Webinar with NBA Hall of Famer Dominique Wilkins: Professional Sports & CBD: The Journey Ahead

Duane Morris, MGO and ELLO Capital will be hosting the webinar, “Professional Sports & CBD: The Journey Ahead,” on Tuesday, September 15, 2020, from 2:00 p.m to 3:00 p.m. Eastern.

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About the Program

As awareness of the health benefits of CBD grows, professional athletes are voicing their support for the supplement as a safe substitute to help reduce inflammation and manage pain—and many are even investing in CBD or launching their own brands. Despite the World Anti-Doping Agency (WADA) removing CBD from their list of prohibited substances in 2018, many professional sports leagues continue to ban CBD, resulting in market and regulatory complexity for the sports world. This panel discussion will explore the legality of CBD use for professional athletes and provide an overview of the consumer and investor markets for CBD in the sports nutrition and recovery industries. The presentation will be followed by a lively discussion around the role of CBD in professional sports with NBA Hall of Famer Dominique Wilkins, who currently serves as vice president of basketball and special advisor to the CEO of the Atlanta Hawks.

Moderator

Presenters

  • Hershel Gerson, CEO and Managing Director, ELLO Capital
  • Seth A. Goldberg, Partner and Team Lead, Duane Morris Cannabis Industry Group
  • Chris Howard, Vice President, General Counsel & Chief Compliance Officer, E-Alternative Solutions
  • Dominique Wilkins, Nine-Time NBA All-Star; NBA Hall of Fame Inductee; and Vice President of Basketball and Special Advisor to the CEO, Atlanta Hawks

About the Duane Morris Cannabis Industry Group

Duane Morris attorneys in offices throughout the U.S. and internationally have extensive experience with the wide array of issues attendant to legal cannabis business activities, including licensing for cultivation, processing and dispensing; litigation; banking and finance; raising and deploying capital; mergers and acquisitions; protecting intellectual property; real estate development; public company representation and SEC filings; land use and zoning; healthcare and research; taxation; and cross-border transactions. In addition to advising participants in the medical and adult-use cannabis and hemp/CBD industries, as the industry has grown, Duane Morris attorneys experienced in cannabis-related issues frequently advise clients in other sectors whose businesses intersect with the expanding regulated cannabis sector.

About the MGO | ELLO Cannabis Practice

The MGO | ELLO cannabis practice provides a collaborative professional services offering that delivers world-class financial, tax and advisory services focused on empowering cannabis and hemp industry operators and investors to achieve their business goals. Its subsidiary ELLO Capital, a boutique investment bank, provides M&A, capital raising and strategic advisory services to companies and investors in cannabis, hemp and impacted industries. Together the cannabis platform delivers a suite of proven solutions to help operators, regulators and institutional investors navigate these complex industries.

New FDA Draft Guidance on Cannabis-Related Clinical Research Omits Discussion of Nondrug CBD Products

On July 21, 2020, the U.S. Food & Drug Administration (FDA) issued draft guidance outlining the agency’s current thinking on the development of drugs containing cannabis or cannabis-derived compounds. The new guidance is disappointing to many in the cannabis industry because it does not provide insight into the FDA’s views on the marketing of nondrug, hemp-derived CBD products.

To read the full text of this Duane Morris Alert, please visit the firm website.

Is this a Trend? A Third Court Stays Class Action Given FDA’s Primary Jurisdiction Over CBD

Seth Goldberg
Seth A. Goldberg

Yesterday, the U.S. District Court for the Eastern District of California stayed the matter styled Glass v. Global Widget d/b/a Hemp Bombs, a consumer class action alleging that Hemp Bombs, which manufactures CBD-infused edibles, tinctures and capsules, falsely advertised the amount of CBD in its gummies, and thereby sold products that were misbranded and adulterated under the Food, Drug & Cosmetics Act (FDCA), on the basis that the regulation of CBD is withing the primary jurisdiction of the FDA, which is in the process of developing regulations and guidance over CBD. We have previously written about two other consumer class actions arising out of similar clams of misbranded CBD products that have also been stayed recently under the “primary jurisdiction” doctrine.

Three decisions staying CBD class actions in two months may signal a trend, especially considering that the Courts in these cases refer to the other’s decisions. Such a trend may keep the plaintiffs’ bar at bay, as it would cast doubt on the viability of consumer class actions asserting CBD violations, or at least it could make the cases less appealing to the plaintiffs’ bar because a stay makes the timing of a settlement or resolution even more uncertain.  

Judicial Decisions Reflect Need for CBD Regulations and Legal Counsel

Consumer class actions regarding CBD marketing are on the rise. In recent months, a number of federal judges have placed lawsuits concerning the marketing of CBD-infused products on hold because the U.S. Food & Drug Administration—tasked with regulating those products under the 2018 Farm Bill—still has not issued regulations governing how they can be marketed. This further complicates the already confusing federal-state regulatory structure concerning the treatment of CBD products.

To read the full text of this Duane Morris Alert, please visit the firm website.

Commercial Litigation in the Cannabis Space: Resolving Disputes Like Every Other Industry Does

Seth Goldberg
Seth A. Goldberg

As a commercial litigator who has handled a broad range of claims in highly regulated industries over the past 20 years — particularly in complex matters such as class actions involving claims brought by consumers and shareholders — and given my experience spearheading the development of Duane Morris’ cannabis industry group, which has included providing regulatory and business advice to a number of businesses and individuals with cannabis-related interests, I have been expecting the maturing cannabis industry to eventually mirror other industries when it comes to using commercial litigation to resolve disputes between businesses and to address claims of injury allegedly experienced by aggreived consumers and shareholders. It appears the time has come. Now, as opposed to even just a few months ago, not a day goes by when the daily legal news outlets that report on litigation matters filed in federal and state courts around the country do not include matters pertaining to adult use marijuana, medical marijuana, and/or hemp.

Today alone, legal news outlets are reporting about a shareholder deriviative action being filed against the manufacturer of cannabinoid-containing transdermal patches, a maker of mobile hemp dryers suing a distributor for alledgedly stealing trade secrets, a publicly-traded company that owns cannabis brands being sued for breach of contract by an MSO arising out of a failed merger agreement. Claims like these are among the many product liability, stock-drop and securities fraud, tradmark infringement, FLSA, and employment litigation matters to be filed in 2020 relating to cannabis; not to mention the federal and state regulatory cannabis-related enforcement actions also commenced. Just as in other industries, COVID-19 is likely to spur litigation in the space because of strains on resources and performance caused by business disruptions and the slower economy.  To be sure, the plaintiffs’ bar has cannabis on its radar.

Thus, now more than ever, it is critically important for cannabis businesses to implement the necessary compliance measures, including making sure appropriate insurance coverage, e.g. premises, products, and D&O, has been obtained, that could protect their businesses from the cost and disruption of commercial litigation. Likewise, cannabis-specific nuances, such as the enforceability of contracts and jurisdictional questions, require careful evaluation by experienced counsel advising plaintiffs and defendants who are considering filing, or who have been brought into, a commercial litigation.

 

 

FDA’s CBD Enforcement Continues

Seth Goldberg
Seth A. Goldberg

On April 20, the FDA issued warning letters to two CBD companies – BIOTA Biosciences and Homero Corp., dba Natures CBD Oil Distribution – directing them to remove statements from their labeling and advertising on websites and social media claiming that CBD can cure opioid addiction among other illnesses.   I am attaching the FDA’s warning letter, as it provides very useful information to the market as to the FDA’s current views of CBD products.  As set forth in the warning letter, the FDA continues to view CBD as (1) an unsafe food additive; (2) not satisfying the definition of a “dietary supplement,” and (3) as unapproved new drugs if marketed as “intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease and/or intended to affect the structure or any function of the body.”  In the case of Homero, the CBD products were advertised with the following claims, among others:

  • “Natures Pure CBD Oil has been effective in the treatment and eradication of opiate use.”
  • “CBD Oil Inhibits the reward-facilitating effect of morphine”
  • “Vaping CBD Oil to Treat Asthma . . . Your best best [sic] to combat Asthma is by vaping CBD Oil.”
  • “Natures Pure CBD is a strong anti-oxidant that can alleviate lower epileptic seizures, psychotic disorders, and has neuroprotective qualities.”

 

A Cannabidiol Catalyst? Recent Events Increase Pressure on FDA to Regulate CBD

By Justin M.L. Stern and Frederick R. Ball

For consumers, the widespread availability of products containing cannabidiol (CBD) is old news. But for those in the cannabis industry—and in particular, those monitoring applicable regulatory developments—the state of CBD remains largely in flux and continues to be marred by uncertainty.

Under the 2018 Farm Bill, the U.S. Food and Drug Administration (FDA) retained its regulatory authority over products derived from hemp, including CBD incorporated into products it traditionally regulates, such as food, dietary supplements, and cosmetics. Unfortunately for the industry, FDA has yet to propose or issue formal regulations concerning the manufacture, distribution, or sale of such products. At the same time, FDA has issued numerous warning letters to producers and retailers incorporating CBD into products operating in the complex gray area between state and federal law. Nevertheless, recent events occurring across all three federal branches of government may reflect an impetus for change in FDA’s approach to CBD products.

To read the full article, please visit the FDLI website.

Patented (and Unapproved) Therapeutic Uses for CBD

In this second article of his Cannabis Patent Review series, Duane Morris partner Vince Capuano reports on recently granted U.S. patents in various areas of cannabis technology.

He writes:

There are plenty of reports and testimonials on the medical benefits of cannabis. Time, and better data, will determine whether these benefits are realized, and whether some are overblown, and the U.S. FDA will decide when the therapeutic uses of cannabinoids are safe and effective, and approvable for human use in the U.S. The FDA has approved CBD (cannabidiol), the principal non-psychoactive constituent in cannabis, for the treatment of certain types of seizures. The approval of Epidiolex (NDA Approval Holder: GW Research Ltd.) brings the therapeutic use of CBD as an active drug substance within the jurisdiction of the FDA. Thus, because CBD is the active drug substance in an FDA-approved pharmaceutical (Epidiolex), the FDA is currently considering regulations for the testing and approval for all drug products containing CBD.

Read Mr. Capuano’s full analysis on this topic.

Read Part 1 in the series.

Kelly Bonner Reviews How to Legally Implement CBD Products and Services into the Spa Industry

Duane Morris associate Kelly Bonner shares legal insight on CBD products and services in the January issue of DaySpa magazine.

From the publication:

  1. Consider the source. CBD can be derived from both hemp and marijuana, which have different definitions in U.S. law and are subject to different statutory and regulatory requirements. Hemp-derived CBD products are not illegal to sell and possess under federal law, as long as they contain no more than 0.3 percent tetrahydrocannabinol (THC). Marijuana has more than 0.3 percent THC, and is a Schedule I controlled substance under the federal Controlled Substances Act.
  2. Get proof. Given the current lack of federal testing requirements for CBD products, it can be difficult to ensure that those purchased from third-party vendors contain no more than the permitted level of THC. So it’s extremely important that spas get anything containing CBD from a trustworthy supplier who can verify ingredients, confirm THC levels with third-party labs and/or provide certifi cates of analysis.
  3. Act locally. While the 2018 Farm Bill lifted the federal ban on the commercial cultivation of hemp and derivatives that contain no more than 0.3 percent THC, the ability to manufacture, market and sell CBD products is still heavily regulated at the state level, and changing rapidly.
  4. Make no promises. The U.S. Food and Drug Administration (FDA) has issued warning letters to a number of CBD companies that have touted their products as having certain health benefi ts in their promotional materials and on packaging or websites. Spas should ensure that any products or services offered don’t come with false or misleading claims.
  5. Handle with care. Although research into the risks of CBD use is ongoing, the FDA has noted potential adverse health effects linked to the use of cannabis products containing THC by pregnant or lactating women. Even though CBD topicals typically contain very low levels of THC, spas should be up front with clients about potential risks.

To read the full text, read the January issue of DaySpa magazine.

Spate of FDA and FTC Warning Letters Sets Stage for Wave of False Advertising Consumer Class Action Lawsuits

Since the 2018 Farm Bill passed in December 2018, removing hemp from the Controlled Substances Act and thus legalizing it under federal law, consumer goods containing the hemp-derivative cannabidiol (CBD) have become exceptionally popular. With that growing popularity among consumers has come increased scrutiny by federal regulators whose mission is consumer safety and protection, such as the Food and Drug Administration and Federal Trade Commission, and now by the plaintiffs’ bar, which files consumer class actions based on advertising. As the recent spate of warning letters and consumer class actions demonstrate, hemp-derived CBD product manufacturers and others in the supply chain for those products have to be mindful of the claims they make to consumers about their products.

View the full Alert on the Duane Morris LLP website.

© 2009- Duane Morris LLP. Duane Morris is a registered service mark of Duane Morris LLP.

The opinions expressed on this blog are those of the author and are not to be construed as legal advice.

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