Ethics for Israel Patent Attorneys

November 23, 2014

ethical and legal

In what some may consider a welcome move, the Ministry of Justice has published a first draft version of a law that will govern the behavior of Israel Patent Attorneys.  For the draft, see here.

Perhaps the most significant thing about the draft law is that client-attorney privilege is formally recognized. Henceforth, Patent Attorneys will also be required to keep escrow accounts.

The IP Committee of the Israel Bar considers that the standards required of Patent Attorneys should be equivalent to those required of Attorneys-At-Law, and considers that the current state of affairs allows Patent Attorneys more freedom regarding marketing. They have requested that this be addressed. The attorney signed on their proposed response is Ziv Glasner who is also a patent attorney.

The Association of Patent Attorneys in Israel has submitted their comments to the Justice Ministry as an amended draft. Briefly, the Association of Patent Attorneys in Israel would like the code of ethics of patent attorneys to mirror that of the Israel Bar Law (Professional Ethics) 1988 mutatis mutandis, seeing a correlation between the two professions.  Thus the draft law as proposed by the Ministry of Justice recognizes that a patent attorney who is also an attorney-at-law will be duty-bound by both the Code of Ethics that bind patent attorneys and by the Israel Bar Law (Professional Ethics) 1988, however in case of conflict, the behaviour required of Attorneys-at-Law will prevail. In contradistinction, the Association does not see room for conflict between requirements of an Attorney-at-Law and those of a Patent Attorney as it wants the Code of Ethics for Patent Attorneys to mirror that for Attorneys at Law.

If we were talking about ethics, where the standards required of Patent Attorneys and Attorneys at law differ, one would require the attorney to have the highest standards. However, this proposed Law is not about ethics, it is about behaviour.

The proposed law legislates and formalizes much of the voluntary code adhered to by the Association of Israel Patent Attorneys that Dr Kfir Luzzatto drafted some years ago. However, the amendment proposed by the Association of Israel Patent Attorneys wishes to delete certain sections such as not denigrating competitors and not aggressively poaching clients, as these are not currently binding on Attorneys-at-Law. Instead, the Association’s propose to import a whole bunch of clauses from the Israel Bar Law (professional ethics) relating to where Attorneys can set up office and where they can meet clients and make these binding on Patent Attorneys as well.

I am concerned that these restrictions will create an entry barrier against sole practitioners and new firms, and should not be allowed on constitutional grounds based on the Basic Law, Freedom of Occupation 1992. Clearly restrictions designed to protect the public are legitimate. However, I do not think that Read the rest of this entry »


Israel Supreme Court Rules on Parallel Importing

November 19, 2014

Tommy Hilfiger

The Israel Supreme Court has issued a ruling concerning the rights and wrongs of parallel importing and related marketing and advertising. This is the first time that they have ruled on this issue.

The Supreme Court ruled that parallel importing is legitimate, as is marking the goods with the trademarks. The licensed importer or franchisee cannot prevent parallel importing, but it is important that the name of the company doing the parallel importing does not imply that the parallel importer has a relationship with the mark holder and has to actively take steps to make clear that they are not the licensed importer. The licensed importer does not have to guarantee or provide a service for the parallel imported goods and the parallel importer that the public are made aware that the parallel imported goods are not covered by the importer’s warranty and servicing obligations.

The Israel Supreme Court partially upheld the ruling of the Court of First Instance that the parallel importers had infringed the registered licensee’s trademark and were also guilty of passing off. This was due to the name of their business, not the parallel importing itself. The Supreme Court decreased both the damages award and the restrictions imposed by the Court of First Instance.

The Appellants, Elad Suissa and Importer Warehouse 42 LTD. imported clothing carrying the Tommy Hilfiger brand, despite not being the licensed importer registered in the Trademark Register and also not having any contractual relationship with the licensee. The Appellants purchased the goods abroad from legitimate suppliers in countries where the prices were lower than in Israel. They traded under the name ‘Importer’s Warehouse – Tommy Hilfiger’ and advertised themselves as selling premium bands at discounted prices. They operated a website www.tomm4less.co.il.

The licensed importer Sea & Shells LTD, together with Tommy Hilfiger Licensing LLC. Tommy Hilfiger USA INC. and Tommy Hilfiger Europe BV sued Elad Suissa and Importer Warehouse 42 LTD on  various grounds of unfair trade and trademark issues.

The Court of First Instance ruled that the parallel importers should pay 457,000 NIS in damages and issued a permanent injunction against them. The Appellants argued that they should not be restricted from parallel importing in circumstances where this is legal.

The Supreme Court partially accepted Appeal 7629/12 by the parallel importer, and rejected the appeal 8848/12 by Tommy Hilfiger.

The Ruling

The starting position is that parallel importing is legal. Parallel Importing is not trademark infringement and is not Unjust Enrichment by the Parallel Importer. However this does not mean to say that there are no restrictions on the parallel importer. The parallel importer is subject to trademark law, fair trading laws and the Law Against Unjust Enrichment.

In Pezachim, using the registered trademark in connection with legitimate goods carrying the mark was considered “True Use” under Section 47 of the Trademark Ordinance. In Toto Zahav, it was ruled that such a use of original goods is an infringement. The case-law of the District Court adopted tests from US case law: If the items cannot be identified without using the trademark it is legitimate to use the trademark. However, usage must be limited to that which is necessary to identify the goods as being genuine and no more, and there should be no indication that the retail outlet is sponsored by or affiliated to the mark holder. Toto Zahav did not relate to parallel importing and, in cases of parallel importing, the Toto Zahav ruling should be modified.

Parallel Imported genuine items do not fall under the guidelines of Toto Zahav. Their sale is not trademark infringement and the goods do not have to have been purchased directly from the rights owner. However, marketing activity relating to such goods may be considered trademark infringement. Servicing and maintenance services have to be recognized for the servicing laboratory to be able to use the registered trademark. Parallel imported goods are not subject to warranties and guarantees of the registered importer and parallel importer has to take care that it is clear that his parallel imported goods are not covered by such warrantees.

Passing Off requires a reputation of the rights holder, and, in addition to the mark owner, the legitimate importer or licensee may have rights in the brand and may be able to sue for passing off. The concept of ‘dilution’ does not apply to parallel importing and cannot be claimed by either the mark owner or the licensed importer. However, where the reputation is built on service and the like, sale of the goods by a parallel importer such that the service agreement does not apply, may be considered passing off.

In the present case, sale and publicity of the goods themselves and the website www.tomm4less.co.il are considered as being truthful. Using the company’s colours is also unlikely, in and of itself to cause confusion.

Trading under the name ‘Importer’s Warehouse – Tommy Hilfinger’ is considered trademark infringement of the rights of Tommy Hilfiger Licensing LLC. Tommy Hilfiger USA INC. and Tommy Hilfiger Europe BV.  This is not infringement of the rights of the licensed importer Sea & Shells LTD however, since they themselves do not have a reputation.

There is no additional element such as bad faith to warrant granting damages under the Law of Unjust Enrichment.

The Parallel Importer must cease to use the name ‘Importer’s Warehouse – Tommy Hilfinger’ and have to pay 100,000 Shekels as estimated damages for their infringing use and have to mention in their advertising that they are not a franchise or otherwise acting under the supervision of Tommy Hilfiger.

The costs awarded by the District Court are canceled and Tommy Hilfiger et al. have to pay 25,000 Shekels costs to the parallel importer.

7629/12 Appeal to Israel Supreme Court (ruling by Dalia Barak-Erez et al): Elad Suissa and Importer Warehouse 42 LTD vs. Sea & Shells LTD, Tommy Hilfiger Licensing LLC. Tommy Hilfiger USA INC. and Tommy Hilfiger Europe BV, 16 November 2014

 


Transferring A Contested Trademark to a Limited Company

November 19, 2014

pama

Abad Elrazak Abido is the owner of a registered trademark number 244831 for Pama, for shoes. He wishes to transfer ownership to a limited company: Pama Shoe Manufacturers LTD and to a partnership called Pama Porza, and submitted a request for transfer of ownership signed by him and the company.

This is actually the second attempt to transfer ownership, where the first attempt was dismissed on procedural grounds. Following that first attempt, an appeal was filed to the District Court. This appeal is pending, but meanwhile the owner has again submitted a request to transfer the mark and the present ruling relates to this request.

Section 48a of the Trademark Ordinance 1972 allows both pending and issued marks to be transferred from one owner to another, but gives the commissioner the right to refuse to register the transfer of ownership if it appears to be likely to confuse the public as to the origin of the goods or apparently contravenes the common good.

Puma S.E. opposed the transferring, arguing that the request had procedural flaws. In addition, they claim that the request is designed to create anonymity regarding the source of the shoes. The logic presumably being that the mark is being used to sell counterfeit shoes and Puma prefer to litigate against a person than a company as it is easier to collect if they win.

The Applicant submitted a Palestinian Authority trademark decision concerning a similar opposition, where registration of the mark Pama was allowed, and also submitted a certificate of incorporation, showing that the company to which the mark is to be transferred is properly incorporated in the Palestinian Authority (West Bank). The Applicant further claimed that there was a mediated settlement between him and Puma that allowed him to sell shoes under the PAMA brand in Israel and in the West Bank. The existence of the partnership remains a little cloudy.

Ms Shoshani Caspi ruled that the parties should submit affidavits and then attend a hearing where the relationship between Abad Elrazak Abido, the company and the ‘partnership’ could be clarified by cross-examination of the parties by the parties. Until such a hearing, she felt unable to address the issue of the public good. She noted that Mr Abido rights were not being compromised, as he would have the opportunity to provide additional documentation to substantiate his case. In the meantime, the request for transfer of ownership is suspended and no costs were-ruled.

COMMENT

Those with an interest in trademarks that are inspired by and somewhat similar to the marks of leading brands will note the four striped sneaker opposed by Adidas that was appealed to and upheld by the Supreme Court. Also of note is the Tigris decision which I am somewhat critical of, as it doesn’t relate to sports goods.

I have a working relationship with a Shechem (Nablus) based trademark lawyer which may help clients registering and enforcing in both the West Bank as well as in Israel. I suspect that proceedings are very different before the two regimes.


Requests for Costs Must be Timely Filed

November 19, 2014

missed

Back in June 2014, I reported on a decision by the Israel Commissioner of Patents and Trademarks that the Chinese brand Lovol and the older and more established Swedish brand Volvo are not confusingly similar. Having persuaded the Israel Patent Office that their mark was registered in good faith and was not confusing, Hebei Aulion Heavy Industries LTD, who own the Lovol mark, were entitled to file a request for costs.

The request for costs should have been filed within two months, as per Patent Office Circular M.N. 80. Hebei missed this deadline and, three and a half months after the hearing, they filed a late request for an extension to file costs.

Volvo opposed this request.

Hebei argued that the delay was caused because they waited to see whether the ruling would be appealed. The Commissioner did not see that connection between a possible Appeal and the right to file, and the right to costs for one proceeding is quite independent of whether the ruling may eventually be appealed or overturned. Furthermore, appeals should be filed within one month of a trademark ruling, whereas a request for costs may be filed within two months of a ruling. Where an extension is requested in an ex-partes proceeding it should be requested in advance and not retroactively.

A further consideration submitted by Hebei’s agent-of-record (Wolf Bregman Goler) was that they were unaware of the Circular and their client should not be penalized for their ignorance in this manner.  The Commissioner noted that the Circular issued back in February 2010 and that the agent-of-record was experienced and regularly appeared before the patent office in hearings and the like.

Citing A. Goren on Civil Procedure, the Commissioner noted that ignorance of the Law may be an excuse if objectively the Law is unclear and there hasn’t been any case-law, or, if subjectively, the legal representative had made efforts to avoid the mistake. In this instance, no evidence or arguments were submitted to establish objective or subjective grounds for clemency.

The agent of record argued that his client had a basic right to costs, that the Trademark Ordinance and regulations doesn’t establish a deadline, and so the Circular should not be considered binding. The Commissioner rejected this argument, considering that the Circular filled a lacuna and gave certainty as to whether costs would be requested or not. He considered that different practitioners should be held to the same standards. Costs should be requested at the end of a proceeding and not any time thereafter. There were no good reasons to consider the two month period insufficient, so the request was thrown out.


Forcing Foreign Witnesses to Attend Hearings In Jerusalem When There is a Difficult Security Situation

November 19, 2014

Courage under fire

It is very unfortunate that Israel in general and Jerusalem in particular suffers from terrorist attacks. The situation is not, of course, limited to Israel.

EBay Inc. is opposing Israel trademark application No. 243223 that was filed by Dotcom Retail LTD for the mark BEAUTYBAY.

Arguing that the US Government has warned its citizens not to travel to Israel, e-Bay Inc has asked to postpone a hearing that was scheduled for 3 November 2014 since it is a US company and one of their witnesses is prevented from coming to Israel because of the security situation. They requested a postponement until January 2015 and were willing to pay any costs caused by the delay. Alternatively, they suggested allowing the witness to testify by video-conference.

Dotcom Retail LTD objects to both requests. They claim that the current warning regarding the security situation in Israel has remained the same for decades, and submitted copies of the US Government’s warnings from 2010 – 2012. They claim that the decision against travel to Israel is an internal policy of eBay and is not an acceptable reason for delaying the hearing, as, say, the state of health of a witness might be. They supported their opposition to the request with reference to 2668/03 Etrade Group vs. Karden technologies LTD.

EBay noted that following the Protective Edge Campaign (War with Hamastan – Gaza) earlier this year, the situation in Israel is not normal and that they have forbidden their employees to travel to Israel. They suggested that the hearing could be held by video conference and noted that the Israel Supreme Court had upheld the possibility of conducting a hearing by video conferencing.

REGARDING DELAYING THE HEARING
In her ruling, the Deputy Commissioner, Ms Jacqueline Bracha, noted that the opposer had already postponed the hearing once and had tried to find someone willing to attend a hearing in November. Not being able to, they were requesting a second postponement.

She noted that in an Opposition to patent application number IL 107741 Unipharm vs. Merck & Co., the then Commissioner ruled that parties wishing to obtain IP rights in Israel or to oppose such rights should be willing to testify and to be cross-examined in Israel.

M Bracha accepted eBay was willing to participate in legal proceedings in Israel, but merely felt that the current time was too dangerous. However, she noted that there is no state of war at present that prevents hearings from taking place in Jerusalem. She noted that in 2006, then Commissioner Noam rejected ‘security considerations’ when there was no actual war taking place, and pointed out that a witness can arrive in an Israel Airport, travel to the Patent Office, give evidence and return on the same day. EBay cannot know from day to day or from month to month what the security situation is and therefore cannot guarantee that any postponement will suffice to reschedule a hearing under better circumstances.

The restriction was an internal decision of the eBay and was not a decision by the US government. It had no legal significance and one cannot simply create travel restrictions and expect the Israel Courts to uphold them.

VIDEO-CONFERENCING
Regarding the Supreme Court precedent regarding video conferencing, Ms Bracha noted that in extreme circumstances where a hearing was postponed four times due to a party being in ill-health, hearings have been held outside of a court room. Where the court sits in a court room but a witness testifies or is cross-examined by video conference, the situation is less than ideal in that the testimony is indirect when compared to a witness in the court room. It may be permitted in some circumstances, but use should be limited, particularly if the other party does not willingly consent.

In 3005/02 SmithKline vs. Unipharm testimony over a video link was allowed since the party could not force the witness to travel to Israel. The current case is different in that eBay is the source of the travel restriction, and can lift it as easily as they imposed it.

Referring back to 2668/03 Etrade Group vs. Karden technologies LTD, Ms Bracha ruled that there is a difference between a minor witness and a major one. The courts have rejected ‘security considerations’ as justification for a witness not turning up in court. Both the request for postponement and the request for video conferencing were both rejected.

COMMENT
I think this decision is correct. Formally, Israel is in an ongoing state of War with various Arab neighbours and has been since 1948. Hamas certainly see themselves as in a perpetual state of war, and at best, accept temporary cease-fires as restraint. The case-law that deals with this issue shows that security problems are ongoing and may be considered a fact of life in Israel.

That said, we note that Operation Protective Edge was not declared as being a war, probably since Hamas are not recognized as being a State. It is not clear, therefore, that when there were rockets hitting the country, and occasionally hitting Jerusalem, that the Patent Office would have recognized a state of war. Security fears may be real and not merely a delaying tactic. On a daily basis there are terrorist attacks and many of these are in Jerusalem. I don’t have enough experience of testimony and cross-examination by video conferencing to know if it is a reasonable alternative to standard cross-examination conditions.

As an Israel citizen working and living here it is difficult for me to put myself in the position of an American. I am sure that things are better here than in Syria, Iraq and Iran. I suspect that they are safer than in Egypt, Lebanon and Jordan as well. Let us hope and pray that the security situation in Israel approves.


Combining Similar Proceedings

November 19, 2014

combining hearings

C.T.S. LTD filed Israel trademark application numbers 2253382 and 253359 “Lactofil” and לקטופיל. The Mark covers Cosmetic preparations namely lotions, creams, mousses and soaps for nourishment and cleaning of the skin and face all in Class 3. “” Laboratorios Genesse, S.L. opposes the marks

Meanwhile, Laboratorios Genesse, SL. has filed Israel trademark application number 249389 for Lactivit for Soaps, gels, perfumery, essential oils, cosmetics, lotions for hair and skin care, creams for hair and skin care, and dentifrices also in Class 3. C.T. S. LTD are opposing this registration.

Both parties propose combining the hearings. The Lactofil hearing was scheduled for 29 October 2014.

The legal issue in both cases is likelihood of confusion with the similar product of the other party. The parties and the issues in both cases is the same. Combining the cases saves the parties time and expense, and saves judicial resources. In one case there are additional claims of inequitable behavior, but this is not seen as sufficient justification to hear the cases separately.

As both parties have equal rights, Ms Yaara Shoshani, Adjudicator at the Israel Patent and Trademark Office ruled the cases are to be combined, however in each case, at the combined hearing, the Opposer has the right to cross-examine the applicant’s witnesses and only then may the Opposer’s witnesses be cross-examined.

In the circumstances, no costs were awarded.

Decision to Combine Similar Trademark Proceedings, Yaara Shoshani Caspi 6 October 2014. 

COMMENT

Apart from the parties in question, there is a third party of importance, i.e. the public. It seems to me that combining the proceedings is not only economical for the parties and for the public purse in terms of judicial expense, but also is most likely to result in a sensible ruling.


Naomi Ragen Found Guilty of Plagiarism Again

November 17, 2014

Sacrifice   marriage made in heaven

On 11 November 2014, Judge Oded Shacham found Ms Naomi Ragen not guilty of Copyright infringement on a technicality, but nevertheless guilty of infringing the moral rights of another author in a book that she wrote that was ruled as plagiarizing a short story by the other author, a Ms Cynthia Rosengarten (now aged 82). The request for an injunction was denied. The damages awarded were 60,000 Shekels, which was rather less than the 2.5 million shekels requested in the statement of case.

Background

The plaintiff, Ms Cynthia Rosengarten published a short story entitled “A Marriage Made in Heaven” in an anthology of short stories written by various Hareidi (Ultra-Orthodox) women, that is titled: “Our Lives, An Anthology of Jewish Women’s Writing” which was published in 1991. The anthology was edited by Sara Shapiro.

Ms Rosengarten claims that the story is autobiographical and relates to the marriage match of her eldest son. The story is a 15 page personal account of her dealing with match-makers, and how, as a mother, she felt when a girl from Boro Park was suggested as a suitable match for her 18 year old son. On one hand she is aware of the need for her son to get married, but on the other hand, she considers all the potential brides inadequate. The story reflects reality in the Hassidic world.

Ms Rosengarten sued Ms Naomi Ragen and Keter Publishing LTD, claiming that Ragen’s best-seller “the Sacrifice of Tamar” which was published in 1997 includes elements from “A Marriage Made in Heaven” and infringes both commercial and moral rights therein. Ms Shapiro was mentioned as a formal plaintiff.

The Sacrifice of Tamar tells the story of Tamar Feingold, who grew up in an Ultra-Orthodox neighborhood of New York, and relates her internal conflicts with the community in which she lives.  Two years after getting married, Tamar Feingold is raped by a black (that is, African American – not Hareidi) rapist whilst staying with her sister. Later that night, Ms Feingold sleeps with her husband and hides the trauma she went through. She becomes pregnant and is unsure which is the father of the child. Chapters 1 to 22 of the book relate to the feelings of Tamar through the pregnancy, where eventually a white skinned child is born.

In Chapter 23, the son asks his mother to help him find a life match.  The son gets married and a year later his wife has a black skinned baby. The son accuses her of unfaithfulness and Tamar has to come clean about the rape. The son’s marriage dissolves and Tamar, the grandmother, adopts the grandson and leaves the Hareidi fold.

According to the Statement of case, Ms Ragen used parts of “A Marriage Made in Heaven” in Chapter 24 of her novel, thus violating the Copyright and Moral rights of the plaintiffs. They claimed damages and also requested an injunction.

Ruling

Because of the time-line, the ruling was given under the old Copyright Regulation of 1911 and not under the new Copyright Act 2008, but, considering the infringement as on-going, eventual damages took into account the statutory damage regimes under both law.

In the ruling there is a lot of discussion as to whether the copyright was actually transferred by Ms Rosengarten to Ms Shapiro and that it wasn’t transferred to the printing house. No assignment document was forthcoming. It was alluded to and was probably filed somewhere but was not produced.

Judge Shacham ruled that the copyright in “A Marriage Made in Heaven” belongs to Ms Shapiro and consequently the plaintiff Ms Rosengarten does not have grounds for financial Read the rest of this entry »


Follow

Get every new post delivered to your Inbox.

Join 296 other followers