United Cannabis Corp. v. Pure Hemp Collective Inc. – Why The (Cannabis) World Is Watching

We have received an unusually high number of inquiries from clients and commentators concerning the patent infringement action filed by United Cannabis Corporation (UCANN) against Pure Hemp Collective Inc. late last month.  (See United Cannabis Corp. v. Pure Hemp Collective Inc., Case No. 1:18-cv-01922-NYW (D.Colo).)  For those not paying attention, the case involves allegations that Pure Hemp’s tinctures, gel capsules, vape pens, and other cannabis products infringe one or more claims of UCANN’s patent for “cannabis extracts and methods of preparing and using same.”  (U.S. Patent No. 9,730,911.)

The hype is not unwarranted.  The case, filed in federal court in Colorado, has major implications on two fronts: (i) the enforcement of the UCANN patent specifically; and (ii) the overall viability of litigation concerning cannabis-related patents.  First, at the industry level, a determination as to the validity and enforceability of what most consider to be a rather broad patent could dictate whether UCANN will be able to successfully enforce this patent against all others utilizing a liquid cannabinoid formulation containing 95% cannabidiol (CBD).  From a broader perspective, this is the first infringement suit concerning a patent on a cannabis-related product that, while patented, is used in connection with a substance that remains illegal at the federal level – leaving open a threshold question concerning the ability of the courts to even hear such cases.

Absent a quick settlement, it is difficult to conceive of any outcome, whether it be at the motion to dismiss stage or at trial, that will not send shockwaves through the industry.  Who those shockwaves impact most remains to be seen, and we will certainly update this blog as the case proceeds.