Monthly Archives: February 2015

Cannabis: Patently Useless?

Not too long ago I was at a party where an acquaintance, upon hearing that I was studying intellectual property in law school, addressed me with a slightly tipsy and decidedly confrontational “you can’t own ideas, man!”  At the time, I just smiled and prevaricated.  It is true, though.  You cannot own ideas.  Intellectual property law is built on that very concept.  There are some fine distinctions and clarifications, and certainly some gray area, but that’s the lawyer’s bread and butter.  Intellectual property is like a contract with the government, and all contracts require both sides to gain something (‘consideration’).  The commonwealth has generally concluded that there are certain protections worth granting for the greater public good and this is where a debate on the merits of intellectual property finds footing.  We should ask what, exactly, do the rest of us get out of affording some entity protection of their copyright, trademark, trade secret, or patent?

A patent, for example, gives the inventor a few temporary rights, essentially to exclude others from making, using, selling, and importing the invention in the United States.  Thomas Jefferson wrote that “the exclusive right to invention [i]s given not of natural right, but for the benefit of society” and highlighted “the difficulty of drawing a line between the things which are worth to the public the embarrassment of an exclusive patent, and those which are not.”  Exclusive rights grant a monopoly of sorts, and a government-protected monopoly without a very important public interest being served would be embarrassing.  For example, the Post Office is a monopoly that serves the commonwealth’s need for delivery of mail.  But what concomitant need does granting a patent serve?

The United States Patent Office (USPTO) has been receiving applications for patents on strains of cannabis. This could be because a few states have legalized recreational use of cannabis or because the majority now supports legalization.  Certainly, the projections of tens of millions of dollars of potential revenue will interest businesses and investors.  But cannabis is federally illegal under the Controlled Substances Act.  Can the USPTO even grant a patent on something illegal?  More importantly, why should the USPTO grant these patents?  There are valid arguments for both sides, but ultimately the USPTO should grant these patents because whether or not those patents can be enforced is a separate question for a separate agency.

In order to patent something the inventor must provide a description of the invention that would give someone familiar with the material the ability to actually make the invention.  This “enabling” for a “person skilled in the art” is part of what the public gets.  When your temporary exclusive rights run out, we can all take advantage of your clever new invention.  Money made during the exclusive period works as a reward for your inventive mind as well as incentive for the rest of us to get out there and innovate.

Among other requirements, an invention must be “useful” to be eligible for a patent.  Just about anything can be “useful” in one application or another, but what about uses that society would not want?  Imagine Ted Kaczynski comes up with a cunning new way to disguise, package, and deliver explosive devices.  It seems patent, so to speak, that there is little “useful” about this invention.  Justice Story, better known for the Amistad case, posited that “a new invention to poison people, or to promote debauchery, or to facilitate private assassination, is not a patentable invention.”  Further, Justice Story indicated that “whether [the invention] be more or less useful is a circumstance very material to the interests of the patentee, but of no importance to the public.”  An invention can be “useful” for patentability purposes but have very little practical use. This doesn’t matter much to the rest of us because, as Justice Story put it, it “will silently sink into contempt and disregard.”

Courts have used Story’s reasoning to deny “useless” patents, usually of gambling devices or inventions to facilitate fraud.  Courts, over time, have shifted away from the sticky issue of morality and generally look toward “usefulness” with a pretty open mind.  In fact, the Federal Circuit explicitly stated that “years ago courts invalidated patents on gambling devices on the ground that they were immoral . . . but that is no longer the law.Juicy Whip, Inc. v. Orange Bang, 185 F.3d 1364 (Fed. Cir. 1999)  (Citations omitted, emphasis added).

In Juicy Whip, the invention was “designed to deceive customers by imitating another product and thereby increasing sales of a particular good.”  That court held that the “utility” requirement in the Patent Act of 1952 “[wa]s not a directive to the Patent and Trademark Office or the courts to serve as arbiters of deceptive trade practices.”  Further, the court pointed to 42 U.S.C. § 2181(a), which revokes all granted patents and denies patentability to anything “useful solely in the utilization of special nuclear material or atomic energy in an atomic weapon.”  Essentially, that court said potentially harmful uses of inventions are not the purview of the patent office and if Congress wants something specific barred from patentability, they will pass a law to that effect.

Now you’re probably thinking “wait a minute, what about our hypothetical patent application by Kazcynski?  Surely we, as a society, still draw the line somewhere?”  Of course we do, it’s just not the Patent Office’s job.  For example, the Federal Circuit in Juicy Whip cited to In re Watson, quoting “it is not the province of the Patent Office to determine, under section 101, whether drugs are safe.”  Other agencies are responsible for safety, the FDA in that case.  Cannabis is federally illegal, but enforcing that aspect of the plant is the purview of the DEA, not the Patent Office.

The Supreme Court has held that “Congress never intended that the patent laws should displace the police powers of the States, meaning by that term those powers by which the health, good order, peace and general welfare of the community are promoted.”  Generally, it seems that a patent on an invention with dubious merits will stand (at least with regard to ‘utility’) even if you might not be allowed to use (‘practice’) it in a given jurisdiction.  Individual states can -and do- determine for themselves how best to enforce cannabis possession, growth, distribution, sales, etc.  The Patent Office was not intended as an enforcer of federal laws.  Still, cannabis is federally illegal.

A plant can be patented.  Plant applications like this application for “Midnight,” a strain of cannabis with 1:1 ratio of Tetrahydrocannabinol (THC) to Cannabidiol (CBD), are curious because possessing one is almost always in violation of the Controlled Substances Act.  While many agree that both the courts and the USPTO have abandoned Justice Story’s observed limitations, the Federal Circuit in Juicy Whip does leave some room for denying a patent application if it could not be put to legal use.  Specifically, the Juicy Whip court cited Fuller v. Berger, 120 F. 274 (7th Cir. 1903) which would deny an invention “incapable of serving any beneficial end.”  Juicy Whip also quoted a much more recent case, clarifying that “the claimed device must be totally incapable of achieving a useful result” and the “test for utility” is “not merely that the device has been used for pernicious purposes, but that it is incapable of serving any beneficial end.”  Fuller referenced the Colt revolver and its inherently dangerous nature, then advocated that an invention is useful if it can be used “to accomplish a good result, though in fact it is oftener used (or is as well or even better adapted to be used) to accomplish a bad one.”  The question, then, is can a cannabis plant accomplish a good result in spite of its federal status?

There may be some plausible legal use for, say, handcuffs that administer electric shocks, even if torture is the first use that comes to mind.  That application has expired, but it’s an example of an invention with questionable “uses.”  Is an invention that has no legal use incapable of serving any beneficial end?  Granting a patent is not a guarantee from the government that you can use, or ‘practice,’ it.  A drug might be patented but be declared unsafe by the FDA, or the FTC might protect consumers from a deceptive invention.  Our laws are malleable, subject to review and change.  Cannabis being legal or not is also changeable.  In fact, legislators are currently working on changing cannabis’ legal status.

What if an inventor during alcohol prohibition created an efficient and safer process to isolate ethanol but was denied a patent?  One amendment to the Constitution later, that invention has legal applications.  Surely this is some injustice to the original inventor, society not upholding our end of the contract.  Also, if we legalize liquor, don’t we want more efficient and safer methods of production?  On the other hand, patent applications are public domain, so an application for an illegal invention by definition enables others to make it. (Though I think it is an unlikely criminal who peruses patent office materials in hopes of some improvement to their criminal empire).

If the USPTO does grant cannabis-related patents it will likely encourage more applications of this kind.  One of the effects of decriminalization is increased awareness and understanding of cannabis and cannabis products.  Cannabis consumers trying to create “butane hash oil” (BHO) have been increasingly blowing themselves up.  Presumably this is because more people are aware of BHO in the first place.  However, the public will subsequently become more aware of the dangers and perhaps less likely to engage in those methods.  Also, people may invent and patent safer and more reliable methods or machines to produce BHO.

An “illegal” invention could be safer than previous technologies, and could further public health concerns while ostensibly subverting federal law.  Consider a particular strain of cannabis with high CBD and low THC that, due to the differences in those active substances, may have medical uses without the psychoactive effects of cannabis.  We should encourage such limited uses and developments of a drug in the same way that we encourage it for other scheduled but better known drugs.  

Certain inventions, such as the physically impossible, provably lack use, but patents should not be denied for current illegality.  Certainly some patents have been granted for substances derived from cannabis plants, which means the inventor was working with those plants – a fact that was probably not overlooked by the Patent Office. Extending that to a patent on the plant itself is a small step. Also, cannabis has some utility, either in the present sense in states where cannabis has been decriminalized, or in the possible future of federal decriminalization.  If that isn’t enough, society can still benefit from increasing knowledge in the public domain while relying on other agencies, such as the DEA or, if legalized, the FDA, to enforce any application of a patented cannabis strain.

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The Champagne of Cannabis Should Not File for Bankruptcy

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Humboldt County is the Champagne of Cannabis. Ask anyone in the marijuana industry where the best “weed” in the country is grown and he or she will reply Humboldt or the “Emerald Triangle.” While this northern California region prides itself on its reputation, praise alone won’t pay the bills. The county is predicted to lose 25% of its economy with the legalization of recreational use in California. Some may interpret this as the intended demise of the illegal market. After enduring the departure of the timber and fishing industries, however, Humboldt already one of California’s poorest counties, does not have the economic elasticity to bounce back from another failed market. Humboldt is savvy to the tides of change, though, and local interests groups are advocating for better policy reform to preserve their beloved region and its famous cash crop. My blog series will focus on the lessons learned from Humboldt County’s long history with cannabis reform and why the state should follow the lead of local interest groups and residents who are dedicated to an environmentally sustainable, safe and economically profitable cannabis industry.

My name is Keri Gross and I am a JD candidate at Santa Clara Law School. I majored in Ethic Studies, Spanish and Biology at Humboldt State University. I’d like to think I represent both the outside the box thinking one would expect from innovative Silicon Valley as well as a collaborative social justice approach to critical problem solving. I came to law school after working with teen moms and adjudicated youth through Planned Parenthood’s community health education program. Inspired by this work I am now branching into criminal law, health law and policy reform. My goal is to make my legal work accessible, engaging, impactful and reliable.

Marijuana Taxation: Can Taxes Help Shape a “Healthy” Marijuana Market?


Alexa Quinn
J.D. Candidate 2016

Can marijuana legalization raise revenue and eliminate the black market? And can marijuana taxes help offset other social harms attributed to marijuana use? My research will try to answer these questions through comparing the different approaches taken by Colorado and Washington in structuring their recreational marijuana markets. I’ll also look at the lessons we learned from taxing and regulating the alcohol and tobacco industries. Legalization forces us to consider a number of issues. My focus is on the benefits and drawbacks of taxation schemes and market structures as they relate to eliminating the black market, normalizing use, and sustaining the recreational market (e.g., price control, revenue, etc.). My goal is to weigh the social tradeoffs inherent to the various ways to tax marijuana and establish what the best options are for California. In the end, I think we’ll find that California can better serve its goals by establishing recreational marijuana taxes and regulatory schemes that simply pay the costs to oversee the legalized system and do not function as a “get rich quick” plan for the state.

About the Author:

Alexa Quinn is a lifelong resident of the Golden State. Ms. Quinn grew up in sunny southern California and completed her undergraduate degree in the very diverse city of San Francisco. She is a second year law student at Santa Clara University School of Law. She recognizes the immense change marijuana legalization can bring to her home state. California has an opportunity to give its voters a marijuana initiative that is, among other things, sound, fiscally responsible, feasible, and represents the entrepreneurial and innovative style of its residents. It is important to Ms. Quinn that the 2016 California ballot initiative seizes the opportunity to create balanced and informed policy. To see future posts by this author please follow this blog. You can also follow Alexa Quinn on twitter @aquinn_dlp.

California’s Retail and Commercial Future with Legal Marijuana

If California legalizes marijuana in 2016, her citizens will have to decide a number of important questions as to the nature of marijuana sale and consumption within her borders. To address this, my writing will focus on questions regarding the potential future existence and regulation of retail point of sale cannabis consumption. Will marijuana be sold exclusively in the classic “dispensary,” with actual consumption of the marijuana allowed only within the privacy of the home, or will there be commercial establishments where cannabis can be bought and consumed socially on premises, similar to a bar serving cigars or alcohol? I will explore contemporary examples of point of sale consumption in Colorado and Washington, and how the interplay between local zoning laws and state and municipal smoking bans could affect the existence of similar businesses in California. All told, I intend my writing to illuminate the difficult choices Californians will need to make about their state’s future societal and commercial relationship with legal marijuana.

My name is Philip Brody, and I’m a current 3L at Santa Clara University School of Law. More importantly, I’m a native Californian who loves and cares about the future of my state. We Californians will have a number of very important electoral decisions to make in 2016, with marijuana legalization being among them. Through the Drug Law and Policy Project, I hope to provide a practical envisioning of what forms a future California could take with safe, legal marijuana.

Is Stoned Driving the New Drunk Driving?

Driving under the influence of marijuana is a criminal offense in California and will continue to be even if marijuana is legalized. Washington and Colorado, the first two states with legalized cannabis, have established laws that create a presumption of intoxication if a driver is tested for 5 nanograms of THC per millimeter of blood or higher. Although this style of law mimics DUI enforcement, it may not actually be the best practice. The active ingredients in alcohol and marijuana vastly differ in their variety and effect, and biological tests for marijuana intoxication are rife with accuracy issues. In an effort to establish best practices for testing and the laws that should apply, I will be writing a set of articles that will analyze the laws and testing procedures surrounding marijuana intoxication. Once the best procedures for testing are established, I will review various products designed to test marijuana intoxication for their accuracy, fairness, and feasibility.

My name is Eugene Yoo and I gave up a career in marketing for law school. I did so with the desire to represent people who are unable to afford a lawyer on their own. Since then, I’ve devoted my education and work experience to the issues surrounding inequality and the law. Our nation’s drug policy has always involved these issues, and it is my goal to address the overlooked or difficult subjects in drug reform without boring anyone to death. Wish me luck.

Cannabis and Intellectual Property: To © or not to ©, and Other Pressing Questions

My contributions will primarily be analysis of different aspects of intellectual property in a market that has decriminalized cannabis while it remains federally illegal.  Can, and more importantly, should a state furnish intellectual property protections when they are unavailable from the federal government?  California’s possible shift from medical cannabis to recreational cannabis raises many questions about commercial and social costs and benefits to affording these protections.  While attorneys and businesses are largely approaching this topic from the perspective of private players,  my goal is to outline not just the various legal challenges and possible solutions to the concerns of cannabis-oriented businesses but, instead, to point out how a state can balance those private interests with public policy, safety, and health concerns.

I am a law student who studied science for my undergraduate degree. I am focusing on intellectual property law with an emphasis on patent prosecution. I am an associate on the Santa Clara High Tech Law Journal, and I have developed a strong interest in the intellectual property challenges presented to emerging markets and businesses.  Because of the politicized nature of these topics I am writing under a pseudonym, Lucilius, who was a friend and correspondent of one of my favorite writers.

Building Big Marijuana

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Sometime in late 2015, a private equity firm by the name of Privateer Holdings will debut a brand called “Marley Natural” to the legal marijuana industry. Bearing the infamous “Marley” surname, Marley Natural will feature a variety of cannabis products and hopes to quickly become the “Marlboro of marijuana” in an industry that is slowly but surely coming out of the shadows. If you wanted to build a big marijuana company like Marley Natural, how would you do it? My multi-part series will inspect the rise of big marijuana and discuss legal strategy and business ethics on topics including marketing and advertising, intellectual property, investments, taxes, and rising ancillary businesses in the big marijuana market sphere. Along the way I will examine case studies of real marijuana companies that are currently on a quest to dominate the marijuana market as it expands quickly across legal boundaries and into the unknown.

My name is Jeff Madrak. I was born and raised on the East Coast. I came to California to surround myself with sunshine and forward-thinking people. I’m currently a law student where I’m focusing on intellectual property and business law. At my core, I pride myself on being an entrepreneur and I’ve launched and been a part of several start-up companies throughout the last five years. I’ve written business plans for marijuana-related companies and designed strategies to navigate the hostile legal landscape that the grey marijuana market provides. In my spare time I run a company that advocates personal vaporizers for use as a tool to quit smoking and as an alternative to cigarettes. I’m fascinated with the law and how it creates new business opportunities for those who are brave enough to test its limits.