Asinu Esek LTD. (literally ‘we’ve done a deal’) filed Israel Trademark Application 233073 for “Pioneer”, as shown below.
The mark was filed for machines and machine tools for making, processing and cooking food and beverages,namely, food processors, meat grinders, blenders, juice press, ice-cream makers, vegetable peeling and slicing apparatus, kneading machines, devices for grinding, milling, crushing and chopping food; coffee grinders; electric can openers, electric meat grinders, garbage disposals; vacuum cleaners and parts and accessories for all the above; all included in Class 7. it was also filed for lightning, heating, steaming and cocking devices; devices for cooling, drying, airing, water supplying and sanitary proposes – such as flashlights, lamps, bulbs, chandeliers, neons, Ultra-violets; ovens, cooking stoves, toaster ovens, hotplates, electric grills, electric bread bakers, electric pans, electric frying devices, electric rice pots, bread toasters, microwaves, electric kettles, samovars; coffee machines, coffee roasters; refrigerators, freezers, ice¬boxes; heaters, filaments, heat conductors, air-conditioners, ventilator, ceiling fans; hair fans; watering devices, water purifying and/or filtering devices; water pressure cleaning devices, steam cleaning devices; oven hoods, water filtering and purifying devices and parts and accessories for all the above; all included in Class 11.
Sh. Cohen (2011) LTD uses the name Pioneer power tools, and manufacturers, imports, exports, sells and distributes power tools under the mark.
Indeed, in June 2013, Sh. Cohen (2011) LTD managed to register Israel Trademark Number 242261 Pioneer Power Tools in classes 7. 8 , 11 and 12.
Sh Cohen noted that applicant had filed in class 7 where they had a mark. Furthermore, classes 7 and 11 cover similar goods. In addition to trademark issues such as likelihood of confusion, etc., the opposer argued that the applicant had filed their mark in bad faith since they had filed for expedited examination on the grounds that they were unaware of other parties using the mark, despite the fact that Asinu Esek distributed the opposer’s goods!
Asinu Esek argued that the word Pioneer was generic and therefore no-one could have sole rights to the word. Indeed, they argued that other parties were using the word for branding purposes. They argued that their usage of the mark was for food preparation equipment, whereas the opposer’s was for power tools and these were different goods and therefore there was no likelihood of confusion.
Asinu Esek argued that the font and shading made their logo distinctive. Furthermore, Pioneer Power Tools, by adding the words power tools created a mark with a totally different sound to Pioneer. They also argued that the new mark wasn’t in use. Finally, they argued that they had invested heavily in promoting the brand and therefore accepting the opposition would be costly to them.
Pioneer Power Tools argued that Asinu Esek had signed contracts with them regarding distributing their gods and ownership of the marks.
Both sides made various assertions regarding the amount of goods sold under their marks, amounts spent on advertising, etc. which were submitted as affidavits, but without providing supporting evidence.
In her ruling, Deputy Commissioner Jacqueline Bracha argued that registerability issues and the contractual obligations of the sides could be separated, and she addressed the trademark issues first. However, in practice she related to sight and sound of the mark, the clientele and distribution channels and any other issues. That is, she applied the triple test, and related to contractual obligations under the rubric of other issues of relevance.
In terms of the sight and sound of the mark, for goods purchased off the shelf, the sound is less important. The name Pioneer is dominating and power tools is descriptive. Customers have faulty memories. The brand is therefore seen as being Pioneer in both cases and there is a likelihood of confusion.
Both parties sold tools for use in the home and garden. The goods are different, but the opposer claimed to have plans to widen the scope of their activities into distributing a wider range of electrical goods than only power tools. The deputy commissioner accepted this argument. As importantly, she found it convincing that the public would associate electrical gods that are not power tools but sold under the brand Pioneer with the distributor of Pioneer Power Tools because this type of horizontal expansion was common in the electrical goods industry. Notably, she found that Pioneer Power Tools was aimed at the domestic market and not at professionals, so the target customers were the same.
Although the word Pioneer is somewhat laudatory, it is not a general laudatory mark such as excellent or superior would be. It is reasonable to grant narrower protection than a unique word, but it was, nevertheless, registerable.
Under the ‘any other issues’ component of the triple test, Ms Bracha examined the contractual obligations.
The problem (as always) is one of interpretation. The contract was headed “Pioneer Power Tools” but then related to the mark of the supplier. Thus whether Asinu Esek had undertaken not to sell power tools under the name ”Pioneer Power Tools”, power tools under the name “Pioneer”, or any electrical goods under the name Pioneer, remains a question of interpretation. The contract was written generously, and related to “development, manufacture and sales of various goods including electrical tools, electrical equipment for home or garden, and any other electrical device.” Consequently, Ms Bracha ruled that Asinu Esek had acted in bad faith by filing their mark.
Interestingly, Ms Bracha ruled that bad faith was not grounds for not registering a mark, despite being grounds for cancelling the mark. She noted that this is apparently the Law in Portugal and Spain as well. She noted Former Chief Justice Aharon Barak’s comments to the effect that Equitable Behaviour underpins the Israel legal system, and US and European law on the topic, but felt it more appropriate to rule in terms of confusion and the like, than equitable behavior per se.
Essentially, she noted that there was inequitable behavior and an attempt to free-ride on the reputation of Pioneer Power Tools, but refused the mark on grounds of unfair trade practices and likelihood of confusion, rather than inequitable behavior.
The mark was refused and the applicant ordered to pay NIS 1500 in costs and NIS 16000 legal fees to Pioneer Power Tools.
I think the decision to use unfair trade practices rather than inequitable behavior as grounds for refusing the mark is hair splitting. That said, I think Ms Bracha is correct to use clear grounds anchored in trademark law rather than to import a concept from Contract law, even if Barak considers otherwise. The problem here is that there are contractual issues as well, but it is not the Israel Patent Office that should decide them.
I note that Simon Kay who is one of Israel’s leading patent attorneys trades under the name Pioneer IP LTD. Maybe he should register the term Pioneer in the filed of IP services. (I assume he can’t register the IP bit).