Can a Fin Shape Jewelry be Eligible for a 3D Trademark in Israel?

Ronit Kopel filed a trademark application for a three-dimensional mark for a fin shape in class 14 for “jewelry and key holders” that looks like this:

The Trademark Office has issued a refusal based on the claim that the mark merely describes the goods as a three-dimensional product and therefore lacks a distinctive character, meaning that the mark is the product itself.

In Israel, it may be possible to register the shape of a good as a trademark in special cases, where sufficient evidence is provided to demonstrate three cumulative conditions ruled by the Supreme Court in the case of August Storck KG B v Alfa Intuit Food Productions Ltd (CA-11487- 03, March 23 2008) (The Toffefe Case), as follows: 

1. The image requested to be registered, in practice, functions as a trademark, namely it indicates the source of the goods intended to be sold under the mark. 

2. The image requested to be registered, does not serve solely an aesthetic or functional purpose.

3. As a result of use, the mark has acquired a distinctive character that indicates the source of the good. 

The above requirements were described later as the “Three Requirements Test” and was also adopted by the Israeli Trademark Registrar as the official requirements for the examination of three-dimensional marks.

The applicant responded that her mark meets the Three Requirements Test, that it is well known in Israel and that it has acquired distinctive character due to intensive use in the market.

The Trademark examiner rejected the applicant’s claims, so the applicant requested an oral hearing, trying to persuade the IP Commissioner that the Examiner’s decision was wrong.

The IP Commissioner relied upon the Supreme Court’s decision in The Toffefe Case, and analyzed the case as follows:

  1. Function as a Trademark

The IP Commissioner ruled that the fin shape functions as a trademark only for the bags and packages, sold under the mark, but not for the jewelry product itself, as can be seen from the following photos:

The IP Commissioner decided that the mere sale of fin shaped jewelry does not prove that the requested mark functions as a trademark, since it doesn’t serve as an indicator of origin that differentiate from other goods been sold in the market. The following are photos of  some of the applicant’s products: 

  1. Aesthetic or Functional Purpose

The IP Commissioner ruled that the shape of a fin as a jewelry or work of art is based purely on aesthetic reasons, since the consumer buys them for their aesthetic value of a fin, that attracts the eyes, and not for any other reason. Therefore, the aesthetic character of the fin shape is so material, it prevents any trademark protection.

  1. Acquired Distinctiveness – Secondary meaning  

Following the rejection of two of the three requirements test, IP Commissioner decided that there is no need to analyze if the mark has acquired distinctive character through intensive use in the market. The IP Commissioner’s opinion was that even if such acquired distinctiveness was established, the fact that the shape is based on a pure aesthetic character prevents any trademark protection.

The Applicant then claimed that the reason for applying for a three-dimensional application is to prevent competitors from selling confusingly similar fin shaped jewelry.

The IP Commissioner rejected this claim and decided that this reason does not justify a trademark protection and in fact was a reason NOT to approve the application.

The IP Commissioner ruled that the applicant should have filed for a registered design  for a limited protection under the law and that the registration of the three-dimensional trademark as the product image and as a defensive step in order to prevent others from using the fin image or similar figures does not meet the basic purposes of trademark law.

The application was denied. 

Disclaimer:
Nothing in the above shall be considered as any legal advice or any legal opinion whatsoever. This is just an informative article. We strongly recommend consulting with a professional attorney in such matters.

Israel: A Trademark Owner Sued His Licensee …But Eventually Lost His Trademark

Managing a licensing business can be sometime challenging for a trademark owner.

In a licensing agreement, a trademark owner (the licensor) receives royalty payments in exchange for allowing another party (the licensee) to use his mark.

One of the risks of trademark licensing is losing control of the brand. Sometimes a licensor may find himself giving up control on material elements of his brand, such as packaging, costs, distribution in discount markets and more.

There could be also other risks such as fraud reports and losing the ability to police the licensee’s activities.

A recent case in Israel (Management Europe Meeting International v. Forum Publishing) shows that there might be another serious risk, which is losing a trademark registration as a consequence of a legal conflict with the licensee.

Here are some basic facts of the case:

Management Europe Meeting International (MEM) is the owner of the Israeli trademark PRODUCT OF THE YEAR. Forum Publishing (Forum) has signed a license agreement with MEMI (a sublicensee of MEM) for the use of the mark in Israel.

In accordance with the license agreement Forum is obligated to pay royalties to MEMI for the use of the mark PRODUCT OF THE YEAR, that allows certain manufacturers to label the mark on their product packaging for marketing purposes.

After several years a conflict erupted between MEM and Forum.

Eventually, MEM has sued Forum in the Israeli Court asking for a declaratory judgment that the license is no longer valid due to lack of trust and bad faith behavior of Forum’s manager. Alternatively, MEM has claimed that the license agreement is no longer valid since the license period has ended and not renewed.

It should be noted that those claims have been denied by the Israeli Court who decided that there were no grounds to cancel the license agreement and that there is no evidence for such a lack of trust.

The trademark owner has also raised an unusual claim in order to attack his licensee. MEM claimed that the license has never been recorded at the Trademark Office, therefore the license was not valid, and the result is that Forum has no license to use the mark.

Can a trademark owner cancel an existing trademark license by claiming that the License wasn’t recorded in the Trademark Office? 

Let’s understand the context. Why does a trademark owner need to record a license at the Trademark Office?


Let’s understand the context. Why does a trademark owner need to record a license at the Trademark Office?

According to the Israeli law (Section 41 of the Trademark Ordinance) any trademark registration that has not been in use by its proprietor for a period of three consecutive years (from date of registration) can be cancelled on the ground of lack of use. Actual commercial use in the market is required in order to meet the use requirements.

According to the Israeli case law, using the mark in Israel only by a local licensee (and not by a trademark owner) will not be considered to be “use” by the proprietor, unless the license was recorded at the Trademark Office.

In the case of A.L. 364/74 Samuel Davidovich v. Miromitt Metal Works 27 Ashkelon Ltd., PD 29 (1) 703 (9.1.75), The Supreme Court has ruled that a trademark license that wasn’t recorded is simply not valid, but the contractual license may be still valid and binding.

It is important to mention that this claim is generally raised by third parties to attack trademark owners in invalidation cases (in a lack of use claims) and not against licensees.

In the case of Management Europe Meeting International v. Forum Publishing, it was the first time that a brand owner itself has raised this claim against his licensee in order to support his claims that the license should be canceled.

Unfortunately, not only that the claim was rejected by the Jerusalem District Court, but the Court has acknowledged the fact that the license indeed wasn’t recorded in the Trademark Office and ruled that the trademark is not valid!

 

“Therefore, and in accordance to the Davidovitch case law, since the trademark in the country (Israel Y.S) is not registered on the name of the Defendant it’s not valid…” 

   


This is clearly a precedent decision since no party has challenged the validity of the registration and still the Judge took the liberty of declaring the registration as not valid.

This is clearly a precedent decision since no party has challenged the validity of the registration and still the Judge took the liberty of declaring the registration as not valid. 

This is for sure a fatal result for the trademark owner, who tried to cancel a license but ends up in cancelling his own registration.

I guess this is the classic case of a brand owner who “cuts off one’s nose to spite one’s face” in the fight against his licensee.

The conclusion is that a trademark owner needs to be very careful in managing disputes against his licensees.


Important: Trademark owners need to make sure to record their license.

Also, trademark owners need to make sure their license is recorded at the trademark Office.   

It will be interesting to know how the invalidity of the registration will affect the contractual relations between the parties. It might surely affect the ability of the licensor to negotiate new licensing deals. 

Disclaimer:
Nothing in the above shall be considered as any legal advice or any legal opinion whatsoever. This is just an informative article. We strongly recommend consulting with a professional attorney in such matters.

 

Israel : Does Rebottling Chanel Perfume Constitute Trademark Infringement?

Sent-Wish is a small local business who buys original perfumes such as Chanel, Tom Ford, Chloe, Hermes and Burberry via parallel import from overseas vendors, pours the perfume to small refill bottles and then sells the new refill bottles to consumers using the manufacturer’s name.

The bottles are sold with a package that carries a disclaimer that the products do not have any affiliation with the manufacturer.

Photo for impression only

Chanel has decided to confront Sent-Wish and sent Cease and Desist letters to Sent-Wish demanding to remove all bottles from the market and to refrain from using Chanel’s trademark.

Sent-Wish company responded by filing a Motion for a Declaratory Judgment asking the Court to declare that the rebottling of the original perfume does not infringe Chanel’s trademark.

Chanel claimed that the use of Chanel’s trademark for selling unauthorized refill bottles constitutes trademark infringement and dilution.

In addition, Chanel claimed that the sale of the perfume in unauthorized bottles damages Chanel’s reputation, the value of the brand and the quality of the original perfume.

Chanel also claimed that the rebottling materially changes the original product, therefore considered to be an infringement.

Sent-Wish responded by claiming that their actions do not damage the basic component and nature of the original perfume and that the use of the name Chanel considered to be “True Use” of Chanel’s mark for the purpose of reselling the perfume legally bought in the market, therefore do not constitute an infringement.

Judge Tamar Avrahami agreed that there is a possibility that the rebottling might reasonably change the quality of the perfume but decided that this assumption is not enough since the question of trademark infringement must be decided based only on implementing section 47 of the Trademark Ordinance.

According to section 47, the use of a trademark without the authorization of the trademark owner is not considered to be an infringement if the use of the mark qualifies as “True Use” in the market, which relates to the original essence or quality of the product.

Judge Avrahami than implemented the three tests that were acknowledged by the Supreme Court to determine whether the use of Chanel’s mark considered to be “True Use” in the market:

Identification Test: Whether the product can be identified without using the mark.

The Essentiality of the Use Test: Whether the use of the mark is essential and reasonably required.

The Affiliation Test: The use of the mark doesn’t imply that the use is authorized or approved by the trademark owner.

Following the implementation of the three tests above and based on the fact that the new bottles were labeled with a disclaimer, Judge Avrahami has decided that the rebottling of Chanel’s perfume considered as True Use of the mark regarding the original product, therefore does not constitute trademark infringement.

In light of the Court’s findings regarding the actual use of the mark, Judge Avrahami ruled that Sent-Wish is entitled to resell the perfume by rebottling and to use Chanel’s mark to indicate the fact that the perfume sold in the bottles is the material ingredient and for identification purposes.

My estimation is that an appeal will certainly follow. 

This does not constitute as a any legal opinion, and it is strongly recommended to consult with knowledgeable lawyers in this field.

Israel Joins Hague Convention for Industrial Designs

Industrial Designs in Israel:

The State of Israel has joined The Hague System for the International Registration of Industrial Designs.

The Hague System provides a practical business solution for registering up to 100 designs in 70 contracting parties covering 88 countries, through the filing of one single international application.

Israel has now formally approved the Hague System which will come into effect in Israel on 3 January 2019.

In Israel, an industrial design provides protection to the ornamental or aesthetic visuality of an article. An industrial design protects the shape of two- or three-dimensional features subject to novelty and individual character requirements. The term of protection for a registered design in Israel is 25 years effective from the Israeli filing date.

Like other countries, in Israel, disclosure of an industrial design to the public within 12 months prior to the filing date of the application in Israel, or before its priority date, will not be considered as prior art (Grace Period).

The Hague Agreement Concerning the International Deposit of Industrial Designs enables citizens of all member states to register an industrial design by filing a single application designating any of the member states.

Every application must be examined by the local Patent Office in accordance with the local law and regulations.

As of January 3, 2020, foreign applicants (out of Israel) can file an industrial design application in their local Patent Office and designate Israel saving considerable expenses required in using local attorneys for the filings.

It should be noted that the examination process in Israel is sometimes more complicated and time consuming than in other countries. A typical design application can have more than 2 office actions before getting registered. The Israeli Patent Office has strict policy in technical issues, drawings and novelty requirements.

Therefore, we recommend getting an advice of a local professional attorney before starting the process of registering an Industrial Design using the Hague System.

 

5 Tips on How to Overcome Trademark Refusals in Israel

There are several kinds of refusals usually issued by the Israeli Trademark Office. We have decided to share with you our 5 important tips on how to overcome a Trademark Refusal in Israel based on our intensive experience in Trademark prosecution. This is a must read for every trademark attorney who files Trademarks in Israel. 

  • Beware of What You Write in Your Response – All Trademark Files in Israel are Public

Since 2015 all trademark files in Israel, covering most of the examination process of trademark applications, are public and can be viewed easily online by others.

It is very important to understand that any claim you claim to overcome any refusal may be held against the client, either by a certain competitor or by any other third party who can easily gain access to the online files. Make sure no confidential information is subbmited in your response.   

For example, if you agree to limit the protection of your application just to overcome a certain refusal your limitation can be used by any third party to block any claim of trademark infringement against him.

Your pleadings in the prosecution process might negatively affect your enforcement options. Therefore, we always recommend asking the local attorney to provide a short brief of the respond by bullet points in English.     

  • Do Not Respond Immediately to an Office Action – Wait and Consider All Options First

Our usual instinct as trademark attorneys is to ask the local attorney to respond an office action by the deadline. It is very important to consider all options before you do so. Such option can be for example to wait until the other side has responded.

For example, once you receive a refusal (Office Action) in which your application cannot be registered based on similarity to other application that hasn’t been accepted yet, you might want to wait until the owner of the cited application has answered, to see his respond and then to decide on the proper course of action.

In that case you can wait a few days before the deadline expires to review the other side’s response first. Reviewing the claims of owners of the cited application first can provide you with material advantage in the process.

  • Ask the Local Attorney to Demonstrate the Use of the Mark using Online Information

In lack of distinctive character refusals, trademark attorneys are confronting claims against the character of the mark. It is very important to show the examiners the actual use in the market using online information.  

In many cases we were able to prove that the mark is distinctive by showing the specific use in the market and how is the specific use in the market acquires a special character to the mark. 

  •  Use Foreign Registrations

In lack of distinctive character refusals, if your client has foreign registrations from his Country of Origin for the same mark for the same list of goods, then you can use Section  16 of the Israeli Trademark Ordinance and request that the registration will be based on foreign registration. By doing so you can efficiently overcome a lack of distinctive character refusal.

  • Ask the Local Attorney to Call the Examiner BEFORE responding the Office Action

Experience shows that in many cases a quick chat with the Examiner can do miracles and be even more efficient than an elaborated response.

We recommend in some of the cases to ask the local attorney to have a short chat with the Examiner, understand his views and specifically ask him what you can provide in order to change his mind BEFORE submitting a detailed response.

Indeed, investing the time and energy in talking with the Examiner can be time consuming, but It is very important to understand that if you fail to convince the Examiner, the second phase would be traveling to Jerusalem, attending the hearing and persuading the Trademark Registrar, this could be very costly for the client even before appealing the decision to the relevant District Court.                        

Yossi Sivan & Co. Law Office is specialized in Trademark Prosecution and litigation in Israel.

 

 

 

The above shall not be considered as any legal opinion whatsoever and we recommend consulting with a professional attorney.

      

 

  

 

   

Who Filed the Most Israeli Trademark Applications in 2018?

The Israeli Patent and Trademark Authority has recently published a report for the year 2018 which exhibits the statistics and activities of the Israeli Patent and Trademark Authority for the year 2018.

The following are the main statistics taken from the 2018 report:

2018 has shown a steady level in both national and international trademark filings in Israel according to the 2018 Patent and Trademark Office published by the Israeli Patent and Trademark Authority (see 2017 Patent and Trademark Office Report)

A total of 10,686 trademark applications were filed in 2018: 5,799 international applications and 4887 national applications.

Apple Inc. has filed the most trademark applications in Israel: 61 international applications and 27 national applications. This is the second year that Apple Inc. is taking the place of the number one trademark applicant in Israel. Israel’s mobile industry is thriving especially in the categories of mobile apps and mobile technology.

Novartis holds the second place with a total of 55 applications: 50 national applications and only 5 international applications.

Sanrio Company holds the third place with 54 national applications and 0 international applications.

Jonson & Jonson holds the fourth place with a total of 45 applications: 44 national applications and only 1 international application.

75.6% of the applicants in 2018 were foreign companies and 24.4% were local.

24.4% of the applicants are from Israel, 20.9% are from the US, 7.2% are from Germany and 7.2% are from China.

Yossi Sivan, Trademark Attorney

Yossi Sivan, Trademark Attorney

Owner & General Partner at Yossi Sivan & Co. Law Offices

 

The 2017 Israeli Patent and Trademark Authority Report

The Israeli Patent and Trademark Authority has recently published a report for the year 2017 which exhibits the statistics and activities of the Israeli Patent and Trademark Authority for the year 2017. The following are the main statistics taken from the 2017 report.

TRADEMARKS

During the 2017 year, the examination period for trademark applications in Israel has been shortened to a period of 12 months (in relation to the previous year where the examination period was 16 months).

In the year 2017 there was an increase of 14% of trademark applications filed in Israel. 55% of the applications were international applications based on the Madrid Protocol, and 45 % of the applications were national applications.

The number of international applications based on the Madrid Protocol has risen by 19% and the number of national applications has risen by 9%.

The applicant with the greatest number of applications was Apple Inc. with 81 applications. The second is Johnson and Johnson with 71 applications, followed by Phillip Morris with 57 applications and Huawei Technologies with 51 applications. The highest number of applications (21.6%) were filed by U.S. applicants. Applicants from Israel made up 24.2% of applications and China 6.6% of applications.

DESIGNS

The New Design Law, which replaced the Patent and Design Ordinance of 1924 was confirmed by the Israeli Parliament and became valid as of August 7, 2018. The leading foreign applicants for design in Israel were Facebook (54), Scania (29), and Dyson Technologies (26).

PATENTS

In 2017, there were 6,813 patent applications filed in Israel. The foreign applicants with the most patent applications were Facebook (94 applications), Phillip Morris (82 applications), and Raytheon Company (62 applications). In 2017, 89.9% of the applicants of patent applications were foreign citizens/companies and 10.1% of the applicants were local applicants.

A copy of the report can be downloaded from here: https://en.calameo.com/read/00566845929ff1d51897c

 

 

Israeli Supreme Court – Copying a Design is not Enough for a Liability

On December 2016 we reported on the fashion designer Gadi Elemelech who sued Renuar a chain of women’s clothing in Israel, for selling dresses that was confusingly similar to his designed dress.

The Court District Court  ruled that the disputed dress constitute passing off and that Elimelech has proved goodwill.

We criticized this decision and indeed the ruling was appealed to the Israel Supreme Court which overturned it, in an agreed decision without costs.

The Supreme Court simply mentioned that copying a design is not enough for a liability and referred to the precedent of 945/06 General-Mills vs Meshubach ruling in which  the Supreme Court stipulated that a mere imitation of a product cannot constitute a passing off unless there is a likelihood of confusion between the products. It is also imperative to establish a reputation in order to sue for a passing off claim.

Comment

It become more and more difficult to protect unregistered designs in Israel, but soon there will be new regulations on protecting unregistered designs. Stay tuned.

Israeli Supreme Court : Infringement or not?    

The Israeli Supreme Court has recently discussed whether an industrial product can be protected even if it wasn’t registered as a design?

The Facts of the Case:

Fisher Price sells baby rocking chairs with different colored illustrations. One of Fisher Price’s products is a rocking chair with an illustration of a colorful lion. An Israeli company named Devron marketed an identical rocking chair with a similar figure to that of Fisher Price’s lion.

Fisher Price’s Product                                                               Devron’s Product   

Fisher Price filed a lawsuit with the District Court against Devron claiming copyright infringement in the rocking chair, in the lion’s figure and in chair’s instructions manual.

The District Court’s Ruling: 

The District Court rejected the Fisher-Price claim and ruled that the rocking chair is not a  registered design and therefore is not entitled to copyright protection.

Fisher price has appealed the decision to the Supreme Court.     

The Supreme Court’s Ruling:  

The Supreme Court overturned the decision of the District Court. The Court ruled that copyright laws and the designs laws indeed do not coexist. A product that is a registered design or is entitled to be a registered design shall not be entitled to copyright protection.  This is with the exception of products that are not marketed commercially and there is no intention to market them commercially.

Based on this ruling, it was found that the rocking chair in question is eligible for the registration as a design but was marketed commercially and therefore should not be entitled to copyright protection. 

However, it was held that under certain conditions, art work that is fixed upon an product that qualifies to be a registered design shall be entitled to copyright protection.

The conditions necessary to enable copyright protection for such work are

 1. The product / design is eligible to be registered

2. The art work can be separated from the product (physical and material separation)

3. The art work is protected under copyright law

Separation from the Product

The court held that separation could be physical or material. When it is not clear whether physical separation is possible, the court shall examine whether substantial separation can occur. Substantial separation takes place when the art work can exist without the product as a separate creation without harming its basic form. That is, for example, it could appear as a painting on canvas.

The Supreme Court held that the lion illustration meets these tests since it is possible to separate the sample from the chair and it is entitled to protection under copyright law. However, the rocking chair on which the painting appeared did not receive protection because it was not a registered design.

Eventually the Supreme Court overturned the decision of the District Court and ruled that there was copyright infringement of the illustration and returned the hearing to the District Court in order to decide on the question of damages. 

The court also noted that even after the entry into force of the new Israeli Designs Law, the precedents established in this judgment will continue to apply.

The conclusion is that in certain cases intellectual property protection can also be enforced with respect to industrial products that have not been registered as a design. For example in the case of a piece of furniture bearing a unique illustration which is entitled to copyright protection. However, the illustration or print should be sufficiently unique and worthy of protection under copyright law independently. 

This does not constitute as a legal opinion, and it is recommended to consult with knowledgeable lawyers in this field.

Attorney Yossi Sivan

Attorney Yossi Sivan

Owner and Genenral Partner

Yossi Sivan & Co. Law Offices has been recommended by the LEGAL 500 2017 edition as an Israeli leading firm in the Intellectual Property Disputes category. Also recommended by the World Trademark Review.

 

Israel’s New Design Law – New Protection for Designs

On July 26, 2018 the new Israeli Designs Law will come into force and it is vital to be aware of the changes it brings to the legal regime concerning designs in Israel, as these effect both new and old designs.

These changes bring the Israeli law in line with European law and international trends. The following are the new law’s most prominent changes from the Patents and Designs Ordinance of 1924 which it replaces.

  • Unregistered Designs Will be Protected

While under the previous law no protection was provided for unregistered designs, the new law provides certain protection for up to 3 years for unregistered designs.

However, unregistered designs are protected exclusively when the copy was made by an entity that was aware of the original design. In the previous regime unregistered designs that were published could not be registered and therefore could not be protected.

  • Grace Period

The new regime provides a “grace period” in which designs that are marketed in Israel as  non-registered designs, may, within 12 months, be registered. These provisions allow limited protection to unregistered designs, similar to the European law.

  • Broader Definition of the Protected Items

The new law will replace the term “article” with the term “product”. Therefore, it will also cover graphical symbols and screen displays, thus bringing the law into the 21st century.

  • Extended Duration

The duration of the protection for registered designs under the new law will be extended to 25 years (as opposed to 15 years according to the existing law subject to a timely renewal every 5 years).

Following this change, the Patents and Designs Ordinance was revised and now allows an additional extension period of 3 years, thus totaling at 18 years for designs registered before the new law comes into force.

  • Changing the Novelty Requirement

The new law has changed the requirement for novelty. Designs will be considered new only if they haven’t been published in Israel or outside of it. The previous law only required that the design is new in Israel (unless proven that it was published online in certain terms).

  • Statutory Damages

Another addition to the existing law are the provisions stating that the court is authorized to award statutory damages for up to ILS 100,000 (about 28,000$ US) per infringement. This is another modernizing change as statutory damage for designs was not addressed in the existing Patents and Designs Ordinance.

When considering statutory damaged the court may take into account considerations such as the scope and severity of the infringement, the damages caused to the plaintiff, the gain acquired by the defendant etc.

  • Designs Created by the Employee and Work Made for Hire

Under the new law the rights to a design that was created by an employee executing its duties or when using his employer’s resources will be owned by the employer.

Similarly, all rights to a design that made for hire under a commissioned work will be owned by the person who commissioned it. However, these exceptions to the rule (i.e., the rights to a design belong to the designer) stand only when there is no other agreement between the parties.