Some Truth about Hemp

MYTH 1) Canna-inventions and canna-innovations cannot be patented. This remains true as long as canna-products are a Schedule 1 Felony under Federal Law.

WHY INCORRECT: This statement is truly asinine, truly ridiculous. YET I have heard this so many times, including from reputable "experts" in the canna-industry, further including some major heavy-hitters and canna-publications. 

Not only is it asinine, it is also easily disproved. As of January 7, 2019, the following searches were conducted on the US Patent database. 

THIS SEARCH OCCURRED ON 01/07/2019 

Number of Issued Patents having the word "cannabis" in the specification: 3,339

Number of Pending Patent Applications having the word "cannabis" in the specification: 6,591

Number of Issued Patents having the word "cannabis" in the claims: 294

Number of Pending Patent Applications having the word "cannabis" in the claims: 941

One hard part about the above is trying to explain what is the difference between a patent "specification" and patent "claims". Lets leave this discussion for another time. Suffice to say they are both important.

Next, the patent statutes only require that an embodiment, system, apparatus, or method be legally usable or sellable in at least one US jurisdiction. Thus, the people saying this nonsense may be referring to plant patents, not utility patents, but even then they are still incorrect.

The DEA has no authority over the US patent system. The federal statutes are completely separate, the DEA can not and does not dictate what is patentable and what is not.

MYTH 2) Canna-inventions and canna-innovations have a dearth of Prior Art, due to a constraint on patentability. As such, Allowances will occur more easily, and there will be a "traffic jam" at the US Patent Office.

WHY INCORRECT: while canna-patents may be scarce, canna-information and canna-disclosures are not scarce. Plan on and expect significant resistance from the Patent Examiner.  

MYTH 3) You did a search for your canna-invention or canna-innovation, and did not find your specific embodiment. Therefore, you can expect an Issued patent, and want it right away.

WHY INCORRECT: This is another canard that I hear all the time. Do not be misled by doing a patent search. For various reasons, patent searches are not worth much to a patent Examiner. First, the Examiner always does her own search, regardless of any search you may perform (or only think you performed). Second, a utility patent application may not even reach an Examiner for 1.5 years after it is filed. 

This is difficult topic that does not lend itself well to brief explanations. Suffice to say, everyone should do a commercialization-search, as its important to see and be aware of what other similar products and services exist. This however is very very different from a patent search. Do not confuse the two!

Thus, do not try the crap-excuse "Mr. Examiner, you should Allow my application, as I did a patent search and there is nothing else like it". I had that said to me many times when I was an Patent Examiner, and perhaps another 200 times as a Patent Attorney. It is an absolute certainty that anyone who says this is a) incorrect, b) does not understand the patent process, and c) does not understand the Examination process. Also, that person certainly does not understand the canna-industry.

WHY INCORRECT PART II:  It is true that until recently, canna-innovations have not been subject to patenting. However, do not assume that a patent Examiner will only use other patents in their Prior Art search. This is one of the most common misunderstandings about the patent system, even by some otherwise knowledgeable attorneys.  SUMMARY: while canna-patents may be scarce, canna-information and canna-disclosures are not scarce. As such, plan on and expect significant resistance from the Patent Examiner. Yes, from above, it is apparent that the US Patent Office is giving out patents right and left for canna-innovations, but only to inventors who have done their homework.  

MYTH 4) You did a search for your canna-invention or canna-innovation, and  found something perhaps vaguely similar to your specific embodiment. Therefore, you completely stop your development, halt your business progress, and "give up" on your business or idea for a business.

WHY INCORRECT: This is another canard. I see this around 2 times/month. It is completely fallacious, specious reasoning. The existence of similar patents, or lack thereof, are almost always mis-interpreted by small businesses. Understanding whether an Issued Patent may affect your business requires making some very speculative judgments. A first problem is that the US patent Office may Issue two different patents, to two different entities, for arguably very close, similar subject matter. This problem can occur for millions of reasons, but for brevity I will only list two. The Patent Office makes mistakes, but also, the claims of the two patents may be very different such that they are not contradictory. Most people do not read patent claims, understandably so as these are difficult to understand.

The safe way to increase your chances of getting a patent yourself: strive for a lengthy, detailed disclosure, preferably at least 20 pages of disclosure and at least 15 pages of drawings. If you do this, it may in the end not matter what other patents are out there, if you have your own patents to rely upon as a business asset.

Below are exact quotes from Steve DeAngelo, while presenting at CannaBiz Day Orlando  on June 6, 2014. This material was posted to YouTube on June 22, 2014. Below, we borrowed about 2 minutes of a much longer presentation. However, you will see that we properly preserved the context.

"Innovate, Innovate, Innovate.  And when you innovate something, protect it."

"Start looking now for a good intellectual property attorney. Reach out and form that relationship."

"Educate yourself about trademark and patent law".

"If you don't have a good relationship with an IP attorney, you are going to make other people very rich off of your ideas. So make sure to protect what you create."

"75 years this plant has been illegal. . . .  in the course of  building your business, you will be forced to innovate."

All original copyrights belong to Steve DeAngelo and the Florida Cannabis Coalition. The microphone squeal (mild) is present in the original recording, and could not be filtered it out.

If you want to hear Steve's voice saying all this, download the files below.

As stated, part of what is holding this industry back is a lack of understanding about investing principles. One problem with canna-companies is the difficulty in defining exactly what is true innovation. Using volume of patent filings as a scaling-indicator of true innovation is a mistake.

Further, because of problems with banking, taxation, and cash-management, accurate financial data can be difficult to obtain. 

That's why canna-IPOs are for the most part premature, subject to a great deal of suspicion, and a symptom of a problem that truly committed canna-professionals should want to stamp out. The scams and cons make it harder for the rest of us who play by the rules.

This section is going to get a lot larger over time, so let us know if there is a specific subject or company you want us to cover.