going to forestall all marijuana-related providers from acquiring trademark rights.
In its movement, Veritas Farms argued VFC’s enterprise and merchandise (which largely relate to offering details about hashish) are unlawful underneath federal legislation underneath the Managed Substances Act, and thus not eligible for trademark safety. VFC responded the availability of informational providers about hashish shouldn’t be unlawful and thus, they’re eligible for trademark safety.
Decide Hegarty started his evaluation by stating the usual:
A trademark qualifies for registration and its related advantages if the trademark proprietor has ‘used [the mark] in commerce’ or has a bona fide intent to take action, and courts have lengthy held that the commerce should be ‘lawful’ for it to fulfill the “use in commerce’ requirement. (Citations omitted).
With respect to the usual, he agreed with Veritas Farms that federal trademark legislation can solely defend marks which are in substance authorized underneath federal legislation – and due to this fact, safety of marijuana-related items is due to this fact prohibited.
Even after passage of the 2018 Farm Invoice, ‘the USPTO [would] proceed to refuse registration when the recognized providers in an utility contain hashish that meets the definition of marijuana and embody actions prohibited underneath the CSA.
Nevertheless, the settlement ends there. Decide Hegarty then regarded into the definition of marijuana underneath the Managed Substances Act:
all components of the plant Hashish sativa L., whether or not rising or not; the seeds therefor; the resin extracted from any a part of such plant; and each compound, manufacture, salt, spinoff, combination, or preparation of such plant, its seeds or resin.
Utilizing that definition, he confirmed the try to trademark items or providers in reference to marijuana, its components, or any of its makes use of, are “not be permitted underneath federal legislation.” That definition was not instructive on VFC’s trademark for the availability of data providers – and in the end, Decide Hegarty dominated VFC’s sought trademark safety isn’t unlawful:
… the plaintiff [VFC] is making an attempt to trademark not cannabis-related items and merchandise however slightly the availability of data concerning hashish and hashish merchandise. The Court docket acknowledges that this can be a grey space of legislation. Primarily based on the events’ arguments and the restricted case legislation and different authorities on the matter, the Court docket doesn’t discover that the availability of data, on this context, is prohibited. In different phrases, the availability of data concerning hashish shouldn’t be unlawful underneath federal legislation, so it’s eligible for trademark safety.
This beneficial order is a constructive signal for the trade as a complete, and it indicators a rising consciousness of the courts that this kind of “grey space of legislation” must be proactively clarified – time and again.