Patent Office Journal Corrected, but Correction published for Opposition Purposes

October 17, 2014

correction

Israel Patent Number 199837 titled “DIRECT EXCHANGE GEOTHERMAL HEATING/COOLING SYSTEM” to Earth to Air Systems LLC is a National Phase Entry of A PCT application dated 18 January 2008 and the second renewal, covering years 6-10 thus fell due on 18 January 2014, which, being a Shabbat, was deferred to 19 January 2014.

The renewal was handled by a renewal company, and, due to an administration error, the renewal payment and a covering letter were only sent to the Israel Patent Office on 20 January 2014, i.e. one day late. The renewal was received but, due to the missing extension fee, the patent office database was updated, however, proof of payment was published in the electronic file accessible via the patent office database. The patent office should have informed the applicant about the wrong payment but apparently this did not occur.

Six months later, the patent lapsed and the fact that it has lapsed is supposed to publish in September 2014 journal. In August 2014 the fact that the patent had lapsed already appeared in the on-line database of the patent in the patent office.

The Applicant for restoration argues that the patent lapsed due to a patent office mistake and that the patent office should have accepted the payment as of the date it was paid, even if there was an outstanding extension fee to be paid and therefore the patent office should reinstate the patent retroactively rather than requiring it to publish for restoration purposes. (similarly, presumably the fees should reflect the mistake and only the one month’s extension fee should be payable and not the request for reinstatement, etc. – MF).

The Deputy Commissioner, Ms Bracha, ruled that under Section 170 of the Law she could correct the journal. The patent was not renewed in a timely manner due to a mistake of the patent office. The renewal payment reached the patent office but the databases were not updated and the patentee was not informed that there was an outstanding extension fee due. In addition to Section 170, Ms Bracha related to Y Zamir “Civil Authorization,” Vol. 2 page 1991 (1996).

Although the fact that the patent had lapsed was published a month earlier in the patent office database, Ms Bracha did not think that the public had relied on the patent having lapsed and it is reasonable to simply correct the database. So, instead of publishing that the patent has lapsed in the September journal, the patent office was publish the correction to the record in the journal, allowing the public to oppose the decision.

Ms Bracha went on to note that the result is the same, in that the public can oppose the decision, and if the applicant had requested reinstatement under Section 60 of the Law instead of correction of the record under section 170, in the circumstances the reinstatement would have been accepted, but the decision would publish for opposition purposes.

As a footnote, Ms Bracha rejected the patentees contention that the renewal should have been allowed despite the missing fee. The Deputy Commissioner sees Section 57 of the Law differently  from the agent of the applicant (Luzzatto et Luzzatto).

Section 57 reads as follows:

“if the renewal fee is not timely paid, it may be paid within six months together with the appropriate extension fee and after having done so, it will be considered as if it was paid in a timely manner under Section 56 and the patent will be considered as not having lapsed.

The underlined section is the basis of the Deputy Commissioner’s reasoning that for a late renewal to be considered as timely paid, the relevant extension fee has to be paid. The Applicant cited Regulation 6 of the patent regulations 1968 to the effect that:

The patent office won’t do anything requiring a fee until the fee is paid, but failure to pay all or some of the fee won’t cancel the application, process or registration unless specifically legislated differently.

Ms Bracha does not consider this regulation as being able to contradict the main legislation. furthermore, the regulation itself notes that it is only effective in cases “unless specifically legislated differently”. Either way, section 56 and 57 trump this.

The record is corrected and the correction is published, allowing the public to object to the correction.


Another patent restoration decision

October 17, 2014

Israel Patent Number 158968 to Ofer Dagan is titled “Solar water heater”. The application was filed on 20 November 2003 and the third renewal, covering years 10-14 should therefore have been paid by 20 November 2013, and with extension fees, by 20 May 2014. Applicant failed to pay these fees and the patent lapsed, with a notice of the patent lapsing being publishing in the July 2014 Journal.

The patentee signed a deal with a Cyprus based company that was supposed, inter alia, to maintain the patent. On 17 November 2013, the Cypriot company paid the fee for a filing a new patent application instead of the third renewal fee. Proof of payment, designating the patent number was appended to the request for reinstatement.

The Cypriot company turned to an Israeli company to maintain the patent and discovered the mistake. In the circumstances, the Deputy Commissioner Ms Jacqueline Bracha ruled that the circumstances fell within the ambit of section 60 of the Israel Patent Law, the difference in fees should be paid and the patent should be reinstated.

 


Israel Patent revived over seven years after it lapsed

October 16, 2014

carry on screaming   living dead

Israel Patent Number 139892 “INNER WORKINGS FOR A WATER TREATMENT UNIT” to Yigal Tsabri was allowed on 11 July 2006, but the first renewal was never paid. Consequently as of 11 April 2007, the end of the six month grace period, it was considered as having lapsed as of 11 October 2006, and in the May 2007 a notice of the patent having lapsed published.

A mere seven years later on 21 May 2015, Yigal Tsabri, the patentee requested the patent be restored. In the request he detailed that around the time the patent issued his financial situation deteriorated and the connection between him and his agent of record was broken. The agent of record did not inform him of the requirement to pay the renewal fee and instead, opened a file with the government collection agency (Hozlap). On 19 December 2011 a bankruptcy order issued but the receiver had agreed to allow attempts to restore the patent.

On 25 May 2014 the Deputy Commissioner noted the long time that had passed and expressed concern that the case could not be considered reasonable. Although the applicant had described difficult circumstances he had not presented any evidence of having done anything to keep the patent alive. The applicant for restoration had not detailed when he learned that the patent had lapsed and why he’d needed a District Court authorization to file a request for restoration.

In the circumstances the Deputy Commissioner gave the Applicant an opportunity to appear before her on 22 June 2014. During this hearing it transpired that the lapsed patent was a source of income as it was being licensed! – this despite the fact the license was not registered with the Patent Office, the patent had lapsed as of October 2006 and apparently the licensee was unaware that the patent had lapsed! The income from the patent license was being used to pay off the bankruptcy debts.

The patentee declared that he’d learned about the patent lapsing about eight months prior to the request for restoration being filed. As soon as he’d learned of it lapsing he’d turned to the manager of the bankrupt estate (presumably the receiver – MF) and had got District Court Authorization to file the request for restoration as the fee for so doing came out of the bankruptcy estate.

The Applicant provided reasons from May 2006 until today, for not having been able to clarify the status of the patent which provides grounds for leniency, despite the patent being to some extent abandoned. These reasons were not published in the decision as they are of a personal nature.

The Court had apparently provided a public defender to represent the patentee, but he had failed to show up for the hearing so the patentee had represented himself.

The Deputy Commissioner ruled that the patent could be restored on payment of the various fees, but this decision publishes for opposition purposes. As the patentee is not represented, the decision is sent to him directly and also to the public attorney’s office.

Decision re restoration of 139892 to Yigal Tsabri. Ruling by Deputy Commissioner Ms Jacqueline Bracha, 9 September 2014.

COMMENTS

It does seem nice that a week and a half before Rosh Hashana, the Deputy Commissioner is showing clemency לפני משורת הדין.

However, 6 years is indeed a long time. It appears from the decision that the receiver had authorized the reinstatement back in 19 December 2011. From a first reading I assumed that this is one of the things that Ms Bracha wanted clarifying and is not actually the case. It also appears as if the patent attorneys had instituted the bankruptcy proceedings. Whilst this is certainly their right, I would be surprised if this is indeed the case. I also find it difficult to imagine that the agent of record didn’t forward the certificate. It seems more likely that they would warn regarding the first renewal and request all bills settled first.

The requirement for clarifying whether or not a patent is in force is to enter the Israel Patent Office website. The details are on line. The staff at the patent office are also fairly helpful over the phone. Indeed, if someone had come in to my office off the street wanting to know if a patent was in force, I would have told them , and suspect that this is true of many other patent offices.

The licensee has been paying money without minimal due diligence to check if there is a patent that is in force. This is surprising but not unbelievable.

Clients are odd things. I had a client who drafted his own application by copying someone else’s issued patent which he cited in the background. The basis of his claim to a patent was that he’d made the device smaller. Not surprisingly, the prior art was cited against him and that was when he came to me. I actually managed to make fairly drastic rewrites based on the figures and to obtain a patent. That inventor made the conscious decision to not to bother paying the first renewal fee since he was licensing the patent anyway!

I also had a Russian inventor who came to me with a portfolio of six patent applications, three of which had lapsed. He’d drafted the applications himself, and I suspect he’d written them in Russian and used a computer to translate the specification. I am always happy to take on a challenge, and managed to restore two of the cases that had lapsed within less than 12 months. I extensively rewrote the specifications without adding new material and got five of the six cases to issue. The earliest application had lapsed over three years earlier and I was unable to revive it, despite the applicant providing some evidence of periodic hospitalization and problems with a previous agent of record. He was unable to adequately demonstrate to the satisfaction of the Deputy Commissioner that he’d taken action promptly on first learning that the patent had lapsed, since I was taken on over a year later. It was a shame, since the patent was for a significant invention. The client wanted to appeal to the Courts, but did not instruct me on time. The Deputy Commissioner’s main concern was that third parties could have learned of the first application from a corresponding US case (published and allowed, however the issue fees were never paid). The rights of such third parties practicing the invention would have been compromised if the patent application was reinstated. I had actually tried to preempt this by offering an unconditional free license to any such third parties in the request for reinstatement itself. In the ruling refusing to all reinstatement, the issue of prejudicing unknown third parties and the need to strike a balance between the applicant’s rights and theirs was extensively discussed. My suggestion of an unconditional license wasn’t. Thisraised grounds for an Appeal to the Court, but the client didn’t instruct me on time and didn’t pay the fees. The main difference between that case and this is (a) that the Russian case was a lapsed application and this is a lapsed patent, and (b) specific health issues of each inventor, where the details of this case have not published. I jumped through all the legal hoops and related to every precedent to no avail. Presumably the patentee in this case did not, as he was unrepresented. What is interesting however, is that in the present case there is clearly a third-party who has not needed to pay licensing fees and was being defrauded, albeit possibly unintentionally. Now, by reinstating the patent, this actual and real licensee will have to continue paying fees hereinafter, possibly until November 2000. Go figure.

This ruling will publish for appeal purposes. The law granting the patent office discretion to revive long dead patents is clear. The question is whether the discretion was used wisely and whether the serious of events described by the patentee to justify the revival were true. We do not know what they are. The decision as published is heavily censored to protect the patentee’s privacy. Unless third parties can access the details, how can they challenge them? Can the former agents of record produce evidence against their ex-client who apparently did not settle his bills, to show that he did receive details of the deadline for renewal? Would this be a considered unethical? What about the hapless licensee who has being paying royalties to use a lapsed patent? It is unlikely that someone not involved would oppose a case with virtually no chance of recovering costs as the patentee is apparently bankrupt.


Claim Reconstruction – Israel style

October 14, 2014

One of the problems with the written word is that word and phrase may have slight ambiguities in meaning that are clarified by context and be dictionary definitions.

The’ metes and bounds’, i.e. the perimeter of the monopoly of a patent is defined by the claims. In the US, virtually every patent infringement proceeding includes a preliminary Marksman hearing where the parties argue as to how the claims should be construed. Once the scope of the patent is determined, the parties can argue about whether an allegedly infringing product or method actually infringes and appropriate damages.

Janssen

Israel Patent Application No. 181650 to Janssen Pharmaceutica titled “SOLID PHARMACEUTICAL COMPOSITION COMPRISING A PHARMACEUTICALLY ACCEPTABLE CARRIER AND HYDROCHLORIDE OF 4-[[4-[[4-(2-CYANOETHENYL)-2,6-DIMETHYLPHENYL]AMINO]-2-PYRIMIDINYL]AMINO]BENZONITRILE AND USE THEREOF IN THE MANUFACTURE OF A MEDICAMENT FOR TREATING OR PREVENTING HIV INFECTION” was allowed and published for opposition purposes. Teva Pharmaceuticals, Israel’s largest pharmaceutical company and the world’s largest generic drug manufacturer opposed the patent.

Somewhat unusually for Israel patent office practice, following submission of claims and counter-claims, Teva noted a large discrepancy between the parties as to the scale of the monopoly covered, and requested a preliminary ruling on the scope of the claims. Teva argued that a preliminary ruling on the scope of the claims could expedite the opposition proceedings.

The application was filed in Israel on 2 September 2005 and was allowed and published for opposition purposes in the August 2012 journal on 30 August 2012. The application for a preliminary ruling was submitted by Teva on 21 January 2014. Janssen filed their counter-claims on 20 February 2014 and Teva responded on 11 March 2014.

Both sides concur that the claimed invention relates to a solid medicinal preparation that includes a therapeutically effective amount of the hydrochloride salt of rilpivirine  as an anti-viral agent by itself or with others.

The argument between the parties is whether the preparation includes Amtrisitivan (FTC) and tanofoyer Diazonbrocsil fomrate (TDF). Teva claims that the claimed invention does not include the combination of rilpivirine, Amtrisitivan (FTC) and tanofoyer Diazonbrocsil fomrate (TDF), whereas Janssen rejects this interpretation and argues that the invention includes this combination.

Teva alleges that a preliminary ruling on this issue would accelerate the opposition process and save judicial time. Specifically, should the patent office rule that the three-way combination is not included, they would retract their opposition, which by nature of the complexity fo the application is likely to be a protracted affair. On the other hand, if the correct claim interpretation is found to include the three-way combination, the opposition will be focused on other issues and will be less complex.

(we assume that it is in the interest of the applicant for the Opposition to proceed quickly as a patent cannot be enforced until all oppositions are dropped or ruled on, and clearly the faster the process, the cheaper it is likely to be).

The Opposition procedure is acknowledged by section 30 of the Israel Patent Law 1967. Grounds for Opposition are given in Section 31 and these include: (i) a reason why the Commissioner may reject the application; (ii) that the invention is not patentable under Section 4(2) (lacking novelty); and (iii) the oppose and not the applicant is the true owner of the patent.

The Opposer considers the request for a preliminary ruling as a kind of division of the proceedings that will save time and could render further aspects superfluous and cites the opposition to Israel Patent Application 75934 Merkaz Argazim LTD. vs. Levy (1992) as a precedent for such a preliminary hearing. The Applicant considers the request as a delaying tactic designed to result in the Opposition including multiple proceedings.

The Commissioner accepts that the opposition to Israel Patent Application 75934 Merkaz Argazim LTD. vs. Levy (1992) provides a precedent to splitting up an opposition, and that this is acceptable as long as doing so does not prejudice the rights of either party, but notes that the current case is not identical in that it is a preliminary hearing (that the Opposer claims could settle the issues.

The commissioner ruled that he had the authority to make preliminary and intermediate rulings, but was not obliged to do so. From review of the claims and counter-claims he considered that there were differences that could best be clarified by allowing the presentation of evidence.

The Commissioner considers that the issue behind Teva’s opposition was an allegation that the Applicants were claiming more than they were entitled to and that the so-called correct interpretation is a wide construction. In other words, Teva’s issue is Section 13a of the Patent Law and regulation 20. This interpretation (which opens the claimed invention to challenges on novelty and inventiveness grounds) is allegedly supported by the specification and how a person of the art would read the patent specification and claims.

The Commissioner ruled that the Applicant should make an alleged interpretation for the Opposer to oppose, and without this it would be improper to rule on the scope of the claims based on so called internal evidence.  Essentially Section 31  of the law is precisely to determine the scope of the claim protection and there was no justification to preempt this.

The Commissioner referred to Hughes Aircraft and to Zuk Ohr vs. Car Security LTD and considered that in the opposition the Commissioner should rule on the scope of the claims taking the prior art into account, and that one cannot interpret an application without consider the inventive step therein, He then stated that the scope of the prior art before the Commissioner required gathering evidence and this was especially the case where there was an apparent dispute between the parties.

The Commissioner considers that Teva wishes to clarify the scope of the claims based on internal evidence only, ignoring external evidence and expert witness testimony. Specifically the Commissioner noted that TEVA argued that claims 4, 5 and 10 of another Janssen patent, Israel Patent No. IL 173438 included the three-way combination of rilpivirine, Amtrisitivan (FTC) and tanofoyer Diazonbrocsil fomrate (TDF), and to allow the patent would result in two patents for the same combination.

Without ruling on whether another patent of the same applicant is internal or external evidence, the Commissioner noted that there is a rebuttable presumption that the examiner was aware of the second patent. The commissioner considered that an Opposition required bringing something that the Examiner was unaware of, or a problem in the Examination, and does not consider that to be the case.

In light of the above, the Commissioner considers that there are factual differences between the parties and the correct way to proceed is with a full-fledged opposition. Furthermore, the Commissioner argued that a preliminary ruling on the issue of patent scope might give one party an advantage in subsequent proceedings. He also expressed concern that this could open the flood gates to other preliminary ruling that could put a strain on the patent office. (this reminds me of a cartoon in MAD MAGAZINE where the wife wanted a washing machine to save on laundry bills, a car to save on bus fares and a coffee machine to save on restaurant bills, and the husband declared that he could not afford to economise). The Commissioner considered that preliminary hearings should be reserved for clear-cut cases where everything could be cleared up, and not for relatively complex issues.

marlsmen

Finally, as an after-word, the Commissioner related to the so called Marksman hearings in the US, that TEVA suggested was a similar model. The Commissioner noted that Janssen did not see this US style preliminary ruling by the courts in infringement cases as parallel to the Opposition Proceeding before the Israel Patent Office.

In conclusion, Commissioner Kling rejected the request for a preliminary ruling on the scope of the claims (ruling of 24 July 2014) and gave the Opposer until 30 October 2014 to submit their evidence. Costs for this interim ruling will be awarded together with costs for the main decision.

Opposition to IL 181650 Teva vs. Janssen Pharmaceutica, preliminary ruling of 11 September 2014.

COMMENTS

I don’t think that the Commissioner needs to do more to reject a request for a preliminary ruling on one issue than to state that he does not feel it was the most efficient way to proceed. I can’t see one party appealing such a statement. Instead, the Commissioner has waffled over 5 1/2 pages. That is his right of course. However, I found this ruling poorly structured. What disturbs me  more is that the Commissioner seems to consider that the scope of the claimed invention is somehow dependent on the prior art and on expert testimony. I disagree. I think the claims should be sufficiently clear without reference to prior art. The correct interpretation may depend on the specification and on dictionary definitions. It does not depend on prior art. The scope of what is actually patentable does depend on prior art of course. After clarifying what the prior art is, it may be justifiable to narrow the scope of the claims. I am familiar with various decisions that strike patents for claiming more than they are entitled to. I disagree with this approach. I think that it is justifiable to narrow the scope of the claims in light of prior art, and relying on dependent claims is one way to do this. I don’t consider double patenting per se. to be problematic. It may be the basis of a terminal disclaimer limiting the term of the second patent to the expiry date of the first patent, but there is nothing wrong with multiple protection of the same formulation with differently worded claims that protects different aspects. What is of relevance, of course, is whether Janssen’s earlier patent is novelty destroying prior art, or raises issues of obviousness.

I do not agree that an Opposition proceeding needs to rely on a piece of art not before the Examiner. I think that it is sufficient for the Opposer to claim that the Examiner did not give sufficient weight to a piece of art or misinterpreted it to have the right to file an opposition, giving judicial review of the Examiner’s work.

I note that in contradiction to the Commissioner’s approach (and, indeed, to Supreme Court precedent, Judge Binyamini of the Tel Aviv District Court who seems to be one of the better judges on IP issues, actually uses preliminary hearings to try to isolate the real bone of contention and to try to rule on this, making further hearings redundant. This does not imply that the Commissioner is wrong to prefer to have all evidence before him and to follow standard procedure. It is however interesting to note the difference in approaches.

I also note that Janssen is represented by Gilat Bareket of the RCIP group which was where the Commissioner Asa Kling worked prior to becoming commissioner. As Reinhold Cohen is the largest local IP group this is not a surprising state of affairs and it is also true that the Commissioner has been in office for a reasonable period of time. I don’t know whether it is practicable for the Commissioner to excuse himself from all cases where RCIP represents one party or the other. Nevertheless I don’t think this looks good. It may be an additional reason for TEVA (represented by Shin Horowitz) to appeal the eventual ruling.

Finally, I had a quick look at the claims of this application and consider them to be fairly clear. I don’t think that a Marksman type hearing would fairly address the issues that according to the preliminary ruling are those of concern to TEVA. I did not review the specification carefully, but did scan it, and could not find correct spellings in English for the chemical terms I’ve transliterated. Corrections and other comments, are, as always appreciated.


Nanobiotix – requesting the posting of a bond to cover Opposition expenses is standard and not exceptional

October 14, 2014
It is actually a graphic mark and not merely the word!

(It is actually a graphic mark and not merely the word!)

Nanobiotix filed Israel trademark Application Number 243678 “Nanobiotix” via the Madrid Protocol in classes 10 for Surgical and medical apparatus and instruments especially for the diagnosis and treatment of tumors using radiation treatment; radiotherapy apparatus; apparatus for use in medical analysis; diagnostic apparatus for medical use; radiology screens for medical use; X-ray photographs; radiological apparatus for medical use; X-ray tubes for medical use; filters and lamps for ultraviolet rays for medical use; apparatus and installations for the production of X-rays, for medical use; X-ray protection devices for medical use; roentgen apparatus for medical use; devices for protection against X-rays, for medical use; receptacles for applying medicines; special furniture for medical use; X-ray bulbs for medical use., in class 42 for Scientific and technological services as well as research and design particularly in the field of nanomedicine (nanotechnology applied to medicine); biological research; bacteriological research; scientific and technological evaluations, estimates and investigations provided by engineers, researchers; design and development of new products (for third parties); technical project studies; industrial analysis and research services; chemical analysis; chemical research; chemistry services; research and development of new products for third parties; technical research; research in radiobiology; research in nanoscience and nanotechnology, particularly applied to medicine; and in class 44 for Health services particularly in the field of nanomedicine; medical services particularly in the field of nanomedicine; hospital services; medical assistance; physical therapy.

Super Medic (Medic Light LTD) and Diateti Col LTD, represented by owner Tzion Yadid, opposed the mark.

The Applicant requested that the Opposers post a bond of 80000 Shekels to the courts to cover costs should the opposition fail, and submitted an affidavit to support this request.

The basis of the Opposition was that the mark in question is confusingly similar to their issued marks 241083, 229880 (and to their pending mark 246664), and therefore cannot be registered under Section 9(11) of the trademark ordinance 1972.

The Applicants argued that the allegedly similar marks Actibiotica and Acti-pearl were substantially different. The pending mark 246664 – Nanobiotica is more similar, but being descriptive should not be allowed. Furthermore, the nature of the goods and the distribution channels of Israel trademark Application Number 243678 “Nanobiotix” and Israel trademark Application Number 246664 “Nanobiotica” are significant enough to allow coexistence.  Nanobiotix requires a prescription whereas Nanobiotica does not.

Section 353a of the Company Law 1999 is the basis of the request for a bond. Applicants noted that the Opposers were working out of a private house and had liens on their product which was apparently their only asset. The fact that they were represented by their CEO and did not have legal representation was submitted as further indication of lack of financial assets.

The Opposers considered that the request for them to post bail was inequitable behaviour as it could prejudice them being able to fight their case and have the opposition considered on its merits. They claimed that their financial status was steady and that there were no liens on their assets. Hey considered their case a strong one, and argued that this also strengthened their position against needing to post bail.

Class 5 was deleted from the mark under Opposition, resulting in Israel trademark Application Number 243678 “Nanobiotix” and Israel trademark Application Number 246664 “Nanobiotica” no longer covering a common class of goods.

THE RULING

Deputy Commissioner Ms Jacqueline Bracha held that she had the authority to require a deposit of likely costs and where a plaintiff is a limited company the assumption is that such a deposit is required unless it is clear that the plaintiff has sufficient assets. If the Opposer wishes to be considered an exception to the rule that a deposit be made, they have to provide positive evidence to this effect.

The Opposer did provide evidence of not owing income tax for the years 2009 to 2013. The Deputy Commissioner did not consider that the applicant had successfully showed that the company did not have other assets or that the marks and products were being used as a security. However, the Opposer had not provided sufficient evidence that they did have financial resources to pay costs should they lose. The company is a private one and apart from not owing money to the income tax authority, there was no indication of resources.

As to the chances of the Opposition being successful, the Deputy Commissioner considered it too early to come to a conclusion on the issue as no evidence had been brought.

In light of these considerations, the Deputy Commissioner considered the request for a bond to be posted normative and appropriate. However, after consideration of typical costs of oppositions of this type, even where the applicant is a foreign entity, she considered 20,000 Shekels adequate costs to be posted.

Intermediate ruling re posting bond for future costs concerning opposition to filed Israel trademark Application Number 243678 “Nanobiotix”, Deputy Commissioner Ms Jacqueline Bracha, 11 September 2014.

COMMENT

Nanobiotrix is represented by Adin Liss. Eran Liss, one of the partners, is a grandmaster. The request for a bond to be posted was merely an opening gambit. Whereas there is nothing wrong with an Opposer fighting a trademark without legal representation, one suspects that he might find himself out of his league. We urge Opposer to seek legal advice and representation to avoid a quick check-mate.


Walla Sued for Not Acknowledging Photographer of Iconic Image of Peretz

October 14, 2014
Amir Peretz views military exercise (c) Ephraim Shrir

Amir Peretz views military exercise
(c) Ephraim Shrir

Ephraim Shrir was the photographer who captured then Defense Minister Cluseau Amir Peretz watching a military exercise in the Golan through a pair of military binoculars with the dust caps on.

On 12 July 2011 and five years after the Second Israel-Lebanon War, Tiltul Communications who run the Walla news and current affairs site showed an image from the Lebanese newspaper El Akhbar which showed the photo under the headline “In Lebanon they are scoffing at Peretz, Halutz and Olmert ” (then Minister of Defense, then Chief of Staff and then Prime Minister respectively). The Israel news-site showed a screen capture of the Lebanese newspaper which prominently featured Shrir’s well-known photograph.  Neither the Lebanese paper nor Walla received permission to show the image, nor did they credit the photographer.

Shrir requested that the picture be taken down from the Walla site which it was, but Walla rejected all claims against them, and subsequently Shrir sued for 50,000 Shekels statutory damages for both his financial copyright and moral rights under the Israel Copyright Act of 2007.

Martians and anyone else not familiar with the photo in question can view it by googling Amir Peretz or by following this link. http://www.nbcnews.com/id/17294091/ns/world_news-mideast_n_africa/t/israeli-defense-chief-makes-lens-cap-gaffe/#.VDuMuxtxmUk

PLAINTIFF’S ARGUMENTS

The plaintiff claimed that the reproduction of the image on Walla was of a commercial nature and infringed his copyright and legal rights in the photograph. Since Tiltul ran a commercial news site they should have known or at least inquired into the owner of the picture. The picture was made available to the public over a two year period on the website and via smart-phone applications. Since the damages claimed were statutory, there was no need to show any actual damage from the infringement. Furthermore, Shrir claimed that the fair-use doctrine was irrelevant here since clearly the Lebanese newspaper had no possibility of having obtained the photograph directly since there is a state of war between the two countries and so the photographer had to be an Israeli and Walla were obliged to ascertain who owned  copyright in the image.

According to the plaintiff, the fair use defence may have been good when the story was hot-news, but four years later, in 2011, that was not the case. Furthermore, due to the centrality of the image, the defendant could not fairly claim that they were copying the newspaper and the image was incidental to the article.

DEFENDANT’S CLAIMS

The defendant countered that they reproduced a Lebanese newspaper article that included the photo, and gave credit to the Lebanese paper, and thus neither infringed the copyright of moral rights of the photographer. Under Section 22 of the Israel Copyright Act, this should be considered incidental use since their article related to and quoted from the Lebanese article and did not relate to the picture itself.

The defendant also claimed that since they were reviewing another newspaper article, they were within the ambit of the fair use defence under Section 19a of the Copyright Law, and that this was a hot news item that was allowed under Section 19b. The photograph was incidental since the story in question related to how Lebanon saw Israel and not to the photograph in question (which presumably related to how then Defence Minister saw Lebanon? MF). There was no intention to profit from the photograph, merely to inform the Israeli public about its use. Furthermore, the defendant argued that the use of the picture neither increased income to the website nor decreased the value of the picture and that there was actually no competition between the website and commercial sales of the photograph and that the case-law considered these arguments critical when assessing damages.

Finally, journalistic norms required referencing the journal and not the individual photographer or journalist which would require unnecessary work for the journalist (and probably be unduly tiresome for the reader-MF).

The defendant argued that the claim of statutory damages should be thrown out since it was not in the original charges brought. Also the demand for the photograph was steady, both before and after Walla’s article, showing that the value of the image had not been affected.

THE RULING

The parties accepted that the dispute was legal and not factual, and authorized the judge to rule on the basis of the evidence without requiring sessions to prove their cases. Thus, both parties accepted that the photographer had absolute copyright and moral rights in the image. Additionally, there was no argument that the Lebanese article with the photograph was reproduced without the photographer’s permission.

The issue is one of whether the copyright and moral rights were infringed and whether the statutory defences applied.

Judge Zoabi ruled that the picture was copyright protected. Both sides agreed that the Lebanese newspaper had infringed the photographer’s rights, but disputed whether reproducing the article with its illustration infringed the photographer’s rights, and this should be addressed with reference to the content and appearance of the Lebanese article.

As to whether the picture was incidental or not, the court quoted from the Israel article “the picture that appears at the head of the article is that of the Defence Minister during the war, Amir Peretz, looking forwards via closed binoculars”. Further on, the article states “And what about Peretz? The author of the article mocks the former Defence Minister and tries, in his words, to hunt down all passers-by that cross his path, to persuade them to vote for him as the head of the Labour Party. “Peretz tries against to lead the collapsing Labour Party and tries to recruit all passers-by to vote for him is stingingly written about the campaign that the leader had been running in recent months to recruit voters”.

The Israel article is not only a review of the Lebanese one but also of the picture itself that was central to both articles. The Lebanese article featured the picture centrally and not incidentally-illustratively, since the picture is worth a thousand words. The court dismissed claims that the Israeli article merely reported on the Lebanese one. It argued that the article was about Peretz and the other political leaders at the time of the Lebanon War and that the Lebanese article was selected to illustrate the article primarily because of the picture. Indeed, were it not for the picture, the Lebanese newspaper article would not have been used to illustrate the Israeli article. Consequently, the Court considered that the picture was not incidental and thus copyright was infringed.

As to common practice, the court accepted that the Lebanese article was fully credited by the Walla article, but did not consider that Walla has satisfied the court that this was sufficient. Citing District Court ruling 1549-08-07 Maariv vs. Business Net , the court noted that to establish a norm, a party has to show that everyone continues to act the same way and that there is an understanding that this is the correct way to behave. In Maariv vs. Business Net the court rejected the concept that the norm was binding. Also in Danon PR Communications  vs Yachimovich the issue of binding norms was similarly addressed.

Critically, in the present case, unlike other cases brought as evidence by the defendant, the referenced (Lebanese) newspaper article did not credit the photographer. Furthermore the court noted that there was a trend to see copies of copies as infringing and the fact that the original picture was not copied is insufficient to have the case thrown out. In other words, there is no doctrine of exhaustion of copyright in this instance.

As to moral rights under Section 46, it is clear that the name of the photographer wasn’t referenced, and this is a right enshrined in Section 46, so the moral rights was infringed as well.

FAIR USE

Section 19a includes newspaper reports as a fair use exception. Shrir claimed that the case-law establishes that fair use requires acknowledging the photographer or author. The court accepted that this was generally the case, but noted exceptions where even though the photographer was not identified the fair use defence was accepted.

In this case, Judge Zoabi felt that the defendant could not claim equitable behaviour in reporting the Lebanese article since the photo was central to the article, this was not hot news. They should have assumed the photographer was Israeli, could easily have identified the photographer with minimal research on the Internet and should have credited him.

The court dismissed the defence that this was a review of other media since although the Lebanese article was paraphrased, the photo was reproduced in its entirety.

However, the court accepted that the report of the Lebanese article was hot news and that the Defences of Section 19a applied. Nevertheless, the picture was well known and from an earlier period and was reproduced in a large format and Walla is a commercial website.

Even if it is allowable to reproduce the image, the photographer should have been credited as fair use does not abrogate moral rights.

Claims that the photograph was incidentally included were likewise rejected.

The court upheld the charges of copyright infringement and moral right infringement, but considered the scope of the infringement to be minor. Interestingly, the court reasoned that it would be wrong to grant double statutory damages for both copyright and moral rights.

After considering that the real damages were negligible, the court ruled statutory damages of 6000 Shekels and that both parties should cover their own legal costs.

Civil Case 4384-12-13 Ephraim Shrir vs. Tiltul Telecommunications LTD. by Rajid Zoabi of Bet Shaan District Court 28 September 2014.

COMMENT

The legal issues here seem straight-forward. The ruling seems well reasoned. Although the damages awarded are low compared to those awarded in other cases, I think this is a good thing.

Shrir was in the right place at the right time, but the resulting photo could be described as iconic. Although the inquiry focused on the lack of preparedness of the military, this photo captures the Israeli feelings regarding the Second Lebanon War.  Furthermore, unlike Sharon with the photogenic head bandage, in this instance, the image is more authentic. I mean Peretz is an idiot, but I don’t think he did this intentionally. Still the moustache is impressive.

I have absolutely no sympathy with Amir Peretz’ politics. I think it was irresponsible to appoint him Minister of Defence merely because it was irresponsible to appoint a Trotskyite to the Finance Ministry. That said, I can’t help feel sorry him for getting photographed like this, despite the real damage it did to Israel’s deterrence against Hizb’Allah and indeed to Hamas.

I am an avid bird watcher but on more than one occasion have forgotten to take the dust caps of my binoculars. So long as one notices that something is wrong and looks for the problem, the mistake is understandable. Where one looks with interest and makes observations, it is a little reminiscent of a Hans Christian Anderson fable. In this case, according to the photographer, Peretz gazed through the capped binoculars three times, nodding as Ashkenazi explained what he was looking at.


Israel Patent Office Shortens Patent term Extension for Ezetimibe

October 12, 2014

Ezetimibe  molecule

Israel Patent Number 110956 titled “HYDROXY-SUBSTITUTED AZETIDINONE COMPOUNDS, HYPOCHOLESTEROLEMIC PHARMACEUTICAL COMPOSITIONS CONTAINING THEM, AND PROCESSES FOR PREPARING THEM”

The patent protects the active agent Ezetimibe as found in the pharmaceutical Ezetrol or Zetia, that reduces the amount of cholesterol in human body. The patent is owned by Schering Corporation and is licensed exclusively to Merck & Co. LTD. The original 20 month patent term will lapse on 13 September 2014. However, on 22 September 2005 the patentee received a patent term extension until 23 June 2017.

On 7 January 2013, the Association of Industrialists in Israel filed a request to cancel or shorten the patent term extension. Grounds for the request for cancellation were Section 64(xi) of the Patent Law 1967 (current version) which states that “Following a request from any third party, other than the patentee or a sole licensee, the commissioner can cancel a patent term extension or change its duration if it transpires that there were grounds for opposing the extension or the patent; there is no statute of limitations to filing a cancellation request under this Section.” The Association of Industrialists in Israel requested that the patent extension term be shortened so that it terminated on 22 January 2016.

On 23 December 2013, the Commissioner of Patents allowed the parties to submit their arguments in writing, avoiding a hearing, but refused to allow the parties to widen the grounds of their attack. The original patent term extension request was based on the first commercial authorization being from Germany on 17 October 2002. However, during the proceedings, the applicant requested to be allowed to delay selection of the country until the US and Australian patent term extensions issued, following the ruling of the then Deputy Commissioner Axelrod in Novartis (Israel patents 79336, 84901 and 105264) and the 7th amendment to the Israel Patent Law 1967, from 2006. On 22 August 2004, the Applicant requested that the extension be calculated on the basis of the Australian patent (AU 681,445) which is what happened. Since that time, under US pressure, the relevant section of the Israel Patent Law has again been amended (11th amendment) but this is amendment is not retroactive.

The current dispute is based on whether or not Schering / Mercke filed details of the US case as required in the 7th amendment. An affidavit from a Dr Volman on behalf off the patentees implies that they did, but this is not supported with any appended evidence. Apparently there is no copy of such a submission and there is no reference to the US case in the file. Whether or not details of the US extension were submitted, under the Law, the maximum extension should have been until 22 January 2016 which is a 597 day extension of the US case (US Re 377721). Furthermore, even without the US case, the maximum extension should have been 14 years after the pharmaceutical preparation was first allowed in the US, i.e.. 17 October 2016 and not until June 2017. The parties also disputed whether the Seventh amendment should be applied retroactively. The patentee argued that this could shorten the lifespan of an extended patent and created uncertainty and although Although the wording of the seventh amendment states clearly that it could be applied retroactively, was argued as being unconstitutional since it destroyed property rights which were recognized in basic laws (section 8 of the Basic Law of Human Dignity and Freedom. 1980. Furthermore, the fact that the subsequent amendment to this section is not retroactive supports this allegation of lack of constitutionality.

The purpose behind the Seventh amendment was to ensure that Israeli generic drug manufacturers would not be disadvantaged when compared to overseas generic drug manufacturers from other countries recognizing patent term extensions. Dr Gil Tomer (Director of Israel Generic Drug Manufacturer and distributor Unipharm) argued on behalf of the Association of Israel Industrialists that regarding the seventh Amendment to the Israel Patent Law, the position of the State of Israel, as clear from negotiations with the US, was that any patent extension term granted was subject to be shortened due to other shorter patent terms. The respondents (Mercke Schering) argued that the correct interpretation of the application of Section 7 retroactively to pending cases was only for cases that did not yet have a published extension period, since this would adversely affect rights already assigned. The respondents claimed support for their interpretation from the ruling of previous Commissioner, Dr Meir Noam, in IL 97612 to Sanofi Synthelabo (July 2005), who argued that after Novartis, changing the duration of issued patents would lead to uncertainty. In addition to claiming that the retroactive application of the seventh amendment was unconstitutional, respondents noted that the amendment was poorly worded and argued that these defects adversely affected its applicability.

In his ruling, the Commissioner referred to a recent ruling concerning IL 94634 of Israel Industrialists vs. Sir Roy Calne from 13 July 2014 which related to similar issues and where the constitutionality was discussed and the constitutional arguments were rejected.  Following previous Commissioner Meir Noam in the patent term extension case concerning IL 83148 to Roche, Commissioner Kling notes that any interpretation of the Law regarding the interim period other than that it affects published patent term extensions effectively renders the relevant Sections as having no application. Essentially the Commissioner reiterated his reasoning from the Calne case and cited the Lundbeck vs. Unipharm, Novartis vs. Commissioner of Patents and Neurim vs. Commissioner of Patents.

Commissioner Kling noted that In 3734/11 Dodian vs. State of Israel (concerning taxing gas wells), Judge Fogelman accepted that in certain cases legislation could have retroactive affect with financial consequences yet still remain constitutional. The Supreme court affirmed this approach in Bahat vs. Ministry of Health, that retroactive legislation could only be considered unconstitutional if it unjust and unfair to the extreme. The Commissioner felt that judicial interference in legislation, particularly regarding the economy, should be considered most carefully and with restraint. Furthermore, any interim arrangement was by nature short-termed and therefore presumably considered by the legislature.

The patentee suggested that the Knesset be invited to defend themselves regarding the amendment. In Bahat the Supreme Court ruled that calling on the Knesset to justify itself was not something that the courts could do after a time lapse. Since in this instance, the Seventh amendment was 8 years since legislated and since then had been amended yet again, it was moot. Furthermore, the Commissioner noted that if it were justified to invite the Kneset to explain itself, this should have been requested at the first opportunity and not now, some 10 months later. Also, the pharmaceutical industry was represented in Knesset debates leading to the legislation.

The commissioner therefore felt that it would be improper for him to interfere with the balance of interests reflected in the Law as legislated. In conclusion, the Commissioner reduced the extension period to 22 January 2016 based on the US patent, and after noting that the parties had waived the right for a hearing, but that there was a lot of material to wade through, awarded costs of 40,000 Shekels from Merke to the Association of Industrialists.

Re 110956 Association of Israel Industrialists vs. Schering and Mercke, Asa Kling, 18 September 2014.


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