IL 199377 is a patent titled “EXPANDABLE DEVICES FOR DISPLACING THE SCHNEIDERIAN MEMBRANE” it was invented by Ben-Zion Carmon back in 2001 and is a patent of Division of an earlier Application.
When Carmon attempted to enforce the patent against Miambi LTD and Dr Ehraim Kfir, the defendants attempted to cancel the patent and successfully managed to limit its scope.
In Israel Law, a party that successfully manages to oppose a patent, have it cancelled or have its scope narrowed, is entitled to costs. In this case, Miambi LTD requested costs of 1,012,418 Shekels from Ben-Zion Carmon since back in December 2014, they managed to get some of the claims cancelled.
I wrote up the original ruling here.
The main claim was:
A device for displacing the Schneiderian membrane from the floor of the maxillary sinus comprising: a rigid conduit for insertion through the maxillary bone towards said Schneiderian membrane, an expandable inflatable container, a connector, a filling tube, a reservoir having a flowable filling material and injecting mechanism, the distal portion of said connector being connected to said conduit, the proximal portion of said connector being connected to said filling tube, said filling tube being connected to said reservoir, said injecting mechanism being configured for the insertion of said filling material from said reservoir through said filling tube inside said container so at least part of said
container being expanded to protrude distally to the distal end of said conduit inside said maxillary sinus to displace said Schneiderian membrane.
The reason why the patent was severely narrowed was that the claimed structure, an expandable inflatable container, a connector, a filling tube, a reservoir having a flowable filling material and injecting mechanism, simply wasn’t supported.
In my write-up at the time, I noted that the practical joke sold as a plate lifter has the same structure, and so this wasn’t novel.
That as may be, PCZL, representing the patentee, alleged that they would appeal the decision and therefore requested that the costs ruling be stayed, and thereby created a chain of letters and responses that generally procrastinated. The Israel Patent Office noted that the authority for staying a decision is in the hands of the Court of Appeals (The District Court) and not in the hands of the Adjudicator of Intellectual Property, Ms Yaara Shoshani Caspi who heard the original case. The Court never ordered a staying of the costs ruling.
Claims and Evidence of Both Parties
Miambi LTD and Dr Ehraim Kfir alleged that the cancellation proceedings and the associated costs were caused by the legal action brought by Ben-Zion Carmon to enforce the patent against them. They alleged that the action was baseless and was filed in bad faith by Ben-Zion Carmon and caused them to invest substantial resources in defending themselves. Dr Kfir appended an Affidavit relating to consultation fees from Gilat Baraket & Co. as evidence of costs accrued. They alleged that the case dragged on before the Patent Office due to the complicated technology involved. The costs comprised three elements:
- 412,000 Shekels for work by the Attorney of Record, Adv. Rahmani, but no documentation was provided to support this cost
- 350,418 Shekels in consultation fees to Gilat Baraket & Co. , with various invoices to support this claim
- 250,000 Shekels for 250 hours work by Dr Kfir himself in fighting this law-suit.
Pearl Cohen Zedek Latzer raised some creative defenses on behalf of their client:
- Ben-Zion Carmon is a private individual and to award costs against him would be a rare precedent. Indeed, he shouldn’t have to pay costs at all
- There was no scientific complexity here and the cancellation proceedings was an off-shoot of the Infringement Proceeding in the District Court
- The costs request was laconic. No evidence was filed to support Adv. Rachmani’s time or Dr Kfir’s, and the statements from Gilat Bareket & Co, were not sufficiently detailed
- The costs requested were unreasonable and disproportionate
- Gilat Bareket & Co are not consultants, but representatives and it is unreasonable to charge Carmon twice for two sets of lawyers fees
- Ms Pugatsch’s costs of 80,000 Shekels for preparing an Affidavit was ridiculous, since Carmon’s witness, Prof. Ciaco only charged 5920 Shekels.
- Citing previous rulings, the costs for Dr Kfir’s time were unreasonable since his work as CEO of the company requires him to work on such matters
- Since Adv. Rachmani is a minor share-holder in Miambi LTD and provides legal aid on an ongoing basis, he can be considered an employee who is performing his regular work and thus his costs are not refundable
Discussion and Ruling
The guidelines for cost rulings are set out in Bagatz 891/05 (Tnuva) which discusses the work done, legal and factual complexity, stage that proceedings reached, bahaviour of the parties, equitable and inequitable behaviour and the like.
Where actual costs are requested, the onus is on the plaintiff to prove that these costs were indeed incurred and were necessary. As ruled in Opposition 113433 Smithklin beecham Corporation (SKB) vs. Teva (30 May 2005) not all costs are recoverable.
Turning now to the three cost elements:
- Rachmani’s costs of 412000 Shekels were for a detailed list of actions but the time involved and hourly rate were not detailed. Certainly some of the time spent and costs requested, such as those for initiating intermediate proceedings that were unsuccessful. Although a minor share-holder he is not a worker. It is acceptable since he provides on-going legal services that he will be paid from costs award and not per action and so lack of invoices is not critical problem. In general, a fair recompense for his work can be assessed by approximation
- It is not clear what Dr Kfir did in his 250 hours, after all Adv. Rachmani was inside counsel of the firm. Furthermore, Dr Kfir is, himself, a named party. He does not, therefore deserve costs.
- The costs for Gilat Bareket’s work were not detailed. There is no clear correlation between the list of actions detailed in Dr Kfir’s affidavit and the Gilat Bareket’s Some invoices precede their submission to be co-counsel. Adv. Rima Pugatsch’s opinion was blled for in two invoices. The breakdown between these is not clear and the basis for the cost was not detailed. This makes it impossible for the Patent Office to assess whether the costs were fair. Thus a fair price for Gilat Bareket’s work can only be assessed by estimation.
- PCZL’s allegation of double representation is rejected, since the case is factually and legally compex.
More or less by weight, Costs were approximated as follows:
- 90,000 Shekels for Adv. Rachmani’s time
- 45000 Shekels for Gilat Bareket’s consultancy
- 8000 Shekels for the Opinion by Ms Rima Pugatsch
- 3000 Shekels for requesting costs
- 3000 Shekels for having to file additional papers after the main ruling.
Total costs of 149,000 Shekels should be paid within 10 days.
The claimed invention was not supported by the specification and the divisional patent should not have issued. I still maintain that structurally the claim relates to a plate lifter and thus lacks novelty.
Pearl Cohen should have told Dr. Carmon not to attempt to enforce the patent against Mumbai. However, as with the Origin Source case and the Air-Conditioning unit support brackets Pearl Cohen have a history of attempting to enforce patents where there is no infringement and the patents should not have issued. The delaying tactics they’ve employed here are also typical of their modus operandi.