Cannabis Trademark Litigation: Wrigley Wins

By Jihee Ahn, Attorney at Harris Bricken

A final judgment recently rendered in WM. Wrigley Jr. Company v. Roberto Conde, et al., is nothing short of a cautionary tale and a powerful reminder to cannabis companies: Parody is NOT a defense to trademark infringement in this type of commercial context.

The parties

We all know Wrigley – it’s a titan in the food industry and offers a range of products like gum, mints, and candies, including Skittles, Starburst, and Lifesavers. Wrigley is the owner of numerous trademarks and, relevant here, owns and have used the famous SKITTLES and STARBURST marks.

The judgment, which is based on a consent decree between the parties, is rendered against Steven Mata, an individual who lives and conducts business in Orange County. Mata does business as OC420, which is a retailer of edible cannabis products.

Mata marketed and sold products like “Medicated Skittles,” “Medicated Cannaburst Gummies,” and a “Munchies Edible Deal.” The packaging is clearly meant to imitate the Skittles and Starburst packaging, which adopts and uses the word marks in the same fashion and features a graphic design that is also nearly identical to the original candies.

The problem

There is a line between using another’s mark to make political or social commentary and using another’s mark to gain recognition and increase sales of your own product. We’ve written before about cannabis companies that have attempted to spoof well known marks and have paid a price for it.

Hershey’s, for example, made a statement against the industry when it initiated multiple lawsuits over several years against companies that branded cannabis-infused chocolate products with names such as “Mr. Dankbar,” “Reefer’s Peanut Butter Cups,” “Hasheath,” and “Ganja Joy,” all meant to imitate the popular chocolate products. These cases ultimately settled out of court.

The judgment

The judgment states that Mata’s conduct constituted:

Trademark infringement; Trademark dilution; Unfair competition and deceptive acts; Dilution under relevant California Business and Professions Code statutes; and Counterfeiting.

The Court issued an injunction against any further counterfeiting, infringement, dilution, and unfair competition. Mata is also to recall any products, packaging, and advertising that is already out in the world, and provide them to Wrigley’s attorneys for destruction. Finally, Mata is to provide an accounting of all profits from the products and “disgorge” them (turn them over) to Wrigley, in addition to statutory damages of $2 million per counterfeit mark, as well as pre-judgment interest, Wrigley’s costs and its attorneys’ fees in prosecuting the case.

Oof. This is one of the harshest judgments we’ve seen in a while, and that’s because Mata’s conduct was malicious and willful. (Sidenote: this also means that if Mata filed for bankruptcy, this judgment is non-dischargeable.) So please – don’t find yourself in a similar position and make sure to work with good intellectual property lawyers to clear your brand from the get go.

Re-published with the permission of Harris Bricken and The Canna Law Blog