Sweet Victory: Ferrara, Owner of Nerds Trademark, Prevails Over Cannabis Candy Maker

Emma Johnson – On January 28, 2022, Ferrara Candy Co., the maker of Nerds, successfully obtained a permanent injunction against Higharchy LLC for trademark infringement. The injunction arose out of a lawsuit filed by Ferrara in Illinois against Higharchy, a cannabis retailer and manufacturer, for selling “Bud Bites” and “Bud Clusters,” THC-infused candies whose packaging used a logo and other trade dress similar to that of Ferrara’s Nerds. Ferrara’s is one of several trademark infringement lawsuits brought in recent years by well-known candy and snack companies against cannabis companies.

The lawsuit sought damages for and an injunction against trademark infringement, trade dress infringement, and unfair competition. The injunction forbids Higharchy, and the products’ manufacturer, ReRoot Chicago, LLC, from using any mark that is “similar to or dilutive of” a number of Nerds marks (including this mark) and from any conduct “that is likely to confuse, mislead, or deceive consumers into believing” that these THC products are connected to Ferrara.

This case is not the first involving trademark infringement of the Nerds logo and trade dress by a cannabis company. In May 2021, Ferrara was granted a similar injunction in California against a different company, Tops Cannabis, for its “Medicated Nerds Rope.” There, Ferrara stated that it “is actively enforcing its NERDS Marks against such uses to protect its consumers from inadvertent consumption of THC.” Ferrara has also filed another suit in California, which is still pending, for infringement of Ferrara’s Trolli and SweeTARTS marks, as well as Nerds, with an additional claim of counterfeiting because the alleged infringing packaging is nearly identical to Nerds packaging.

Other candymakers have also mounted trademark challenges against companies marketing THC-infused candies. Wrigley, a subsidiary of Mars, sued Packaging Papi over Skittles and Starburst lookalikes in May 2021 and obtained an injunction forcing Packaging Papi to stop manufacturing those lookalikes. In 2014, Hershey reached a settlement in Colorado with TinctureBelle, a cannabis company that had been selling, among other cannabis edibles, “Ganja Joy,” infringing on Hershey’s “Almond Joy” trademark and dress. More recently, the Girl Scouts of America has asked a cannabis company to stop selling THC-infused cookies that are reminiscent of classic Girl Scout cookies, which they claim implies the organization’s endorsement of the product.

Despite January’s judgment in favor of Ferrara, Higharchy appears to still be selling some products that evoke well-known candies. Compare Hempheads with Airheads Xtremes Bites; and Stoney Patches (“First they’re sweet. Then they’re sour. Then your [sic] High!”) with Sour Patch Kids (“First they’re sour. Then they’re sweet.”). The latter example is particularly surprising, given that in 2019, Mondelez, maker of Sour Patch Kids, brought a trademark infringement suit against a different cannabis company in California that was producing “Stoney Patch” candies.

There is an additional complication for cannabis companies in the branding sphere: because marijuana is still illegal in the United States at the federal level, trademarks these companies hold may be at risk. While cannabis companies can sometimes register their trademarks at a state level, the United States Patent and Trademark Office will refuse to register marks if the “goods, services, or trademark violate a federal law.”

The fact that marijuana is legal in the state where the cannabis company is operating may be irrelevant for the purposes of trademark enforcement. A 2019 case in California indicates that in such a trademark dispute involving conflicting trademark claims and where the state mark involves federally illegal activity, a federal trademark registration may very well preempt a state trademark registration.

Despite this disadvantage, the cannabis industry is still relatively new, and there is a steadily increasing movement towards legalizing marijuana federally in the near future. Meanwhile, however, budding cannabis companies still have some landmines around which to navigate to protect their brands. With time, they will develop their own recognized trademarks as their brands grow. The best course is to steer clear of any packaging or marketing of edibles that are designed to riff off well-known candy brands—creating cannabis parodies will only hurt business in the long run.

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