Licensing in the Marijuana Industry

LICENSING ISSUES IN THE MARIJUANA INDUSTRY

Managing Risk

Tsan Abrahamson, Cobalt LLP

WHAT WE’LL COVER

• PROTECTING YOUR IP– Copyrights– Trademarks, Trade Dress– Patents

• WHAT IS A LICENSE– SHOULD YOU LICENSE– SHOULD YOU FRANCHISE (hint: NO)

• TOP CONSIDERATIONS

BUT FIRST, A WORD OF CAUTION

We’re in Uncharted Territory

• Recipes• Databases• Textual Works• Websites• Artwork• Architectural

works• Software

Original Works of Authorship

Thin Protection.

TRADEMARKS

• Logos• Brand Names• Sounds• Non-functional

smells• Non-functional

packaging• Trade Dress

SERIOUSLY? ANOTHER LEAF AND CROSS?

You can’t get broad protection for something EVERYONE uses

Um… NO!

Alaskan

Thunder

Fuck

Trademark Infringement. Period.

SCAN

DA

LOUS

MARK

YES! • SUGGESTIVE,

BUT NOT DESCRIPTIVE

• STYLIZED VERSION OF A LEAF

• EASY TO POLICE• RECOGNIZEABLE• EASY TO

PRONOUNCE• CONVEYS

QUALITY

DON’T STOP THERE

THINK BROADLY• Packaging shapes• Store Designs• Product Shapes• Colors• Holograms• Smells• Designs

Yes, it’s protected!

PROTECTION MEANS RIGHTS

Penny Wise is Pound Foolish: Don’t Skimp on Protection

LICENSING

What is it? What Does it Guarantee?

ELEMENTS OF A LICENSE• Right to Use Various Properties• For a Limited Time Period• On an exclusive or non-exclusive basis• In a specific territory• With an understanding of obligations• During and after the license period• Entered Into Under State Law, and with

terms mutually agreeable by both parties

ELEMENTS OF A FRANCHISE

• Required disclosures to state and franchisee

• Dictated by state law, not necessarily mutual party agreement

• Involves Federal law• Allows significant control, not just quality

control• Franchisees have significant state and

registration requirements

It’s Not a License Just Because You Want it to Be

Learn from the

Girl Scouts

TOP CONSIDERATIONS5 Steps to Successful

Licensing

1. PROTECT YOUR IPStrategic Thinking Means Long Term Planning

2. LOOK FOR STRATEGIC PARTNERS

PLAN FOR THE LONG TERM

WHAT’S A STRATEGIC PARTNER?

• Will Grow the Brand

• Is Trustworthy

• Reciprocal Benefits

3. SET REASONABLE TERMS AND INCENTIVES

Motivate Licensees to the Do the Right Thing… Carry a big Stick

4. KNOW THE LAW

Each State is Different. Understand Your Obligations

5. PREPARE FOR BREACHOutline Terms to Help Get Your Property Secured

QUETSTIONS? CALL US

Tsan [email protected]