Under What Grounds Can A Mark Owner Require A Party Filing to Cancel a Mark to Post a Bond for Expenses?

bond lighterfelix lighter!

Briko Burns You More LTD has a registered trademark for HN covering lighters in class 34.

Tranmirian Hamias M’yeri LTD filed a cancellation proceedings and Briko responded to a cancellation request from Tranmirian Hamias M’yeri LTD.  to post 70,000 Shekels to cover legal expenses should their attempt to have Israel TM 245007 cancelled fail.

At the time the request was made, the parties had both files statements of case and Tranmirian had already filed evidence.

The request to post costs was based on legal precedent. Briko argued that as a rule, companies should post bail, and the onus is on the company to persuade the courts that this is not necessary. The Company Register lists  Tranmirian as not keeping the law since for 6 years they haven’t paid their company fees. Briko argued that this is sufficient to show that  Tranmirian is not on a sound financial footing.  Briko further argued that  Tranmirian have been using a wrong address which further complicates collecting should Briko win.

Tranmirian countered that none of the above was supported by an affidavit and this alone should be sufficient to have the request thrown out.  Tranmirian claims to be a law abiding company that pays its debts and that the missing fee to the company register was an oversight that has no been attended to.  Furthermore Briko themselves have a similar debt to the companies register!

The wrong address was a typographical error. The correct street was identified, but in the wrong city (Haifa instead of Nahariya). This has also been corrected. The firm denies any liens or mortgages and submitted an accountants letter to the effect that it could settle any bills if it lost. Furthermore, the requested 70,000 deposit was disproportionate to expent costs.

In her decision,  Ms Yaara Shoshani Caspi ruled that requesting a bond was legitimate if there were reasoanble grounds to conclude that an opposing party would not be able to pay their bill. A debt to the company register is not sufficient, and certainly where it is settled on being brought to the attention of the party in question. She concluded that there were insufficient grounds to require Tranmirian to post a 70,000 Shekel bond and she therefore rejected the request and ordered 1000 Shekels costs against Briko.

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