Branding partnerships between Canada’s biggest cannabis companies and their celebrity backers will be thrown into limbo when new regulations governing recreational cannabis take effect Oct. 17.
The Cannabis Act has general prohibitions on the promotion of marijuana that includes the depiction of a person, character or animal, whether real or fictional.
That includes celebrity names, a Health Canada spokesperson told Marijuana Business Daily.
“Under the current regulations, a brand could be named after an individual,” the spokesperson said. “The Cannabis Act will prohibit this and other types of promotions upon coming into force.”
That means cannabis brands such as Leafs By Snoop, Marley Natural and even Justin Trudope could soon run into trouble.
“If a name can, in and of itself, be a ‘depiction,’ then yes this will have an impact on branding. Any brand referencing a celebrity by name will be offside in that case,” said Trina Fraser, a business lawyer at Brazeau Seller Law and adviser to licensed producers.
Big names already in play
Some of the biggest names in Canadian cannabis have shelled out big bucks to ink partnerships with celebrities.
In 2016, Canopy Growth offered up a piece of its company to win exclusive rights in Canada to Snoop Dogg’s marijuana brand, Leafs by Snoop.
The business partnership involved a combination of Canopy Growth shares, royalties and monetary compensation released over the course of the agreement.
Just last month, Canopy Growth said it intends to offer Leafs by Snoop to recreational consumers in Manitoba cannabis retail locations.
Meanwhile, Winnipeg-based Delta 9 Cannabis has been selling its Justin Trudope product to medical customers. Justin Trudope socks have even made an appearance.
A spokesperson for Justin Trudeau said the prime minister has not given Delta 9 consent to market the Justin Trudope socks or cannabis brand.
A Delta 9 Cannabis spokesperson said the company does not plan to sell the line once the recreational market launches, although that policy could change down the road.
Tilray, the second-largest cannabis company in the world by market cap, also has some decisions to make.
Privateer Holdings, Tilray’s Seattle-based parent company, has a branding partnership with Bob Marley’s family to sell Marley Natural.
Tilray has said it plans to sell the line to recreational cannabis users in Nova Scotia and Ontario – so far.
Marley Natural products are “rooted in the life and legacy of Bob Marley,” the company stressed in a news release earlier this year.
Representatives from Canopy, Tilray and Privateer did not immediately respond to Marijuana Business Daily‘s requests for comment.
Unknowns
There is still much to be cleared up before adult-use marijuana becomes legal in two weeks.
And cannabis multinationals are sure to find legal avenues to continue to capitalize on their celebrity partnerships.
“What if you name a cannabis product after a band? Or a song, or book, or movie, or some other signature element of a celebrity’s public persona?” Fraser asked. “While such brands would be referable to the celebrity, they would arguably not include ‘depictions’ of the celebrity.”
That could have implications for Newstrike’s business relationship with members of the band The Tragically Hip.
The band members are “significant investors” in the Ontario-based cultivator and help the company “develop brands and strategies to elevate Newstrike’s profile,” the company said in a regulatory filing.
That includes naming cannabis strains after the band’s songs.
“There will be an incentive to license brands that are compliant but still sufficiently connected to the celebrity to benefit from their goodwill,” Fraser said.
Matt Lamers can be reached at mattl@mjbizdaily.com
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