Cannabis, Consumers, and the Trademark Laundering Trap

At the moment, cannabis companies cannot acquire federal trademark protection for their marijuana products because the ''lawful use" doctrine limits trademark registration to goods lawfully sold in commerce. Given that marijuana remains illegal under federal law, this may not sound like much of a problem, but it has serious consequences for consumers. Without trademark rights, one cannabis company can simply use the brand name of another, more prominent, company on its marijuana products, and consumers will assume that they are getting the products they have come to rely on, with potentially dangerous results. The current approach of the United States Patent & Trademark Office (PTO) and the federal courts does little to protect against this outcome and is thus at odds with trademark law's consumer protection and fair competition goals.

This Article examines how the PTO and the courts have mishandled marijuana marks and identifies how they have interpreted and deployed the lawful use doctrine in ways that undermine and conflict with trademark's stated goals. Given that the PTO is unlikely to abandon the lawful use doctrine anytime soon, we propose changes to the way the PTO applies that doctrine in the trademark registration process, as well as changes to the courts' consideration of trademark disputes involving cannabis companies. These changes will ensure that both consumers and marijuana businesses are protected as the United States transitions from marijuana prohibition to a post-prohibition federal regulatory regime.