With adult use of cannabis now legal in California as of January 1, 2018, some food companies may be considering adding “edibles” – cannabis-infused products that are intended for human consumption – to their product lines.  According to Forbes, edibles may account for more than half of the growth in the booming cannabis industry, as high-end food products infused with cannabis and cannabinoids are growing in demand for the discerning consumer who cares not only about the high, but also taste and quality.

But with legalization comes regulation, and the California Department of Public Health has issued emergency regulations detailing what is and isn’t allowed in manufacturing and selling edibles. Among the regulations are stringent requirements for THC content per serving and per package, and packaging and labeling requirements.

Here are some key things to know about manufacturing and selling edibles under the new California regulations.

Prohibited Products

There are certain things that you just can’t make into and sell as edibles.  Alcoholic beverages, dairy products, meat (other than dried meat) and seafood are out.  Products that have to be kept below 41° Fahrenheit to make them fit for human consumption are also out, as is juice that is not shelf-stable.  Products with additives such as nicotine or caffeine that would increase potency, toxicity or addictive potential, or that would create an unsafe combination with psychoactive substances, are prohibited.  But a product that has naturally-occurring caffeine, like tea, coffee or chocolate, is fine.  You can’t add cannabinoid concentrate or extract to commercially available candy or snack food with no further processing, and products that are easily confused with commercially available food products that do not normally contain cannabis are prohibited.

Don’t Make Them Appealing to Children

A big concern addressed by the regulations is preventing children from accidentally ingesting cannabis edibles.  To that end, manufacturers of cannabis edibles can’t make products that might be attractive to children.  Edibles that are shaped like a human, animal, insect or fruit are specifically prohibited.  If you are going to make cannabis gummies, for example, don’t make them look like gummy bears and don’t call them “candy.”    The terms “candy” or “candies” can’t be used.  The label and packaging can’t contain content that imitates candy packaging or labeling, or include anything that might appeal to children, such as cartoons or other images, characters, or phrases popularly used to advertise to children.  Finally, the packaging itself has to be child resistant and can’t look like packaging used for products typically marketed towards children.

THC Content and Servings

The regulations limit the amount of THC (tetrahydrocannabinol, the chemical compound in cannabis responsible for a euphoric high) that can be in edibles. Edibles may not contain more than 10 milligrams of THC per serving and 100 milligrams of THC per package.

Edibles have to be packaged so that a consumer can accurately identify a single serving.  Products that contain more than one serving have to be scored or delineated to indicate a single serving, if it is in solid form.  If it is not in solid form, it has to be packaged in such a way that a single serving is readily identifiable. For example, if selling a cannabis-infused drink, you may want to include a dosage cup similar to what comes with cough syrup. Each serving in a multi-serving package has to contain about the same amount of THC.

All product ingredients or components, other than the cannabis, cannabis concentrate, or terpenes, must be permitted by the U.S. Food and Drug Administration (FDA) for use in food or food manufacturing (Everything Added to Food in the United States).

Packaging Requirements

The packaging for edible cannabis products must:  (1) protect the product from contamination, (2) be tamper-evident, meaning that it is sealed so that it cannot be opened without obviously breaking the seal, (3) be child-resistant, (4) not imitate packaging for products typically marketed to children, (5) be opaque, and (6) if containing more than one serving, be re-sealable so that child resistance is maintained.

Labeling Requirements

If you are a food manufacturer, you know that making sure your labels are compliant with FDA regulations is important.  It is no different under the California regulations for edible cannabis products.  The labeling on packages of edibles must have two components:  a primary panel and an informational panel.

The primary panel must include:

1. The identity of the product in a text size reasonably related to the most prominent printed matter on the panel, and the words “cannabis-infused” immediately above in a text size larger than the text size used for the identity of the product;
2. The universal symbol as shown below, printed conspicuously and legibly, not less than a half inch by a half inch;
   
3. Net weight or volume of the contents; and
4. THC and CBD (Cannabidiol, the non-psychoactive cannabis compound) content of the package, as well as the THC and CBD content per serving, all expressed in milligrams.

The informational panel must include:

1. Name and contact number or website address of the manufacturer;
2. Date of manufacture and packaging;
3. The following statement in bold print: “GOVERNMENT WARNING: THIS PRODUCT CONTAINS CANNABIS, A SCHEDULE I CONTROLLED SUBSTANCE. KEEP OUT OF REACH OF CHILDREN AND ANIMALS. CANNABIS PRODUCTS MAY ONLY BE POSSESSED OR CONSUMED BY PERSONS 21 YEARS OF AGE OR OLDER UNLESS THE PERSON IS A QUALIFIED PATIENT. THE INTOXICATING EFFECTS OF CANNABIS PRODUCTS MAY BE DELAYED UP TO TWO HOURS. CANNABIS USE WHILE PREGNANT OR BREASTFEEDING MAY BE HARMFUL. CONSUMPTION OF CANNABIS PRODUCTS IMPAIRS YOUR ABILITY TO DRIVE AND OPERATE MACHINERY. PLEASE USE EXTREME CAUTION.”
4. If for medicinal use, the statement “FOR MEDICAL USE ONLY”;
5. A list of all product ingredients in descending order of predominance by weight or volume;
6. If the product contains a major food allergen, the word “contains” followed by a list of such allergens;
7. The names of any artificial food colorings contained in the product;
8. The amount, in grams, of sodium, sugar, carbohydrates, and total fat per serving;
9. Instructions for use, such as the method of consumption or application, and any preparation necessary prior to use;
10. The product expiration date, “use by” date, or “best by” date, if any; and
11. The UID (the unique identifier for use in the track-and-trace system established by the Department of Food and Agriculture) and, if used, the batch number.

The label can’t contain any claims that the cannabis was grown in a California county if it was not actually grown there and can only name the California county in which it was actually grown.  The label can’t have any false or misleading information, and can’t make any health-related claims that are untrue or misleading. However, the label can include a statement of effects – information on the characteristic anticipated effects if the manufacturer has substantiation that the information is truthful and not misleading, as long as there are no claims of health benefits.

Other Considerations

It’s important to note that cannabis is considered a controlled substance under the federal Controlled Substances Act, and despite legalization in California, trafficking in cannabis, including the manufacture and sale of  edible cannabis products, remains illegal under federal law.  Possible negative consequences, including federal criminal prosecution and tax liability, still exist. Along with the requirements outlined here, there are other requirements under California law with regard to obtaining a manufacturing license, testing, advertising, distribution and sales of edible cannabis products. It’s a brave new world of legalized cannabis in California, but before jumping in, it is important to first seek legal advice and to proceed with caution.

Can a corporation protect its logo by copyright as well as by trademark law?

Traditionally, when one thinks of works protected by the law of copyright, one thinks of substantial works of authorship such as a novel, a song or a painting. And, indeed, among the required elements to establish a copyright in a work is that the work contain a certain degree of originality and creativity.

It has been recognized that a corporate logo used as a trademark is nonetheless copyrightable where the logo qualifies, in and of itself, as pictorial or graphic work that meets the general requirements of the law of copyright. See 1 McCarthy on Trademarks and Unfair Competition § 6:18 (4th ed.). Courts have found that a corporate logo can incorporate a “creative drawing” which is a creative work of the sort at the “core” of those types of works protected by the Copyright Act. Bouchat v. Baltimore Ravens Limited Partnership (4th Cir. 2010) 619 F.3d 301, 311.  Indeed, it has been observed that “pictures and logo designs used as marks are no less pictures and designs merely because they appear on labels and in advertisements.” McCarthy, supra, at § 6:18; see Bleistein v. Donaldson Lithographing Co. (1903) 188 U.S. 239 (a pictorial work is no less a subject of copyright protection because it is used to sell goods).

To be copyrightable as a pictorial, graphic, or sculptural work [pursuant to 17 U.S.C. § 102(a)(5)], a work “must embody some creative authorship in its delineation or form.”  37 C.F.R. § 202.10. The logo must demonstrate “artistic features” above and beyond serving as a mere identifier of the source of goods or services.  See Fabrica Inc. v. El Dorado Corp. (9th Cir. 1983) 697 F.2d 890, 894 (pictorial, graphic, or sculptural works must “stand alone” as “works of art,” with “artistic features” separate and apart from their utilitarian purpose); see also John Muller & Co. v. New York Arrows Soccer Team, Inc. (8th Cir. 1986) 802 F.2d 989, 990 (logo for the New York Arrows soccer team lacked the minimum requisite level of creativity to be considered a “pictorial, graphic or sculptural work”).

Even tradedress can be copyrightable where it rises to the level of a unique, creative work of authorship. See Reader’s Digest Association, Inc. v. Conservative Digest, Inc. (D.C. Cir. 1987) 821 F.2d 800, 806 (Reader’s Digest has combined and arranged common typeface and other elements to create a unique graphic design and layout.)

If your company is ever in a position to have to be thinking about pursuing an infringer where trademark protection of a logo is problematic for some reason or perhaps insufficient to bar the particular infringing use at issue, it may be advantageous to consider other theories such as copyright. At the very least, this is a reminder of the need for “creative” thinking about the nature and source of intellectual property protections that may yield alternative sources of protection in many circumstances.