From (Digital) Field to Plate

There's a plethora of products to be protected now in the agribusiness and cannabis sectors — and they need a host of intellectual property protection types

From the “digital farm field” to industrial design, patent and trademarks and plant breeders’ rights, there’s a myriad of property protection that agribusiness, including the cannabis sector, need.

The types of intellectual property protection available for agribusiness and cannabis are those available in all industries, says Rob McDonald, a partner and trademark agent at Bennett Jones LLP in Edmonton. That’s patent protection, industrial design, trade secrets, trademark and copyright protection; specific to agribusiness and cannabis are plant breeders’ rights.

“Every business has these rights to keep in mind, but agribusiness and cannabis in particular, because they’re growing so rapidly . . . they have to be [especially] aware of their rights and take steps to protect their rights,” he says.

And although agribusiness is not new, there is significant innovation in the field.

Alistair Simpson, managing partner of Smart & Biggar LLP’s Calgary office, says he sees a “melding together” of agribusiness and the food sector business. By way of example, the Calgary Stampede renamed its International Agricultural Committee as the International Agriculture & Agri-Food Committee a few years ago, he says.

And agribusiness has moved from being mechanically driven to relying more on technology, implementing computer processing and mobile communication technology systems.

“It’s the industrial Internet of Things,” says Simpson. Twenty to 30 years ago, most farm equipment components were mechanically driven. Today, the “digital farm field” has entered into the agricultural equipment sector.

“Companies are getting involved in the ag equipment electronic systems,” says Simpson. “Not just traditional multinational companies, but other computer companies are developing IP” for the sector. In the past, patents were typically mechanical, but “with this infiltration of computer and mobile technology systems, the level of patenting is starting to increase,” he says. “The consequences of that will be seen in the next several years, with a greater emphasis on ag equipment manufacturers protecting their technology.”

Another issue that arises as a result of high-tech computer systems is that of interoperability, Simpson says, meaning the ability of computer systems or software to exchange and make use of information. Computer boxes can talk to another, and mobile phones talk to a cellular tower. Interoperability between the products of different manufacturers “is an emerging issue and covers not only patents, but copyrights,” says Simpson.

And although there has always been a good amount of litigation in the agricultural equipment sector in Canada, he says, he expects to see more going forward with the introduction of high tech.

With the legalization of recreational cannabis in Canada, a lot of money is going into technological innovation, including the seeds themselves, Simpson says, as well as in new technologies for improving the growing of cannabis in
Canada, “particularly regarding the challenges of the Canadian climate.”

“One of the challenges is how to address and improve the growth profile of cannabis plants, especially on a large scale. Others in our firm are up to their waists in that sector. That’s one thing I’ve seen with clients in Alberta and Western Canada: a focus on improvement and the ability to grow plants and tech solutions.”

When IP disputes arise, “they will always be regarding a trade secret, whether it was properly protected, whether contracts in place were adequately protected, whether disclosures were made or not properly protected,” says Evan Nuttall, a litigation partner in Smart & Biggar’s Calgary office.

“If a client thinks they have some form of trade secret, make sure you identify it, limit access to it. And, for employees, make sure you have proper employment and confidentiality agreements in place [as well as] a non-disclosure agreement that clearly identifies what is confidential.

“The problem’s always going to be failure to properly get your employees covered by confidentiality agreements,” Nuttall says. “That doesn’t change from sector to sector dramatically.”

New varieties of plants can be protected. “We’ve seen an increase in [filings for] another type of IP called plant breeders’ rights,” says Micheline Gravelle, practice group co-leader of Bereskin & Parr LLP’s cannabis group in Toronto. Plant breeders’ rights, which also apply to other agricultural plants such as berries, can be obtained instead of or in addition to patent protection and confer an exclusive right to sell, produce and reproduce, import and export propagating material of a new plant variety. Plants themselves cannot be patented in Canada.

Patents for growing cannabis are “more on the different methods of extracting the cannabinoids — the CBD or THC — out of the plant, because that can be quite complicated,” she says. “In Canada, you can’t really patent the method of growing, unless you’ve made a genetic strain and you did something to alter the plant, and then you might be able to [patent] a method of making a new cannabis plant using genetic engineering.”

Gravelle also reports seeing an increase in patent filings for industrial design protection for ornamental or esthetic elements of cannabis products for delivery devices, such as the shape of vaporizers.

Retailers will also be able to create a look and feel to their stores that can be proprietary and protected as well, says McDonald.

And patents are a rapidly increasing area of IP protection in both agribusiness and cannabis, notes McDonald. More than 250 cannabis-related patents have been filed in the U.S. alone in 2018 — more than in the previous seven years combined, he says. Many are related to pharmaceutical compositions, cultivation techniques, for methods in finding pests on plants, for extracting pharmaceutically active ingredients from cannabis, for vaporizers and cannabis-
related paraphernalia.

“There are patents relating to cannabis-infused products that range from toothpastes to coffee beans to alcoholic beverages,” says McDonald. “There are just a plethora of intellectual property rights being protected through the patent system for cannabis and its related products. . . . There’s almost nothing that you can’t infuse with cannabis.”

The outcome of all of these new patents and the growth in cannabis-related patents is that there’s more prior art out there, says McDonald, meaning publicly available information related to inventions and discoveries and previously filed and issued patents. This is important because only something new and original can be patented.

“If the prior art that exists in the world discloses certain inventions, then you can’t get patents for them,” he says. “So, as this industry grows, and as it’s growing so rapidly, the prior art is growing, meaning it’s going to be harder and harder to get patents because it’s going to be harder and harder to find something that is new and innovative.”

McDonald sees challenges in all areas of IP protection in the sector.

Because cannabis is still illegal under the United States’ Controlled Substances Act, companies may be able to get trademark protection in Canada but not reciprocal arrangements in the U.S., he says.

“The other issue that’s unique to patents and higher life forms [which include plants] is that you can’t get patents on higher life forms in Canada, but you can in the United States.” This makes it difficult to get consistency of
IP protection and for a company to be able
to enforce and commercialize intellectual property between jurisdictions, he says.

Promotion of cannabis products also remains a challenge, says Jennifer McKenzie, practice group co-leader of Bereskin & Parr LLP’s Cannabis Group in Toronto.

The Cannabis Act of 2018 allows legal, licensed producers to promote in a very limited way. “The challenge continues for companies to navigate the allowable promotions, because there’s some ambiguity in the law,” she says, and so difficulty in creating a name brand that is lawful. When the COVID-19 pandemic passes, “I think Health Canada will be giving more guidance on the federal law and how they interpret it.”

The Cannabis Act also prohibits marketing cannabis with an existing brand for an alcoholic beverage. This raises the question, says McKenzie, of whether the Canadian Intellectual Property Office will take the view that a pending application for a cannabis mark will be considered confusing compared to a mark covering alcoholic beverages.

“The prosecution hasn’t been that intense yet because most of the cannabis marks are still pending,” she says.

McKenzie also advises clients to file a trademark application even if they don’t plan to use the mark immediately. Since the Cannabis Act says that marks cannot be cancelled for non-use, “you can sit on a mark.”

And traditional agribusiness companies are embracing the cannabis sub-sector, says McDonald, including those who manufacture baking goods, are active in the crop sciences field and who make pet food, fertilizer and dietary supplements and run craft breweries.

“As we see things like edibles and beverages starting to proliferate, you’re going to see more traditional agribusinesses looking more like cannabis-related businesses because they’re going to have cannabis-related products.”