Law students are taught that one purpose served by the civil legal system is to provide predictability in business. For the cannabis industry, predictability remains a work in progress in view of conflicting federal and state laws and regulations. Cannabis is a Schedule I controlled substance under the Controlled Substances Act, and possession of cannabis is a Class I felony under federal law. Nevertheless, 33 U.S. states and the District of Columbia have legalized medical cannabis, and 10 U.S. states and the District of Columbia have legalized recreational cannabis. This legal patchwork creates challenges for companies in the cannabis industry in banking, taxation, real estate, insurance and other areas that are routine for businesses in other industries.
Patent procurement for cannabis-related inventions is not beset by unpredictability. The U.S. Patent and Trademark Office (USPTO), a federal agency, routinely examines and grants patents covering cannabis-related technologies despite cannabis remaining a controlled substance under federal law. The USPTO applies the same standards to cannabis-related applications as it does to patent applications covering any other technology. An applicant must show that the claims are new, useful and not obvious, and must teach one of ordinary skill in the art how to make and use the invention. The number of granted patents and newly filed patent applications in the cannabis industry is increasing steadily and shows no signs of tapering off.
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