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Washington Court of Appeals' definition of trademark rights in Washington

Recently, the Washington Court of Appeals waded into the murky waters of defining trademark use when an out-of-state marijuana business licenses a trademark for the sale of cannabis products in Washington. In Headspace International LLC v. Podworks Corp, the Washington Court of Appeals considered two fundamental trademark principles: (1) to establish trademark rights, the mark owner must lawfully use the mark in commerce in the relevant jurisdiction; and (2) to enforce its trademark rights, a licensor must exercise sufficient control over the goods and services sold under the mark by the licensee. Walking a fine line between these two principles, the Court ultimately held that licensing a trademark to a Washington cannabis business is sufficient to establish “lawful use in commerce” in Washington for the purpose of establishing trademark rights. But such use is not sufficient to constitute doing cannabis business in Washington.

All brands should strive to be unique. However, it is particularly important that businesses in competitive industries, like the cannabis industry, adopt brands that are highly distinctive and unique. Why? In competitive industries, consumers are bombarded by choices. When consumers walk into a store and are faced with numerous, similar brands, they have a hard time distinguishing between them. Consumers may have had a positive experience with a brand, but they can’t quite remember whether it was ACME 1 brand or ACME 2 brand. The need to be distinctive extends both to the brand name, as well as to its packaging. If ACME 1 and ACME 2 both have green and black packaging, it may be impossible for consumers to correctly identify the brand they had a positive experience with. Even worse, if a consumer had a negative experience with a brand that sounds and looks similar to another brand and its packaging, the consumer may avoid both brands, either because they can’t tell them apart, or they assume they are related in some manner.

To ensure cannabis brands benefit from consumer loyalty, and do not suffer negative branding consequences caused by inferior competitor products, it is imperative that cannabis brands strive to be distinct.

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Since its founding in 1966, Garvey Schubert Barer has counseled clients across a broad range of industry sectors. Our attorneys have deep bench experience and significant expertise in both complex legal and business matters. We value innovation and entrepreneurship, and closely monitor industry trends. It is with these values in mind that our firm established the cannabis industry group. Read More ›

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