Trademark laundering increases consumer confusion and unfair competition.
Viva R. Moffat 22, Professor of Law and Co-Director of the Intellectual Property and Technology Law Program at the University of Denver Sturm College of Law; Sam Kamin, Chauncey G. Wilson Memorial Research Chair and Professor of Law at the University of Denver Sturm College of Law; Tim Maffett, JD from University of Denver Sturm College of Law, Law Clerk to Supreme Court, May 2022, “Cannabis, Consumers, and the Trademark Laundering Trap,” William & Mary Law Review, 63(6), pp. 1978-1979, Lexis, kav
The apparent success of the trademark-laundering strategy obscures significant concerns. The way that the PTO and the courts have interpreted and applied the lawful use doctrine has led to a situation in which there may be more downside than upside to federal registration for marijuana firms. What is more, the current downsides of trademark registration are likely to become more problematic, presenting significant hurdles to marijuana companies as the United States inches closer to federal legalization. We explain in this Part why the current situation presents more problems than we anticipated and what it implies for the future - for cannabis companies, for their lawyers, and for consumers.
A. For Cannabis Companies and Cannabis Consumers, Registration Is a Trap
The fact that the PTO requires disclaimers from (some) marijuana companies, and the way in which courts have interpreted and applied those disclaimers, means that marijuana companies are [*1979] getting much less benefit than they might have expected from their federal trademark registrations. 191Indeed, in some circumstances, it would have been better for the companies not to have sought trademark protection at all. Perhaps more significantly, consumers are made worse off as well. The PTO's handling of these marks is creating, rather than preventing, consumer confusion, and encouraging, rather than punishing, deception and unfair competition.