Israel Supreme Court Rejects Appeal from Shukha Trademark Infringers

June 9, 2017

shukhaThere are two branches of the Shukha family that market oil and other food stuffs: Sons of George Shukha ltd. and Antoine Shukha and Sons ltd.

Sons of George Shukha ltd, which also imports and distributes rice, have 27 registered trademarks including the name Shukra in English, Hebrew and Arabic.  The earliest registered mark is from 1984 but one mark is for Sons of George Shukra from 1930.

Over a six-year period, the Sons of George Shukha ltd attempted to enforce their marks through the courts with the parties reaching an agreement that allowed Antoine Shukra and Sons to use labels that include the name Shukra in a font size no larger than that for Antoine and Sons and together with a logo. The settlement, though ratified by the court, was not fulfilled and so Sons of George Shukha ltd. appealed to the Supreme Court. Antoine Shukra and Sons submitted various creative arguments arguing that since the size of their oil containers was larger, the agreed size of the label was no longer reasonable. They also claimed that the ruling only related to the name Shukra in Arabic. They submitted that two weeks to recall and remove all infringing products from the shelves was too short a period, and the penalty of 2500 Shekels for every day delay would cripple them.

Supreme Court Judge Amit pointed out that unless the penalty for failing to enforce was crippling, infringing parties would simply continue to prevaricate. He noted that in two of the three counts of continued infringement, Antoine Shukra and Sons acknowledged that they were infringing, and in the third case, where the issues that received court endorsement related to the size used for the name Shukra and to it being used together with a logo, even if there was some grounds to consider the Appeal based on font size, the infringers were not displaying the logo prominently. He refused to reconsider issues ruled on by District Judge but noted that the District Court judge had stated that the Appellants had made various claims in affidavits but withdrew them during the hearing, and had generally acted in bad faith.

Judge Amit noted that with financial penalties for failing to enforce, staying a ruling during Appeal was generally not appropriate since a monetary ruling could rectify any issues. Judge Amit refused to stay the enforcement, but granted a 30 days instead of 14 days for it to be enforced.  By the end of this period, the Appellants have to provide a full record od what was done to recall or relabel the infringing goods. Costs of 5000 Shekels were awarded to Sons of George Shukha ltd.

Appeal 4113/17 Sone of George Shukra ltd. vs. Antoine Shukra and Sons ltd. and various members of the Shukra clan and related companies. 8 June 2017


Requesting Enlargement of A Deposit of Costs

January 8, 2017

The Krasnyi Octybar and Rot Front Joint Stock Companies own four Israel trademarks: 184179, 182758, 182759 and 182763. Each covering a long list of goods in class 30, including such things as for 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.

Five companies including the Roshen Confectionery Corporation,  Dealer B&D International Ltd, Kjarkov Biscuit Factory, Dolina Group Ltd and Latfood Ltd have filed cancellation requests against these marks.

The marks owners have requested that the sum that the challengers are required to post as a guarantee against legal costs in the event that the mark owners prevail be increased by a further 130,000 Shekels, or by whatever sum the commissioner sees fit. The request was submitted together with 90 pages of appendices and a copy of an Affidavit from the legal counsel of the mother company, however the original Affidavit was not submitted. The challengers opposed the request to increase the guarantee. A hearing has been set for the 17th and 18th of January for cross-examining the various witnesses.

The background to the request for guarantees is two requests for cancellation of the marks. Roshen Confectionery Corporation and  Dealer B&D International Ltd have requested the cancellation of 184179, 182758 and 182759 trademarks, and the Kjarkov Biscuit Factory, Dolina Group Ltd and Latfood Ltd have requested cancellation of the 182763 mark.

Following requests for guarantees that were filed in March 2015, the Adjudicator of IP Ms Yaara Shshani Caspi ruled on 21 June 2015 as follows:

In light of the above, and considering all the circumstances of this case and the general considerations used to determine the magnitude of the appropriate deposit, the first two challengers are to jointly deposit 75,000 Shekels and the second group of three challengers are also to jointly deposit 75,000 Shekels, and this should be done within 21 days.

The present request includes suspension of the proceedings until the deposit is increased.

The Parties’ Allegations

The mark holder claims that increasing the deposit is required because following the original decision there have been changes in circumstances that warrant increasing the deposit. These new circumstances include the expectation of long and complex proceedings and a number of cross-examinations. Furthermore, the case is complex and it transpires that the costs are expected to be higher than originally anticipated. The additional costs are incurred by the two groups of challengers retaining separate counsel and making unnecessary requests. A further claim is that it was not previous clear but now is transparently so, that there will be a massive amount of evidence and documents and a hearing that will be conducted largely in Russian, requiring simultaneous translation. The mark owners nevertheless reiterate their opinion that the likelihood of challengers prevailing and the marks being cancelled are very slim. The amount of the deposit, standing at 150,000 Shekels, is too low and not proportional to the costs that will be requested if the cancellation attempts fail and so this is a classic example of where increasing the deposit is warranted.

Both group of challengers consider the request to increase the deposit should be refused since the ‘new circumstances’ were already fairly obvious when the original request for costs was made. The second group of challengers considers this to be a vacuous request filed in bad faith simply to stretch out the proceedings.

Ruling

Ms Yaara shoshani Caspi did not consider that the circumstances had changed since the original request for a deposit was ruled on. For example, where there are five parties challenging two groups of marks it is not unpredictable that there will be lots of witnesses to cross-examine. Since the challengers are Russian companies, it was always expected that their witnesses would testify in Russian and simultaneous translation would be needed, as is the fact that there are two groups of challengers. The massive amount of evidence was also expected and Ms Shoshani Caspi considered that these grounds were all considered by her in her original ruling regarding the size of an appropriate deposit.

With regard to the likelihood of the challenges prevailing and the marks being cancelled, there is no way to consider the likelihood or otherwise of the challenges be successful at this stage since the witnesses have not been heard and have not yet been cross-examined. At least this is the theoretical state of affairs. Since the challenges are on the basis of inequitable behaviour in the original filings, there is a high level of proof that the challengers will be required to submit to establish their case since they will have to positively show that many years ago the mark holders intentionally appropriated marks that were not theirs.

Nevertheless, the fact that the challengers have a difficult task ahead is not justification to increase the deposit that they have already placed. There are no unexpected circumstances not considered in the original ruling considering the size of the deposit.

The request to increase the deposit is refused. However, Ms Shoshani Caspi does not see the request as indicative of inequitable behaviour designed to make the trademark cancellation proceedings unnecessarily complicated. that said, the mark owners should nevertheless pay costs to the challengers for requiring them to respond to this request. The mark owners will therefore may 1500 Shekels to the first group of challengers and a further 750 Shekels to the second group and will do so by 15 January 2016 or interest will incur.

In cancellation proceedings concerning 184179, 182758, 182759 and 182763 trademarks, Ruling on increasing size of deposit by Ms Yaara Shoshani Caspi, 28 December 2016.


Are methods of calculating rediculous alleged legal costs trade-secrets?

November 1, 2016

novartis    teva

Teva successfully opposed IL 184027 to Novartis titled “COMPOUND TRISODIUM [3-((1S,3R)-1- BIPHENYL-4-YLMETHYL-3- ETHOXYCARBONYL-1- BUTYLCARBAMOYL)PROPIONATE-(S)- 3¶METHYL-2¶PENTANOYL{2¶¶ TETRAZOL-5-YLATE)BIPHENYL- 4¶YLMETHYL}AMINO)BUTYRATE] HEMIPENTAHYDRATE, ITS PHARMACEUTICAL COMPOSITIONS, METHOD FOR ITS PREPARATION AND USE THEREOF IN THE PREPARATION OF MEDICAMENTS.”

The application was filed on 18 June 2007 as the national phase entry of PCT/US2006/043710. A divisional application was filed as IL 219782. The application published for opposition purposes on 30 November 2014, and on 25 February 2015 Teva Pharmaceuticals LTD filed an opposition. One day later Unipharm also filed an Opposition. Subsequently, since there was a pending divisional application and because the opposer had not filed their statement of case, the Opposers filed for suspension of the Opposition proceeding for 18 months as per Commissioner Circular 020/2012 “Opposition to a divisional patent or to a patent that is divided” from 18 November 2012. The Applicant opposed the request to stay the opposition. However, on 9 August 2014, the Commissioner agreed to stay the opposition proceeding.

On 7 September 2015, the applicant abandoned the divisional application and requested that the Opposition against the parent application be renewed and that the Opposer file their statement of case. The commissioner accepted this, and on 9 September 2015 gave the Opposers 60 days to file their statement of cases.

On 8 November 2015 Teva announced that they were withdrawing their opposition for “pure business reasons”. On 30 November 2016, the Commissioner ruled that the Teva opposition be closed and that the Unipharm opposition continue.

detailed-costsOn 11 January 2016, Novartis requested costs from TEVA. The costs request was supported by a statement from Liad Whatstein, Novartis’ counsel, but with many details thereof blacked out as they are allegedly business secrets and some are pertinent to the ongoing Opposition by Unipharm. They also requested a confidentiality order with respect to the blacked out data.

The Commissioner decided that Novartis had failed to make a case that the data should remain confidential, and issued a ruling on 4 February 2016 rejecting the confidentiality clause. Novartis’ counsel chose not to provide a time-sheet detailing the work done, considering this also as being a trade-secret.

Novartis’ Claims

The Applicant considers that TEVA’s withdrawing from their opposition puts them into the category of a party that loses their case. They do not think that the ongoing opposition by Unipharm should release TEVA from having to bear costs in a proceeding that they initiated. Thus Novartis alleges that TEVA should have to pay half the actual costs incurred by Novartis from when the opposition was filed until when it was abandoned, which comes to $17,136.72.

The Applicant claimed that due to the tight deadlines and the complicated scientific data they had to prepare for the opposition prior to the statement of case being filed. The complications are evidenced by Unipharm’s opposition and by the corresponding opposition filed in Europe. Furthermore, the Applicant claims that TEVA’s behavior and the time passed from when the opposition was filed until when it was withdrawn after the continuation was abandoned, created a state of affairs wherein TEVA could reasonably expect that Novartis would work on the opposition and incur costs thereby.

Novartis also claimed that TEVA had abused the opposition process by filing a baseless opposition simply to delay the patent issuing and to cause the divisional application to he withdrawn. Consequently Novartis considered that TEVA should pay costs.

 TEVA’s Claims

TEVA considers that Novartis is NOT entitled to costs at all and the cost request should be denied and Novartis should be charged for Teva having to respond to their costs claim. Alternatively, each side should bear their own costs.   Since the Opposition was terminated early it is by no means clear that were it to have continued, Novartis would have prevailed and would be entitled to costs for the preliminary part where Teva was involved. Teva alleges that if the Novartis application is refused, not only would Teva not have to compensate them, but conceivably Novartis would have to pay the costs  that Teva incurred in filing the statement of case.

Additionally, Teva considers that the Applicants actions and the costs incurred thereby in preparation of an anticipated opposition were needlessly incurred. Teva considers that from studying other statements of opposition, there is nothing to justify the preliminary and anticipatory actions that Novartis took, and certainly one cannot hold Teva responsible for such actions. Furthermore, the actions taken by the Applicant preceded the time when Teva had to submit their statement of case – which, in the event, were never submitted.

Teva went on to allege that the claimed expenses were unreasonable when considering the stage that the opposition procedure had reached. Furthermore, these so-called expenses were, in the main, not supported by an affidavit.

The Ruling

True, Teva filed an Opposition which was then abandoned early on. The Application is, however, still being opposed by Unipharm and has not issued as a patent. In this specific case, following review of the claims and counter-claims of the parties, Commissioner Kling concluded that the request for costs to be awarded to Teva should be deferred until the Unipharm opposition runs its course, depending on the outcome thereof.

The Commissioner has the authority to delay cost ruling under section 162b of the Law:

162b The commissioner is authorized to rule reasonable costs, to determine which partner should pay costs and how they should be paid.

Generally, the Commissioner rules costs in favour of the winning party. As a general rule, the side that abandons their case for whatever reason, and consequently a patent issues, is considered as having lost the proceeding and is to bear costs of the opposing party. (See 133957 cost ruling Pfizer Products Ltd vs. Teva Pharamaceuticals 14 February 2008). Nevertheless, the awarding of costs is left to the commissioner’s discretion and this is certainly the case where the abandoning of an Opposition does not necessarily lead to a patent issuing.

In this instance, despite Teva abandoning the Opposition the proceedings are ongoing. Unipharm’s opposition is still being fought and one cannot consider Novartis as being one who has won their battle. It is thus not the time for Novartis to claim costs. Consequently, at this stage the Commissioner is refraining from determining what costs the Applicant is entitled to, and what costs the Opposer is or may be entitled to. These will be determined once the fate of IL 184027 us known.

As an afterward and without final determination of the costs themselves, the Commissioner noted that it is rather difficult to rule on costs in the manner that they were submitted, with certain facts blacked out and no support for other contentions. This makes the reasonableness, necessity of and proportionality of the alleged expenses difficult to substantiate and makes it difficult to award real costs (see Supreme Court Ruling 891/05 Tnuva Cooperative for Marketing Israeli Produce vs. The Authority for Granting export Licences of the Department of Trade and Industry p.d 60(1) 600 (30 June 2005). This is particularly the case when considering the enormous costs claimed and the early stage at which the Opposition was abandoned by Teva, prior to submission of any substantive arguments.  See the ruling of the Then Deputy.  Commissioner re IL 113433 Smithkline Beecham Corporation (SKB) vs. Teva Pharmaceuticals (30 May 2005).

Interim Ruling re Costs in Il 184027 Teva vs. Novartis Oppostion Asa Kling 19 September 2016.

COMMENT

Whilst filing an opposition and then suspending until a divisional application issues or is abandoned could be considered as a delaying tactic, often filing such divisional applications is simply a means to keep an applications pending through parallel opposition proceedings, enabling a new claim approach not conceived at the time of filing to be considered. Since Unipharm is rather good at successfully opposing patents, it is a reasonable tactic for Teva to leave it to them to challenge the validity of the allowed claims. One suspects that Teva will have made relevant prior art and arguments available to Unipharm.

The successful opposer is entitled to claim costs from the applicant. Nevertheless, I am flabbergasted that Whatstein could make a claim for over $17,000 for costs incurred by having an opposition filed against his client prior to even having a statement of case requiring analysis being submitted. There were no patents or other prior art or other evidence that needed to be analyzed and no claims that needed consideration. Apart from informing Novartis that an Opposition had been filed, it is difficult to see what work was necessarily incurred.  Submitting a blacked out statement simply flags the fact that this is unreasonable. In desperation, I went to his website and discovered that as part of patent litigation “The firm orchestrated and designed complex experiments in patent infringement and opposition proceedings and uses a network of internationally acclaimed experts and external laboratories. In addition, the firm is involved in a large number of multi-jurisdictional patent proceedings.” This certainly goes some way to explain how $17,000 worth of costs could be accumulated, but one wonders if it was proportionate, reasonable and neccessary in response to an opposition being filed prior to relevant prior art and arguments being made of record.


Dormeo – A mark-owner is entitled to a hearing in a cancellation proceedings, even when failing to show evidence of use of the mark.

October 10, 2016

dormeo

Studio Moderna owns Israel Trademark Numbers 109784, 209785, 209786 and 209787. The mark is for Dormeo, in classes 20 (Mattresses; beds and parts thereof (not included in other classes); slatted frames and bed undersides; cushions; pillows; anatomical pillows not included in other classes; seat cushions; pillow materials), 24 (Textile goods, not included in other classes, including covers, coverlets, mattress covers, covers for cushions, bed sheets, blankets, bedding, bed linen and bed cloths (bedding); textiles, not included in other classes), 25 (Clothing; footwear; headwear; scarves, corsets (belts for warming the lower back), arm sleeves, leggings, elbow bands, wrist bands and slippers) and 35 (for Advertising, marketing and promotion services; advertising agencies; advertising through all public communication means; distribution and dissemination of advertising material; rental of advertising space; demonstration of goods; public relations; marketing studies; presentation of goods on communications media for retail purposes; advertising via electronic media and the internet; publicity services, namely, promoting the goods, services, brand identity and commercial information and news through print, audio, video, digital and on-line medium; advertising and commercial information services, via the internet; advertising services in connection with the commercialization and sale of products for household purposes, furnishing articles, clothing; creating and updating advertising material; distribution and dissemination of advertising materials, leaflets, prospectuses, printed material and product samples).

In July 2015, Aldi GmbH & Co. KG filed to have the marks cancelled under Section 41 of the Trademark Ordinance, alleging lack of local use.

In response, on 12 October 2015, Studeo Moderna submitted evidence of usage and denied that the mark was not in use. Aldi responded with Affidavits of their personnel and of a private investigator, and argued that the marks were not in use in Israel.

Time passed, and Studeo Moderna took various extensions, but failed to submit evidence. On 7 June 2016 Aldi requested that the Patent and Trademark Office rule on the case based on the material in the file. Studeo Moderna opposed this, claiming the right to cross-examine Aldi’s witnesses.

Commissioner Kling reviewed Regulations 71 and regulations 37 to 46 which relate to an opposer and an applicant, as if they relate to a challenger and a trademark holder and noted that once the challenger has provided evidence, the mark holder was obliged to provide evidence, but the time-frame for so-doing was limited and the deadline had passed. He specifically rejected the implicit position taken by the marks holder, that ONLY if the challenger’s evidence is considered compelling, is the marks holder required to submit counter-evidence on the basis of regulations 38-40 which require the parties to submit their evidence in one go.

According to the Commissioner, an Opposer or a challenger of an issued mark who fails to provide evidence supporting a claim of non-use is considered as withdrawing or abandoning the claim. This is NOT the case for the applicant or mark owner, who, though obliged to provide evidence, is not considered as abandoning his marks if he fails to do so. Since the mark owner has requested to cross-examine the challenger’s witnesses he cannot be considered as having abandoned his marks. The right to cross-examine witnesses is fundamental and is rarely denied.  The Commissioner is also obliged to hear the claims of both sides. Consequently, the hearing will go ahead, however the marks owner is warned that he may be laying himself open to high costs of the marks are nevertheless cancelled. The parties are invited to list days that they are available for a hearing in January 2017.

 

 


Patent Opposition Withdrawn But Applicant Not Entitled to Costs

May 9, 2016

piggy bank

Israel Patent 178249 to ASTELLAS PHARMA INC. titled “Pharmaceutical Composition for Use in Solid Formulation Crystalline Solifenacin or Salt Thereof and a Process for its Preparation” was allowed, and on publication, TEVA filed an opposition. Astellas amended the claims three times and eventually Teva withdrew the Opposition. Astellas then filed for costs, claiming that as the Opposition was withdrawn, they had technically won!

The Deputy Commissioner Ms Jacqueline Bracha took a dim view of this, and noted that although she had awarded costs to Teva for their successfully opposing some of the first set of amendments, the Applicant had been allowed to narrow the claim set and make clarifications under Sections 65 and 66 and the resulting claims were significantly different from those originally allowed.

Astellas and Teva were allowed three sides without appendices for their costs requests but although Teva fulfilled this condition, Astellas submitted reams of paper. Furthermore, even with the opposition withdrawn, Ms Bracha had notified Applicant on 21 February 2016 that she intended exercising her authority under Section 34 and to disallow the patent from issuing as it appeared that a case had been made that there was no novelty or at least no inventive step. That as may be, Astellas could not be considered as having won the Opposition, and she saw no reason to award them (or Teva) costs.

 


DSM Awarded Significantly Reduced Costs in Opposition

April 10, 2016

meter

DSM IP Assets B.V. successfully defended Israel Patent Application No. 142789 from an Opposition filed by PMS Shielding Factory LTD.

Now DSM IP Assets B.V. have asked for a cool three million shekels that they claimed defending the Opposition cost them. This sum includes $450,147 for legal fees, 262,849 Euros costs and workers time. Furthermore, DSM has requested punitive damages due to the inequitable behaviour of PMS. The first request for costs was filed in November 2013 when the Opposition was rejected and the patent was ruled to be registerable. That decision was appealed to the District Court who over-ruled a decision by Ms Shoshani Caspi that the entire file wrapper of the corresponding European patent could be admitted as evidence and the Patent Office should review the case and issue a new ruling.

In accordance with the Court order, the .case was reconsidered and Ms Yaara Shoshani Caspi once again concluded that the patent was registerable and the Opposition should be thrown out. The Applicant again requested costs. PMS responded and this ruling considers the claims and counter-claims.

Essentially the issues are whether the opposition and the way it conducted was justified. DSM claimed that the case was both legally and scientifically difficult, and resulted in it being expensive to defend. However, PMS’s behaviour had resulted in unnecessary interim procedures and additional costs. The opposer should have to pay for the original opposition as well as for the second reconsideration which was totally unnecessary.

Based on an affidavit from the collection clerk at Reinhold Cohn, the actual costs for the original case were $347,912.3 in legal fees and a further $20,397.49 in accrued out-of-pocket expenses. Receipts and detailed invoices were added to this affidavit. A second,separate affidavit signed a second cost calculation for the costs of the second round. A further affidavit from Mr Lok, legal counsel for DSM, related to 255,459 Euros for work performed by the staff of DSM in fighting this case, and a further 8225 Euros for reviewing the European patent.

PMS considered the alleged costs as inflated. They alleged that the opposition was no more difficult than other opposition cases. Furthermore, since the Applicant was well aware of the European file wrapper but tried to suppress it, it was the Applicant and not the Opposer who can fairly be accused of inequitable behaviour regarding the European file wrapper, and of causing an additional and costly, ultimately superfluous proceeding. Indeed, PMS considers that DSM is billing twice or more for the same work. The opposition should be considered as a complimentary process to the patent examination and necessary to ensure the purity of the register. Consequently, real costs should not necessary be awarded.

DSM’s employees costs and their legal counsel were not required for Agent of Record to manage the opposition and are not refundable as these costs are part of their work. Similarly Applicant’s employee’s limousine transport to and from the airport is not something fairly rolled over to the Opposer.

The Opposer therefore concluded that the costs should be simply estimated by comparison with other cases of similar complexity, or that each side should bear their costs.

Applicant responded that since the Patent Office had found Opposer guilty of widening their grounds for Opposition, they Opposer’s actions were not justified, or at least they mismanaged the case causing unnecessary expense.

Applicant rejected claim that Oppositions should be treated specially. The purity of the Register requires not only Applications to be filed in good faith for proper inventions, but also Oppositions should only be filed where there are proper grounds for so doing. The costs calculation was sufficiently detailed to support a request for real costs. The scientific and legal complexity of the case resulted in the costs being necessary, proportional and reasonable.

In her ruling, Ms Yaara Shoshani Caspi noted that the courts do not need to rule actual costs, but take into account judicial principles. To support a claim for actual costs, these have to be necessary, reasonable and proportional in the circumstances, and citing Tnuva vs. the Import and Export Authority, P.D. 60(1) 600, 615, 20 June 2005, these considerations include the amount of work in managing the case and submitting papers, the legal and factual complexity, the stage reached, the behaviour of the parties with respect to each other and the Patent Office, equitable behavior, and so on.

However, citing various rulings, she noted that one should not make it too expensive to fight legal battles and that interested parties may and often do spend more than is really necessary. Furthermore, as ruled in Opposition 113433 Smithkline Beecham vs. Teva, 30 May 2005, not all costs are recoverable. Actual costs are, therefore, merely a starting point in coming up with a fair legal costs ruling.  The winning party makes his claims for actual costs and attempts to justify them. Then the opposing party can challenge the costs as exorbitant or unnecessary. Furthermore, the more extravagant the costs claimed,  the more difficult it is to prove that they were indeed necessary. See Opposition 153109 Unipharm vs. Merk Sharp & Dohme, for example.

Ms Yaara Shoshani Caspi refrained from addressing the claims and counterclaims regarding the behaviour of the parties and her previous ruling and confined herself to considering the various costs requested.

The legal costs were $450,147 which is 1,757,463 Shekels. This was actually billed and paid. Nevertheless, despite the factual and legal complexity and drawn out nature of the case, this is an exorbitant sum for oppositions and is also disproportionate to the amount of work done in this case. Indeed, it appears that some 18 members of Reinhold Cohen’s staff worked on this file at one stage or another. Invoices bore a heading but no detail of what was actually done before a submission. In this instance, the Adjudicator felt that despite this level or detail apparently satisfying the Applicant, it was insufficient for her to conclude that the costs were justified. Furthermore, there was no apparent correlation between the legal fees and the costs accrued.

Some costs, such as translation costs, costs for reviewing the court protocol, extension fees, preemptive costs billing for the first case, and the like were not necessary. There does seem to be double billing for the first and second costs request.

At the level of detail provided, it is impossible to conclude that the costs were reasonable, proportional and necessary.  True, the case was appealed and reconsidered by the Patent Office. Nevertheless, there were only two hearings. Consequently, Ms Yaara Shoshani Caspi considered it impossible to conclude that the 1,757,463 Shekels.were justified, necessary, reasonable or proportional, and decided to rule based on estimation.

In general, the 1,127,858 Shekels claimed for DSM’s staff’s time is not recoverable. Opposers’ staff are employed to work and the cost of an opposition is not an additional payment over their salaries. This principle is detailed in the cost ruling for Opposition IL 151762 Unipharm vs. Novartis AG, 21 June 2013. Sometimes, however, such costs are partially recoverable where clearly detailed. See 155919 Teva Pharmaceutical Industries vs. AstraZeneca, 18 July 2012 .

In this case, the Applicant’s basis for calculating employee’s costs, including their hourly rate, was not even specified. The amount of hours seems unreasonable,

Applicant argued that DSM were providing internal expert witnesses and legal services instead of outsourcing and this approach finds support in 165704 Israel Aircraft vs. Rafael, 12, July 2012. These witnesses were required to come to Israel and needed hotels, flights and the like. Nevertheless, the costs are insufficiently detailed.

it is necessary to find the correct balance to encourage both patent registration but also opposition by third parties where there is a legal or factual basis for the opposition, but to prevent the filing of oppositions merely as a delaying tactic.

The Applicant was not required to study new documents, only those that they should be familiar with, such as the file wrappers of  corresponding applications.

In conclusion, legal costs of 350,000 NIS + VAT were awarded, as were an additional 45,000 NIS (including VAT) to compensate for employees’ time spent on the case.

PMS Shielding Factory LTD are given 21 days to settle these costs.

COMMENTS
It seems that PMS have accused DSM of duplicated work and Ms Yaara Shoshani Caspi’s conclusion that the legal costs of $450,147 ( 1,757,463 Shekels) are exorbitant and disproportionate to the amount of work done in this case seems to imply that Reinhold Cohn’s team had several attorneys and/or patent attorneys working in parallel, each clocking up billable hours. If we assume an average billing rate of 1000 Shekels an hour, there are apparently 1757 hours billed. This is more than 10 1/2 months of full time work. Frankly, it does seem rather a lot for a case involving composite materials where the Applicant’s expert technical and legal people are hands on to the extent that on a salary basis, their accrued time is 1,127,858 Shekels.

Note, I previously commented that an opposition in a different case had cost a lot of money. Ms Rimma Pugatsch Shendelzon who had worked on that case whilst at RCIP hotly denied this and alleged that I didn’t have any experience or understanding regarding oppositions. I hadn’t commented then on whether the lot of money was justified, but did think that for a statement of case, it was a lot of money. Nevertheless, for the record, I do have some experience with oppositions, most recently representing the Ministry of Religious Services opposing a patent aplication for a high-density burial solution which was withdrawn following our Statement of Case. That said, I comment on judicial rulings in this blog despite never having issued one, and report and comment on pharmaceutical oppositions which is not part of my practice.

Going back maybe 14 years, when I worked at Seligsohn & Gabrieli, I worked with Adv. Tami Winitz on an opposition involved with composite materials for anti ballistic purposes. It may well have been for the same parties as this case. As a materials scientist who started a PhD in Applied Chemistry on fiber reinforced polymer matrix composites, who then did a PhD in Physics on surface engineering and with a client making anti-ballistic ceramics for whom I have successfully prosecuted four patents in the US, I can confidently state that in this instance I can both cope with the technology and estimate the amount of work required for handling cases of this nature. I think that the Adjudicator has been generous in ruling $100,000 costs.

I am reminded of a joke I once heard from a Reinhold Cohn patent attorney (name witheld), about a lawyer who joined the family firm and was trusted with an important file for a special client that had been with the firm for a long time. The young lawyer worked on the file diligently and six weeks later went into his father’s office and proudly announced that he’d negotiated a settlement and all parties were happy. His father informed him crossly that he had put the son through college on that file, as indeed his own father had put him through law school and paid off his mortgage…

 


Israel Patent Office Refuses to Reject Patent Oppositions Out of Hand

April 10, 2016

patent opposition

When a patent application is allowed in Israel, it publishes for Opposition purposes. Third parties have a three month window to file oppositions. But what happens if the last day of the three month period is a weekend or holiday?

Unipharm filed two Oppositions to pharmaceutical applications that published in the October journal on 29 October 2015.

One application was IL 199215 to Janssen Sciences, Ireland UC titled “POLYMORPHIC FORMS OF A MACROCYCLIC INHIBITOR OF HCV”. The other case was  IL 181734 to Bayer Healthcare LLC, titled “POLYMORPH I OF SORAFENIB TOSYLATE, PHARMACEUTICAL COMPOSITIONS COMPRISING IT AND ITS USE IN THE MANUFACTURE OF MEDICAMENTS”. In both instances, Mr Zeebulun Tomer , the CEO of Unipharm filed the Oppositions himself without bothering with legal representation. In the second case against Bayer, Teva Pharmaceuticals also filed an Opposition (via Shin Horovitz).

The three month period for oppositions ended on 29 January 2016, but this was a Friday. On the first working day, i.e. Sunday 31 January, 2016 the two oppositions were filed.

Bayer and Janssen, both represented by Gilat Bareket and Partners, requested that the Oppositions be rejected as they were not filed in a timely manner, since the three month period had passed.

Now the deadline of three months as stated in Section 30 is not extendable. The Applicant argued that Friday is a working day and despite Section 10(c) of the Law of Interpretation, argued that there was no reason not to have filed the objection on the Friday.

The Applicant (unrepresented!) cited patent office circular 003/2011 to the effect that the Israel Patent Office is open Sunday to Thursday, from 8:30 to 13:30 . The regulations state that the patent office is not open the public on Fridays.

Theoretically, the Applicant could have filed on line on the Friday (or indeed on the Saturday) but the Law does not require him to.

The appeals to dismiss was rejected and the Oppositions will proceed on its merits. Costs of 1000 NIS were awarded to Dr Tomer.

COMMENT

I think this ruling was obvious to practitioners. Possibly it has not previously been litigated, but that imply that it was obvious to litigators as well, as I am sure this is not the first time that the last day for filing has been a Friday. What is fascinating here is that the unrepresented Opposer has been awarded legal expenses, despite not incurring any!

Sometimes, when one sees ridiculous stalling tactics by experienced practitioners rejected in favour of arguments supplied by non-represented opposers one wonders who needs professional representation. I would, however, caution non-practitioners with less experience than the Tomers from trying to file oppositions themselves…