A seven-year battle between two rolling paper sellers has wrapped up in court. The jury sided with both HBI International, maker of Raw Organic Hemp rolling papers, and Republic Bands, maker of OCB Organic Hemp rolling papers, on the multiple claims the companies brought against each other, resulting in both companies owing each other damages.
Judgement was entered on June 5 in the U.S. District Court for the Northern District of Illinois under Judge Thomas M. Durkin, court documents show.
The jury found in a 2021 trial that Republic Brands, previously known as Republic Tobacco, willfully infringed on Raw’s copyright and trade dress—or the general appearance of a product or its packaging—and awarded HBI damages of more than $1 million, HBI said. Including a prejudgment interest award, the court found Republic must pay Raw more than $1.5 million in total compensation, according to Phoenix-based HBI.
The jury was in favor of Glenview, Illinois-based Republic, though, when it came to its Deceptive Trade Practices Act claim and claim of unfair competition, court documents showed. HBI must pay Republic its attorneys’ fees spent resolving a branding issue. The fee was $665,000 for false statements made regarding papers being made in Alcoy, Spain. Another $200,000 was awarded to Republic from Raw’s founder Josh Kesselman arising out of his violation of a court order barring the use of social media during the trail that might influence the jury, Republic said.
Kesselman said he was pleased with the June 5 court outcome but nonetheless frustrated.
“Republic has persistently filed lawsuit after lawsuit against our company, perhaps because of our success,” Kesselman said. “We intend to donate the net proceeds we will receive, now that this case is resolved, to organizations working to help small businesses in the cannabis field, particularly businesses that are startups involving individuals who were previously convicted of nonviolent cannabis related crimes. We’re hopeful that Republic will now cease its relentless effort to destroy our business and focus, like us, on helping the emerging cannabis industry achieve greater equity in the marketplace.”
A Republic Brands spokesperson claimed that HBI was using a 2016 counterclaim ruling regarding trade dress for a single package design that Republic stopped producing in 2014 to divert attention from more recent 2023 court rulings.
“Since Republic first brought this case in 2016, BBK Tobacco [doing business as HBI International] had ample opportunity to proactively cease any false and misleading statements and modify their packaging and products accordingly. They did not do so,” the Republic spokesperson said. “Republic Brands is a family-owned, French-operated company and has been a respected leader in the rolling paper industry for three generations. Republic Brands remains committed to a level playing field where all parties act in good faith and engage in honest marketing to customers and consumers.”
Case Background
The 2016 trademark and copyright case stemmed from Raw contacting Republic to note the similarity between Raw’s distinctive organic hemp product packing and Republic’s OCB Organic Hemp paper packaging, HBI said. Republic sued Raw in federal court, saying it had not infringed on anything; however, Raw counterclaimed for infringement, causing Republic to bring a series of allegations that Raw had made misstatements on its products and marketing materials, among other claims, HBI said.
This eventually resulted in a jury in 2021 determining that Republic had willfully infringed on Raw Organic Hemp’s packaging with Republic’s 99-cent version of its OCB Organic Hemp product, HBI said. The jury also found Republic had willfully infringed on Raw’s copyrighted “Sold Here” sign, the company said. This ultimately resulted in the court awarding HBI $1.5 million.
Then in February 2023, a federal court ordered HBI to stop selling and distributing certain products after a jury found the company engaged in unfair competition and violated the Illinois Uniform Deceptive Trade Practices Act.
Republic claimed HBI “deceptively and unfairly marketed” its Raw Organic Hemp rolling papers and that conduct largely fell within nine topics or categories. Those include HBI marketing its papers as having been made in Alcoy, Spain, and referring to Alcoy as the “birthplace of rolling papers.” HBI affixed an Alcoy stamp to some of its products.
Evidence at trial found, however, that HBI “makes no rolling paper in Alcoy, Spain whatsoever,” a Jan. 19 opinion and order from Durkin said.
HBI told the court it would stop making the statements previously indicated, without consenting to a finding that any of the subject statements was false.