IL 182763, 184179, 182759 and 182758 are trademarks owned by Krasnyi Octybar and by the “Open-Type Joint Stock Company Rot Front”

The marks cover Waffles; confectionery for decorating Christmas trees; cakes; pastries; peanut confectionery; almond confectionery; pasty; cocoa; cocoa products; caramels [candy]; sweetmeats [candy]; liquorice [confectionery]; peppermint sweets; coffee; crackers; meat pies; farinaceous foods; candy for food; fruit jellies; marzipan; custard; honey; ice cream; sherbets [ices]; muesli; mint for confectionery; cocoa beverages with milk and coffee beverages with milk; coffee-based beverages, tea-based beverage, chocolate beverages with milk, chocolate-based beverages, cocoa-based beverages; lozenges; petits fours [cakes]; biscuits; pies; fondants; pralines; gingerbread; chewing gum, not for medical purposes; sugar; cake paste; confectionery; rusks; sandwiches; almond paste; tarts; cakes

(Edible decorations for-); halvah; bread; tea; all included in class 30.

Roshen Confectionary Corporation and Dealer BMD international LRD, Kharjov Biscuit Factory, Dolina Group and Letfood LTD requested that the marks be canceled. Krasnyi Octybar and Open-Type responded by requesting that those requesting the marks be canceled deposit 150,000 Shekels to cover legal costs should they lose. They considered that the initiators of the action should be made to deposit these relatively large sums as the plaintiffs are limited companies formed outside of Israel without significant Israeli assets. The plaintiffs countered that Open Type has not provided a shred of evidence that they would have a problem paying costs should they lose.

Ms Shoshani Caspi, the adjudicator of IP disputes at the Israel Patent Office noted that Section 253a of the Company Law 1999 provides the courts with wide discretion whether or not to grant such request.  Citing Judge Gronis, she noted that with minimum evidence such costs should be deposited.  Citing 10376/07 L. N. Computerized Engineering vs. Bank HaPoalim 11/2/2009, a three stage review of such requests should be conducted. The first stage is to ascertain the economic footing of the company.  Having ascertained that the company may have problems settling their bills, the court then has to decide whether there are grounds to require the side to place a deposit or not, based on the likelihood of them losing. Only then is the third stage, which is ascertaining the amount to be deposited.

In this instance, the respondents are the plaintiffs who launched adversarial proceedings against the mark holder. The onus is therefore on them to show financial ability NOT on the mark holder to show that they don’t have financial ability. The main grounds for the bond request are that the plaintiffs are foreign entities. As far as individuals are concerned, that is not, in and of itself, sufficient grounds to require a bond to be posted.  A lack of Israel assets does not indicate a lack of ability to pay if one loses, but it does indicate a lack of ability of the other party to collect which is, after all, the rationale for the Law. This, according to the adjudicator of IP, Ms Shoshani Caspi, is sufficient grounds to open the requirement of the posting of such a bond to be considered.

Meanwhile, the companies requesting that the marks be canceled have not shown evidence of having assets in Israel and have not provided evidence of financial standing. In the circumstances, there is no reason to assume that were the plaintiffs to lose, they would be able to pay costs. Consequently, it seems fair to require the party suing for the marks to be canceled to post a bond to cover defendants costs should they prove unsuccessful.

The defendants have managed to find the resources to register and maintain their marks and there is no indication that they should have problems paying costs were they to lose. Indeed, their comments indicate that they have resources. Nevertheless, if this is indeed the case, requiring them to post bail will not adversely affect their ability to conduct this legal proceedings.

Ms Shoshani Caspi does not accept the respondent’s position that the mark is likely to be canceled. She feels that unless a case is very obvious to succeed or to fail, she should reserve judgment until the evidence is submitted. She was not impressed with comments concerning the strength of other marks of the defendants or that they themselves had not requested that a bond be made.

Weighing everything up, Ms Caspi came to the conclusion that 7000 Shekels would be an appropriate bond in this case and ordered that it be posted within 21 days, otherwise, the request for cancellation of the marks would be canceled.

Intermediate ruling, Ms Shoshani Caspi, 4th June 2015.

Categories: Uncategorized

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