Tag Archives: technical

Richard Naiberg
Quality From Canada

Protecting Intellectual Property in Canada: A Practical Guide, Part 4

By Richard Naiberg
No Comments
Richard Naiberg

Editor’s Note: This is the third article in a series by Richard Naiberg where he discusses how cannabis businesses can protect their intellectual property in Canada. Part 1 introduced the topic and examined the use of trade secrets in business and Part 2 went into how business owners can protect new technologies and inventions through applying for patents. Part 3 raised the issue of plant breeders’ rights and in Part 4, below, Naiberg discusses trademarks and how cannabis businesses should go about protecting their brand identity in Canada.


Trademarks: Protections For Brands And Goodwill

Cannabis businesses must not only protect their investments in their technical creations, but also must protect their brand identities. A cannabis producer can invest heavily in making a desirable, high-quality product, and can advertise and sell this product so as to generate customer interest and goodwill, but if the customer cannot distinguish the producer’s product from that of its competitor, this investment is for not. Trademarks become unenforceable when they are no longer distinctive.

A trademark provides its owner with the right to have the Court stop another entity from using the trademark, or using a similar trademark in a way that confuses the public. When the trademark is infringed, the Court can also make a monetary award in favor of the trademark owner.

Trademarks are identifiers of a particular source of manufacture and they can take virtually any form. Trademarks can be words, phrases, symbols, names, designs, letters, numbers, colors, three-dimensional shapes, holograms, moving images, modes of packaging, sounds, scents, tastes, textures, or any other distinguishing element. What a trademark cannot be is a mere descriptor of the goods or services themselves because such a trademark would prevent other entities from describing their products in their ordinary terms.

Trademarks can be registered, but they do not have to be. In choosing a trademark, the cannabis producer must balance competing impulses: the desire to choose a trademark that is suggestive of the product itself so as to have an immediate meaning to customers without need of an expensive marketing campaign; and the desire to coin a unique and striking trademark which is instantly eye-catching and memorable, but which must be advertised before customers can understand the product to which it refers.

For example, a depiction of cannabis leaf or a word that plays on the ordinary terms used to refer to cannabis will not make a strong mark that can be enforced against those who adopt something similar. On the other hand, a coined word, such as “Kodak”, may have no independent association with cannabis but, after a time, use of this mark in association with a cannabis product can create a very strong mark with a wider ambit of exclusivity.

All that said, even a very suggestive mark can serve as a trademark where the use of the mark is so longstanding and ubiquitous that the suggestive mark acquires a secondary meaning as an indicator of its source of manufacture. Cannabis producers can and should also consider adopting specific colors, scents or tastes of their products as trademarks, where appropriate.

Trademarks become unenforceable when they are no longer distinctive. For this reason, trademark owners must keep abreast of any use of trademarks similar to their own by third parties, and must act quickly to either license such uses or to restrain them.Cannabis businesses have been very busy applicants for trademarks. More than 1700 such applications are now on file, though a comparative few have yet been registered. 

Trademarks can be registered, but they do not have to be. When a company’s product or service becomes known to its customers or potential customers with reference to a mark through ordinary business use, a trademark has been created.

Registration does however provide certain advantages. Under the amendments to the Trademarks Act coming in 2019, a registered trademark can be obtained for without any proof of use or goodwill.  By contrast, and as noted above, an unregistered mark must be used and possess goodwill before it can be said to exist at all. A registered trademark provides protection for its owner across Canada. An unregistered trademark can only be enforced in the geographical area in which its owner has established its reputation. A registered trademark is protected from those who use it in a manner that is likely to depreciate the goodwill of the trademark. An unregistered trademark only protects against consumer confusion.

Registration under the Trademarks Act also makes it an offence to sell goods or services on a commercial scale in association with another’s registered trademark, or to traffic in infringing labels. Further, a trademark owner can request that the import or export of such goods in Canada be arrested. No similar rights accrue for unregistered trademarks.

Finally, a registered trademark is published at the CIPO web site, providing notice of its existence to new market entrants before these entrants commit to using a similar trademark. Unregistered marks are not always easily discovered and a new market entrant may commit to a mark before having any opportunity to discover that it is the unregistered trademark of another.

Registering a trademark is straightforward. The applicant prepares an application that identifies the applicant, the trademark and the goods and/or services with which the trademark is being used or is intended to be used. Once satisfied that the application complies with the Trademarks Act, CIPO publishes the application to allow potential opponents of the registration to come forward. If there is no opposition, or if an opposition proceeding is brought and dismissed, the trademark is issued.

There is an interaction between the Trademarks Act and the Plant Breeder’s Rights Act. As discussed above, when a denomination has been adopted for a plant variety under the Plant Breeder’s Rights Act, nothing similar can be adopted or registered as a trademark. This is so other traders may use the denomination in their sale of the variety after expiry of the plant breeder’s right.

Cannabis businesses have been very busy applicants for trademarks. More than 1700 such applications are now on file, though a comparative few have yet been registered. Trademark applications in this area are likely to increase further with the coming changes to the Trademarks Act and the removal of the requirement that applicants show use of the trademark prior to registration. Companies will be encouraged to apply for trademarks they may only be considering using, and for any trademarks that they think their competitors may be planning to use. There is some concern that the changes to the Trademarks Act will lead to the rise of trademark trolls.

Before adopting a particular trademark, the producer must do what it can to minimize the likelihood that a third party will assert that the trademark infringes the third party’s prior rights. Searches of Canadian and international trademarks, particularly United States trademarks, are advised. National intellectual property offices, such as CIPO and the United States Patent and Trademark Office, maintain easily searchable databases of registered and applied-for trademarks that should be reviewed. Search professionals can also assist in identifying trademarks that have never been the subject of a trademark application. With the result of the searches in hand, the cannabis producer can determine whether or not to proceed to adopt the contemplated mark and invest in its promotion.


In Part 5, Naiberg will explain how to use a copyright to protect works of creative expression. Stay tuned for more!

EVIO Logo

EVIO Labs Massachusetts Accredited to ISO 17025

By Aaron G. Biros
No Comments
EVIO Logo

EVIO Inc.’s Massachusetts lab announced yesterday they received ISO/IEC 17025 accreditation from the American Association for Laboratory Accreditation (A2LA). According to the Massachusetts Cannabis Control Commission, the body in charge of regulating the state’s cannabis industry, accreditation to ISO/IEC 17025: 2017 is a requirement for cannabis testing labs.

The press release says this makes EVIO Labs Massachusetts one of only a few operating and accredited testing laboratories serving the state’s medical cannabis industry. With recreational sales coming shortly to the state, EVIO is preparing for a higher demand in their lab testing services. “We are very proud of all of the teams’ hard work that resulted in this advanced accreditation,” says James Kocis, lab director of EVIO Labs Massachusetts. “With the state-mandated laboratory regulations, EVIO upholds the high standards of testing and plays a pivotal role in ensuring consumer safety and confidence in the states burgeoning marijuana market.”

According to Adam Gouker, general manager at A2LA, EVIO Labs Massachusetts, based in Southborough, MA, is the first cannabis laboratory they accredited in the state. “A2LA is excited to expand our cannabis accreditation program into yet another state, promoting the value of independent third-party accreditation to support quality products in the industry,” says Gouker. “Having the opportunity to work with a prominent name in the industry such as EVIO Labs and assess their exceptional Massachusetts laboratory has been an additional bonus.”

EVIO LogoAccording to the A2LA press release, by achieving ISO/IEC 17025 accreditation, EVIO Labs Massachusetts demonstrates that they “have management, quality and technical systems in place to ensure accurate and reliable analyses, as well as proper administrative processes to ensure that all aspects related to the sample, the analysis, and the reporting are standardized, measured, and monitored.” It also requires that personnel are competent to perform each analysis.

EVIO Inc. operates in the cannabis testing market with lab services in a number of states, including Oregon, California and Florida among others. Their Florida location was the first accredited cannabis lab in the state and they recently earned the same accreditation for their Berkeley, California location.

Dr. Ed Askew
From The Lab

Quality Plans for Lab Services: Managing Risks as a Grower, Processor or Dispensary, Part 2

By Dr. Edward F. Askew
No Comments
Dr. Ed Askew

Editor’s Note: The views expressed in this article are the author’s opinions based on his experience working in the laboratory industry. This is an opinion piece in a series of articles designed to highlight the potential problems that clients may run into with labs. 


In the previous article, I discussed the laboratory’s first line of defense (e.g. certification or accreditation) when a grower, processor or dispensary (user) questions a laboratory result. Now let us look behind this paperwork wall to the laboratory culture the user will encounter once their complaint is filtered past the first line of defense.

It is up to the client (processor, grower or dispensary) to determine the quality of the lab they use.In an ISO 17025 (2005 or 2017) and TNI accreditation, the laboratory must be organized into management, quality and technical areas. Each area can overlap as in the ISO 17025-2017 standard or be required to remain as separate sections in the laboratory as in the ISO 17025-2005 or TNI 2009 standards. ISO 17025 standards (e.g. 2005 and 2017) specifically require a separation of monetary benefits for laboratory results as it applies to the technical staff. This “conflict of interest” (CoI) is not always clearly defined in the laboratory’s day-to-day practices.

One example that I have experienced with this CoI separation violation goes back to my days as a laboratory troubleshooter in the 1990s. I was called into a laboratory that was failing to meet their Department of Defense (DoD) contract for volatile organic hydrocarbon analyses (VOAs) of soil samples by purge trap-gas chromatography-mass spectroscopy. I was required to “fix” the problem. What I determined was:

  • The analytical chemists performing the VOAs analyses were high school graduates with no coursework in chemistry or biology.
  • There was no training program in place for these analysts in instrument use, instrument troubleshooting and interpretation of the analytical results.
  • The only training the analysts received was for simple instrument set-up and basic instrument computer software use. (e.g. Push this button and send results to clerks)
  • Clerks with a high school degree and no analytical chemistry training in the business office generated the final reports and certified them as accurate and complete.

None of the staff was technically competent to perform any in-depth VOAs analytical work nor was the clerical staff competent to certify the results reported.

When I pointed out these discrepancies to the laboratory management, they declined to make any changes. The laboratory management had a direct monetary interest in completing all analyses at the lowest costs within the time limit set by DoD. If the laboratory did not complete the analyses as per the DoD contract, DoD would cancel the contract and not pay the laboratory.

The DoD, in a “Double Blind” test sample, later caught this laboratory.. A Double Blind test sample is used to check to see if the laboratory is performing the tests correctly. The laboratory does not know it is a test sample. So if the laboratory is cheating, they will be caught.This does not mean that all laboratories have staff or management issues

Once the laboratory was caught by DoD with the Double Blind, laboratory management claimed they were unaware of this behavior and management fired all analytical staff performing VOAs and clerical staff reporting the VOAs results to show DoD that it was a rogue group of individuals and not the laboratory management. The fired staff members were denied unemployment benefits as they were fired with cause. So, the moral to this story is if the analytical staff and specifically the clerical staff had wanted to hold the laboratory management accountable for this conflict of interest, they may have been fired, but without cause. The staff would have kept their reputation for honesty and collected unemployment benefits.

I have witnessed the “CoI above repeatedly over the last 30+ years both in laboratories where I have been employed and as a consultant. The key laboratory culture problems that lead to these CoI issues can be distilled into the following categories:

  • Financial CoI: In the financial CoI, the laboratory management must turn out so many analytical test results per day to remain financially solvent. The philosophical change that comes over management is that the laboratory is not producing scientific results, but is instead just churning out tests. Therefore, the more tests the laboratory produces, the more money it makes. Any improvement in test output is to be looked upon favorably and anything that diminishes test output is bad. So, to put this in simple terms: “The laboratory will perform the analyses quickly and get the report sent to the user so the laboratory can be paid. Anything that slows this production down will not be tolerated!” To maximize the Return on Investment (RoI) for the laboratory, management will employ staff that outwardly mirrors this philosophy.
  • I Need This Job CoI: This is the CoI area that poor quality lab technical staff and clerical staff most readily falls into. As outlined in the example above, both the analytical staff and clerical staff lacked the educational credentials, the technical training to be proficient in the use of the analytical instruments, ability to identify problems performing the analytical methods or complications in reporting analytical results. That means they were locked into the positions they held in this specific laboratory. This lack of marketable skills placed pressure on these staff members to comply with all directives from management. What happened to them in the end was regrettable, but predictable. Management can prey on this type of staff limitation.
  • Lack of Interest or Care CoI: This form of CoI is the malaise that infects poor quality laboratories, but can reach a level in management, quality and technical areas as to produce a culture where everyone goes through the moves, but does not care about anything but receiving their paycheck. In my many years of laboratory troubleshooting this type of CoI is the most difficult to correct. Laboratories where I had to correct this problem required that I had to impress on the staff that their work mattered and that they were valued employees. I had to institute a rigorous training program, require staff quality milestones and enforce the quality of work results. During my years of laboratory troubleshooting, I only had to terminate three laboratory staff for poor work performance. Unfortunately after I left many of these laboratories, management drifted back to the problems listed above and the laboratory malaise returned. This proves that even though a laboratory staff can achieve quality performance, it can quickly dissolve with lax management.

So, what are the conclusions of this article?

  • Laboratory culture can place profit over scientific correctness, accuracy and precision.
  • Laboratory management sets the quality of staff that determines the analytical results and report quality the user receives.
  • Laboratory quality can vary from acceptable performance to unacceptable performance over the lifetime of the laboratory depending on management.
  • This does not mean that all laboratories have staff or management issues. It is up to the client (processor, grower or dispensary) to determine the quality of the lab they use.

The next article in this series will introduce the user to the specific Quality Control (QC) analyses that an acceptable laboratory should perform for the user’s sample. These QC analyses are not always performed by accredited laboratories as the specific state that regulates their cannabis program does not require them. The use of these QC samples is another example of how laboratory’s with poor quality systems construct another paper work wall.

Marguerite Arnold
Soapbox

Paradox Or Paragon? A Non-Techie Look At Blockchain and Cannabis: Part III

By Marguerite Arnold
1 Comment
Marguerite Arnold

Disclaimer: Marguerite Arnold has just raised the first funds for her blockchain-based company, MedPayRx in Germany (and via traditional investment funding, not an ICO). She will also be speaking about the impact of blockchain on the cannabis industry in Berlin in April at the International Cannabis Business Conference.


Part I of this series was an overview discussion of blockchain, cryptocurrencies and cannabis and Part II dove into some of the pitfalls of ICOs in the cannabis space. This is the third and final piece of this series.

Beyond raising money or tying a tradable altcoin to cannaproduct, there are many places where blockchain technology can (and will) be used to great effect in the cannabis industry.

In fact, ICOs and cryptocurrency are only part of the blockchain discussion for the cannabis industry. In general, the technology will disrupt the vertical just like it is upending other businesses right now. However, for the moment at least, it will prove most useful in the most complicated and challenging technical and regulatory areas – supply chain product tracking being the lowest hanging fruit (which is still fairly high off the ground for a number of reasons). If evaluating blockchain tech is too onerous (which it usually is for the average investor or even senior cannabis exec), there are other options. Look for innovative mobile DApps (distributed apps that use blockchain for a specific purpose) and smart business cases.

The fascinating reality is that where there are service models that can be adapted to regulatory guidelines, blockchain promises, in fact, to remove the red tape and paperwork holding the industry back internationally. The impact on research and testing will also be huge.The rules are certainly changing with regards to public companies and cannabis.

The technology, or even the regulations, in other words, is not necessarily all to blame for the many issues budding blockchain entrepreneurs currently face. This space-age techie stuff, no matter how mind-blowing, is still “just” a tool. As the late Peter Drucker famously said, the raison d’etre of every successful business is one that solves a critical need for their customer. Find one for the industry that happens to use the technology, and you might just retire early. But there is a lot of road between that reality and now. And there probably will not be an ICO on that path. Not in most jurisdictions, and certainly not without complications in every one of them.

With an internationally stock-listed Canadian cannabis business now developing, the rules are certainly changing with regards to public companies and cannabis. For all the press that Cronos recently received for getting listed on the NASDAQ, AbCann got (relatively quietly) listed in Frankfurt last summer. Canopy and Aurora have also just become two of the hottest stocks in Sweden.

That said, these are public companies with regular stock issuances. What that means for ICO issuances related to the cannabis industry in Canada specifically is anyone’s guess at the moment. In Germany presently, this is mine-strewn territory. But even here, that will be driven as much if not more by banking law than canna-reform, just like everywhere else.

Not to mention this of course: Given the choice of investing in a public cannabis company already in business with its stock conveniently listed and purchasable via a regular exchange, what would most people choose? It’s just a whole lot easier than taking a flier on a cannabis-themed ICO offering for a concept that may be a great idea, but will never materialize. Or find a bank. Even in Europe or Canada.

The End Game Is Rosy Even If The Path Is Unclear

Despite all the caveats, the impact on the cannabis industry of this technology will be large – far beyond finance in other words – and in ways that are not necessarily all understood even now. The potential impacts on research, compliance and even further reform, however, are already clear. And for the most part, potentially very positive.

For that reason, there is no such thing as a blanket “yes” or “no” at any part of this discussion. Regulatory environments regarding both cannabis and blockchain are changing everywhere. Go slow and with caution is the watchword of the day. Look for interesting beta projects and track them.This is a rapidly changing territory in every direction.

Mentioning cannabis and blockchain if not cryptocurrency in the same breath is also legit, now. As little as 2 years ago, the idea or any combination of the two terms in fact, for whatever reason, was widely dismissed as just another iteration of Silk Road.

When combining this technology and cannabis, in other words, expect either amazing results or fantastic explosions that create a lot of heat and noise but go nowhere. There is more room, in other words, for a cannabis.io to become the industry’s NextGen Pets.com than Google or Facebook. That said, there are experiments going on now, in several countries where the banking and insurance questions are being addressed early (Germany, Canada, Australia and Israel all being such locales) where such issues have begun to be addressed up front.

In summary? Stay tuned and watch this space. This is a rapidly changing territory in every direction.

Ask The Expert: Exploring Cannabis Laboratory Accreditation Part 4

By Aaron G. Biros
No Comments

In the first part of this series, we spoke with Michelle Bradac, senior accreditation officer at A2LA, to learn the basics of cannabis laboratory accreditation. In the second part, we sat down with Roger Brauninger, A2LA Biosafety Program manager, to learn why states are looking to lab accreditation in their regulations for the cannabis industry. In the third part, we heard from Michael DeGregorio, chief executive officer of Konocti Analytics, Inc., discussing method development in the cannabis testing industry and his experience with getting accredited.

In the fourth and final part of this series, we sit down with Susan Audino, Ph.D., an A2LA lead assessor and instructor, laboratory consultant and board member for the Center for Research on Environmental Medicine in Maryland. Dr. Audino will share some insights into method validation and the most technical aspects of laboratory accreditation.

Susan Audino, Ph.D.

Susan Audino obtained her Ph.D. in Chemistry with an analytical chemistry major, physical and biochemistry minor areas. She currently owns and operates a consulting firm to service chemical and biological laboratories. Susan has been studying the chemistry and applications of cannabinoids and provides scientific and technical guidance to cannabis dispensaries, testing laboratories and medical personnel. Dr. Audino’s interest most directly involves cannabis consumer safety and protection, and promotes active research towards the development of official test methods specifically for the cannabis industry, and to advocate appropriate clinical research. In addition to serving on Expert Review Panels, she is also chairing the first Cannabis Advisory Panel and working group with AOAC International, is a member of the Executive Committee of the ASTM Cannabis Section and has consulted to numerous cannabis laboratories and state regulatory bodies.

CannabisIndustryJournal: What are the some of the most significant technical issues facing an accreditation body when assessing a cannabis-testing laboratory?

Susan: From the AB perspective, there needs to be a high level of expertise to evaluate the merits and scientific soundness of laboratory-developed analytical test methods. Because there are presently no standard or consensus test methods available, laboratories are required to develop their own methods, which need to be valid. Validating methods require a rigorous series of tests and statistical analyses to ensure the correctness and reliability of the laboratory’s product, which is– the test report.

CIJ: When is method validation required and how does this differ from system suitability?

Susan: Method validation is required whenever the laboratory modifies a currently accepted consensus or standard test method, or when the laboratory develops its own method. Method validation is characterized by a series of analytical performance criteria including determinations of accuracy, precision, linearity, specification, limit of detection, and limit of quantitation. The determination of system suitability requires a series of deliberate variations of parameters to ensure the complete system, that is all instrument(s) as well as the analytical method, is maintained throughout the entire analytical process. Traditionally, method validation has been referred to as “ruggedness” and system suitability as “robustness.”

CIJ: What are the most important aspects of method validation that must be taken into account? 

Susan: In keeping with the FDA guidelines and other accepted criteria, I tend to recommend the International Conference on Harmonization (ICH), particularly Q 2A, which is a widely recognized program that discusses the pertinent characteristics of method validation. This include: method specification, linearity, range, accuracy, and precision (e.g., repeatability, intermediate precision, reproducibility). As mentioned earlier, system suitability is also a critical element and although related to method validation, does require its own protocol.

CIJ: What three areas do you see the laboratory having the hardest time with in preparing for accreditation? 

Susan: My responses to this question assume the laboratory employs appropriate instruments to perform the necessary analyses, and that the laboratory employs personnel with experience and knowledge appropriate to develop test methods and interpret test results.

  • By and large, method validation that is not appropriate to the scope of their intended work. Driving this is an overall lack of information about method validation. Oftentimes there is an assumption that multiple recoveries of CRMs constitute “validation”. While it may be one element, this only demonstrates the instrument’s suitability. My recommendation is to utilize any one of a number of good single laboratory validation protocols. Options include, but are not limited to AOAC International, American Chemical Society, ASTM, and ICH protocols.
  • Second is the lack of statistically sound sampling protocols for those laboratories that are mandated by their governing states to go to the field to sample the product from required batches. Sampling protocols needs to address the heterogeneity of the plant, defining the batch, and determining/collecting a sample of sufficient quantity that will be both large enough and representative of the population, and to provide the laboratory an adequate amount from which to sub-sample.
  • Third, sample preparation. This is somewhat intertwined with my previous point. Once an appropriate sample has been collected, preparation must be relevant to the appropriate technology and assay. It is unlikely that a laboratory can perform a single preparation that is amenable to comprehensive testing.