Dr. Ruth Fisher: 0:00

It the lawsuits are coming. And I think that if you get a lawsuit with a big damages settlement, that that's going to incentivize a lot of other attorneys to come in and take cases on contingency. And I think the dominoes are going to start to fall.

Ben Larson: 0:24

Hey everybody, welcome to episode 112 of High Spirits. I'm Ben Larson and I'm recording solo this week. Anna Ray is hopefully voting, but it's also out sick. So feel better, Anna Ray. We hope to have you back soon. It is Tuesday, November 4th, 2025, and it is election day, like I was saying. And I was at the gym this morning and I was doing my 5 a.m. routine and I was I was listening to this great podcast. It's called Solve by my friend Mark Manson, who who is the author of the book uh The Subtle Art of Not Giving. And on that show, he had the modern stoic Ryan Holiday. He's the author of like 10 Stoic books. I've been studying Stoicism since 2017. And anyways, they were they were discussing uh one of the core principles of Stoicism and how you should focus on the things that you can control, let go of the things that you can't. You could have a very deep discussion about what you can control. Obviously, I'm someone who finds myself meddling in many things, but I feel that the thing that keeps me grounded day over day, week over week, especially right now, is that you know I do center around understanding what I do have complete control over, and I focus most most of my energy on that. Anyways, when it comes to elections, and it is not a presidential election year, as you know, we're still in the first year of uh of Trump's administration, um, but there are different initiatives that are happening, critical initiatives in certain states, like Virginia, all around the nation. And what you need to know about elections, and and I've had to tell myself this living in California, is that maybe your vote doesn't matter in certain things, like a presidential election, because maybe your state always votes a certain way. But what you do have control over is what's happening in your own region, in your own city, in your own state. And so I am encouraging everyone to get out there and vote. And just to kind of highlight my motivation behind telling you this is that the most influential people on the hill right now, with the exception of probably the one at the very top, did have some humble beginnings in their political journey. And so here's a few just as an example. Chuck Schumer, Democrat from New York, minority leader, uh started in the New York State Assembly at 23. So he was elected on by the local constituents and worked his way up over many, many years. Uh Mitch McConnell, Mitch, Mitch, Mitch, Mitch, uh, began as a county judge in Kentucky. And now he holds the appropriations and farm bill in his hands. Uh John Thune is a former congressional aide, turned House member in the 90s. Kamala Harris started out as San Francisco's DA, and Rand Paul was an ophthalmologist. So take that for whatever it is. But just all this to say is focus on your local, your local elections. You never know where people are going to end up or how redistricting is going to go as far as California goes and Prop 50 goes. But that's my anecdote from this morning. Uh, I've been up for a few hours already, but let's kind of progress through the show. And again, I don't have my rudder with me. Anna Ray is always doing such a good job at driving us through the show that uh I'm really starting to actually miss her when she's not here. As far as the news goes, New York is going through a massive recall through Omnium Cana, a Long Island processor under investigation for allegedly running an inversion scheme, opposite of diversion, helping unlicensed or out of state companies move product into the New York market. So brands like Stizzy and M Fuse took a massive hit. Others like Groan are defending their compliance. All this to say is that the states continue to trip and fumble and is highlighting an opportunity to better regulate the systems or create systems that are regulatable because the tracking process in New York leaves a lot to be desired. In Florida, uh, there's a legalization lawsuit. Smart and Safe Florida is suing Governor Ron DeSantis, accusing his administration of misusing state funds to block their adult use ballot initiative. Freedom means different things depending on who defines it, but in cannabis, Florida's voters might finally get to define it for themselves. Anyways, after stumbling through that, let me just get to the good part of the show and bring on our guest. Our guest today is Dr. Ruth Fisher, co-founder of CAN Dynamics, an economist, systems modeler, and educator who helps decode how cannabis as both a medicine and a market creates real value. Ruth's work bridges the economics, technology, and biology, modeling how laws, culture, and infrastructure interact to shape cannabis outcomes. She's also one of the few voices mapping the global patent landscape in cannabis and hemp, revealing where innovation is actually happening. So, Ruth, welcome to the show. How are you doing today?

Dr. Ruth Fisher: 5:51

Thank you for having me here. I'm I'm doing wonderful. And as you were talking, I was thinking that it's never a dull day in cannabis, is it?

Ben Larson: 6:02

No, no, it's it's persistent entertainment. Uh I'm I'm I'm approaching I'm approaching my 10-year anniversary in the industry, and I will say there has never been a dull moment. In fact, if I go two weeks with somewhat normalcy, I start to get nervous. It's like it maybe it's that stoic and me it's like, oh, something's gonna go wrong. I have to like figure out like what's next, what's what bad can happen.

Dr. Ruth Fisher: 6:27

Seriously, yeah, it's one of the most dynamic industries I've ever seen. And the you know, the fact that we have the legal markets rolling out in different states, and then you know, the hemp and the the illicit markets and everything else, it's just there's always so much going on.

Ben Larson: 6:47

Yeah, yeah. Well, and you have a very diverse background. I was reading through it, economists, you're you're looking up patents, and and and the reason we have you on the show is because you published this great paper where you had downloaded over 10,000 cannabis patents and started kind of sorting through it to try to get an understanding of the landscape of the patent world for cannabis, which I think is uh largely unknown. Like we we have some patents, but like I didn't realize how broad the patent brought broader portfolio of cannabis patents was until I saw your report. And so, how does an economist uh go on a massive patent hunt and trying to map out the entire patent world for the cannabis industry?

Dr. Ruth Fisher: 7:36

That's a great question. So I had kind of in my former pre-cannabis life uh spent a lot of time with patents and technology and licensing and been in that world. And several years ago, I had done an earlier analysis of patents in cannabis. And so I knew that there at that time I had managed to find several hundred or more. And more recently, with the talk of uh rescheduling to schedule three, you have you know that issue of research in cannabis. And a lot of people are saying, well, there's really been no research in cannabis because of all the schedule one restrictions. And um, I was talking with some other people and they said, yeah, there really is, you know, very little research and there's you know no patent activity. I said, Well, that's not in fact true. There is are actually patents, and so I decided to update the analysis and went in and I was doing the analysis, and this is kind of in the midst of all the schedule three uh rescheduling discussions, and people and so the topic of patents came up, and I would say, you know, how many patents do you do you think there are? And people would say, Well, there are none at schedule one, or you know, some people say, Well, almost none because it's schedule one. I said, Well, how many do you think? Take a guess. And they would say, I don't know, 50, 100, maybe 200. Now, I went to the US PTO, that's a US US patent and trademark office. That's you know, the the office that issues the patents, and just to clarify, anyone who wants to protect an invention while engaging in activity in the US markets needs to own a patent if they want to be able to, you know, have patent protection on that entity. So there's US companies, and if you're foreign companies selling products in the US market, you also need a patent. So if you're like Toyota and you're selling your Toyota cars, that's a Japanese company, but they're competing in the US market, so they need to have a patent. So you'll have Japanese companies holding patents and American companies, Ford and GM, holding patents. So it's the same thing for anything. So um I went to the US PTO trademark, uh USPTO uh database and did a I wanted a very narrow search for what I was doing. So I did a very narrow search, and lo and behold, up came roughly 12,000 or so patents for my keyword search. And the the database would let me download 10,000 patents. They put a limit on it. So I downloaded those 10,000 patents and worked through them. Um, but that's kind of how I got into that venture. Um, and when I tell people, you know, no, there's actually like 10,000 patents out there, it's just it's it's mind-boggling and it's very surprising to people.

Ben Larson: 10:34

I mean, what also might be surprising to people, basically anything sounds like it might be surprising if people believe there's only 50 to 100, but of those 50 to 100 or 10,000, like the US government actually holds cannabis patents as well. And so I'm curious, you said surprising, as you were going through this list of patent holders. What did surprise you? Like, who's holding a lot of patents? Like, where you know, what types of companies are holding these patents?

Dr. Ruth Fisher: 11:02

Wow. Um, so uh the database contains issued patents, and I was interested in active patents, and I started reading, and one of the things that surprised me is I'm reading through, and when you're doing a patent, it's kind of like any formal uh uh study that you publish, is generally you have to say, okay, I'm doing a study on this, and here's what other people are doing in this general area. Here's why what I'm doing is different from what they've done. And so there's a lot of patents out there. Well, they where, especially in the medical area, where they say, Well, you know, I'm I'm dealing with a pain product and cannabis is out there and it's used for pain, but I'm not I'm not doing a cannabis approach, I'm doing something else, but cannabis is there, um, it has problems, a lot of, you know, the psychoactivity um is is one of the big problems, but they're doing something else. And so I weeded out a lot of patents that weren't directly relevant because they were mentioning cannabis as being in the prior art, but not in the actual invention. And so, kind of one of the things that surprised me off the bat is how much recognition there is out there of cannabis. And this is, you know, in the medical area, most of these are looking at therapeutics. So when you're talking again about schedule three, and people are saying, well, you know, schedule three would be great because all of us it would unleash the ability to do research, it would make it a lot easier. And while it would remove some hurdles, there seems to be a misnomer that there hasn't been any research. And there's actually been a vast amount of research in, you know, where they're actually researching, they're inventing in cannabis, but also they're recognizing that cannabis is out there and doing something kind of peripheral or tangential. So that was kind of one of the big primary things that I learned. Um as far as the that wasn't directly relevant to the question you asked, um for country-wise, um I I was looking at at patents where if uh you have like three or more patents because it's a ton of one-offs, and I couldn't I couldn't get to all those. But if you look at um companies that hold at least three patents, there are roughly 30 countries holding patents in the US patent and trademark office. And that I found really surprising. Company countries like Saudi Arabia, uh, which was interesting.

Ben Larson: 13:50

That is very interesting.

Dr. Ruth Fisher: 13:53

Um, of course, New Zealand, Australia, um, just all over the world, all over the world. And so that was that was really interesting. Now you have a lot of those are research institutions, a lot of universities. Universities do a lot of research and they often serve as pipelines for pharmaceutical companies. So they're developing the early stage research and then they license it to pharmaceutical companies. That was very interesting. As you said, the U.S. government through um the United States Navy, the United States Army, um, Department of Health, they hold a lot of different patents. And that was also very interesting, especially, you know, as we know that it's schedule one. It's like, okay, either either cannabis is useful, in which case it shouldn't be schedule one, or it's not useful and you shouldn't have patents. Um that was and then the variety of different uh industries represented was also very surprising. Um I was interested in the pharma, um, who, which of the pharmaceutical companies? Um it turns out that a lot of traditional pharmaceutical companies have patents in cannabis. That was very interesting. You also have a lot of new pharmaceuticals, I call them cannabis pharmaceutical companies. So they're kind of going the FDA route, or they're acting like a traditional pharmaceutical company, but they were founded to develop cannabis technologies.

Ben Larson: 15:27

So this is like earlier versions of like GW Pharma or I know Charlotte's Webb recently started pursuing their medicine. Yeah.

Dr. Ruth Fisher: 15:36

Yeah, there's an Israeli company called Buzzlet, I think, uh, which is a cool name. And there's also medical device companies. So for like inhalers uh vaporizers and stuff, um, for their, I would, as I said, medical device companies. Um and so there's there's cannabis pharma, there's traditional pharma, there's obviously the tobacco companies, um, British American tobacco and Philip Morris hold a lot of patents in uh vaping technologies, um products for vaping uh tech uh vaping cannabis. Um you have uh the largest patent holder is a company called BASF, and that's a big German industrial company. They hold 140 patents, and most of that is in cultivation. And so they're looking at increasing plant yields, at um gene splicing, so honing kind of what you're gonna end up growing, um pesticides and fungus control. Now, a lot of those technologies that they're developing um are relevant for cannabis, but also many other different types of crops.

Ben Larson: 16:53

Right.

Dr. Ruth Fisher: 16:54

But they hold a lot. Um, and you have Bayer, which is that's actually a big conglomerate, and they do hold medical patents, but they also hold a lot in cultivation and I believe uh pesticides. And so it's it was interesting to me that you had a lot of patents in the area of cultivation, which presumably is creating all the raw materials, presumably for pharmaceutical companies.

Ben Larson: 17:22

So a lot of those kind of seem almost obvious. Yeah, Philip Morris having happy having vaporizer, they had the icos and and and all that kind of stuff anyway. So it's like, okay, it's not a far leap. But they're kind of also like sitting out on the periphery. Like, I haven't heard of people enforcing patents on on the industry, and so that either means people aren't aren't infringing them or they're just like not really caring. And how should we think about patents? Like, if we're creating a company and doing things, how deeply should we be out there, you know, investigating what patents are owned and not being used in the industry? Maybe we should be going out searching like all these alcohol companies and and and what have you, and see like, are they forging ahead and creating patents around things that they have no intention of using until far after legalization? And at that point, is there some sort of statute of limitations or something?

Dr. Ruth Fisher: 18:22

That is a phenomenal question. That's a really good question. I hadn't really thought about that, but so there's a limp, there's an age limit on the patents, and they expire after roughly 30 years, I believe. Um, that's changed a bit over time. My pre-cannabis life, I lived in Silicon Valley and it was in the technology world, and obviously patents play a huge role there. And anyone who's who's doing anything is looking at patents and infringing. Um, and if you're doing a startup and you want to get VC money, and in cannabis, it's really hard to get funding. Uh, you can't go to the bank and get a loan. And so you're you're generally getting funding from, say, a VC, a venture capitalist. And one of the key things that venture capitalists like, and especially in you know, technology companies, if if you're developing IP, is they want a patent. And so there's, you know, there's a tendency to get patents. Um, I will say that regardless of what industry you're in, the vast majority of patents never have any creating any value. And so it's only a maybe a couple of percent that are even kind of start to go down that licensing or development or value process. And even those, um, if you look at the patents being licensed and licensed, a lot of those never actually generate any money because the uh the failure rate for startups is really high. Um, what you're doing is you're creating a fence, you know, with a patent. Um the idea that there hasn't been much any or much litigation in cannabis um has been interesting to me from the beginning, and that's patents or any other area. And I think the the lawsuits are coming.

Ben Larson: 20:14

Um, interesting.

Dr. Ruth Fisher: 20:16

And I think that when there's part of the problem is cannabis federally is still Schedule One. And so as far as the government's concerned, it's illegal. And they're actually um, so the short answer is there have been a couple of lawsuits, and the first one I could find was 2017 or 18. There were uh like four suits that I could find that settled, these are patent infringement suits, so we don't really know anything about them. Um what an area of formulation. One company was suing another company, and they ended up going bankrupt before the anything was resolved. Um, yeah, and that happens a lot in cannabis.

Ben Larson: 20:57

Um I was gonna say that's like not only the litigation effort, but why people don't have strong patent portfolios. So you used kind of the fence as an analogy just a minute ago, and also mentioned that there's a lot of like singular patents, and like when you think of patents and you get one, it's almost like you're putting a single fence post in the ground. Yeah. And without the portfolio work, you know, you haven't created a fence until you have multiple, right? Yeah, you have one post, and which is pretty easy to work around most of the time. What have been your observations about companies actually building a strong patent strategy versus just oh hey, we got a patent around our technology?

Dr. Ruth Fisher: 21:43

In patent lingo, they call them patent thickets. And so what you want to do is you want to have a bunch of patents, you know, all around the same area. Because if you're sued for patent infringement, the first thing you do is you challenge the patent that you're accused of infringing. So you say, Well, I don't think your patent's valid. And so now the patent needs to undergo examination. And the thing that's really important to understand is just because a patent was issued doesn't necessarily mean it's valid.

Ben Larson: 22:13

Do you have a rough percentage of patents that do get challenged?

Dr. Ruth Fisher: 22:17

And well, that's every patent that's infringed is an automatic countersuit is to invalidate it. And you can you know, then you so you require to undergo the require the patent holder to undergo an evaluation of the patent, and a lot of them are thrown out, or specific claims are thrown out, and so you get a much weaker position. And yeah, so part of the problem, and I I've given a lot of talks on patent valuation, and the scary thing about a patent is it's only valuable if you're able to enforce it. Um, I was giving a talk um long time ago to a group of most of the people in the audience were startup people, and I gave the talk on how to value a patent, and one guy raises a hand, he says, Yeah, he says, Microsoft's infringing my patent, and I sent them a cease and desist letter, and they said, So sue us. And well, what are you gonna do? And it's kind of like that case that I mentioned where that the company went bankrupt, is we know how shaky the finances of so many cannabis companies are. That it's not, I mean, it's probably a very usual situation in cannabis, and I've encountered it, where if you have any sort of litigation going on, you have one powerful company and one weak company, and the powerful company can just wait out the weak company until they go bankrupt and the whole thing goes away, you know? And the same thing could happen with patents. And so uh having a patent is sexy, and you can tell people I have a patent and it's really cool, it's expensive to get and you need to enforce it, otherwise, what good is having it? And that's kind of the trick here. So I would tell people it's again, it's the the the strongest or one of the most important reasons to get a patent is to be able to get funding. So whether or not it's really valid, um you want to have it to be able to get funding.

Ben Larson: 24:17

I I remember was it 2018? I I ran into John Cooper, who is the the founder and CEO of of Ebu. Um and I ran into him at MJ Biz right after they had sold to Canopy Growth for like I don't know if it was like 300 million or 400 million dollars, which is a lot, it was a lot of money that was in the very exuberant phase of cannabis. And uh he was telling me that they had built this pretty radical patent portfolio, but it was getting to the point where they couldn't even afford to manage the portfolio, defend it. And so they it they kind of threaded a needle and got really lucky and sold right at the right time. Where someone who was well capitalized saw this patent portfolio and be like, oh, we can defend that, and that's valuable to us. But for the startup, they were like running off a cliff because they didn't have the capital to pay all the legal expenses. Yeah, that got me really excited about patents, but also it's just like, oh yeah, careful about how far you extend yourself when you're a small company.

Dr. Ruth Fisher: 25:20

It's I mean, the question of do you patent your technology when you're startup and you're you know, you're bootstrapping and don't have a lot of money to spend, that's a really difficult position to be in. And some industry, some industries you need the patents to be able to play, and other industries you don't. And I suspect there will be areas, and there's gonna be a lot of um areas challenged. And I mean, in particular, there's a lot of patents on plants. Can't coming up with a specific, well, my plant grows, I don't know, C B high C B C and C BG, or I don't know what, or you know, really high THC or whatever. But I mean, if you go into the patent code, you know, one of the things they say is you can't patent natural substances. Now, if you if you get the the plant to be a very, you know, have a very sp specific genetic makeup, does that mean that you can patent it? I don't know. And I mean, a lot of people spend a lot of resources patenting plants, but there's been no litigation. So uh one of the things I was gonna say is it's kind of funny because um one of the defenses is if someone's accused of infringing, one of the first things they say is, Well, you can't sue me because cannabis isn't legal. So they're kind of trying to have their cake and eat it too. And then that's been thrown out. That hasn't worked. But I read that in a couple of the cases where they allege that as a defense.

Ben Larson: 26:53

So you bring up the potential challenges around patenting around a plant, like an organic organism, uh, which leads me to start thinking about synthetics, which is a very hot topic depending on what realm of cannabis or hemp you're you're sitting in. Uh, what did you see as far as synthetics go? How are different players thinking about synthetics for you know, like pharmaceutical companies? Are they building up these like synthetic portfolios? And I know other companies in the cannabis and hemp industry are probably doing the same, but maybe for for different purposes or different motivators. Uh, what how are you thinking about that that side of the plant that, or not not the plant necessarily, but uh the synthetic cannabinoid uh world?

Dr. Ruth Fisher: 27:40

I love that question. I the topic of synthetics is really fascinating to me and it's multifaceted. Um, when I first came in and I was looking at the the pharmaceutical patents or the medical patents, what I had assumed would happen would be that the traditional pharma companies would be dominating the patent holdings and they would be doing synthetic cannabinoids. So um synthetics are great because you can make them in a lab and you can make them perfectly consistent consistently at volume, which is kind of what the whole FDA approval process has been designed around. And I assume that that would be the case, and that's what where the majority of patents would be. Um it turns out that that was not the case. It turns out that actual cannabinoids, and they use it, it's you know, some patents cite specifically therapeutics involving THC, CBD, CBG, but mostly THC, um, or cannabinoids, which I take to be phyto derived, but they could totally a synthetic. It turns out that the plant-based patents outweigh the synthetic-based patents. And so kind of this is one realm of the synthetics. And what was interesting to me is it's the traditional pharma companies that are doing the synthetics. And as I mentioned, this new pharma cannabis at a group of companies, those tend to be doing the phyto-based. So GW, they're playing with the actual plant molecules, whereas, say Synophi or GLACSO are dealing with synthetics. So I thought that was really interesting.

Ben Larson: 29:27

Yeah.

Dr. Ruth Fisher: 29:27

You have the conversion cannabinoids, which are also synthetic or semi-synthetic. And I was very interested in whether or not that was a big patent area. That's the, you know, all the converting of CBD to delta nine and delta eight. There's a lot of patents in that area. I have no idea how those are going to be treated. And then there was another area I was really interested in, and there's a number of uh patents in that area, and that's using uh they're synthesizing cannabinoids from, say, yeast or aldo. Or non-canvas plants. And so they're they're co-opting, say, yeast, which is a natural factory. It turns out it's the structure of THC is is difficult to copy. And if you take a natural source and have the natural source make it, it might be easier than making it say from scratch in a lab. So they're taking yeast and algae and other living organisms and they're feeding in raw materials and having them output cannabinoids. I don't have no idea how you treat those.

Ben Larson: 30:34

Yeah, it's been a complicated conversation. I mean, I've been looking at these alternative methods of cannabinoid development, let's call it, uh, since I think 2018. And I always had this question. We always talk about the the source of the cannabinoids. Like, well, what if the source isn't a plant? Um, which after spending some time on the hill and at some of the state capitals, I don't know if anyone is ready to have that conversation. Like, I'm I'm people are still asking what the difference between THC and CBD are. Let's take it back to the plant. We got a we got a question here from Dr. Jaehan Marco. Uh, thanks for watching, Jayhan. If I have a variety, uh, say green crack, how can I protect that reputation from being undermined uh to inferior green crack imitators? And I remember this question coming up long ago when we talk about genetic drift and all that kind of stuff. Like blue dream was all the rage at one point, and then it became very clear that blue dream from one dispensary in the Bay Area was very different from a blue dream just down in you know LA. And so is there a way to be like, this actually is a really great strain and in how and and you can protect that cannabinoid profile. Is it protecting the profile or is it like the genetics that you actually have to like refine and then create some level of robustness so that it's repeatable?

Dr. Ruth Fisher: 32:01

You know, if you're talking green, uh something like green crack, and let's just call it that, um, that's what I'm envisioning, you know, these plant patents are. And the problem is the problem that you have with cannabis, as we know, is you have the genotype or the genetic profile, and then you have the phenotype, what ends up happening, which is shaped by the environment. So you can patent the genetics, but that's not the same thing as what it actually grows into.

Ben Larson: 32:31

Right. Right.

Dr. Ruth Fisher: 32:32

And that's and that's really hard to control. And when you put all of it together, it makes it really messy. And I mean, that's a great question. And a lot I I know people are trying to figure out, well, how exactly do you now? It's kind of moving in the other direction. If you take say blue dream, and if you look at say 500 samples of blue dream, it's like, well, will the real blue dream please stand up? You know? But if you're starting in the other direction saying, okay, I have this one, how do I protect it? It's it's really hard. Um, again, it kind of comes back to the real difficulty of trying to enforce a patent, which is, I mean, are you gonna send people out to every farm, you know, or or every retailer who's selling it or, you know, brand or whatever? It's and then you need to, I don't know, you would need to, I guess this would be interesting at some point, it maybe it'll be proven, is you need to establish that the infringing product uh product is substantially similar.

Ben Larson: 33:35

Yeah.

Dr. Ruth Fisher: 33:36

Now, substantially similar, or it was made in a substantially similar way. And that's I believe that's the terminology used, and that's not objective. You know, how do you go about proving? And I've thought about this before, if there's a lot of different compounds and you're looking at one sample here and one sample here, and it's kind of, you know, there's a bunch of different things and a bunch of different things, how much variation in each of those different, you know, the cannabinoids and the terpenes. Well, how do you determine that it's substantially similar? Or the flip side, is there you know, different enough? How do you define that?

Ben Larson: 34:14

So in order to it's interesting because, like, on the on the trademark side, I think you can use like terminology like confusingly similar, right? And and like you can measure that by just putting it in front of people and see if they're confused, right? But if it's like an actual technology, it's a little bit harder, which also like thinking about trademarks, like say you did build a patent around green crack. I mean, this industry has just proven time and time again that people are not afraid to infringe until they're attacked, and we get back to the lack, lack of capital aspect and the ability to enforce force these things. There will be a time where people do have the resources and initiative to start enforcing patents, right? Do you is there a point in time or regulation where you believe that will happen and that companies will just start getting knocked out because of patent enforcement?

Dr. Ruth Fisher: 35:11

I think that what the lawsuits are coming, and I think that if you get a lawsuit with a big damages settlement, that that's gonna incentivize a lot of other attorneys to come in and take cases on contingency. And I think the dominoes are gonna start to fall. And I think that once that happens, and I think that that's I mean, you talk about like the testing fraud, similar there, um, and just kind of the products not living up to what they're supposed to be doing. Um, you know, someone's gonna die because of a, you know, a moldy product or something, and someone's gonna win a very large lawsuit, and that's gonna bring in a lot of attorneys and contingency, and they're gonna start suing. And then you're, you know, there's gonna be, I think, a before period and an after period with a pretty clear line of okay, here's when the law started being enforced. Because you, I mean, what's going on in cannabis wouldn't exist in any other industry because there would be so many lawsuits that would have prevented it. And I don't know why, but for some reason in cannabis that isn't happening, although it's starting.

Ben Larson: 36:23

Can we dive into damages a little bit? Because I I imagine as a business owner, at some point someone's gonna send me something and be like, you owe me 80 bajillion dollars, and I'm like, that's unreasonable. And in some cases, maybe they do want 80 bajillion dollars, but maybe they'll take a settlement. But like, I don't want to give more than than what's due. And so, like, how should business owners, whether they're on the receiving end or the attacking end of one of these cases, like, how should they be thinking about damages? And then how do the courts think about damages when it actually comes to awarding someone for patent infringement?

Dr. Ruth Fisher: 37:03

So um, if you're talking about patent infringement, then so suppose someone infringes, and first of all, there have to be damages, and you have to establish damages in order to be able to win.

Ben Larson: 37:16

So you can damage damages largely meaning like lost revenue.

Dr. Ruth Fisher: 37:20

So this is what I was gonna get into. Um, so you sue for infringement and so or for damages, and there was a case that came out recently where someone sued and it was uh THC fraud, where you know the labeled contents was I don't know, hundred 150% and the actual content was like 15%. And the guy sued and he said, Well, you misled me. And the question there is, well, what are the damages? And he said, Well, I could have been harmed or something, and that's you can't get damages for that because there's no real you need to say, okay, what's the harm? And you need to be able to reasonably quantify that harm. And if you can't get a reasonably, you know, if it's too speculative, then that won't work. And so you need to be able to define clearly what the damage is and have be able to reasonably estimate those. And in in in patent infringement, there's two different types of damages. So if you can think about you have an invention and there's two ways to commercialize it. One, you can go out there and you can build a business around it and you can earn money, or you can license it to someone else and have them, you know, build and sell the technology, and then they will pay you a royalty. It's usually based on a percent of revenues, and there's, you know, some percent, maybe five percent of revenues. So they license your extraction technology, they make a million dollars in extractions, they owe you 10%, so they pay you $100,000. So a royalty is generally lower than a profit number because profits generally tend to be say 20%, 30%, whereas royalties tend to be say five percent. And a royalty is easier to get than an actual profit. And that's kind of why the numbers are that way. So if your patent is infringed and you say, Well, I you you hurt me, I I lost money. The if you can prove that that that you have, say, an extraction technology and someone else infringed on your technology on your patent and they made a sale that you would have made, so they got those profits that you would have made, then you need to establish that you actually could have and would have made or could have made those those uh profits. So for example, if you're a company and you're operating in California and you're doing your extraction business in California and that's all your operations are, and someone say in Maine or or Florida or New York or whatever copies your invention and sells it within New York, you can't the only way that you can get lost profits is if you establish that you would have made those sales in New York. Now, if you don't have any sales guys in New York and you don't have any operations in New York, then you wouldn't have made those sales. You can't establish that you would have made them, in which case you get a reasonable royalty, not lost profits. Right. And so to determine, well, what's that number? Is it 5%? Is it 10%? Generally, there's a couple of different things that you need to look at. Um, one of the big things is what is what is the industry standard? And there tend to be industry standards in cannabis. There's probably, we haven't gotten to the point, probably, because there is no licensing really, I don't think. Um, but you can go into other industries and say, well, and in another, like you have extracts in other industries, and so what are the royalties they pay there? And you look at kind of similar sit situations. Another thing that's really, really, really important for people to understand is if they have IP, any sort of intellectual property that they're trying to protect, they need to be able to establish that they're taking reasonable means to protect that property. So if they're like sharing the their secret sauce, you know, if they're posting it on the internet and they're telling all their friends and neighbors, and then later they came back and say, well, that was a secret. It's like, well, if it was a secret, why are you posting it on the internet? And you're less likely to get damages. On the other hand, if you can show that, well, you keep the formula locked in a safe and only a couple of people have access to that, then the courts will say, Well, you were really trying to protect it. You, you know, you were making reasonable efforts to protect it. So you wouldn't have been free to give it out or license it. So your damages will be higher. So that's kind of an important thing that people with technology can do. And, you know, in Silicon Valley, you have all the tech people there, they all have their notebooks where they're documenting things to establish that they were the first to do it, but also they're establishing that they're taking taking reasonable means to protect their information from other people.

Ben Larson: 42:17

I'm gonna ask one kind of selfish question because I'm the host and I can do that before I ask the the most logical next question, and that's regarding kind of like my line of business, right? So we've been building out you know a patent portfolio just with the work that we've done in liquid emulsions and that kind of stuff. And emulsion is really like an interesting category in of its own because not only is it applicable to to beverages and creating stable systems, um, but it's also a way to create bioavailability for you know as an ingredient. And so I'm curious, what did you see in your research regarding the realm of emulsion systems and and kind of other infusion technology? And is that a robust part of the broader ecosystem of patents out there?

Dr. Ruth Fisher: 43:05

So I would I would classify those as delivery patents because it's a it's not just you know patenting like a formulation. You're saying I'm delivering it say in a beverage. And I was I was very and I separated out the delivery, uh, what I call delivery patents because that's a big area of interest of mine. And so there's that was the second biggest area. There's a lot of patents and different delivery mechanisms, say topicals. Um, and I was I subdivided the delivery mechanisms into two groups, either oral delivery or not oral delivery. And I'm kind of keeping yours for last. The non-oral delivery, there's most in oral. In non-oral, the biggest is topical by far. And then so uh second and third to topical is transdermal in patches, which are all topical. So those are the biggest for non-oral. For oral, you have general oral, they say oral delivery, but then the water, the soluble, the emulsions, the um beverages, you have you know, a lot of coffee. Um, but the generic beverage soluble and emulsion uh technologies is a very heavy area of patents. So there's a lot going on there. And that's I mean, that's fundamental to being able to deliver cannabis, as you said, you know, consistently with high bioavailability.

Ben Larson: 44:42

Yeah, interesting. One of the gating factors here that keeps arising is that you know it's coming, cannabis hasn't been there yet, there hasn't been a lot of funding. Let's turn our lens away from patents for a second, just get your perspective on where the industry is at. What are you worried about? What are you optimistic about? Just about the state of the industry and us getting to this kind of legitimate world where, you know, for better or for worse, there's like patent litigation and all that kind of stuff happening, and people are actually leveraging the the value of what they've created.

Dr. Ruth Fisher: 45:16

I'm start with the optimism. I'm very optimistic about the product and the plan. And, you know, the mess of hemp, whether you love it or hate it, shows that there's that the speed at which it's growing and the enormous size of the market shows that this is a product that people want. And, you know, if it's if it's available at low prices, there's huge demand. Uh, and I think that the potential there is enormous. And um, I'm a technology geek and I've been watching the technologies being developed at every stage of the supply chain. And it's what I would call glorious. There's so much innovation there. And it's just it's kind of setting up for the future of this plant well into the future. And what's so amazing too is all the innovations they're being developed for cannabis because cannabis is a relatively high value product. But so many of the technologies being developed for cannabis will have applications for other products and industries as well. So, for example, all the extraction that's not just, you know, applicable to cannabis, it's applicable to any herbal or you know, plant or anything else. Um, and so the moving forward, the diversity and the variety of cannabis products has just tremendous potential. What I worry about is the regulatory environment. And the the problem with cannabis is it's, I mean, it's I love complexity. Uh, I thrive in complexity, and cannabis is more complex than anything I've ever seen before in so many different ways. Everything about cannabis is complex. You know, it's it's the plant and all its compounds, it's the way, you know, their endocannabinoid system and the way that they process it, it's the regulatory environment, it's the cultural environment, you know, it's the market environment. It's just there's so much complexity and nuance, and it saddens me that the people making all the laws and regulations seem to have so little understanding, and they keep styming the potential. So that frustrates me.

Ben Larson: 47:31

It is interesting, and we lament this almost every episode. It's just it doesn't seem that there's a large learning cycle going on from year to year, from new market to new market. And it seems like we make a lot of the same mistakes that history repeats itself every time, and sometimes there's new mistakes like we were talking about off offline. It's just like it's like they're coming up with new innovative ways to make mistakes every every year.

Dr. Ruth Fisher: 47:59

Well, it's it's so funny because I was watching Californian, Californians just magnificently kilt cannabis, and it it's just I mean, it's been so phenomenal, and I just I couldn't imagine that anyone could potentially top that. And then New York came along.

Ben Larson: 48:14

What's I mean, hopefully this isn't too loaded of a question, and I swear, folks, we didn't talk about this beforehand, but Ruth, like, what's your perspective on on what's been happening with the hemp cannabinoid market and how that's been influencing the trajectory of the kind of the whole industry and plant?

Dr. Ruth Fisher: 48:31

That's a very complicated area. Um I think it's it shows you the beauty of human ingenuity and the ability of people to maneuver around any roadblock in their uh in their way. Um, I think it's it's it's complicated. I personally I'm very much for descheduling and to combining all cannabis together under a single framework and just legalize the whole thing. And I think that would eliminate a huge portion of the problems that we're having.

Ben Larson: 49:06

Yeah.

Dr. Ruth Fisher: 49:06

Um I think it's unfortunate that within the environment, there's certain players who you have regulators who don't understand what's going on. Um, as I said, and you have a couple of different actors out there who are doing things that are not helping the industry at all. They're helping themselves kind of at the expense of everyone else. And just a lot of bad activity where, you know, we as an industry need to do better and we need to kind of show the rest of the world that, you know, we're willing to step up and do what we need, like have testing and have age gating, um, and you know, have proper labeling and transparency. Um, and I think a lot of people have been trying to do that. They've been stymied for various reasons. But again, I think that, you know, we should just legalize it already. Um, and that would solve a lot of the problems.

Ben Larson: 50:00

Amen. Amen. A very diplomatic answer. Thank you, Ruth. All right. Well, this has been an amazing, amazing conversation. I really appreciate you taking the time today uh to just kind of unpack uh patents and all that kind of stuff. But I know there's a lot more to your area of expertise and in the things that you get yourself involved in. And so now that it's time for our our last call, this is an opportunity that we typically give our guests an opportunity to give a last shout out, a call to action, whatever it is, cannabis or otherwise. And so, what did I not ask you? What do you want to tell our audience?

Dr. Ruth Fisher: 50:43

I'll do a shameless book plug. Uh, I wrote a book. Yeah, the Medical Cannabis Primer. Um, so that's available and it's on our website, medicalcannabusprimer.com or Amazon, but less shamelessly, I'm available on LinkedIn. Um, so I love meeting new people. Uh, please reach out and contact me, and I'd love to hear about you and what you're doing.

Ben Larson: 51:06

Amazing. Amazing. Dr. Ruth Fisher from Quanta and Can Dynamics. Thank you so much for spending the past hour with us. You're just a wealth of information. Really appreciate you spending the time.

Dr. Ruth Fisher: 51:19

Thank you for such a very interesting uh and delightful conversation. Thank you for having me.

Ben Larson: 51:24

Amazing. Well, we'll talk to you soon. All right, folks, what do you think? Do you have your patents all tightened up? Are you ready to defend them? Are you ready to defend yourself if someone comes at you with a patent? Uh call Ruth if you need some help. If stoicism teaches us anything, control what you can. Ruth reminds us that understanding the world that you're operating is within your control. So please do that. Thank you for those leaving comments and engaging Scott Wessler, Jehan Marku, and all the rest. Thank you, Bertosa and Wolfmeyer, our team members for the support, and of course, our producer, Eric Rossetti. If you've enjoyed this episode, please drop a review on Apple Podcasts, Spotify, or wherever you listen to your podcasts. It helps us be found. Things are looking up, but we want it to grow more and more and more. Thank you, thank you, thank you. As always, folks, stay curious, stay informed, and keep your spirits high. Until next time, that's the show.