Small plot, outdoor California cannabis farmers are among those who stand to gain the most from the state’s new appellations law, under which marijuana growers can claim, protect and market the unique elements of the plant grown in their specific region.
Appellations are legally defined and protected geographical indications. Appellations laws are the reason that only sparkling wine that originates from the region of Champagne, France can be legally marketed and sold as “Champagne,” (with a few exceptions for some semi-generic names that were grandfathered in a few years ago).
Back to marijuana marketing: Establishing a strong, consistent reputation for the best quality, potency and flavor profiles will give smaller growers a leg up in the market. This is critical for several reasons, including the fact that a place-based brand (very similar to what we see with producers of wine) could help some above-board growers edge out the black market dealers. A region with a highly-rated brand association could parlay that into a niche tourism market, similar to what we see in Napa Valley (which also relies heavily on appellations to build their credibility and customer loyalty). This could prove especially fruitful if prohibition is lifted at the federal level.
Smaller growers (those with less than 10,000 square feet of grow space) could especially can carve out a benefit from Senate Bill 67 because many of they have the benefit of providing a premium, craft-grown product by region instead of just by county. Most of the larger marijuana farming operations are selling their product wholesale direct. They market their product to other companies which then package and sell it under their own brand names – even though they had nothing to do with how it was grown. As has been proven with beer and wine, consumers will often pay a higher premium for craft-grown products, particularly in a region whose reputation proceeds it.
Senate Bill 67 Appellation Standards
As our Los Angeles marijuana business lawyers can explain, there are certain parameters that need to be taken into account before a grower can claim a certain appellation of origin.
Mainly, anyone claiming a certain appellation must have a product that was 100 percent grown in the soil and with sun from that region. They cannot have been grown using a shelter or artificial light.
The measure also requires the California Department of Food and Agriculture to develop standards by a which a licensed marijuana farmer could designate a city, county or region of origin.
There is an express prohibition against misrepresentations of cannabis appellation origin and against misleading consumers. Penalties can include significant fines and possibly loss of one’s license.
With much to lose and much to gain, it’s important that any grower considering taking advantage of their appellation consult with an experienced marijuana marketing attorney who can help you determine whether your plan and approach to doing so meets the legal parameters.
California is the first to have an appellation law pertaining specifically to marijuana. It’s likely Oregon and Washington will follow suit, given that both also have a substantial number of thriving, outdoor grow operations.
The Los Angeles CANNABIS LAW Group represents growers, dispensaries, ancillary companies, patients, doctors and those facing marijuana charges. Call us at 714-937-2050.
SB-67 Cannabis: marketing: appellations of origin: county, city, or city and county of origin.