Rentalcars.com

August 4, 2015

gtld

This mark considers whether a generic top level domain g.TLD can be registered as a trademark.

Traveljigsaw LTD filed Israel Trademark Application TM 241856 for the word mark rentalcars.com for:

Transport services; travel services; car hire services; arranging holiday transport; vehicle rental and leasing services; rental and leasing of passenger vehicles, commercial and industrial vehicles; rental and leasing of cars, bicycles, motorcycles, camping cars, trucks, lorries, vans, coaches, buses, caravans; rental and leasing of vehicle equipment and apparatus; rental and leasing of vehicle accessories, including, luggage carriers, car seats, child safety seats, vehicle trailers, luggage racks, bike racks; arranging for transportation of persons; travel arrangement services; travel reservation services; electronic information services, namely, interactive and on-line information services featuring vehicle leasing and rental and travel information and interactive and on-line reservation services for vehicle leasing and rental; booking and ticket services; arranging and/or booking of holidays, travel, tours, cruises and vehicle hire, including arranging and/or booking of holidays, travel, tours, cruises and vehicle hire via the Internet; arranging and/or booking of seats for travel, including arranging and/or booking of seats for travel via the Internet; travel agency services, including travel agency services via the Internet; including, but not limited to, all the aforesaid provided by electronic means including the Internet; consultancy, advisory and information services relating to all the aforesaid services, all included in class 39.

The mark was applied for on 26 October 2011 and the Trademark Examiner at the Israel Patent Office refused the mark under Section 8a of the trademark Ordinance 1972 as the mark was descriptive of the goods to be protected.

The Applicant rejected this, arguing that the mark was not descriptive and the link between the mark and the services was tenuous. The mark relates to a website and not to car services. The site doesn’t even offer car hire services but merely is a platform for such services. The addition of the .com makes the mark distinctive and not merely descriptive.

The Applicant further argued that various countries such as Italy, Greece and Romania had allowed the mark to be registered. The company was internationally recognized. The applicant did not, however, want the mark based on a foreign registration.

The applicant supported their argument with an affidavit which was not found persuasive. They therefore filed a second affidavit, and, following a final rejection appealed this decision to the Commissioner to rule based on the contents of the file, but requested that the contents of the second affidavit be kept confidential as it allegedly included trade-secrets.

Ruling

Trade Secrets

Section 23 of the Fair Trade Laws 1999 allows the court to keep certain submissions secret, See 2375/13 Rami Levy vs. Moshe Dahan, 8 July 2013, where relevant considerations such as relevance of information to the proceedings, damage likely to be caused by its publication and the advantage to third parties.

In this instance, the confidentiality request relates to expenses in marketing and publicising the website, number of customers in each country during the period of 2004 to 2012, number of web visits from each country, invoices to Google and other suppliers.

Section 5 of the Fair Trade Laws states that:

A trade secret is business information of any type that is not public knowledge and is not easily obtainable, that provides a commercial advantage over competitors, so long as that the owners take reasonable precautions to keep the information confidential.

The information in question may be considered as trade secrets. In adversarial proceedings, the information is usually necessary to follow the adjudicator’s reasoning. In this instance, however, the proceeding is one of examination between the applicant and the Israel Patent Office and the amount of information that needs to be published is simply the minimum required to make the decision comprehensible.

In this instance, the decision does not require the second Affidavit by Peter Ronney from 2 May 2014 to enable interested parties to follow the decision, and so this information may stay restricted.

Inherent Distinctiveness

The purpose of section 8a is so that articles labeled with the desired mark (in this case rentalcars.com) can know the source of origin of goods or services (Seligsohn page 20).

In general, marks may be generic, descriptive, indicative, random and imaginary, although sometimes the boundaries between these categories are blurred. There is a theoretical continuum between generic and created marks, and the more unique and random the mark, or the more a mark has acquired distinctiveness, the wider protection, and generic marks are not protectable at all. Words that are descriptive of the goods or services must remain in the public domain. “Rentalcars.com” is, accrding to Deputy Commissioner, Ms Jacqueline Bracha, wholly generic and descriptive of the services provided, and the dotcom suffix is insufficient to make the mark unique and distinctive.

The .com suffix merely indicates a generic top level domain gTLD, see Kerley’s Law of Trademarks and Trade Names 15th Ed. (201) P. 859. The issue has been widely discussed in previous ruling 234287 “Hotels.co.il” from September 2013.

Quoting Kerley, the dotcom suffix merely indicates an international profile and therefore does not provide distinctiveness.

The summations noted that the company provides car rental services in Israel and abroad. Consequently, the argument that the company does not ONLY provide care rental services was not given much weight as this was the major activity and other services were related.

The fact that a name is registerable as a domain name does not imply that it is registerable as a trademark as the guidelines and requirements for registering domains in Israel  are very different from the trademark regulations, so the fact that a domain was registered does not free the patent and trademark office from independently examining whether marks are distinctive enough to serve as trademarks.

The commissioner noted that there is no connection between Traveljigsaw – the name of the service provider, and the services provided. Citing the TTAB – the Trademark Tribunal in the USPTO in its ruling concerning 1800.tickets and tickets.com it was ruled that such marks may not be registered even if the term ticket is dropped from the list of goods.

“The test for determining whether a mark is merely descriptive is whether the involved term immediately conveys information concerning a significant quality, characteristic, function, ingredient, attribute or feature of the product or service in connection with which it is used, or intended to be used. In re Engineering Systems Corp., 2 USPQ2d 1075 (TTAB 1986); In re Bright-Crest, Ltd., 204 USPQ 591 (TTAB 1979). It is not necessary, in order to find a mark merely descriptive, that the mark describe each feature of the goods or services, only that it describe a single significant quality, feature, etc. of the goods or services. In re Venture Lending Associates, 226 USPQ 285 (TTAB 1985). Further, it is well-established [*5]  that the determination of mere descriptiveness must be made not in the abstract or on the basis of guesswork, but in relation to the goods or services for which registration is sought, the context in which the mark is used, and the impact that it is likely to make on the average purchaser of such goods or services. In re Recovery, 196 USPQ 830 (TTAB 1977).

In turning first to the alpha or letter portion of this alleged mark (the word “tickets”), we find from this record that the evidence is overwhelming that the word “tickets” is merely descriptive of applicant’s services, even after all the earlier “ticket” and “ticketing” language has been scrubbed from the recitation of services.

Similarly in In re Dial A Mattress Operating Corp., 1999 TTAB LEXIS 623, 9-10 (TTAB 1999)  concerning the mark 188-mattress:

“We are persuaded that the analysis and rationale set forth in Dranoff-Perlstein and 800 Spirits, supra, would serve as an appropriate complement to the Federal Circuit’s Ginn two-part test in cases requiring a determination of the genericness of alphanumeric telephone number marks. Accordingly, we hold that if the mark sought to be registered is comprised solely of the combination of a designation (such as a toll-free telephone area code) which is devoid of source-indicating significance, joined with matter which, under the Ginn two-part test, is generic for the identified goods or services, then the mark as a whole is generic and unregistrable. Stated differently, a generic term is not transformed into a registrable mark simply by joining it with a toll-free telephone area code which itself is devoid of source-indicating significance.

TMEP section 1209.01(b)(12). Furthermore, it appears that a similar analysis has been adopted by the Office for examination of the ever-increasing number of marks which consist of or incorporate those portions of Internet domain names which are devoid of any source-indicating significance, such as “http,” “www” and “.com”. See Examination Guide No. 2-99, issued September 29, 1999, entitled “Marks Composed, in Whole or in Part, of Domain Names.”

Acquired Distinctiveness

Since the mark is generic it cannot have acquired distinctiveness. Nevertheless, the ruling went on to examine the alleged acquired distinctiveness and, citing Kerley, noted that A domain name registration as such is not an intellectual property right: it is a contract with the registration authority.”

In conclusion, the mark was refused.

Re TM 241856 to Traveljigsaw LTDRENTALCARS.COM, decision by Ms Jacqueline Bracha, 30 June 2015.


Israel Supreme Court Issues Long Awaited Decision regarding Service Inventions

July 23, 2015

employment agreement

Isscar is a leading Israel company that manufactures hard metal cutting tools. As an employee at Isscar, Gidon Barzani was involved in the development of hard metal cutting tools at Isscar during the years 1992 to 1995, and again between 1997 and 2001 and was involved in a certain service invention, his actual contribution being a matter of contention. The employee signed various documents that gave up on monetary claims.

In Israel, an employee invention is owned by the employer. However, under Section  134 of the Law, the employee is entitled to compensation, the amount of which is determined by a special committee under Section 109.

The Committee, at the head of which sits the retired Supreme Court Justice, Itzak Englard, the Commissioner of Patents and an university professor, rejected Barzani’s claims as he had had waived his rights to consideration for the inventions when he signed on the general waiver.

Barzani appealed to the Supreme Court as a High Court of Justice (BAGATZ) see here which resulted in the committee freezing its actions.

One of the more interesting legal questions is whether a general waiver as part of the employment contract, where no invention is yet conceived can be considered as legally binding. (Talmudist’s may note a similarity to discussion of unlaid eggs).

The Supreme Court rejected the appeal arguing that it had limited power to interfere since under Section 111, the Bagatz ruling was final. The Supreme Court ruled that Section 134 describes a non-cogent right that is not a socialist employee right that requires special defense. On the face of things and with deference to the language of the clause, the decision appears to be correct, and certainly is sufficiently reasonable that there is no justification for court interference.

Nevertheless, the court noted that in a dynamic and changing world there is room for additional legislation or for companies to come up with voluntary compensation schemes. However, there is no reason for the court to interfere.

Judge Reuven, Deputy President of the Supreme Court quoted Section 109 of the Law as follows:

Where there is no agreement providing compensation to the employee for his service invention, regarding the amount of compensation and the conditions, these will be determined by the Committee for Compensation and Royalties.

Section 111 fixes the finality of the committee’s decision, but there is no doubt that in extreme circumstances, the Supreme Court sitting as a High Court of Justice can interfere. Since, however, the committee includes a retired senior court justice, the commissioner and an academic, interference in its conclusions are likely to be minimal, and this instance does not justify the court’s involvement.

The main argument, following the Actelis ruling of 2010 is concerned with the question of whether Section 134 should be considered cogent or dispositive. The committee came to the conclusion that it is not a cogent right and is not an example of employer-employee labour law where (due to the inherent differences in power between the sides) workers’ rights require special protection. The ruling seems to be correct, but anyway, since the Law states that the committee’s rulings are final, there is no room for the court to interfere.

Nevertheless, the court has criticized the current situation and noted that common sense and natural justice indicate that there is room for a more equitable arrangement,  whether the result of voluntary agreement or of legislation, and such arrangements exist in the private sector.

4353/14 Appeal to Supreme Court, Barzani vs. Isscar, Ruling by Rubinstein Fogelman and Mazuz 8/7/15

COMMENT

There was a lot of interest in this case, and we believe that employers will be giving deep sighs of relief. Employees will probably feel that the system favours the company against the individual. I am aware that some academics have strong feelings, see for example, Dr Shlomit Ravid’s position here and here.

Since the court has criticized the committee’s ruling and is not prepared to get involved, it is not inconceivable that a future committee could reach the opposite conclusion. Indeed, one of the judges of this ruling might, on retirement, sit in such a committee. There may, therefore, be room for clear legislation on the issue.

Personally, I think the Supreme Court decision is correct. I encourage corporate clients to institute compensation programs or at least weekend breaks and the like to encourage employees to come forwards with ideas, but think that changing the law in Israel may result in multi-nationals taking their R&D centers elsewhere, and that is not good for the economy or the workers.


Random House Loses Copyright Case to Goebbels Estate

July 20, 2015

Goebbels Diaries

The estate of notorious Nazi propaganda minister Joseph Goebbels won a lawsuit against Random House publishing company in Munich last week.

The case was brought against Random House Germany by the estate because royalties were not paid out for the use of Goebbels’ personal diaries in a 2010 biography written by historian Peter Longerich. The biography was originally written in German and was republished in English by Penguin Random House UK and its imprint Bodley Head.

 

The Newsweek Report may be found here. Versions in the Israel press are slightly different.

COMMENT

This is far from the first copyright argument related to Goebbels’ diaries. When they  were first discovered in the early Nineties, different British papers published extracts. I believe the Mirror Group paid royalties but the Sunday Times refused to.

Substantively, Random House showed creativity in suggesting that the royalties be paid to Holocaust Survivors. I can understand why Nazis sympathizers may find the suggestion inappropriate. I suspect that the same considerations that caused Menachem Begin to oppose German reparations to the State of Israel might make more than once survivor feel uncomfortable with the idea as well.

I think that Random House’s arguments that the copyright was removed along with other possessions after the War is an interesting one. Jewish courts can also appropriate private property in the principle known as הפקר בית דין הפקר. That as may be, if the German court did not accept the argument and the State of Barvaria has shown no interest in contesting their rights, the legitimate heirs of Goebbels are entitled to seek retribution. Unlike Goebbels, I believe that IP and other property rights have to be recognized regardless of the political leanings, race and nationality of the owners.

Random House’s arguments regarding scholarly access, etc. have more than a little merit. This is one reason that I am against the present long copyright periods, and think that copyright should be for, say, 10 years, extendable on payment of a fee, for a second ten year period. This is also probably why rather than writing books I write a blog and am happy for anyone to reproduce or quote, so long as they attribute.

 

 


Tel Aviv Court Refuses to Endorse Out-of-Court Settlement Between Service Providers and ISPs requiring that the ISPs Block Site Offering Software for Facilitating Downloading of Copyright Protected Material

July 14, 2015

rubber stamp
ZIR”A Organization for Internet Copyright LTD, United King Film Distribution 1990 LTD, DVS Satellite Services 1998 LTD, Hot Telecommunications, Keshet Transmissions, The Noga Net LTD and Noga Telecommunications LTD sued Anonymous, Bezeq International LTD, Partner Telecommunications, 012 Smile Telecommunications LTD, 013 Netvision LTD, Hot Net Internet Services and Internet Rimon LTD.
Broadly speaking, the case is one of content providers suing Internet Service Providers, and the not identified owner of a website allowing downloading of a piece of software that enables accessing and downloading content.

The content providers sued for a temporary injunction against the service providers and for details of the surfers.

Popcorn is software that allows both streaming content for online viewing and downloading content for future viewing. The plaintiffs sought to stop this service and to require ISPs to prevent access to the website allowing downloading of the software. A temporary injunction issued on 19 May 2015. On 3 June 2015 a hearing was held and on 11 June 2015, the plaintiff announced that it had reached an agreement with 013 Netvision LTD, Hot Net Internet Services an Internet Rimon LTD.

Judge Magen Altuvia of the Tel Aviv District Court ruled that there was no place to issue a temporary injunction to block access to Internet sites that allow downloading of software programs that allows viewing of creative works for which copyright protection is alleged. Such an injunction is ineffective and damages the free flow of information, the right of the public to know, freedom of expression and provides power to Internet Service Providers to determine what may or may not flow through the Internet Conduit. Other issues are the fight of anonymity and of privacy on the internet.

In consequence of the above position, the temporary injunction requested by a website and by an Internet Service Provider to prevent the use of the Program Popcorn was denied. It appears that many Internet service providers had come to an understanding with the plaintiffs, but one held out. The one that held out was vindicated. Furthermore, the agreement reached by the plaintiffs with the other ISPs would not be ratified by the court and the temporary injunction was cancelled.

The Court ruled that by law, the court is not able to order a temporary injunction against a third party to reveal the identity of an anonymous surfer that allegedly has committed an offence. It appears that the plaintiffs themselves were tardy in requesting the injunction and this indicates that the temporary injunction is hardly significant to the plaintiffs and there is thus no justification in issuing it.

The balance of interests does not favor the plaintiffs where there is no clear legislation that allows action against Internet Service Providers. Closing down the website will not prevent the downloading and installing of Popcorn and will have no action against those Internet surfers who have already downloaded the program, and there are opposing values of free flow of information, right of the public to know, freedom of expression.

Plaintiff’s Position
On 29 June 2015, the plaintiff requested that an agreement made with Partner Telecommunications, 012 Smile Telecommunications LTD, 013 Netvision LTD, Hot Net Internet Services and Internet Rimon LTD be ratified by the court. Bezeq International held out and the plaintiffs requested a temporary injunction again them.

According to the plaintiffs, United King Film Distribution 1990 LTD, DVS Satellite Services 1998 LTD, Hot Telecommunications, Keshet Transmissions, The Noga Net LTD and Noga Telecommunications LTD held copyright in various programs and none of them had authorized Anonymous or Bezeq International to use the protected content via the Popcorn website or program.

Anonymous is not known to the plaintiffs [the ruling uses both verbs to know, i.e. conaitre and savoir, knowing in the Biblical sense does not seem to be intended]. The name Anonymous relates to the owner of the Popcorn website that allows surfers to choose to watch programs without the plaintiff’s permission, thereby infringing copyright under the Copyright Act 2007, and being guilty of unjust enrichment under the Law of Unjust Enrichment 1979.
The ISR is the bottleneck that has the cheapest and simplest way to stop access to Popcorn’s website from Israel based Internet browsers.

On 14 May 2015, and again on 17 May 2015, the plaintiffs contacted all the internet service providers but these were ignored.

On 28 April 2016, the Chancery Division of England ruled on Popcorn’s website and in that ruling, determined that the Popcorn sites infringed copyright and Internet Service Providers should block access. Twentieth Century Fox Film Corporation and Others vs. Sky UK and others. Case No: HC2014-00229, EWHC 1082 (ch). According to the plaintiffs, Judge Gidon Ginat (also of the Tel Aviv District Court) adopted the UK decision in his ruling of 12 May 2015, T.A. 11-333227-13 NMC United Entertainment LTD. Et. Al. vs. Bloomberg et al. In that instance, the Court found that by allowing conversion from view only format to saveable MP3 format, Mr Parpori had aided and abetted copyright infringement and that Internet service Providers should block access to the site. See here for my analysis of that case.

According to the plaintiffs, both the Fox decision and the Papori decision support their position that access to the Popcorn site should be blocked. Due to the ‘unacceptable ease of infringement and the fatal wounding of their rights’ there is a need to grant the requested injunctions as soon as possible to preventthe daily infringements.

Bezeq International’s Position
Bezeq International claims that the plaintiff’s filed suit following the ruling in the UK against Popcorn, despite the software being available from much earlier. Suit was filed only in May, so this case cannot be considered urgent.
Bezeq International claims that the plaintiffs do not have a single damages claim against them and therefore there is no room to grant an injunction against them. There are a number of Supreme Court precedents that prohibit issuing injunctions against third parties.

Bezeq considers that such a third party injunction would do them damage whilst would not have an effect on Popcorn since they would simply open up further sites allowing content to be downloaded.
In the appeal considering obligations of ISPs 4447/07 Rami Mor vs. Barak ITC (1994) Bezeq international, Judge Rivlin of the Supreme Court related to whether the Court had the authority to force a third-party to reveal the identity of an anonymous surfer who committed an offence.

There judge Rivlin ruled:

“My position Is that the Courts should not issues such injunctions without a proper hearing. Until there is specific legislation that that allows the requested injunction in cases of slander, there is no alternative but to inquire into whether there is a general framework that allows such third party injunctions. In other words, anonymous Internet surfing should be treated like anything else, and there has to be either specific legislation or general legislation and there is no justification to invent such a framework by judicial legislation.
In the current instance, there are three parties. There is the plaintiff who claims to have been slandered. There is the anonymous slanderer and there is the third party who may know the identity of the anonymous slanderer. This scenario of three parties is not unique to Internet slander. In other contexts, a party may consider himself damaged by an anonymous damager and may suspect that a third party may know the identity of the culprit. The question in front of us is thus wider than anonymous internet surfing. The question is whether Israel civil law allows forcing a party to identify a damager so that suit may be filed against him.

One possible source for contemplating forcing the revelation of the identity of the third party is Section 75 of the Law Courts Law 1984. Section 75 grants wide posers to the courts one the infringement is proven. It does not provide rights outside of a civil proceedings. The law does not contemplate court rulings in the air, but court rulings against parties being prosecuted.
Where A damages B, B may obtain an injunction against A. However, where A damages B, B cannot obtain an injunction against C who is not connected to A or to B. This would require special authorization. In other words, one cannot pull oneself up by one’s bootlaces and cannot create a civil matter against a third party by legislation designed to provide recourse against actual infringers.
This logic is good for Sections 71-75 of the Civil Tortes Ordinance, also considered as a possible basis for action. These Sections deal with the courts authority to provide retribution for civil damages and to give injunctions to act or to refrain from acting, but are not relevant in this instance. The injunction requested against the Internet Service Provider is not with respect to actions by the Internet provider. There are no charges for damages case against the ISP and no grounds for requesting compensation in these clauses so there is no grounds for revealing his identity.

Judge Rivlin went on to refer to another UK case, Norwich Pharmacal, where the court ruled on the revealing of an anonymous infringer in a separate proceeding:

…it should be emphasized that this principle does not have an anchor in Israel law and does not dovetail with any judicial framework recognized in Israel. The opposite is true. It contravenes the spirit and purpose of the judicial framework established by the primary and secondary legislators for Civil Court procedures. Such a change should come from the primary or secondary legislators. [i.e. the Knesset or the Ministry of Justice].

Judge Rivlin’s position was opposed by Judge Elyakim Rubinstein but was endorsed by Judge A.A. Levy.

Judge Magen Altuvia considers that the principles laid out by Judge Rivlin in the Mohr case are appropriate in this instance where the temporary injunction is identical to the main injunction and the rights of the plaintiff and defendants have not been clarified, and where there is no case against the defendant alleging infringement of the rights of any of the plaintiffs. Furthermore in the Appeal 1622/09 Google Israel vs. Brokertov et al. Judge Rivlin reiterated the position in Mohr and stated that “these differences don’t solve the issue of court authority to sanction a third party who is not guilty of any direct claims.

The Plaintiffs rests their case on the Parpori issue. From the way things developed it appears that the plaintiffs only decided to file suit after the Papori ruling on 12 May 2016. Thus only on 14 May 2015, a couple of days after Judge Ginat’s ruling, the plaintiff wrote to the ISPs (defendants 2-7) and requested that access to the Popcorn site be blocked. The law suit was only filed a week later, on 19 May 2015.

It will be appreciated that Tel Aviv District Court rulings are not binding precedents to the Tel Aviv District Court and the Court can ignore the Parpori ruling, whereas the Mohr case is binding precedent. Furthermore, without expanding, Judge Altuvia considers the Parpori scenario rather different. In this instance, there is a difficulty for the plaintiff to identify Anonymous and to prevent alternative websites being set up, so it is not clear that ordering the ISPs to block the site is efficient. Neither Parpori or the UK ruling are binding on the Tel Aviv Court. Indeed, in Mohr, the Supreme Court reviewed UK and US caselaw that allowed action against third parties such as ISPs and didn’t adopt the approach.
In Parpori, the main culprit had the opportunity to defend himself. This is not the case here as the main culprit isn’t identified.

Temporary injunctions are an exception to general procedure and are only appropriate where there is an urgency, which clearly wasn’t the case here, as the plaintiff was tardy in pressing charges.
The program Popcorn does not itself infringe. It merely aids and abets the downloading and viewing of copyright material. Blocking the site does damage to the ISP’s image and other ISPs can choose not to block access.
Clause 9 of the Statement requires the ISP to block future sites. This requires them to be a policeman and a censor for the plaintiffs. This policeman is not to generally police the net but to take action against a specific entity who has not had the opportunity to defend himself in court.

The reluctance of the court to convert ISPs into policemen outweighs the copyright of the plaintiffs.

In view of the above analysis, it would be wrong to endorse the out-of-court agreement as it is not a simple contractual obligation but has in rem aspects. The desired censorship would have consequences for the public and the Legal Counsel to the Government (Perhaps better translated as the Attorney General, has not addressed the issue, despite being invited to do so.

Conclusion
The temporary injunction granted by the court is voided and the plaintiffs are obliged to compensate Bezeq ben Leumi 40,000 Shekels for costs and legal fees.
Civil Action 37039-05-15 ZIR”A et al. vs. Anonymous, Bezeq Ben Leumi et al. Ruling by Magen Altuvia of Tel Aviv District Court, 1 July 2015.

COMMENTS
With all due respect to Judge Gilad Ginat who I consider to be the most competent IP judge in the District Courts and probably in any of Israel’s Courts now that Judge Gronis has retired, I think that Judge Altuvia is correct. In my comments on Civil Ruling 33227-11-13 NMC United Entertainment LTD et al. vs. Bloomberg et al. Tel Aviv District Court by Judge Ginat, 12 May 2015 I criticized the decision as ultra-vires judicial activism. I don’t accept that there is a lacuna that the legislators forgot about, but rather the current state of the Law reflects conscious government policy, not least due to the fact that when the new copyright act being passed, Israel was regularly being criticized in the US 301 Special Report also here for not having ISPs required to police the net.

I think that Judge Altuvia is correct that this is an instance where the Attorney General should present the government’s position. I think that the Attorney General is supposed to attend to such matters. It seems that Attorney Yehuda Weinstein views things differently and believes that his job is to dictate government policy and to keep the government in line with the positions of the Supreme Court.
For example, at present there is a contentious issue to be debated by the Knesset – the Death Penalty for terrorists. I have no problem with the Knesset debating this issue from time to time. I have no problem with lawyers in private practice, clerics, academics and journalists, human rights activists, victim support groups and the lay public expressing strong opinions, whether for and against. However, I find it totally unacceptable that the Israeli press reports that the Minister of Justice is considering supporting the legislation despite the opposing views of the Attorney General. Sure the Attorney General is entitled to have opinions and to express them to the government ministers. He should do so in a discrete manner and the public and press have no business knowing his personal opinions. The government is selected by the ruling coalition that represents a majority of the members of Knesset who are elected democratically. The Attorney General is an appointee. The current proposed legislation is a private member’s bill with some support from government back-benchers. But Weinstein also speaks out on government policy. This case and many others are not legal issues, but moral, ethical, strategic and tactical ones. If Weinstein is unhappy with supporting a government policy, he should either be professional and do his job to the best of his ability, as Barak apparently did as Attorney General, or he should resign. There are a number of cases where the Attorney General seems to have dictated policy or ignored the government. This is, in my opinion, grounds for dismissing him.

I am very critical of judicial activism, which seems to be justified to protect democracy from the people’s representatives. Thankfully Justice Aharon Barak’s term as president of the Supreme Court has ended and some of the damage to fidelity of the Law and to the democratic process has been reversed. I am pleased that Judge Magen Altuvia and Judge Rivlin have seen fit to take a formalistic stance in this instance.

As to judicial legislation for enhancing enforcement of IP infringement, the Supreme Court has accepted contributory infringement and aiding and abetting infringement in schori vs. Regba (Apppeal to Israel Supreme Court 7614/96) and in the Rav Bareach (Appeal to Israel Supreme Court 1636/98) Crook Lock case.  In the US, the CFAC and the Supreme Court have moved away from these judicially created indirect torts. Arguably both cases are legitimate workarounds. We’ve seen the courts moving away from A.Sh.I.R. which provided legal grounds for sanctions for unregistered designs under the amorphous value of Unjust Enrichment. In absence of amendments to the Patent Law, perhaps it is about time that Srori vs. Regba and Rav Bareakh were reversed?

In the last election I did look for a party with a strong IP position. Unfortunately, it was difficult to find a party with a clear stated position on anything, and none seemed to mention intellectual property in their manifestos, bumper stickers TV commercials. The Knesset is, nevertheless, updating its IP laws. I think we should lobby them to do more rather than give the courts legislative powers. Whilst there are ministers without portfolios, maybe there is room to have an IP Minister or Czar, or a Deputy Minister in the Ministry of Justice or that of Trade and Industry with specific IP responsibilities. Other countries, including the US and the UK have such a position.

One final point, Internet Rimon advertises itself as a religious ISP that blocks pornography, gambling and other websites deemed immoral, objectable under Jewish law and values and damaging. I believe such a pious company should take copyright infringement seriously and block sites such as Popcorn as well, or at least provide the option to parents to elect to block copyright infringing sites.


IP Best Practices Conference 2015

June 16, 2015

Kim's event

Intellectual Property Resources (IPR) held their annual conference entitled IP Best Practices 2015 in the Tel Aviv Sheraton Hotel on May 11, 2015. I apologize to the organizers and to readers for my tardiness in reporting this. The program can be found here.

This event has become an annual fixture in the Israel IP calendar, and is widely attended by in house counsel, foreign patent attorneys. The speaker list, as always, was impressive. The event was well attended by in-house IP counsel and by sole practitioners. There were also a number of participants who had flown in from abroad, not all of whom were sponsors or speakers.

Ruud Peters, strategic advisor to Philips gave his perspective on IP developments as did Toshimoto Mitono, a Senior IP Counsel at Sony. Whereas the issues and budgetary considerations that Philips and Sony have may not be relevant for most Israel companies and their IP counsel, whether in-house of a service provider, I did find some aspects of the talks relevant, and found the presentations as a whole, thought provoking and well worth attending. It was interesting hearing from Philips dismiss the company as a developer of shaving solutions that does strategic deals with manufacturers of other products, allowing them to use the Philips name on their products, where Philips has only a marginal influence, mostly on the aesthetics. I have long felt this to be the case, but rather enjoyed hearing someone from Philips saying it.

The regional updates were generally good, however the Indian practitioner seemed to get stuck in excruciating details of the formalities requirements for Indian native inventors having to first file in India and only later go abroad. This was of little interest to the other participants, none of whom were Indian. The Peter Sellers Goodness Gracious Me intonation merely accented the irrelevance. Micaela Modiano attempted to convince us that with the right attorney (her?) one could obtain patents for software in Europe. The problem was that one apparently requires novel and inventive hardware elements, so the jury is still out.

Chixue Wei, Chairman of the Board of Linda Liu & Partners didn’t speak English, but this didn’t stop him from giving a presentation, with his very presentable young female assistant doing a simultaneous translation for him. It was rather like a prequel for the Eurovision song contest in that one didn’t actually need to understand what he was saying to follow the gist, with the slides being quite adequate. Frankly I wondered why he didn’t have her present and apologize for his poor English, but note that His Excellence had come in person and would deal with questions on a one-on-one basis. This would have left us assuming that he had some English but just wasn’t up to public speaking. He made a valiant effort to convince us that he could solve all enforcement problems and may indeed by true, but it wasn’t convincing. I have yet to hear a foreign practitioner presenting himself as not being able to provide a solution. However, I can’t see myself intentionally engaging a practitioner who doesn’t speak English and suspect that this is true of others as well.

Terry Rea the Former Acting and Deputy Director USPTO and Deputy Under secretary for Intellectual Property (which is apparently anything but a secretarial position) gave a very polished fireside chat on changes in the USPTO. She even managed to professionally field a naughty question I asked her about when the USPTO examiners would come to realize that there might be relevant art filed in other countries and not necessarily in English.

The US practitioners that presented were drawn from Mintz Levin, Finnegan and Greenbaum & Bernstein. All spoke well and competently. The most useful presentation was that of Michael Fink of Greenbaum & Bernstein who addressed the issue of writing contracts with indemnity clauses, to roll over responsibility for IP to suppliers of components. I found myself making a written note to engage him for this task where relevant.

food at Kim's event

The food, as would be expected from the Sheraton, was plentiful and delicious. Breakfast was filling. During the breaks the refreshments provided an opportunity to graze mingle. Lunch was superb.

kim one eyed

Kim Lindy was taking a back seat on the day, and though ever present, was not introducing speakers. Not exactly a shrinking violet, it turned out that she had damaged her eye. With the patch and the military precision with which the event ran, she was reminiscent of Moshe Dayan. I suspect, that rather than being a Model Major General, behind the scenes, she was more like a Piratical Maid of all Work.

In terms of the quality of the presentations, the opportunity for networking and the refreshments, the event was extraordinary value for money. The fees were less for in-house counsel than for service providers. This is a common strategy abroad, but less frequently practiced in Israel. In theory it ensures lots of big fish for the IP harpoonists service-providers. Of course, manufacturing and research entities would generally be paying the attendant’s fees and a couple of hundred Shekels more or less may make little difference. I can understand but disagree with the short-sightedness of both employees of service providing IP firms and their employers who did not attend in large numbers. There were a number of practitioners from smaller firms, but only two employees from larger IP firms (one from Colb and one from Ehrlich).  I find this worrying. I can understand IP firms not patronizing each other’s events. I can also understand firms seeing IP Factor as competition or not being happy with some blog article or other and avoiding my events, despite their high educational and social value. With over 1600 blog posts, I have criticized decisions and rulings in which all firms were a party at some time or another and so can understand my loyal readership not patronizing my events. The thing is that Kim is not an IP firm. She is a service provider to IP firms, hosting events and training programs and offering software solutions. Now it may be annoying to some that she offers a platform to US and other foreign firms to work directly with in-house counsel but as Thomas Friedman put it, the world has gotten flatter. In-House counsel generally started life in one of the patent service providers. They are aware of foreign firms and know the advantages and disadvantages of engaging them via local practices. By boycotting Kim’s event, the larger Israeli practices are giving the US firms a free playing field.

I don’t expect an Israeli patent attorney to be expert on writing contracts for licensing or subcontracting manufacturing in the US. I would expect a local attorney to work with someone licensed abroad. Kim’s event enables one to learn who specializes in what and to get a brief overview of these sorts of issues which anyway are continuously changing. I think that Israel Attorneys owe it to their clients to have a basic handle on these issues and so am a firm believer in attending IP events like this.


Can evidence submitted in an adversarial civil legal proceeding be kept confidential from the opposing party?

June 14, 2015

trade secretevidence

Israel Patent Number 132540 “System and Method for Direct Monetary Transfer Using Magnetic Cards” to Yehuda and Yigal Tsabari issued and then lapsed due to failure to pay the renewals.

Back on 24 July 2014 the Israel Patent Office agreed to the patent being reinstated. Generally, third parties who are utilizing the patented technology in good faith relying on the fact that the patent was abandoned are granted a non-transferable license that allows them to continue their business activities.  Nevertheless, the Israel Patent Office Decision to allow a patent to be reinstated is published for opposition purposes, giving third parties three months to oppose the lapsed patent being reinstated.

In the case of IL 132540, on 23 November 2014, Going Dutch LTD filed an opposition to the reinstatement. They claimed that the patent had not lapses unintentionally, but that Tsabari had knowingly abandoned the patent and that this was evident from the way Tsabari tried to enforce his patent.

Tsabari responded to these charges but requested that part of his response be kept confidential by the Patent Office and not made available to the opposer, claiming that the information constituted a Trade Secret. The documents to be kept secret included a document describing an enabling system, a draft contract with a credit card organization, a proposal for developing a system based on the patent, a contract with an investor and a letter from the investor, canceling the contract.

The patentee argued that these documents were confidential and for the parties themselves, and that their publication could compromise the patentee’s ability to compete in the relevant market. They were submitted as evidence that the invention had not been abandoned, but beyond that, their contents were not relevant to the issue in question, and so their contents should remain restricted.

The Opposer noted that the patentee had not provided sufficient evidence to prove that the documents in question were fairly described as trade secrets. This was particularly the case due to the fact that the documents apparently related to a failed business transaction from ten years previously. Furthermore, the patentee was not a side in the agreements in question and therefore could not claim that any trade secrets were his secrets.  Substantially, any documents used to support a legal claim should be available for public inspection. In addition, the opposer noted that the documents should have been supplied together with an affidavit and their dates and the parties thereof and the editor thereof should be identified.

 

Ruling

Section 23 of the Trade Related Torts Act 1999 give the courts (including the Patent Office) authority to prevent the publication of evidence considered as including trade-secrets and to allow only restricted access.

In recent Supreme Court Decision 2376/12 Rami Levi [a discount supermarket chain] vs. Moshe Dahan, July 8, 2013, Judge Amit ruled that there was a connection between the relevance of a document to a proceeding and the extent it could be kept confidential.

Essentially, where a document is relevant to a proceeding but one side claims a trade secret, the court has to weigh up the opposing rights of the parties and also to be aware of the potential damage to further entities not party to the a proceedings.

As a general rule, in civil proceedings, documents are available to all and confidentiality is the exception – See 7598/14 Theopholus Johnopholus (Theopholus III), the Greek Orthodox Patriarch of Jerusalem vs. Hymnota LTD., albeit the precedent relating to religious confidentiality and not to trade confidentiality.

Firstly, therefore, the court has to assess the relevance of the documents in question, which is a function of the arguments between the parties. In this instance, the argument relates to the restoration of a patent under Section 61 of the Patent Law 1967:

Any person may oppose a patent being restored within three months of the publication of the restoration notice on the grounds that the Commissioner [or deputy in this case] did not have grounds to order the publication of the request [i.e. to oppose the decision to reinstate].

Consequently, the discussion regarding reinstatement should focus on the three grounds for reinstatement:

  • failure to pay the fees resulted from reasonable circumstances
  • the patentee did not intend the patent to lapse
  • the patentee requested reinstatement as soon he realized that the fee was not paid.

The opposer considers that the patentee’s behaviour over the years was unprofessional, surprising and irresponsible. In other words, the patentee either wanted the patent to lapse or at least was unconcerned about his rights.

In response to these claims, the patentee described his attempts to commercialize the invention and submitted the documents about which he requested a secrecy order. The documents in question date to the period 2007 and 2008 and are thus of little relevance to the opposition proceeding.

Due to their lack of relevance to reinstatement, it seems that the right for confidentiality outweighs the right of access. They were prepared for the patentee or for exclusive licensee and were not published after they were not successful. There is no reason why these documents should enter the public record. Based on the statement of cases, the documents are not relevant and should not be published.

As to the lack of an affidavit, i.e. a signed statement testifying to that claimed, in Patent IL 118045 AstraZenca AB from 16 Jan 2005, there was a ruling to the effect that a statement should have been submitted.  However, in the Rami Levy case the Supreme Court ruled that the affidavit requesting secrecy was sufficient and there is no need for an additional affidavit accompanying the submissions. In the present case, the documentation as supplied is sufficient since the content is clearly sensitive, rendering superfluous the need for an affidavit supporting this contention.

Furthermore, the Patentee decided to submit these appendices to his statement of case and not to later submit in the evidence stage as he could have done, relying on Section 93 of the Patent Regulations 1968. Consequently, at this stage of the proceedings, the patentee does not have automatic rights to view the documents.

Thus in the meantime, the documents shall remain confidential. Should the Opposer consider these documents relevantat a later date, he is entitled to request their publication. At this time, no costs are awarded.

Opposition to reinstatement of IL 132540 “System and Method for Direct Monetary Transfer Using Magnetic Cards” to Tsabari, opposed by Going Dutch LTD., interim ruling by Jacqueline Bracha, 7 May 2015.

Comment

I am a little confused here.  The adversarial system requires that evidence brought in a legal proceeding be available to opposing parties to examine and challenge the validity thereof.

In this instance, the Opposer is using his legal right to oppose a patent being reinstated on the grounds that the patent was willfully abandoned. The Patentee has countered that there was no willful abandonment and has substantiated this claim with various evidence that allegedly shows this to be the case. In the circumstances, the evidentiary documents are considered by the patentee to be pertinent. If the patentee does not want the opposer to see the documents, he should retract them and base his case on other evidence.

That said, the 2008 documents are irrelevant as the patent only went abandoned on 24 October 2013, presumably retroactively on 24 April 2014, when the six month grace period past.

This patent was ‘abandoned’ for less than three months. The issue is when Tsabari realized that the patent had gone abandoned and when he tried to have it reinstated. Reinstatement is thus unlikely to be difficult, and one suspects that the patentee would be better served if he had chosen to use professional counsel for the reinstatement.

money plany

I had a look at the patent in question. It is a variation of the hoary old wedding present patent for directly transferring money from a credit card to the celebrants at a wedding. This is what a call a hardy perennial as approximately once a year some inventor comes in with this great idea he’s had.

Ironically the patent appears to be eminently voidable due to both lack of novelty and obviousness in light of the prior art and also on the substantive grounds that it is a software implemented business method and the fact that it is hardware implemented is insufficient to change this characteristic.


Does Size Matter? Dun & Bradstreet Publish their Silly Stats Again

June 2, 2015

1.Does Size Matter

Dun and Bradstreet has published their annual IP rankings once again. See here for the Globes article based on the Dun & Bradstreet 2015 rankings.

As readers of this blog will know, I consider the rankings infantile. D & B ranks based on the number of patent attorneys and this year, Reinhold Cohn with 43 patent attorneys has been knocked off its perch as Israel’s largest IP firm by Pearl Cohen, the new branding of PCZ”L that allegedly employs 46 patent attorneys. It seems that Dun & Bradstreet would fail their matriculation in both Maths and Geography.

The problem is that whereas Reinhold actually employs 37 patent attorneys in Israel and a further several attorneys-in-law that work in Intellectual Property, and these are all bona fide employees or partners and are all licensed, Pearl Cohen does not employ 46 patent attorneys in Israel.

Unfortunately, Pearl Cohen and D&B are somewhat misleading regarding what a patent attorney is, what an Israel licensed patent attorney is, what an Israel firm is, what an employee is and what part of the world may be considered part of Israel.

Allow me to elaborate:

1. There is a confusion between general attorneys-at-law and patent attorneys. The 55,000 odd Israel licensed attorneys-at-law may practice before the Israel patent office, but only a small fraction have any IP competence whatsoever, and a smaller fraction still understand anything about patents.

2. To practice before the USPTO one needs to be an US Patent Agent or a US Patent Attorney.

3. Pearl Cohen has a US office, a Boston office and a UK office. The employees of these offices cannot be considered as being part of an Israel firm, unless, of course, one considers Finnegan, the US’s largest IP firm as being an Israel IP firm by virtue of their Israel office and website. Finnegan has only one attorney, Gerson Panitch, based, part-time in Israel (he is actually based in Washington DC according to Finnegan’s website). If Finnegan is an Israel IP Firm, they are clearly larger than Pearl Cohen. Actually, from his profile, I am not sure that Gerson is a patent attorney licensed to practice before the USPTO, but that’s beside the point. According to the warning previously published on the Israel Patent Office website, it is also illegal for anyone other than Israeli attorneys-at-law and Israel patent attorneys to advise clients in Israel:

הובא לידיעתנו, כי אנשים שאינם עורכי דין או עורכי פטנטים עוסקים לכאורה, בשכר, בפעילות שנתייחדה לעורכי דין ולעורכי פטנטים, ובכלל זה הכנת מסמכים המוגשים לרשם הפטנטים בישראל ובחו”ל, גם אם אינם חותמים על המסמכים בשם הלקוח.כל אדם מהציבור הזקוק לשירותי ייעוץ ורישום בתחום הפטנטים, סימני המסחר והמדגמים מוזהר בזאת שלא לפנות לאותם גורמים הפועלים בצורה בלתי חוקית, שכן הסתייעות באותם גורמים עלולה לגרום להם נזק בלתי הפיך.

This is a rough translation:

Let it be known that people who are not patent attorneys or attorneys at law apparently practice, for payment, services that can only be provided by patent attorneys or attorneys at law, including preparation of documents for submitting to the Israel Patent Office and to foreign patent offices, even if they don’t sign in the name of the client. Any member of the public who needs advice or registration services relating to patents, trademarks and designs is hereby warned not to turn to such illegal practitioners, since doing so may result in irreversible damage.

This is based on Section 20(4) of the Israel Bar Law (Professional Ethics) 1988 which forbids anyone who is not a licensed attorney-at-law in Israel (or an exception, such as a Patent Attorney for IP Law) from giving legal advice. Note, I am not sure that the Israel Patent Office’s interpretation of this law is in accordance with International Obligations, and arguably (as Mr Panitch argues), a US attorney can advise re US law. Even if he is correct, I suspect that the advice will be lacking when it comes from a US attorney not licensed in Israel, as there are Israel tax and other issues that affect the decision making process. Consequently, even when the jurisdiction of interest is the US, China or Europe, an Israel firm is advised to work with foreign counsel via a local practitioner.

The one shop model of a firm with US, Israel and European offices is also, not necessarily in the client’s interest. If a local firm drafts the application and a separate US firm (and not a branch of the same firm) makes a decision regarding whether or not to litigate in the US, it is likely that the additional level of review will avoid the filing of frivolous law suits such as the Source Origin case.

4. An employee is someone who works for a company and receives a salary. Pearl Cohen has a highly dubious arrangement by which attorneys and patent attorneys that work for them are considered as not being employees and new employees are coerced into signing a statement to that effect.  Pearl Cohen’s professional employees are perhaps best considered as being free-lancers. Pearl Cohen does not pay the license fees of these professionals.

5. There are 19 patent attorneys that list their address in the Israel Patent Office database as working for Pearl Cohen in Herzliya. This is a mere 41% of the 46 patent attorneys that Pearl Cohen claims to employ. This list includes Assaf Weiler who is living in the UK according to Pearl Cohen’s website. It also includes Zeev Pearl who according to Pearl Cohen’s website is considered the managing partner working from the New York office. Pearl is licensed in Israel, but is not licensed as a patent attorney in the US.

I can’t opine about the legality of this situation since I am not licensed in the US. For those interested in exploring this further, see New York City : 1st Department, Chief Counsel, First Judicial Department, Departmental Disciplinary Committee, 61 Broadway, 2nd Floor, New York, NY10006, (212) 401-0800, Fax: (212) 287-104, Website: www.courts.state.ny.us/ip/attorneygrievance/complaints.shtml Also see the unauthorized practice of law committee in New York.  Their contact information is as follows: Kathleen Mulligan Baxter, New York State Bar Association, One Elk Street, Albany, NY12207, Tel: 518/463-3200, Fax: 518/487-5694 kbaxter@nysba.org See also ABA Formal Opinion 01-423 Forming Partnerships With Foreign Lawyers (2001). Report 201H (Licensing of Legal Consultant) Report 201J (Temporary Practice by Foreign Lawyers) as presented by the ABA Multijurisdictional Practice Commission and adopted by the ABA House of Delegates in 2003. See Also Report 107C as Amended by the ABA Ethics 20/20 Commission (ABA Model Rule on Pro Hac Vice Admission) that was adopted by the House of Delegates in 2013.

Of course, size isn’t everything. Pearl Cohen’s employment arrangement is not limited to that firm, and some competing firms have similar practices. I consider the model unethical, not least because it is both open to abuse by the ’employer’ and is frequently abused.

Dun and Bradstreet’s table has other problems. For example, Colb does not appear in the table listing the top 12 firms, and I am fairly sure that they are larger in terms of number of Israel Patent Attorneys than some of the firms that are listed.  Despite losing much of his litigation team recently, I think Dr Shlomo Cohen Law Office has enough Lawyers and patent attorneys working in IP to enter the table. There are, of course, also very large Israel law firms that have one or more patent attorney or IP lawyer working for them. Shibboleth and Shin Horowitz come to mind.

What is, of course, of more interest to clients is the competence and track record of the individual attorney who handles their files. Some of Israel’s best patent practitioners in private practice, including patent attorneys work for small firms or are sole practitioners.  This is true of both patent attorneys that draft and prosecute patents, and litigators that fight validity issues. It is also true of trademark attorneys, many of the better ones in Israel work for small firms.

The size of an IP firm can provide depth of knowledge and experience, but this is not necessarily the case. There are few economies of scale in this industry, and Parkinson’s Laws go a long way to explain why the same service from larger firms is more expensive, yet the sole practitioners and partners of smaller firms are usually better off financially than their colleagues in the larger practices.

The lists of IP firms put out by the professional magazines is also skewed towards the larger firms. The more attorneys that club together to form a single shop window, the more and larger clients they are likely to attract. The irony is that the when a successful attorney decides to grow his or her firm, the head attorney does more administration and less legal work, and is likely to take on less competent staff who are less of a threat. The more competent staff tend to break away and form their own firms. The upshot is that the average ability per attorney is generally lower in the bigger firms. A more objective statistic of a firm is the average billing per attorney, or something similar that normalizes absolute values by the number of practitioners.


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