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.


Rado Uhren AG (the Rado Watch Company) Fails to Stop Israel Company Registering Rado as Trademark for Shoes.

July 7, 2015

Rado

Rado Import and Marketing LTD filed the above mark for Clothing, footwear, headgear all in Class 25. The mark was allowed on 29 February 2012, and, perhaps unsurprisingly, Rado Uhren AG (the Rado Watch Company) opposed the registration.

Rado Uhren AG (the Rado Watch Company) claimed that the rights in the word mark RADO, including class 25, are exclusively associated with them. Under 24(1a)(1) of the Trademark Ordinance 1972, the Commissioner should prevent the mark in question from issuing. Grounds for the Opposition included that the Mark was confusingly similar to the Opposer’s marks which were well-known marks; registration of the mark was against the public order, and allowing the mark to register would mislead the public and allow unfair competition, under Sections 11(5), 11(6), 11(9) and 11(14). Furthermore, under Section 12 the mark was confusingly similar to Rado’s trading name and was applied for in bad faith.

The Opposer’s evidence was submitted as an Affidavit by Eli Holland, the CEO of Planet Time LTD which represents Rado in Israel.  Rado Import and Marketing LTD likewise filed an Affidavit of their CEO. Both parties attended a hearing before the Commissioner, and were cross examined. At the commissioner’s request, the parties submitted written summations.

Rado Uhren AG (the Rado Watch Company) is a leading watchmakers that was established in 1917 and which has a considerable worldwide reputation. Recently, the company has started selling clothing under the RADO brand, both in Israel and abroad, in a chain of Planet Time stores across the country.

Rado Uhren AG (the Rado Watch Company) has their own mark, TM 79906 in class 14 as follows:

Rado

They also have a further 5 marks in class 14 for different lines and models, RADO DIASTAR, RADO FLORENCE, RADO, RADO  D STAR and RADO JUBILE.

Rado Import and Marketing LTD was established in 1994 and claims to have spent hundreds of thousands of Shekels in advertising, and to have sold large numbers of shoes under the brand RADO in hundreds of stores, including leading Israel chain of department stores HaMashbir l’Zarchan, the Center for Orthopedic Shoes, Marco Shoes, and other retail outlets.

The Opposer, Rado Uhren AG, claims to have made continuous use of the RADO mark for decades and to enjoy an exclusive reputation in Israel and abroad for high quality watches.  Rado Uhren AG further claims that Rado Import and Marketing LTD intentionally copied their mark to benefit from the fruits of the mark’s reputation and usage of the mark was confusing to the public, particularly as the mark was virtually identical.

The Opposer considers that the marks look and sound the same, and that the additional R in the logo does not visually mitigate since the public has imperfect recall. The additional R would not generally be pronounced, as indeed, the CEO of Rado Import and Marketing LTD themselves pronounced the mark RADO and didn’t enunciate the additional R.

Rado Uhren AG claimed to be using the mark for clothing and not just watches and to have actually registered the mark for clothing in some jurisdictions. Rado Uhren submitted as evidence, a number of press releases, clips and catalogs from Israel and abroad., and footage from sports events which they had sponsored.

There were two suitcase designs, one cap and one shirt that included the RADO logo, but prior to the hearing were not yet on sale in Israel, but which Rado Uhren AG’s CEO indicated were to go on sale shortly. Rado Uhren AG’s products were available in 25 jurisdictions.

Rado Uhren AG claimed that there was a trend to sell watches and shoes together, under a common brand, and showed that Louis Vitton, Prada, Boss and Dior sold both shoes and watches under the same logo.

Rado Import and Marketing LTD countered that Rado Uhren AG’s claiming rights to the word RADO in the shoe category some 20 years after the mark being used by them for shoes, was, in itself, inequitable behavior. Since Rado Import and Marketing LTD had 20 years market presence in Shoe branding, after carefully building their reputation, the mark in Israel was identified with them.

 

The Ruling

Noting that the opposition was under Sections 11(5), 11(6), 11(9) and 11(14) of the Trademark Ordinance, the Commissioner examined each Section in turn.

Section 11(9) considers the likelihood of confusion between the requested mark and marks registered in the trademark register. Likelihood of Confusion is based on the triple test. In this instance, the marks sound the same, and, due to the dominance of the word, RADO, look the same as well.  As to the customer base, both companies market to the wider public and advertise widely. Both classes 14 and 25 are large classes. They are, however, different classes, nevertheless, one has to look into whether the classes are of the same type.

The Commissioner does not consider that watches and shoes are the same type of good. Even though they may be advertised in the same magazine, they are sold in different stores. Rado Uhren having Class 25 registrations abroad for shoes or cases does not help them as it is the local mark that is of interest.

As to other considerations, Rado Import and Marketing LTD claim that the name Rado should be pronounced Radu and is Arabic for desirable (similar to the Hebrew רצוי).  Although not convincing, The Commissioner was more impressed with the fact that the usage by Rado Import and Marketing LTD goes back 20 years, 10 of which with Rado Uhren AG’s knowledge.

The Commissioner concluded that there is no real likelihood of confusion as the goods are in different classes.

As to Section 11(14), which protects well-known marks, the law states that a mark that is identical or similar to a well known mark, even for different types of goods cannot be registered, if the mark indicates a connection between the goods and the well known mark is likely to be damaged by the registration.

The definition of a well-known mark is discussed in the Absolut vodka case (9191/03 V&S Spirit Altiebolag vs. Absolut Shoes LTD, 19 July 2004).

In deciding whether a mark is well-known in Israel, one has to consider the relevant populations and whether the notoriety is the result of marketing. Notoriety has to be local. See UB TM 93261 Pentax vs. Asahi Kogaku, the considerations for whether a mark is to be considered well known or not were listed as including: the notoriety of the mark, the amount of usage and the period under which the mark has been in use, publication, registration and enforcement, exclusivity, type of use and similarity of other marks by third parties. In this regard, acquired distinctiveness is considered better than inherent distinctiveness in showing reputation, type of goods and services, marketing channels and the extent to which the mark indicates the quality of the goods.

Both parties agree that Rado is a dominant player in the watch market, both in Israel and abroad. The word Rado appears not only on watches, but also on hats, shirts and bracelets which are, essentially, promotional items for marketing watches.

In Israel, Rado watches are available from a number of outlets, and, in 2011-2012, the income generated from Rado watches was 11 and 13 million shekels, respectively. In 2012, 2 million shekels was spent on advertising Rado watches in the media and on hoardings, including in the Hebrew, Russian and Arabic press. Furthermore, with caution, advertising abroad, such as sponsoring the US Champion Tennis Tournament in 2011 and the Kremlin Cup in 2012, and other cultural events, has an impact on the reputation of Rado watches in Israel. This leads to the conclusion that Rado is a well-known mark in the watch population.

Although Rado Import and Marketing LTD’s products are not in the same class, well-known marks can block registration in other classes. Here the considerations are whether one would assume a connection and whether the famous mark owner would be likely to be damaged.

Judge Berliner in Unilever referred to Judge Rubinstein in Absolut and ruled that

“damage to reputation is not far from misleading but is not identical to it. The Legislator differentiates. It is easier to damage reputation than to mislead, but there is still a need for the customer to see a connection, and to cause damage, one needs a real basis for this”

In this instance, the Commissioner ruled that the Opposer has not shown that the sale of shoes under the brand Rado has done them damage, and again noted that they had knowingly lived with the Rado shoes for 10 years.

The Commissioner does not see that the public would assume an association.

As far as Section 11(6) ”passing off” is concerned, the Commissioner considered that Rado had failed to prove that there had been an attempt to ‘free ride’ on the reputation of Rado watches, and so there are no grounds to cancel the mark under this clause.

The Opposer did not themselves relate to Sections 11(5) and 12 in their summaries and the Commissioner therefore felt equally able to ignore these grounds.

The Opposer wished to submit some late evidence including Facebook pages where the Applicant was using the word RADO without the additional R, but the Commissioner did not see that these would change his ruling.

In light of the above analysis, Adv. Kling ruled that the mark could be registered and, after weighing up the evidence, ruled 5000 NIS in legal costs and 20,000 in lawyers fees.

Re 244357 Rado, Adv. Assa Kling, 29 June 2015.

COMMENT

I am unhappy about this ruling, and the recently reported Coveri case, since Rado is a well-known mark that is at least being diluted. The argument that Opposer did nothing to prevent the word Rado being used for selling shoes for ten years has some validity but we note that Eden Spring’s use of the word Champagne in a marketing slogan was considered illegal and there the court did not find that the Comite Interprofessionnel du vin de Champagne (CIVC) were tardy in bringing their complaint.

Shoes and watches are not the same, but Rado is a made-up word. Not speaking Arabic I can’t comment on the Rado-Radu explanation, but I note that the word virgin is generic for olive oil, and the Israel Patent and Trademark Office nevertheless found in favour of Richard Branson’s Virgin Enterprises where an enterprising person sold candles made from solidified olive oil as virgin candles.

It seems to me that despite not acting against the shoe retailer, Rado Watches should, based on these precedents, be able to prevent the R-Rado trademark from being registered.  If the word Rado to be pronounced Radu means desirable in Arabic, that is additional grounds for the patent office to consider the mark Laudatory and thus non-registerable.

As an aside, when we got married twenty years ago, Miri and I received matching His & Hers watches (paid for by our respective in-laws). Certainly 20 years ago Rado was considered a high-quality watch. Our models were at the cheaper end of the range. I actually had nothing but trouble with mine (I call this the Geller effect. My cheaper current Seiko watch has disappeared a few days ago – I call that the Houdini effect. My wife calls it clutter).  It is certainly true that the company took repairs seriously. I never had a problem having it repaired. I eventually got fed up and no longer wear it.

As I see it, using Rado for shoes is rather like someone randomly choosing the name Rolls Royce or Ferrari as a brand, and should be treated as such.


Is a Do-it-yourself Opposer entitled to legal costs?

July 2, 2015

do it yourself

Unipharm, an Israel ‘Branded Generic’ supplier has a long history of successfully opposing and canceling pharmaceutical patents.

In this instance, they successfully opposed IL 164925 titled “Pharmaceutical Compositions and Kits Comprising Combinations of Valsartan, Amlodipine and Hydrochlorothiazide” to Novartis which led to the application being abandoned. Where an Opposer wins such an Opposition proceeding, the opposer is entitled to claim real costs accrued in so doing.

In this instance, Unipharm, represented by their CEO Dr Zebulun Tomer and without legal counsel filed a Notice of Opposition and statement of case directly (without using the services of their outside counsel, Adv Adi Levit).

The opposition resulted in Novartis abandoning Israel Application No. IL 164925 titled “”. As he did not use legal counsel, Dr Tomer asked for an assessment of costs based on the quantity weight of material filed and the number of references that had to be learned, rather than real and actual costs incurred.

Novartis sees things differently. They believe that Unipharm have failed to show any additional work beyond what they usually do regarding every patent application in Israel, and, citing Regulation 516a of the Civil Procedural Law 1984 and various Israel Patent Office Decisions, argued that consequently no costs should be awarded.

Discussion

The Deputy Commissioner Ms Jacqueline Bracha noted that both sides agree that were Unipharm to have engaged professional counsel they would be entitled to real costs incurred provided that, after judicial review, those costs were considered realistic and necessarily incurred in the opposition until the point where the Applicant gave up. The argument in this instance is simply a question as to whether a Do-It-Yourself Opposition conducted by Unipharm’s management entitled them to some sort of compensation for the time spent and work performed on the opposition where they chose not to engage outside counsel.

Ms Bracha noted that without any paper work to go on such as an affidavit from the CEO or the firm’s accountant indicating how many hours were spent by staff and what their time was worth, it is difficult to estimate costs, and even so called ‘estimated costs’ have to be anchored to something.

Unipharm claim that examination of the Statement of Case which was the last filing before the application was abandoned, and comparing to other cases provides prima facie evidence of time spent. In IL 143088 where Unipharm successfully opposed Glaxosmithkline LLC’s patent, Unipharm were awarded 2500 Shekels including the fee for filing the opposition – which was clearly incurred in this instance as well.

Novartis countered that in IL 166621 where Unipharm successfully opposed an application filed by Neurocrie Bionsenses Inc. and requested 110,000 Shekels costs, the Commissioner assessed the costs and noted that the work by the CEO was not proven.  Furthermore, in other precedents, the Israel Patent Office has ruled that employees time that was within the course of the daily work should not be considered as being a recoverable legal expense. In the Neurocrie Bionsenses case, the Commissioner ruled costs of 6000 Shekels by way of estimate – and, in that case, the application was abandoned after evidence was filed.

Ms Bracha ruminated that Costs are not a punishment for the loser, but are compensation for the winner. That said, the opposer is providing a public service [in causing the canceling of a patent application that should not issue on its merits due to lack of novelty, obviousness, etc]. This is very different from most civil cases where a ruling only affects the parties concerned. Ms Bracha considers the public service aspect of more significance than the significance to the opposer themselves.

In 248/95 Fabio Perini SPA vs. Industrie Meccanishe Alberto Consani SPA, President Winograd considered the opposer as being a ‘soldier of the commissioner’. This public good aspect was also recognized in the Opposition proceedings IL 200343 Tzori Naaman Victor LTD vs. Ronen Aharon Cohen, 23 March 2015. MS Bracha then drew a parallel between the Opposer and someone bringing a class-action who is entitled to compensation for the public duty performed.

Weighing up all the above (and, I suspect rolling the dice), costs of 3500 Shekels were awarded to Unipharm.

IL 164925 to Nvartis, Opposed by Unipharm, Ruling re Costs by Jacqueline Bracha, 5 May 2015

COMMENT

Health Warning – It is highly inadvisable to file patent opposition procedures without professional counsel. It is highly inadvisable to forgo legal counsel when going head-to-head with one of Israel’s larger Patent firms representing a multinational company that is ranked by Forbes as the third largest healthcare company worldwide among other rankings that Novartis is proud of.

That said, Dr Zebulun Tomer has handled more patent oppositions than the vast majority of Israeli attorneys-in-law specializing in IP and of Israel patent attorneys.

As to the issue of whether compensation is deserved, one could regard Dr Tomer as saving Novartis real lawyers fees. Certainly Dr Tomer’s time has some value. Nevertheless, I think there is an assumption on Ms Bracha’s part that the result of the patent application being abandoned means that there is merit in Unipharm’s opposition. This may well be the case. They have an impressive track record killing pharma patents as readers of this blog will be aware. But herein lies the rub.

You see, Novartis and others have come to realize that it may be strategically sensible to abandon Israel patent applications that are opposed by Unipharm irather than to fight for them. The Israel market is small. If Unipharm present their evidence and arguments, not just the patent in Israel but the worldwide patent family could be invalidated. This has happened to Smithkline, Lundbeck and others that Unipharm have taken on in recent years.

If Unipharm has not had to win their opposition on its merits, there may be no prima facie basis for assuming that the patent is actually invalid. Indeed, I opposed a patent on behalf of an Israel Government Ministry (the Ministry of Religion) against a subcontractor (offering high density but nevertheless, Halllachically permissible burial solutions), and though the subcontractor explicitly denied all my points he nevertheless decided to abandon the allowed patent rather than to fight the Israel Government who is the major client. In that case I am fairly sure that we had good arguments. In this instance, who knows what Unipharm would have argued?

Public good is also more nuanced. Non-patented medicine is generally cheaper which is generally considered as being in the public interest. However, without the temporary monopoly rights afforded by patent protection, pharmaceutical companies will invariably not undergo clinical trials. Causing a promising drug to be abandoned is not in the public interest. Furthermore, pharmaceutical research is not cheap. Companies like Novartis need sales revenue to be able to develop new drugs.

I suspect that the pharma lobby will be unhappy with this decision, and those that see Unipharm as a Robin Hood pharmacist will applaud it. That as may be, I suspect that neither side will appeal as the costs in so doing will be totally out of proportion to the possible financial benefits.


Coveri (Caveri?)

July 1, 2015

Enrico Coveri

On 3 May 2011, Enrico Coveri s.r.l. filed Israel Trademark Application No. 237567 for ‘COVERI’ coveri(ng) clothing, footwear and headgear, all in class 25. The mark was eventually allowed and published for opposition purposes on 30 April 2012. On 23 July 2012, Sar-Go Investment LTD opposed the mark. (The opposition actually related both to Israel TM 237,567 ‘COVERI’ and to Israel TM 237566 ‘ENRICO COVERI’ in Class 35, however, Sar-Go Investment LTD retracted their opposition to TM 237566 ‘ENRICO COVERI’ which was subsequently granted). In parallel with the Opposition before the Israel Patent Office, Enrico Coveri s.r.l. sued Sar-Go Investment LTD for infringing their (pending) mark. [– this is possible under common law rights, albeit not a good idea to sue before the mark issues].

Sar-Go Investment LTD asked the Court to require that Enrico Coveri s.r.l. post a bond [which is common practice where a plaintiff is not domiciled in Israel] and, on failure by Enrico Coveri s.r.l. to do so, the Court closed the case. On 31 December 2012, Sar-Go Investment LTD filed two trademarks, Israel TM 252378 “COVERI KIDS” for wholesale of clothing and shoes for children and youth, for “COVERI HOME” for wholesale furniture and children’s domestic accessories both in class 35. Both applications were suspended at the Opposer’s request until after the present Opposition is concluded.

Opposer’s Arguments

The Oposer claimed that they have used the (unregistered) marks Coveri Kids and Coveri Home for 15 years and had a reputation among their clients for these marks. The Opposer is a wholesaler whereas the Applicant is a manufacturer [this argument, together with the competing marks scenario created seems to be setting the scene for a request for co-existence]. In consequence of their longer usage in Israel, the Opposer claims that they should take precedence over Enrico Coveri s.r.l. in Israel under Section 24(a1)(2) of the Trademark Ordinance 1972, and, under sections 5(11) and 6(11) argued that allowing Enrico Coveri s.r.l.’s application to register would be unfair trade, would mislead the public and be contrary to the public good. In an alternative strategy, the Opposers argued that if Enrico Coveri s.r.l.’s was not canceled, then the two marks should be allowed to coexist due to the difference in sight and sound of the marks, as their desired mark was to be pronounced CAveri whereas the opposed mark was to be pronounced COveri. [I find this argument a little tenuous. The mark does not come with pronunciation instructions, and Israelis include Bedouin, Russian immigrants, American immigrants, Ethiopians, Thai foreign workers and Sudanese illegal immigrants. I doubt that there is a common pronunciation of vowels].

Applicant’s Counter Arguments

The Applicant claims a worldwide reputation in the word Coveri that goes back to the Seventies. [“When The Levee Breaks” — Led Zeppelin (1971) was a coveri song from the Seventies. It was originally recorded by Kansas Joe Mccoy and Memphis Minnie in 1929!]

The Applicant denied the allegations of misleading the public as they claimed to have the reputation and also argued that the Trademark Ordinance only protects registered marks, which the Opposer had not (then) registered.

Furthermore, the Applicant claimed that they were the first owner of the Coveri mark and back in 1986 had applied for ENRICO COVERI in claims 3 and 18, for soap and leather goods, and this the Opposer’s claims should be rejected. The Opposer was acting in bad faith as it was inconceivable that he was unaware of the Applicant who had marketed goods in Israel that were branded as COVERI.

Discussion

In the District Court proceedings, the current Applicant accused the Opposer of willful infringement and of ignoring requests from the Applicant to cease and desist from using the term Coveri. Furthermore, the Applicant argued that the Opposer’s us of the term Coveri would lead to misleading the public as the Opposer’s goods were sold by the Applicant. The Applicant further claimed dilution of their mark and Opposer’s enrichment at their expense.

In their defense, the Opposer denied knowing about the Coveri brand when they chose their own branding. As wholesalers of clothing brands and not manufacturers, they were unaware of the Applicant’s brand. Furthermore, the Opposer denied infringing the Coveri mark as their marks was Coveri Kids and Coveri Home.

However, as noted above, the District Court Proceedings were thrown out due to Applicant’s failure to post a bond.

The Applicant here, Enrico Coveri s.r.l., argued that the position taken by Sar-Go Investment LTD in the District Court estoppled them from claiming that the current proceeding be dismissed as the parties are the same in both proceedings. Support for this argument was found in Civil Appeal 246/66 Klausner vs. Shimoni.

The Trademark Office considered that the current situation was different as in the previous (court) proceeding, there was no substantive ruling as the case was thrown out. Also, the identities of the parties (and the marks in question) has switched, thus there is no estopple against bringing the case to trial. Furthermore, the legal arguments are different. For additional analysis, see TM 245411 Orez Gamalim Hahav Pninim (graphic logo) Yoram Sassa vs. Yehudit Matck, as published on the patent office website in April.

In conclusion, Deputy Commissioner MS Jaqueline Bracha saw no reason not to rule on the merits of the case.

Inequitable Behavior and the Common Good.

The Opposer claimed that the applications should be canceled as they were filed in bad faith, since the filing occurred 15 years after the opposer was using the mark and gaining a reputation in it. Furthermore, since the Court had thrown the case out, dealing with it on its merits now would be contrary to the public good under Section 11(5). The Applicant also accuses the Opposer of inequitable behavior since the choice of the term Coveri by the Opposer was itself an attempt to cash in on Henrico Coveri’s reputation. Arguments that Coveri means Cover Israeli Kids as the Opposer had claimed were dismissed as fanciful and unconvincing, and the alleged correct pronunciation as CAveri and not COveri as written was further indication of inequitable behavior.

The Opposer considered the marks were not registerable, as, due to inequitable behavior, their registration was impermissible under Sections 11(5) and 39(1a) of the Ordinance. However the Deputy Commissioner considered that this was not grounds for Opposition per se, only, for cancellation of an issued mark. Support for this position was found in the Pioneer decision.

[I am less than happy with the Deputy Commissioner’s ruling that inequitable behavior can be grounds for cancellation of a mark once issued, but not for opposing the mark. I know it is considered a dirty word, but I am relatively formalistic in my approach to the Law and have little time for interpretation of what the law meant to say. However, I can see no logic in allowing grounds of inequitable behavior to be sufficient to have an issued mark canceled, but not sufficient grounds to have a pending mark opposed. This seems senseless. I note that I disagreed with Ms Bracha in the Pioneer case as well  so at least I am consistent. Perhaps consistently wrong, but consistent.]

According to Ms Bracha, Section 11(5) was to cover cases such as to prevent an opponent to prevent an applicants from using opponents copyright protected artwork as trademarks.

Misleading the Public and Unfair Competition

As far as misleading the public is concerned, Ms Bracha considers that the mark has to be at least widely known if not formally ” a well-known mark”. She went on to apply the triple test to examine the similarities between the marks. As far as the sound of the mark is concerned, Ms Bracha noted that the Opposer claims that Coveri Kids has a patah sound (“a” as in cow – i.e. Cah-ver), whereas in on Henrico Coveri’s Coveri, the Sound is a holum “Oh” as in Copper. Noting that they are written the same way, Ms Bracha considers it unlikely that one can ensure that the marks are correctly pronounced and doesn’t think that anyone other than the Opposer’s who would be aware of the difference. [here I disagree. The word Coveri has a Kamatz Qatan and is pronounced Oh as in Copper by Yemenites and Ashkenazim but as an Ah by Spanish and Portuguese and in the Standardized Hebrew pronunciation. Nevertheless, the word, written in English (Latin) letters, could certainly be pronounced either way. This reminds me of the road sign conveniently placed near Heathrow Airport to confuse tourists. It points to Slough. Is the ough an oo as as in through? Is it an uf as in rough, an ‘or’ as in bought? No, it’s an ow as in bough!]

In the Coveri mark and in Coveri Kids and Coveri Home, the dominant word is Coveri. Furthermore, the other words are descriptive and lacking in independent distinctive character. Consequently, the marks are visually and audibly very similar. Both Opposer and Applicant sell clothing and children’s goods, one wholesale and the other retail. The client base is different, but it still overlaps and one could imagine a purchaser of Coveri clothing could go into a COveri Home shop to buy furniture or accessories. Whilst, it is certainly possible that Henrico Coveri is using his name for branding purposes and Coveri Kids means Cover Israeli Kids so there is no intent to confuse, however, it is unlikely that the public would be aware of this. The Opposer has stores in the upscale Kikar Hamedina of Tel Aviv. The Applicant’s witness was more circumspect as to where they were using their trademark.

Reputation

Reputation in a specific market sector is judged by the time period the brand has been in use and the amount of publicity and marketing invested in linking the product to the brand name.

Coveri kids have shown 15 years history of the mark. However, Mina Tzemach’s market research has shown low brand penetration, nevertheless, Ms Bracha agreed with the Applicant that the onus is on the Opposer to show that they have a reputation in the mark and not that the Applicant does not.  Ms Tzemach’s affidavit was an appendix to another one and not a freestanding document. However, the The Opposer did not choose to cross-examine her on her findings which rather strengthens them.

Coveri admitted that they had never opened a shop, but claimed that their neckties and other things were sold in boutique stalls. Consequently, it appears that Coveri Kids and Coveri Home have a larger footprint in the market.

Equitable Behavior

It seems that Enrico Coveri acted after discovering that Coveri Home and Coveri Kids were strong marks in Israel. They first sent cease & desist letters and only subsequently filed their own marks, and later still, filed in the District Court. Under cross-examination from Adv. Tony Greenman, Enrico Coveri’s witness spoke about design shows abroad abut did not answer questions about their local advertising. Despite prompting by both Adv. Tony Greenman and by the Deputy Commissioner, the witness failed to show that the mark had been used in Israel prior 2011 and had local reputation. This lead the Deputy Commissioner to suspect that the Applicant’s registration was merely to prevent being sued by the Opposer and was not indicative of actual use or intent to use.

Although in Israel one can apply for a mark not in use if there is intent to use, however the intent should be genuine. The Israel courts view defensive trademark practices with a jaundiced eye.

Such an approach is also true in the US:

A lack of bona fide intent to use is a ground for an inter partes opposition proceeding to an application before the Trademark Board. Aktieselskabet, 525 F.3d at 21; McCarthy § 20:21, at 20-65,66. Lack of bona fide intent to support an intent-to-use application also may render an application void ab initio upon challenge in federal district court.” (W. Brand Bobosky v. Adidas AG, 843 F. Supp. 2d 1134, 1140 (D. Or. 2011).

The long and real usage by the Opposer and lack of cooperation by the Applicant’s witness lead Ms Bracha to consider that the mark should be refused under Section (6)11 of the Trademark Ordinance.

Previous Rights to the Mark

The Opposer claims prior rights to the mark under Section 24(ia)(2) of the Regulation. As far as distinctive marks is concerned, this is a relevant issue.

As cited in ITT. vs. Ratfone Import LTD, 23 June 2009:

“Furthermore, it is important to note that when a mark is canceled from the register or even if it was never registered, this does not indicate a lack of proprietary rights of the owner. There is a right of reputation which is protected in unregistered marks.

In this instance, however, the Opposer did not register their mark. They did not act to have the mark registered, and the present instance and the previous Court case were superfluous. Having ruled that the Opposition should be accepted under Section 11(6), the ownership of the marks is superfluous, particularly as the Opposer has long established usage and the Applicant has not shown usage in Israel. However, the lack of registration by the Opposer should be taken into account when ruling costs.

Conclusion

Registration of the Italian designer’s mark was refused without a ruling of costs to the Opposer. The Opposer’s marks (Coveri Kids and Coveri Home) can continue to examination following this ruling.

Israel TM 237567 “Coveri” to Enrico Coveri, Trademark Opposition by Sar-Go Investment LTD, Ruling by Deputy Commissioner, Ms Jaqueline Bracha, 27 May 2015

COMMENT

Potahto or Poteitoe?

Gefen or Gafen?

Pronunciation aside, this case bears more than a passing resemblance to the Versace case, since we have a well know international design house and a couple of Israeli stores using the name in ambivalent faith. I therefore suspect we haven’t heard the last of this.


Novartis – Double Patenting in Israel

July 1, 2015

novartis

The present ruling relates to the issue of identical of overlapping patents and patent applications, and examines the ramifications of double patenting in Israel.

IL 2039732 is a Divisional Application of IL 176831 titled “Compressed Pharmaceutical Tablets or Direct Compression Pharmaceutical Tablets Comprising DRR-IV Inhibitor Containing Particles and Processes for their Preparation”.  During prosecution it received a final rejection and the Applicant, Novartis, appealed this final Examiner’s rejection.

The Examiner considered that the claims of the parent and the divisional application are directed to the same invention. After this issue was first raised, the Applicant amended the claims, but the Examiner considered that the amended claim set (claims 1-23) covered the same invention as claims 23-26 of the parent application. Based on 5293/93 Welcome Foundation vs. Patent Commissioner (1993), the Examiner rejected the claims of the divisional application. A telephone conversation was to no avail. The Examiner issued a final rejection noting that there were substantive issues not addressed, and the Applicant appealed this decision to the Commissioner of Patents claiming that the issue is one of interpretation of the Law.

The Commissioner held a hearing and allowed the Applicant to present a short summary of the comparative law in US, Europe, Australia, Japan, China and India. In this instance, the Examiner did not claim that the divisional had identical claims to the parent application, but that there was some overlap. According to the Commissioner, the issue is one of interpretation of Sections 2, 8 and 9 of the law. These state that an inventor is entitled to a patent, that a patent can only cover one invention and that where two or more applicants file for the same invention, the first to file is awarded the patent. The purpose of divisional applications is to prosecute additional inventions claimed within the same parent application.

In the Welcome case, claims 1-10 related to uses of a pharmaceutical preparation in the treatment of various diseases and claim 15 related to a method of preparation of the active ingredient.  Then Commissioner, the late Michael Ophir ruled a claim for use in preparing a medicament’ and ‘use in the treatment of’ were identical. He did not see that the application related to more than one invention. On appeal, Judge Winograd ruled that one can file and prosecution an application for a material, a second one for the method of fabrication and a third one for uses, provided each application is directed to patentable subject matter and there is no overlap between the cases. There Judge Winograd went on to rule that one application cannot include more than one patentable invention, i.e. one should not award more than one patent for one invention, and this is a corollary of Section 8 that a patent should cover one invention. One can file a plurality of applications for a plurality of related patents provided that each one is directed to a patentable invention and the claims are not identical or overlapping.

In the present case, both the parent IL 176831 and the divisional application IL 203972 have the same title. In IL 203972 there is one independent claim. Claims 23 and 24 of the parent IL 176831 each depend on claim 1, and claims 25 and 26 are dependent on claims 24 and 23 respectively.

The independent claim of IL 203972 is directed to using a powder to form a pill for treating a wide range of ailments. Claims 23-26 of the parent IL 176831 are directed to forming tablets and a corresponding process. The divisional relates to various states that are not in the parent application, but both applications have the same specification. According to the Applicant, the parameters are identical but the parent claims the process whereas the divisional application claims use of the active ingredient to prepare a pharmaceutical.

According to the Examiner, the divisional application claims the use of a formulation for treating a disease, where the formulation is given in claims 23-26 and the diseases treated are listed in claims 1-22. In both cases, the formulation is the same, the particle size is the same and the active ingredients and additives are the same as those given in claims 23-26 of the parent.

Novatis found the Welcome decision poorly claimed and poorly reasoned and could not see why two applications could not claim identical or overlapping inventions. They argued that where applicants are the same, there is no need to relate to identical or significantly overlapping claims, holding that the Israel Patent Law does not prevent multiple patenting. Novartis argued that Section 2 is merely a declarative statement that the applicant may file a patent. It does not have legal ramifications, and certainly does not limit the number of patents that the applicant may file. Section 2 does include the word “one” and it should not be read into the claim such that one patent may be requested for one invention. Support for this interpretation is found by contrast to Section 9 which relates to different applicants with patent applications for the same invention.

The parties are in agreement that different applicants cannot be awarded separate patents for the same invention. Novartis holds that the same applicant can be awarded two or more patents for the same invention. The Examiner disagrees. Novartis accepts that there is no economical justification or logic in an applicant having more than one patent, and even sees this behavior as unacceptable. However, so long as there is some difference between the two patents, it is legitimate to award the protection of both patents.

The Commissioner upheld the Examiner’s conclusion and ruled that so long as there is nothing in claim 1 of the divisional that exceeds the scope of the claims of the parent, there is no reason to allow the divisional.

COMMENTS

In the US, the issue of double patenting is dealt with by filing a terminal disclaimer. Although this procedure prevents extending a term of protection (sometimes called ever-greening), it still has negative ramifications. Third-parties such as an alleged infringer may have to show that he is not infringing a number of overlapping patents. Likewise, a competitor may have to show a number of similar patents are invalid or not infringed. This places an unnecessary burden on third parties.

I think that although Novartis is correct that the Law does not explicitly prohibit multiple patents for the same invention, the Commissioner is correct that not to allow it is a reasonable interpretation of the intention and spirit of the law. Because of the large sums of money involved with pharmaceutical patents, this decision may well end up being appealed to the courts. If that happens, we will see how the Israel courts consider double patenting.


Impotent Appellant Has No Standing

July 1, 2015

class action  no standing

This ruling relates to a Class Action filed in bad faith. The court ruled that when Applicant challenges the validity of claims made for a formulation, failure by the Applicant to take the formulation during the minimal period prescribed by the manufacturer, is sufficient to cancel the standing of the Appellant as representing the class in a Class Action.

The Appellant purchased a formulation intended to strengthen the male libido. Prior to the Appellant finishing the prescribed course of treatment detailed in the accompanying literature and as explained by the Supplier’s Helpline, the Appellant filed suit with the District Court claiming that the product is misleading, and requested that the case be considered as a Class Action. However, the District Court refused to see this as a class action since the Appellant had no standing, and therefore could not represent the class.

Supreme Justice Danziger upheld the decision of the lower court without awarding costs to either party, and added that the need to test that the plaintiff behaves equitably is anchored in Section 8(a)4 of the Class Action Law. The ruling of this court does not indicate a general ruling of what is considered equitable behavior as far as Class Actions are concerned. In one case Inequitable behavior occurs when a case is filed due to false motivation, such as an intent to damage a competitor or to “squeeze a compromise”. In other instances, the mere fact that a plaintiff is acting commercially, looking to profit from the Class Action does not, in and of itself, indicate that he is behaving inequitably, however the plaintiff has to behave equitably during the hearing. This is particularly important in cases where the plaintiff wishes to represent a class of consumers and not merely himself and when a lawyer solicits plaintiffs for a Class Action.

In this instance, the District Court has determined, from the evidence before it, that the Appellant:

  • recorded conversations with the service hotline of the vendor
  • did not read the accompanying literature, tried the formulation for too short a period in direct contradiction of the instructions that he received with the formulation
  • contacted a lawyer prior to finishing the course; filed suite 5 days after stopping the treatment
  • via his attorney, submitted advertisements that were not related to his decision to take the treatment

These facts resulted in the District Court concluding that the plaintiff did not have standing in his own right and could therefore not represent the class of men with impotence issues.

The Court concluded that the circumstances indicate that this is a rare case of someone initiating a Class Action inequitably, and contrary to Section 8(a)(4) of the Law. This conclusion is not based on the motive of the plaintiff, for one may be motivated by material gain, but by the inequitable behavior determined by the District Court. Simply not going the full course indicated by the manufacturer is sufficient to make the Appellant not appropriate to represent the class.

Oddly, and perhaps not inappropriately, this case was heard by three male judges, who agreed unanimously with the verdict.

4534/14 Appeal to Supreme Court, Eli Daniel vs. Direct Nature LTD

COMMENT
The Appellant, Eli Daniel, may not have had to pay compensation or costs, but, due to his actions, has entered the Israel legal text-books as having erectile dysfunction. Not the end of the world.

From discussions with pharmacist clients over the years I understand that the efficiency of all medicines, both classical and alternative (where there are active ingredients, as opposed to homeopathy) work to a greater or lesser extent in different patients due to personal physiology. A class of one is hardly a representative sample to test the efficiency of a treatment. There is a well documented placebo effect and presumably this works in both directions, so a patient lacking belief in a treatment is unlikely to see positive results. I assume that not everyone reacts the same way to aphrodisiacs, and there are large number of foods that are attributed as having both aphrodisiac and libido dampening effects. Apparently, patients taking classical medical treatment for erectile dysfunction still need to feel aroused, and taking the medicine alone has no effect.  I therefore wonder whether the treatment in question works some of the time and for some men. Certainly, there is no indication in this class action that this is not the case.


Amad Arabiyah Wins Injunction and Damages from 13 Bootleg Distributors.

June 24, 2015

Arab Music

Amad Arabiyah Music Management and Distribution LTD sued 13 different shops in the Nazareth District Court. The shops had sold Music CDs and had stocks of pirate compact disks and were accused of contributory copyright infringement. Due to the similarity of the cases and the common plaintiff, the cases were combined into one case.

The original production of the albums was by Digital Sound LTD and Aalem en-Fan LTD, both Egyptian companies, who transferred the rights to the plaintiff. The logos and names of the Egyptian production companies appeared all over the compact disks and their packaging. In the original case as filed, the Egyptian production companies appeared as formal complainants, but the judge ruled that their names could be deleted from the statement of case since Amad Arabiyah Music Management and Distribution LTD had an exclusive license to distribute the compact disks and to sue for copyright infringement.

Amad Arabiyah Music Management and Distribution LTD sent a couple of investigators who purchased fraudulent disks in each shop and testified that the shops had stocks of such disks. They claimed 100,000 Shekels in statutory damages against each shop.

Amad Arabiyah Music Management and Distribution LTD considered that the full statutory damages should be awarded as the infringement was widespread knowing commercial infringement over a 35 year period that was profitable for the defendants. The shops considered the charges trivial and unsubstantiated and denied the standing of the plaintiff.

The court found the defendants guilty ruling that the recording company that produces music disks enjoys copyrights independently of the singers and composers. In this instance, the recording company transferred its rights to the plaintiff. The defendants sold copies of these compact disks from a company that was not authorized to distribute them, and so the disks are infringing copies. In the circumstances, the defendants knew or should have known that the disks infringed copyright, or at least should have made inquiries. Consequently an injunction was awarded against the defendants that requires them to destroy and forbids them from selling these compact disks. Each of the thirteen defendants has been fined 10,000 Shekels and has to pay 7500 Shekels in legal fees.

Civil Action 33968-05-11 Amad Arabiyah Music Management and Distribution LTD vs. Ahmed son of Mustafa Anbatawi et al., 13 Judge Atrash, 6 May 2015.             

COMMENT
I can see the sums awarded being appealed but the fact that there is infringement is clear. Although this particular proceeding relates to Egyptian music sold in Arab shops, I think that similar offenses occur in the Jewish sector, including Hassidic music traded in ultra-Orthodox areas. I am publishing this ruling in the hope that it will encourage others to enforce their rights and that those who do not see this as a kind of stealing because they are not sophisticated enough to understand the concept of rights in the abstract, should think again.


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