The First Cannabis Patent Infringement Lawsuit Has Officially Concluded

0
23
The First Cannabis Patent Infringement Lawsuit Has Officially Concluded

We’ve been reporting on the progress of the United Cannabis Corporation (UCANN) patent infringement lawsuit against Pure Hemp Collective, Inc. since it was filed in July 2018. (See posts here, here, here, here, here, here … and here!) This was a fascinating case for the first few months as it was the first of its kind and the industry was excited to see how it would develop.

That patent is USP 9,730,911 – “Cannabis Extracts and Methods for Making and Using Them”, which generally includes liquid cannabinol formulations using tetrahydrocannabinol (THC), cannabidiol (CBD) and various terpenes (the “911 Patent”). The 911 patent generally covers liquid cannabinoid formulations using tetrahydrocannabinol (THC), cannabidiol (CBD), and various terpenes. UCANN had alleged that Pure Hemp’s “Vina Bell” product contains a cannabinoid formulation that directly violates claims 10, 12, 14, 20-22, 25, 27, 28, 31 and 33 of the 911 patent. Pure Hemp had argued that the UCANN formula was not patentable because “essentially pure liquid CBD products are ubiquitous”.

Then UCANN had no choice but to apply for relief in accordance with Chapter 11. As we discussed in this post, the patent infringement suit was automatically suspended and the court decided to close the case if it reopened for compelling cause.

UCANN faced various challenges before the bankruptcy court. As my colleague Jesse reported in this post:

UCANN is calling on this court to get involved in adjusting the debts of those who appear to have conspired to violate them [Controlled Substances Act]”. Obligations that “have arisen for further criminal behavior,” says the trustee, “cannot be a valid purpose for bankruptcy.” The trustee argues that it is “clear” that the licensees are entitled to use the 911 patent and that the 911 patent pertains in part to THC. The trustee asks the court to force UCANN to explain whether the license agreements provide for the use of the 911 patent to make, sell, or distribute THC-containing productions.

In another blow, bankruptcy judge Rosania agreed that UCANN’s connections to marijuana prevented relief under bankruptcy law and granted the trustee’s motion to dismiss the Chapter 11 case in January 2021.

We don’t know what has happened since then, but last week the parties finally agreed to dismiss the patent infringement case, leaving the intellectual property issues basically unresolved. Interestingly, UCANN rejected their claims with prejudice (meaning they will never be able to assert those claims again), but Pure Hemp unscathed their counterclaim for “bogus litigation” dismissed. It remains to be seen whether Pure Hemp will actually pursue this claim against UCANN in the future: UCANN’s financial situation seems dire, but Pure Hemp was obviously not ready to rule out the possibility.

This isn’t the closing post I imagined when I wrote about the first patent infringement lawsuit filed, but there will inevitably be others to be filed and litigated as the industry matures. We will monitor.