Is Leapfrog trying to jump ahead at Sony’s expense?

September 18, 2014

Sonicgear

Leapfrog Distribution PTE LTD filed Israel trademark application No. 240389 for SONICGEAR.

The application covers “Audio devices, including but not limited to: speakers, multimedia sound systems, docking stations, radios, radio clocks, portable multimedia devices, headphones, headsets, microphones, earphones, audio cables and accessories; all in class 9.

On the mark being published for opposition purposes on 31 October 2012, the Sony Corporation filed an opposition.

Sony frog

Sony’s claims

Sony claimed to be a world leading brand of electronic goods including video game consoles and telecommunication equipment with worldwide reputation, including Israel, with a range of branded products that are identified with Sony. Since the company name Sony is well established, it may considered a Well Known Brand and is entitled to wide protection.

According to the Opposer, there is a similarity between the Applicant’s mark and their name, both phonetically and visually, and so the mark lacks distinctiveness in contradistinction to Section 8a of the Trademark Ordinance.

The Opposer (Sony) claims that a connection between the Applicant’s mark and their own will damage the reputation of years and cause a dilution of Sony’s name. Sony accused Leapfrog of trying to free ride on Sony’s long established reputation which is the result of years of cultivation, and so claims that the registration of the mark is inequitable behaviour and contrary to the public good.

Leapfrog’s claims

Leapfrog was established in 1999 and has sold electronics under the name SONICGEAR for more than a decade. SONICGEAR’s goods have been sold in Israel since 2006. The requested mark has been in use in Israel since 2008 and has developed its own reputation.

Leapfrog denies a likelihood of confusion since both Sony and Sonicgear have developed their reputations over years. Leapfrog claims that Sony has lived with their use of the SONICGEAR branding for years and are thus estoppeled from opposing it, and their opposing it now is itself inequitable behaviour.

Evidence

Leapfrog further claims that the marks look and sound different and that there are very many marks that start with the prefix SON in Class 9 of the Trademark Ordinance.

SONY submitted an affidavit of the Head of Trademarks at SONY that shows the rating of the SONY mark in Japan, examples of branding publicity for Sony in Israel and lists of SONY’s trademark registrations around the world.

Leapfrog filed an affidavit of their CEO showing sales of the SONICGEAR brand over the previous five years and examples of their trademark registrations.

Both sides gave up on the right to cross-examine.

Ruling

Citing Supreme Court precedents, Deputy Commissioner Jacqueline Bracha ruled that where the parties agree to accept testimony without cross-examination this adversely affects their rights to challenge the facts presented in the testimony but this does not bind the court to accept the affidavits at face value.

In this instance, the two affidavits may be used to build a picture of the relative usages but the court has to bear in mind that the affidavits were not challenged.

As to the Opposer’s challenge to the distinctive nature of the mark, Section 8a states that a mark cannot be registered unless it may be used to distinguish between the goods of the registrant and those of competitors. Ms Bracha ruled that the purpose of the Section is to prevent parties from monopolizing generic words. She considers that the distinguishing features of a mark have to be considered by looking at the mark in isolation, without considering competing marks. The issue is whether the mark is descriptive or laudatory, not whether it is confusingly similar to other marks.

Consequently, Ms Bracha ruled that better grounds of opposition might be 11(9) or 11(13) as Sony’s marks are registered and they are claiming a likelihood of confusion.

She went on to apply the triple test and ruled that the as far as the appearance and sound of the mark were concerned, the marks should be considered in their entirety and not broken down into syllables or parts. SONICGEAR does not look or sound like SONY. The mark is also stylized with distinctive graphic elements.

The prefix sonic implies audio and is thus generic descriptive, and not fairly monopolizable by Sony. She noted that it was true that many other firms were actively using marks starting with or including ‘son’, but did not consider this as being grounds for registration per se. Nevertheless, since other players were using the syllable / sound, it weakened Sony’s argument that there was a likelihood of confusion.

The hard G in the middle of Gear is audibly dominant. Furthermore, as a stylized ON-OFF button, it is graphically distinct. She then went on to cite the Appeal of the Killy – Killa decision (considered by former Commissioner Dr Noam as confusingly similar, but overturned by Judge Ginat of the Tel Aviv District Court).

As far as the clientele is concerned, there is certainly overlap but Ms Bracha did not consider that there was a likelihood of confusion, and certainly no evidence of their being a likelihood of confusion was submitted.

Under other considerations and common sense, MS Bracha accepted that the prefix Son was not distinctive and noted that Leapfrog also had a second stylized mark Powerlogic where the Os were jack-plugs similar to the C of Sonicgear, and this strengthened the identity of the mark with Leapfrog’s.

As to Sony being a well-known mark, Ms Bracha accepted this, but explained that the significance of this is covered by Section 11(14) of the Trademark Ordinance, i.e. that an identical or confusingly similar mark could not be registered in a different class if this could create a likelihood of confusion. In this case, since she had concluded that the marks were not confusingly similar, the issue was moot.

In terms of unfair competition, Ms Bracha ruled that merely establishing that a competing mark is wel known is insufficient. A likelihood of confusion is also required and no evidence of this was submitted.

The grounds of Public Interest were considered not relevant, since these were limited to marks that were widely considered offensive, and that wasn’t the case here. As to inequitable behaviour, Ms Bracha referred to the Pioneer decision instead of repeating it again, and also noted that although alleged, no evidence was submitted.

The Opposition was refused and Ms Bracha awarded the Applicant 2000 Shekels costs and 13,000 Shekels + VAT in legal fees.

Ruling: Opposition to Israel Trademark 240489 “Sonicgear”, Sony vs. Leapfrog Ms Jaqueline Bracha, 10 August 2014.

Comments

This was a well-reasoned response. That cannot be said of the Opposition as filed.

If the Opposer chooses to oppose a mark based on one legal argument and is unable to prove his case since the legal basis chosen was wrong, why should the Patent Office raise legal issues such as Section 11 which were not raised? After all, an Examiner had already decided that the existence of Sony’s marks were insufficient to prevent registration and Sony (via their Counsel, Dr Shlomo Cohen, Law Offices) did not challenge this under Section 11.

The Chinese do seem to often choose marks that are at least reminiscent of and perhaps inspired by brand-leaders. Sonicgear is somewhat reminiscent of Sony and of Panasonic, and this case reminds me of the Lovol – Volvo decision.


Israel Supreme Court Overturns Ruling Concerning Unjust Enrichment

September 16, 2014
Reversed Challa Cover!

Reversed Challa Cover!

Back in January 2012, then Jerusalem District Court Judge Yaakov Shapira issued a permanent injunction against a Merkaz Matanot 2006, a competitor and former client of the plaintiff, Karshi, prohibiting them from importing, exporting or otherwise trading in ceremonial ritual challah cloths that had a similar general design to those that produced and distributed by Karshi. Their client, Ami Motzrei Noi LTD and their owner were also injuncted and they were See here for more details.

Essentially Judge Shapira who is now the State Comptroller ruled that there was Unjust Enrichment, breach of contract and passing off. I was very critical of the decision, and particularly that Shapira gave a world-wide injunction which seemed to have been beyond his judicial competence.

I am pleased to announce that the Israel Supreme Court has now reversed the ruling.

Essentially, Karshi ordered these ritual cloths having the words ‘שבת קודש’ – ‘Holy Shabbat’ in a fairly standard font embroidered on a piece of chiffon with a more solid fabric border from China.

Judge Chayot ruled that since Merkaz HaMatanot labeled their cloths with a tag stating that the supplier was Merkaz HaMatanot, there was no case of passing off. Merkaz HaMatanot was a retail customer of Karshi as wholesaler and not an agent of theirs, there was no contractual relationship and thus no breach of contract.

Karshi made no attempt to register the design and there was no additional consideration to imply that Karshi had rights in the design. There was no case of inequitable behaviour to answer for so there was no grounds for sanctions under the Law of Unjust Enrichment.

Case: Civil Appeal 1898/12 Merkaz Matanot 2006 LTD vs. Karshi Intenrational LTD. before Judges Solberg, Natyot and Chayot.  Hearing 25/6/2013, decision, August 2014.

COMMENTS

It seems that A.Sh.I.R. is still good case-law, but the judges want some real indication beyond competition to rule Unjust Enrichment.

The cloths in question were variations on a well-known theme. It is suprising how many of these are sold. I suspect that a lot of ritual Judaica (probably including mezuzot and tefilin) are made in China. Being an importer does not create a monopoly. The original decision was wrong (as were decisions by Shapira concerning the Hallel wine trademark and concerning alleged copyright infringement by Naomi Ragen. I am pleased he no longer rules on IP issues. Whether or not he will be a good state comptroller is beyond the scope of this blog, and beyond my competence to comment on.

 


Kosher Food at AIPPI Toronto

September 14, 2014

toronto

The Chairperson of the Israel Chapter of AIPPI, Adv. Tal Band rose to my challenge and has ensured that there will be Kosher food available at the AIPPI conference in Toronto this week. We applaud him on this achievement.

Andrea Rush, a leading IP Attorney living in Toronto can be contacted for details of Kosher and Synagogue facilities in Toronto.

Unfortunately, due to pressure of work, etc. I won’t be attending, but wish colleagues and competitors a successful conference.


Israel Patent Office Requests Submissions Regarding Patentable Subject Matter

September 12, 2014

 

The postage stamp - a great idea, but probably not patentable

The postage stamp – a great idea, but probably not patentable

Section 3 of the Israel Patent Law states:

. אמצאה, בין שהיא מוצר ובין שהיא תהליך בכל תחום טכנולוגי, שהיא חדשה, מועילה, ניתנת לשימוש תעשייתי ויש בה התקדמות המצאתית – היא אמצאה כשירת פטנט.

An invention, whether a product or a process in any technological field, that is new, useful, may be used in industry and has an inventive step is a patentable invention.

Prior to 1995, the Law related to agricultural or industrial, but the term agricultural was dropped.

The Guidelines to Examiners follow TRIPS and patents are allowed for any technology invention. Unfortunately, this does not clarify what is and isn’t patentable.

There are exceptions. Natural organisms and methods of therapeutic treatment are specifically excluded by section 7 of the Law.

The courts in Israel have not clarified what is and what isn’t patentable subject matter.

Clause 5 of appendix b to the Guidelines for Israel Patent Attorneys 23/1 states that

את המונח “שימוש תעשייתי” ניתן לקרוא בהקשרו של התחום הטכנולוגי (הנדון להלן) ולאור היות האמצאה מועילה. בדרך כלל, אם ניתן לשייך את האמצאה לתחום טכנולוגי כלשהו ושיש בה את התועלת המובטחת על ידי המבקש הרי שגם ניתן לעשות בה שימוש תעשייתי

My best attempt to translate this is as follows:

The term ‘industrial use’ may be read with respect to technological fields, and the invention has to have utility, to be categorizable in a specific class and to have the required usage, and will thereby be deemed as having industrial applicability.

Of particular confusion to Examiners, are medical devices, surgical diagnostic and treatment; inventions that contradict the Laws of Nature (helpfully explained as patent applications claiming new physical theories without indication of their uses; genetic sequences and other biological material without use being discussed.

Perhaps not surprisingly, Examiners would like a little more clarity. Less surprisingly perhaps, the Israel Patent Office has solicited comments from the public. We welcome this initiative.

In addition to the above fields of endeavour, responses may relate to the meanings of industrial usage, utility, technology field, process or device, and also to other restrictions to granting patents, including on the basis of Section 17c, i.e. that some other recognised jurisdiction (typically USPTO) has ruled that the invention is patentable – and that the claims in Israel are identical to those granted.

Helpfully, the patent office has included links to Guidelines for European examiners and UK examiners:

http://www.epo.org/law-practice/legal-texts/html/guidelines/e/f_ii_4_9.htm

http://www.ipo.gov.uk/practice-sec-004.pdf

http://www.ipo.gov.uk/medicalguidelines.pdf

http://www.ipo.gov.uk/biotech.pdf

Responses may be submitted to the Israel Patent Office up until 30 October 2014 – when presumably there will be a Halloween party.

COMMENTS

Back in 2009, I held an event titled “The boundaries of patentability”. We examined stem cell research, business methods, software and the like. The question keeps coming up.

In the US, in Diamond v. Chakrabarty, 447 U.S. 303 (1980), paraphrasing Koheleth (Ecclesiastes), Judge Burger ruled that anything under the sun made by man was considered patentable. Some US patent attorneys have tried to patent plots for films. Children, though man-made are also not considered patentable. Over the years, I’ve come across a range of clients wanting to patent cold fusion, directed Brownian motion motors (that client actually managed to obtain a patent in the US on an earlier version and had apparently been around to every patent firm). I’ve had clients wanting to patent games, including chess openings. One academic with feminist leanings has suggested that the technological industrial requirement discriminates against women who are less technical, and has suggested that patents become available for non-technical inventions.

It is about time that gene sequences per se are recognized as not patentable in Israel. The Circular on the subject is wrong.

As the issue has not been raised, I assume that the guidelines for examining computer inventions are clear to examiners. I don’t find them clear, and nor do other practitioners who’ve I’ve spoken to.

Despite the working of this call for comments, I don’t think that the patent office considers new Laws of nature as patentable subject matter. The question is whether devices that operate according to principles hitherto unknown to science, or rejected by mainstream science should be considered patentable. Should the applicant have to provide proof of utility?

It occurs to me that patent attorneys have an interest in the range of patentable subject matter being widened as this may translate into extra work. It would be nice if the Association of Israel Patent Attorneys sets up a working committee and petititions its membership for comments so as to be able to submit an official position.

 


The Ethics of Outsourcing

September 12, 2014

The IP Ethics and Insights blog covers some interesting issues.

They’ve recently posted a disciplinary hearing against an Attorney-in-Law who collected fees from a client for a patent application and then outsourced to a small-timer at a fraction of the cost. The sub-contractor was not a partner or associate of the Attorney, and the disciplinary court ruled that in the circumstances, the client’s permission should have been obtained. See here for more details.

I find the case interesting as there are a couple of IP boutiques in Israel that have trouble holding on to competent staff and which outsource prosecution work to sole-practitioners, tech-transfer professionals that are moon-lighting and the like. One wonders if their clients are aware of and would approve of the relationship? Clearly the clients are paying over the odds for the service they receive.

Anyone have any thoughts?


Holiday Closures

September 11, 2014

Closed

The Israel Patent Office is closed from 24-27  September 2014 (inclusive) for Rosh Hashana and from
8-18  October 2014 (inclusive) for Suckot.

Yom Kippur is Friday evening and Saturday, so the patent office is closed anyway, however we note that the UN is not merely closed anyway for Yom Kippur, but is actively closed since it is being recognized as a holiday.

Any official Israel Patent Office deadlines due to expire during these holidays will automatically be extended
to the next workday.  This includes Paris filing dates so PCT applications falling due on Rosh HaShana or Suckot may be timely filed immediately afterwards. However, the USPTO may have reservations for a PCT application claiming priority from a US provisional application.

Please note: Sundays are regular workdays in Israel.


Sakare and Sacara Competing Marks

September 11, 2014

Sakare boxes    Sakare shops   Sacara products    Sacara

Sakare and Sacara are trademarks that are co-pending and are confusingly similar so a competing marks procedure was instituted under Section 29 of the Trademark Ordinance.

Sacara LTD is an Israel brand of cosmetics. Sakare is a UK-based brand of Cosmetics owned by Soap & Co. UK LTD

Both companies filed their confusingly similar trademarks for their confusingly similar brands selling confusingly similar products at around the same time, and a competing marks procedure was initiated.

Sacara submitted a statement from a branding expert that testified to when he conceived and suggested the name. Soap & Co. UK LTD filed a submission on 9 July 2014 to have the expert testimony submitted by Sacara LTD struck from the record!

On 24 July 2014 Sacara LTD responded and on 31 July 2014, Soap and Co. filed a response to the response.

This is an intermediate ruling that relates to the request to strike the Statement.

On 30 March 2014 Gidi Adar who is a branding specialist prepared a statement for Sacara. During cross-examination he claimed that the statement was prepared on 27 December 2012. The statement claims that Adar offered Sacara LTD a list of 17 names. On 30 March 2014 at the end of the hearing the parties agreed that the question to be considered was when Adar first prepared the list and the parties would agree on an expert to determine when the computer file was created.

On 15 May 2014 Sacara noted that the sides were unable to agree on an expert to collaborate when the file was created and that Adar’s statement would be acceptable but that Soap and Co. could cross-examine him on it. Adar stressed that for the sake of clarity and for the record, the term file indicates the digital file containing document appended to the witness statement.

On 28 May 2014 in a hearing, Deputy Commissioner Bracha gave Soap and Co. (Sakare) 30 days to submit an expert testimony and Adar could be present whilst the file was examined. On 6 July 2014 Soap and Co. filed an opinion by Mr Yoav Zilberstein who is a forensic computer recompiling specialist. The specialist determined that the file was created on 23 December 2012 and that a second file with a similar name was created on 19 February 2012.

Although Sacara claims that the sides agreed that both files were authentic, the Sakare withdrew from this position. On 9 July 2014, Sakare requested that the expert testimony be voided as the file contained 15 names instead of 17 and the wrong date. Additional files examined constituted and illegitimate widening of the issues. Sacara claims that Mr Zilbersten’s job was to determine when the file was created and he did this as requested and there was no widening of the issues.

Reviewing Mr Zilberstein’s statement indicated that although he claimed to be addressing wider issues in his investigation he actually addressed the issue in question, i.e. when the file was created. The predetermined agreed scope of his research did not take into account that two files with the same name would be uncovered. Ms Bracha ruled that the Expert Statement did not exceed that agreed and did answer the question. She found additional support in Issues of Civil Procedure p 145, 11th edition, 2013. Furthermore representatives of both parties were there when Mr Zilberstein did his investigation. As to the list only having 15 and not 17 names, whilst the file did no include Glossy24 and Gloss24, it did include the name Sacara, so the testimony did show that the name Sacara was considered in December 2014. Then again, the appended list was from a file not in the computer. Although the parties are not in agreement as to the authenticity of the files, Ms Bracha felt that the evidence could be included as something contentious rather than as agreed evidence and both parties could relate to it later.

Ms Jacqueline Bracha therefore rejected the request to cancel the expert opinion but ruled that the applicant is allowed to cross-examine the expert witness on his testimony on a mutually acceptable and agreed date in December 2014 or January 2015. She saw no reason to allow the applicant to cross-examine the workers of the printing-house. The Applicant is, however, allowed to submit an expert testimony within 14 days. Costs will be awarded at the end of the competing marks proceedings.

COMMENT

The date of conception and even the first use of a mark is rarely decisive in a competing marks issue, and scope of actual use and reputation is generally given more weight. The third consideration is equitable behavior and I suspect that the summations will attempt to argue this point in relation to when Sacara thought of the name.

Both parties are using arbitrary names that nevertheless recall mascara. I warn clients trying to be cute when selecting trademarks, that they will invariably run into these kinds of difficulties. they rarely listen, which is why these competing mark, opposition and cancellation procedures happen.


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