California Cannabis Advertising – What’s Legal, What’s Not

Outdoor advertising of cannabis products on more than 4,000 miles of California highways (any that cross the state border) was banned earlier this year following a district court ruling. In that matter, the court sided with a resident of San Luis Obispo County who alleged the state’s cannabis regulation bureau’s read of Proposition 64 would unduly expose his teens to marijuana ads. But what does that mean for marijuana marketers?

As our Los Angeles cannabis business attorneys can explain, cannabis advertising is not something companies should engage in until they’ve consulted with an attorney and are certain their approach is within the boundaries of the law. Having an attorney on retainer assures you can run decisions like this by someone who will be on hand to give you solid advice for whatever issues arise.

The good news is that despite blanket bans on marijuana advertising, many cannabis companies are still finding creative ways to get their brand some traction. For example, some businesses have orchestrated workarounds with state Sponsor a Highway programs. That gets them brand visibility while also complying with the law.

That said, while the strategy is creative, it’s really just a temporary fix. Further, it’s likely the issue will continue to become more fragmented and complicated as states continue legalization.

Cannabis businesses should be prepared to grapple with three sets of regulations: Federal, state and local.

Some baseline rules to bear in mind:

• Advertising limited to target audiences 21 and older. This comes straight from Prop. 64, Section 26151. It states that cannabis ads are only allowed where at least 72 percent of the audience is suspected to be over 21. This covers ads in print, radio, broadcast, cable and digital communications. Direct, individualized dialogue or communication must use some type of age verification method. Companies are also restricted in the release of marketing approaches that might be attractive to kids.
• Prohibition on false and misleading statements. Advertisers can’t make claims that aren’t supported by the truth. Companies can’t make misleading or unsupported claims about the health benefits of their marijuana product.
• Ban on giveaways. Cannabis companies can’t give away products or accessories as part of their promotions. The only exclusion to this is donating cannabis to a patient who benefits from medical marijuana.

Full details on cannabis advertising in California are spelled out by the California Legislature, but you should talk to your attorney as well.

Understand too that some “workarounds” may only work in the very short term. For example, some dispensaries, growers and distributors use their creativity to market products on platforms like social media or search engines without directly identifying their product as pot. If you do this, you’re taking a major risk because:

• Your ad is likely to get pulled soon after launch.
• You may face penalties for actions like this, including being kicked off of those platforms entirely.
• If you make it sound like you’re selling an everyday product or supplement, you might run into serious legal trouble for misleading consumers.

The bottom line is that if you are in any doubt, it’s imperative to be cautious. Marijuana business owners have worked so hard to jump through all the legal hoops to throw it all away for a poorly-planned ad.

The Los Angeles CANNABIS LAW Group represents growers, dispensaries, ancillary companies, patients, doctors and those facing marijuana charges. Call us at 714-937-2050.

Additional Resources:

Marijuana companies still face advertising and marketing obstacles, but options exist, July 2, 2021, MJBizDaily.com