RKS is covering the the Cannalaw Summit, a conference covering a range of topics including cannabis valuation. Beyond the newest US states to legalize recreational cannabis use, Mexico is proceeding with legalization steps in what observers said could become “the world’s largest cannabis market.” The summit kicked off yesterday covering an industry “with projections of $35 billion by 2024 for the US market, and upwards of $100 billion worldwide.”
Panels yesterday covered:
The Evolving Relationship Between IP Law and the Cannabis Supply Chain
The panel focused on a wide range of IP issues and risks associated facing cannabis companies, including legal requirements to protect IP of plants and interstate regulation issues. Companies must take a strategic approach to determine the scope of protection needed for the plant: utility patents, plant patents or PVPC protection. They can protect IP by filing state trademark applications, registering non-cannabis related goods, and file on an “intent to use” basis. Once federal regulations are loosened, those who take steps to protect their IP will benefit the most. Other risks specific to this industry are the inability to transport the goods across state lines and dealing with state specific manufacturing/distribution. To mitigate these risks, companies can create separate IP licensing companies, separate manufacturing in each state, and structure payment terms to comply with laws of all jurisdictions.
Collaboration in Cannabis Law: Utilizing Firm Resources to Provide Holistic Client Services
This discussion focused on challenges and strengths for both the boutique cannabis-driven firms and “big law” firms, and how they can work together to maximize benefits for their clients. Boutique cannabis firms have a unique understanding of the nuances of cannabis law and the risks associated with them, , while “big law” can provide IP, M&A, federal and commercial advice. Boutique law firms also understand the organizational structures of multi-state clients, while “big law” can handle unforeseen issues that could result in class action litigation, like unknown health or environmental issues.
A Review of Client Engagement, Intake and Risk Best Practices
The panel laid out issues surrounding the emerging cannabis industry – federal illegality, inconsistent state regulations, conflict issues, unsophisticated clients – and the need for law firms to protect themselves from ongoing risk management issues. Conflict checks, waivers, retainers and scope of work must be written down in detail and define the end or your representation in writing. To mitigate risks, firms can consider running background checks, offer flat fee arrangements, replenish retainer fees, and inform malpractice insurance carriers of cannabis representation.
We look forward to covering the next day’s events.