Last week, the U.S. Court of Appeals for the Ninth Circuit issued a ruling in AK Futures LLC v. Boyd Street Distro, LLC, No. 21-56133 (May 19, 2022), holding that e-cigarette manufacturer AK Futures had a legitimate trademark on its line of delta-8 tetrahydrocannabinol (THC) vaping liquids and affirming a preliminary injunction against wholesaler Boyd Street Distro LLC.
AK Futures filed suit against Boyd Street in California federal court in June 2021, alleging the vape seller was infringing its trademark by selling unauthorized versions of its “Cake”-branded delta-8 vaping liquid. The court granted AK Futures a preliminary injunction against Boyd Street. Boyd Street appealed.
On appeal, Boyd Street argued federal law forbids possession and sale of delta 8-THC as a controlled substance, preventing AK Futures from holding legitimate trademark rights based on use of the “Cake” mark on such goods. The Ninth Circuit disagreed, and affirmed the injunction. Specifically, the Court held the 2018 Farm Act removed the word “hemp” from the definition of marijuana under the Controlled Substances Act, thus legalizing delta-8 THC. The Court further noted that delta-8 THC is an extract originating from the cannabis plant that contains “not more than 0.3 percent delta-9 THC.” The Court explained that as long as AK Futures’ “Cake” product contains only delta-8 THC derived from non-psychoactive hemp, legitimate trademark rights can exist in the mark.
The ruling is significant in that it opens up federal trademark protection for products that contain delta-8 THC.