Cartoon Network vs. Hassan Nesirot

cartoon networkThe Cartoon Network sued Hassan Nesirot for 100,000 NIS as statutory compensation for copyright infringement,.

The plaintiff is a company that was incorporated in the United States that owns much copyright and trademarks, and this includesthe Character known as Ben 10. The defendant owns a large stationary and toy store called Nidat Alsalam in Taybe, a large Israeli city with a predominently Arab population.

Ben 10The Statement of claim stated that the defendant has infringed the plaintiff’s rights by selling counterfeit goods bearing the Ben10 image without a licensing agreement with the plaintiff.

The goods in question included 345 packets of strickers and 80 packets of wrapping paper having the Ben 10 image. The defendant denied all charges.

After a preliminary hearing, the date of 23 December 2018 was selected for hearing the evidence.. On 19 December 2018, the plaintiff alleged that they had become aware that a second Statement of Case had been filed against the defendant and that on 21 June 2018, the defendant had admitted some guilt in a plea bargain. See Civil Case 51721-08-16.

At the start of the hearing on 23 December 2018 the parties reached an agreement as follows:

We agree that the defendant will admit to having in his posession the items in question, and that these items do constitute copyright infringement and trademark infringement. We also agree that the images appended to the witness statements be considered evidence and the parties will come to an agreement regarding the compensation due for the infringement.

This agreement, designed to simplify the court case by concentrating on the issues that were contended, as ratified by the court which stated that the only factual evidence that the ruling was based on was that the defendant had infringed the plaintiff’s copyrights and trademarks by having the goods listed in the statement of case in his possession as indicated in the photographs appended to the statements.

The parties then submitted their summaries in writing.

The Plaintiff claims that the Statement of Case should be accepted in its entirety and alleged that the there were six cartoon images that were copied (apparently from the same family) and that the maximum statutory damage under Section 56a of the Israel Copyright Law 2007 is thus 6 x 100,000 Shequels. The plaintiff further alleged that the various considerations listed under Section 56b lead to a conclusion that significant compensation was appropriate since there were several infringements and the store-owner was a significant retailer who had acted in bad faith.

The defendant claims that the charges should be rejected or that only symbolic compensation be awarded. He considered the incident a single infringement and that the goods in question were  a minor part of his turnover and were worth a mere 200 Shekels. Furthermore, the goods were supplied by a known distributor and he was unaware that they were counterfeit.

Firstly, Judge Avi Stav considers that in their summations, both parties had  attempted in widen the discussion beyond that agreed and by noting the issue agreed, the judge was limiting the damages to the agreed subject matter.

ben 10 CNIn the original statement of case, the plaintiff had sued for one infringement of the Ben 10 character and claiming there were actually 6 separate infringements is an impermissible widening of the case and is contrary to the agreement reached by the parties. Whilst it is true that the photographs were accepted into evidence, this was with regards to the original charges brought and so this should be considered as relating a single infringement.

Apart from the inadmissibility of the charge of multiple infringements, this is a single event that can be considered a single infringement under Section 56b, even if there are a number of individual characters that were copied The case law cited by the plaintiff related to the old law and may well mot be relevant (see Amit Ashkenazi “Compensation without Damage” in Creating rights – readings of the Copyright Law 596-598, edited by Michael Birnhack and Guy Pessach, 2009.

As to the other considerations listed in Section 56b of the Law, it is true that we are talking about a large retailer and this consideration appears in 56(b)6); whilst this is not an agreed fact it is not something that the parties disagree about and the defendant himself admits as such in his summation. However this fact has a certain leniency associated with it when considering the extent of the infringement. The infringement is not a large one, but is also not insignificant. As nothing was agreed on the issue and there is no contrary evidence, one has to find in favour of the defendant that the infringement was not over a long period and the plaintiff did not suffer real damage Section 46(b)4l and the profit to the defendant was low Section 46(b)(5), and the plaintiff didn’t even dispute this in his summation.

As to bad faith, where the defendant is found guilty in a criminal proceeding, one cannot consider his behavior sufficiently virtuous to provide a full defense. Nevertheless, when considering the factual evidence agreed by the parties, there is nothing to indicate that the defendant was overly irresponsible.

The agreed facts indicate a light to average infringement: on the one hand we are relating to goods sold on a scale that is more than de minimis, but on the other hand, this was not a large scale counterfeiting operation. No evidence was provided that the there was systematic infringement over time or that the defendant made significant profit from the infringement. Nor is their indication that the defendant was damaged. Weighing it all up and after reviewing the relevant case-law, Judge Avi Stav considers the appropriate compensation to be 15,000 Shekels. When considering the damaged ruled as compared to that claimed, and that the there was no need for a full trial, but also noting that the defendant original denied all charges, including that the goods were counterfeit which required the plaintiff to submit evidence regarding this point, and noting his failure to inform the court that he had been found guilty in the other case, costs of 7500 Shekels are added.

The defendant has 45 days to pay the fine and costs.

Civil Complaint 12817-10-14 Rulingby Avi Stav on Cartoon Nettworks re Hassan Nesirot,  5 June 2019 

Categories: Copyright, Intellectual Property, Israel Court Ruling, Israel IP, זיוף, זיופים, זכות יוצרים, סימני מסחר, סמני מסחר, קניין רוחני, קנין רוחני

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