Cannabis Company Learns Important Trademark Lesson

Cannabis Company Learns Important Trademark Lesson

A Nevada cannabis company must rebrand its products after being hit with a trademark infringement lawsuit. The suit highlights that as the marijuana industry gains legitimacy, businesses must adopt traditional intellectual property strategies, such as conducting a trademark search before expending resources to promote a brand or product.

Trademark Infringement Suit Against GG Strains

In March, Gorilla Glue Co. filed a trademark infringement lawsuit against GG Strains LLC over the name of its award-winning Gorilla Glue 4 cannabis strain. The suit alleged that GG Strains was unlawfully advertising and selling products and services under a confusingly similar name to Gorilla Glue’s trademarks, in violation and dilution of Gorilla Glue’s trademark rights. It further maintained that “the name of Defendant’s product was selected with the express purpose to exploit and trade on the goodwill and reputation for strength and stickiness that Gorilla Glue had built in its GORILLA GLUE mark.”

In its complaint, Gorilla Glue noted that it filed the suit solely to protect its intellectual property rights. It stated:

This lawsuit is not a comment on any federal or state policy matters, medical or pharmaceutical issues, or choices in recreation. GG Strains not only took the name but intentionally traded on Gorilla Glue’s reputation for high-quality adhesives’ ‘stickiness.’

The two companies recently agreed to settle the trademark dispute. Under the terms of the settlement:

• Within 12 months, GG Strains must cease using the word “Gorilla,” an image of a gorilla or the “Gorilla” trademarks.
• In the nine-month period following Dec. 18, 2017, GG Strains can only use the Gorilla words, images or trademarks preceded by a different name and the phrase “formerly known as” or within a “History” page on GG Strains’ website.
• GG Strains must disable the gorillaglue4.com website (can redirect it until Jan. 1, 2020, and explain the redirect for nine months following Sept. 19) and transfer the website to Gorilla Glue Co., which will not activate or use it.
• GG Strains must assign its interest in GG Strains’ registered “Gorilla Glue” trademarks to Gorilla Glue by Jan. 1, 2020.
• Affiliated companies, dispensaries, cultivators and other partners have to stop using the word “gorilla,” or any Gorilla Glue Co. trademarks or imagery. Licensees of the strain have up to 90 days from Sept. 19, 2017, to stop using the gorilla word, images or trademarks. For 12 months after Sept. 19, 2017, GG Strains and only its licensing partners can use the prohibited words if preceded by a different name and the phrase “formerly known as.”

Marijuana companies that have adopted product names and guerilla marketing tactics that “play on” the intellectual property of established brands may face infringement claims. For example, mainstream companies, including Hershey and Girl Scouts of America, have pursued legal actions against cannabis companies over the sale of marijuana strains with allegedly infringing names.

Importance of Conducting a Trademark Search

Businesses can establish legal rights in a trademark based on the use of the mark in commerce without seeking registration with the U.S. Patent and Trademark Office. However, federal registration has a number of benefits, including public notice of your claim of ownership of the mark; a legal presumption of your ownership of the mark and your exclusive right to use the mark nationwide on or in connection with the goods/services listed in the registration; and the ability to bring an action concerning the mark in federal court.

Because marijuana is still illegal under federal law, the U.S. Patent and Trademark Office has refused federal registration of medical marijuana and other cannabis-related trademarks. Nonetheless, it is still advisable to conduct a trademark search. Conducting a trademark search can help ensure your company logo or brand will not be “confusingly similar” to an existing mark, and also prevents you from wasting substantial resources, including time and money on marketing materials and advertisements that feature a company logo or name that already belongs to someone else. A founder of GG Strains estimated that the dispute and rebranding efforts will cost their company around $250,000.
Source: https://litconsulting.co.

This article is a part of a series pertaining to cannabis legalization in New Jersey and the United States at large. Prior articles in this series are below:

• Opposition to Rohrabacher-Farr Amendment Puts Medical Marijuana Industry at Risk
• Legal Cannabis States Pushing Back Against Sessions’ Warning Letters
• Harmony Foundation Receives Permit To Grow Medical Marijuana

Do you have any questions? Would you like to discuss the matter further? If so, please contact me, Crystal Prais, at 201-806-3364.