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Cannabis Patents – The Elephant in the Room?

I write a lot about trademark issues within the cannabis industry, but there is another aspect of intellectual property that I believe will have a greater impact on the industry than even brand/trademark disputes, and that is patent infringement.
Cannabis-related patents have been around for years, but we’re just starting to see those patents being challenged and asserted. Two recent examples are illustrative of what I believe will become more and more commonplace in the very near future.

Case 1: Insys Development Co. v. GW Pharma Ltd.
This case is actually an “inter partes review” (or “IPR”) before the United States Patent and Trademark Office’s Patent Trial and Appeal Board (“PTAB”). In a nutshell, the IPR process allows a party to challenge the validity of another party’s patent prior to any claims of infringement. The argument is that the patent never should have been issued because the invention was already known or was obvious before the application was filed.
GW Pharma owns U.S. Patent No. 9,066,920 for “Use of one or a combination of phyto-cannabinoids in the treatment of epilepsy”. Claim 1 of the ‘920 Patent is simply this:

A method of treating partial seizure comprising administering cannabidiol (CBD), to a patient wherein the CBD is present in an amount which provides a daily dose of at least 400 mg.

Thus, if your CBD product is used to treat partial seizures and the treatment method includes CBD “in an amount which provides a daily dose of at least 400mg” then you arguably infringe the patent.

Insys filed an IPR petition to cancel the ‘920 Patent based on “prior art” (i.e. relevant evidence) which Insys believes shows that the invention in the patent was already known or was otherwise “obvious” in light of other prior art that existed prior to the filing of GW Pharma’s application. The IPR process (and patent law in general) is very complex and beyond the scope of this post.

One reason this IPR is so important is because the claims in the patent are fairly broad and could implicate many, many products that are already being marketed (albeit perhaps without the claims of treating epilepsy and seizures, which is part of what complicates these cannabis-patent issues). So, just how easy is it to challenge a patent like this via an IPR? Well, you’ll need over $30,000 just in filing fees to the USPTO if your petition is accepted by the USPTO and the proceeding is instituted ($15,000 just to file the petition, and another $15,500 if the USPTO “takes the case” and starts the review process). You read that correctly – over $30,000 just in government filing fees to get started. That does not include the attorneys’ fees that Insys (and GW Pharma) are paying, which I conservatively estimate are already in the hundreds of thousands of dollars. This is all to invalidate a single cannabis-related patent.
This is complicated litigation that few businesses can afford despite the fact that some of these patents affect the very ability of such businesses to exist.

There are many supplemental procedural issues involved in this case, but I expect a decision regarding the ‘920 Patent’s validity will be reached within the next couple of months.

Case 2: United Cannabis Corporation v. Pure Hemp Collective, Inc.
This case is different than the above IPR because this is a “classic” patent infringement case that is being brought within the United States District Court for the District of Colorado. Whereas Insys brought an IPR at the USPTO to try and invalidate GW Pharma’s patent prior to GW Pharma asserting the patent against Insys, here, United Cannabis Corporation owns a patent and is alleging that Pure Hemp Collective’s products infringe the patent. The similarity to the IPR is that it is typical practice for the defendant in a patent infringement case to defend against the infringement by counterclaiming that the patent is invalid. Thus, the Colorado court will likely address the validity of the patent should the case proceed.

The patent at issue in this case is U.S. Patent No. 9,730,911 for “Cannabis extracts and methods of preparing and using same.” Claim 1 is simply:

A liquid cannabinoid formulation, wherein at least 95% of the total cannabinoids is tetrahydrocannabinolic acid (THCa).

The case was just filed early August 2018, so it’s too early to see how Pure Hemp Collective intends to respond. It is a pretty typical example of the type of a patent infringement complaint which I predict we will see more and more of in the very near future as cannabis-patent owners start asserting their patents.

In sum, I expect to see more patent friction within the cannabis industry, and I also expect the media attention to increase as the gravity of cannabis-related patents becomes more well-known. There are already “patent busting” projects out there related to cannabis-patents, and I would not be surprised to see an increased focus on those efforts.

* This article, in its entirety, was first published on Kevin’s personal blog, www.floridaiptrends.com.

Kevin Wimberly Presents to the OCBA IP Committee

October 4, 2016—With the pending Florida Constitutional Amendment on the November Ballot regarding medical marijuana, Kevin Wimberly provided a CLE-credit presentation entitled Medical Marijuana & Intellectual Property in Florida. Kevin discussed distinctions between Florida trademarks and federal trademarks while also providing examples and strategies for obtaining a medical marijuana trademark should the constitutional amendment pass. He also addressed marijuana patent issues and how local government regulations may affect medical marijuana dispensaries.

BWSM’s IP Series at Florida Institute of Technology Continues

September 26, 2016—Fred Romano and John DeAngelis are scheduled to present another in a series of intellectual property law luncheon seminars at Florida Institute of Technology on October 11, 2016. All seminars in this series are open to the public at a minimal cost to cover lunch for the participant. At the October seminar they will discuss commercial transactions, especially as related to start-up and new businesses. Previous seminars in this series covered other aspects of intellectual property, including patents, copyrights and trademarks. For further information or to register for the seminar please contact Fred or John through our website or Mary Tabeling at Florida Tech at mtabeling@fit.edu or 321-674-8382. The seminars will continue monthly through June 2017.

Attorney Wimberly Guest Lectures at Barry University

September 21, 2016—Kevin Wimberly guest lectured during the Copyright Law class at Barry University’s School of Law. Kevin’s lecture used several real world case examples to teach the students about certain copyright issues, including the registration precondition to filing suit, the Digital Millennium Copyright Act (“DMCA”), preliminary injunctions, and the way that copyright prosecution intersects with copyright litigation.

BWSM Achieves Managing Intellectual Property Magazine’s Highest Ranking for 2016

May 24, 2016–For the fourth consecutive year, BWSM is ranked “Highly Recommended” in the fourth edition of the IP Stars Handbook—a Managing IP guide which identifies the leading intellectual property firms and lawyers in the United States. BWSM is only one of four law firms in the State of Florida to achieve the “Highly Recommended” ranking. BWSM is recognized as being among the top IP boutiques in Florida for its particularly strong patent practice and burgeoning reputation for its trademark work.

The IP Stars Handbook is produced by Managing Intellectual Property Magazine which is a leading international magazine for in-house IP counsel and is part of the Euromoney Legal Media Group with offices in London, Hong Kong and New York.

Visit ipstars.com to view the 2016 rankings and editorial.

BWSM Hosts Welcome reception for INTA Participants

May 21, 2016—With the 138th International Trademark Association Annual Meeting occurring in Orlando this year, BWSM hosted a well-attended reception for foreign agents on the first evening of this six-day event. In addition to foreign trademark attorneys attending nearly an equal amount of foreign patent attorneys were also in attendance. This reception provided BWSM attorneys and staff an opportunity to forge more binding relationships with many of the foreign agents the firm currently uses and a chance to meet potential new foreign agents. The 2016 Annual Meeting had over 10,000 registrants, making this meeting the largest in INTA’s yet.

Molinelli Achieves Highest Attorney Rating

May 3, 2016— After an extensive and confidential peer review by members of the Bar and Judiciary, Dr. Gene Molinelli received a Martindale-Hubbell® Peer Review Rating of AV Preeminent, which is the highest rating available. According to Martindale-Hubbell®, “Peer Review Ratings attest to a lawyer’s legal ability and professional ethics in specific Areas of Practice, and reflects the confidential opinions of members of the Bar and Judiciary. The Peer Review Rating is established by lawyers. The legal community respects the accuracy of ratings because it knows that its own members are directly involved in the process.” Patents and intellectual property were the specific areas of practice in which Dr. Molinelli was evaluated.

Davis Participates in 2016 OCBA Bench Bar Conference

April 15, 2016—Amber Davis was a panel participant during two sessions at the Orange County Bar Association’s Bench Bar Conference entitled “Cruising the Seven CLEs”. The two sessions were entitled IP Considerations in Business Litigation Part 1 and IP Considerations in Business Litigation Part 2. In addition to Amber, both esteemed panels also included The Honorable Paul G. Byron, United States District Judge, and two other local IP attorneys.

BWSM Transitions to a New Domain Name

With the addition of patent practice group in Manassas Virginia back in July 2015, BWSM has transitioned to a new domain name, BWSMiplaw.com. As a result the firm’s email addresses (for those previously using iplawfl.com) and website address have been formally changed to include the new domain name, BWSMiplaw.com, in place of iplawfl.com. Though replaced, the use of iplawfl.com still functions for reaching the firm’s website and when contacting firm attorneys and employees who previously used iplawfl.com.