Only federal trademarks provide greater protection and allow the building of brands.

Trademarks are a valuable form of IP businesses use to protect and build their brands. 136A trademark is a "word, phrase, symbol, and/or design that identifies and distinguishes the source of the goods of one party from those of others." 137Trademarks do not have a finite protection period, as they remain in effect as long as the owner uses the mark in association with goods and services. 138

Generally, there are two types of trademark protection that cannabis businesses should consider: federal trademark protection and state trademark protection. Cannabis businesses may also attempt to invoke common law trademark rights. 139 Each trademark form confers different rights and protections. Cannabis businesses should utilize all forms of trademarks as they offer unique brand protections that other forms of IP do not.

Given the lack of clarity regarding federal trademarks in relation to cannabis, cannabis businesses must use them strategically, with state trademarks and common law rights used to fill the gaps left by their federal counterparts. Exploring federal trademark registration should be a cannabis business's first step as trademark registration provides the greatest benefit. Federal trademark registration gives a rights holder protection from confusingly similar marks entering the market across the entire United States. 140Federally registered marks may have the "(R)" stamp on their logos and brand names, which helps deter copycat producers by putting the public on notice that a brand is being exclusively used. 141 Federal trademark protection also eases the process of bringing infringement claims to federal court and can lead [*215] to a business receiving greater legal remedies. 142 While federal trademarks provide the most legal rights and protections, they also carry the most strict application criteria.

Much like the patent process, federal trademark registration begins with an application to the USPTO. 143Then, an examiner reviews whether the applicant met all statutory and regulatory registration requirements. 144There are many nuanced federal trademark registration requirements, but only a few merit discussion. First, federal trademark protection requires that a business use the word, phrase, symbol, or design in interstate commerce. 145If a business only uses its mark in intrastate commerce, then the mark does not qualify for federal trademark registration. 146Second, a trademark must be descriptive and not generic in nature. 147Generic words and symbols cannot be registered for protection because everyone has the right to use generic words and symbols to describe their goods or services. 148Trademark registration also requires that the mark not be confusingly similar to another mark in commerce, i.e., it must be unique. 149Finally, the trademark must be used in lawful commercial actions. 150 The final requirement is where cannabis gets hung up.

The federal illegality of marijuana leaves many cannabis businesses' marks on goods unprotectable, even if the goods are made and sold in jurisdictions with legal cannabis. 151 Marks on goods such as packaged psychoactive marijuana, CBD products derived from marijuana, ingestible CBD products, and consumption devices such as pipes and vapes remain trademark ineligible. 152This poses significant risk for businesses wishing to establish their brands. For example, if Company A sells a trademark-ineligible marijuana drink and Company B subsequently begins selling a similar drink with Company A's logo on it, Company A could not bring federal suit against Company B because [*216] Company A does not and cannot own federal trademark rights to its logo for that marijuana drink.

Despite the inability to federally register certain cannabis-related marks, there are strategies small businesses can utilize to help mimic the benefits of direct federal trademark registration. The strategy most commonly used by cannabis businesses is best described as "boxing out" competitors from using their unprotected marks. 153In order to "box out" competitors, businesses will register their marks for ancillary items such as clothing, stickers, and federally legal-and trademark registration-eligible CBD products. 154Brand recognition is important for businesses, and building a trademark portfolio based on ancillary products can help cannabis businesses build their overall brand within the market. This strategy not only helps build brand recognition, but also puts competitors on notice that the mark is protected in some way, albeit not on the marijuana product.

Another commonly used strategy is placing the "TM" logo on marijuana items. Using the "TM" logo is an attempt to invoke common law trademark rights, which do not require registration. 155But these common law rights only exist in the geographic area in which the marks are used in commerce and are not subject to any statutory remedies. 156These common law rights can be difficult to uphold in a lawsuit, but the recognizable "TM" logo may help deter potential copycats.

Cannabis businesses can also acquire state trademark registration for their otherwise federally illegal goods. 157 State trademark registration is inexpensive and easily obtainable, but does not grant nearly the same protections as federal trademark registration. 158 The state trademark schemes of the fifty states all differ, with some granting greater protection and enhanced rights than others. 159In some states, trademark registration is simply a certificate that may serve in state court as evidence of a common law infringement claim. 160In other states, [*217] trademark registration may provide prima facie evidence of the mark's validity and that the mark's owner has the exclusive right to use the mark in association with goods and services. 161Unfortunately, claimants can only commence state trademark infringement action in the state where the trademark is registered, with many states further limiting protection to the city or "geographic area" where the mark is sold and used. 162

Regardless of the strength of a state's trademark laws, cannabis businesses should register their marks within all states they do business. State trademark registration does not offer the same protections and benefits as federal trademark registration, but cannabis businesses should make every attempt to protect their IP through every available mechanism.