Continue reading »]]> By Assaf J. Naim, Adv.

Many individuals as well as corporations are nowadays filing trademarks all over the world as well as in Israel.  

Although it is well known that when filing a trademark there is no guarantee that the said application will proceed to registration. One can estimate, however there is no certainty in such subjects.

Interesting to note that international filers often file for a trademark in a foreign territory without performing an initial check to verify if someone else acquired rights in the desired name before them.  Patent searches seem to be more popular than trademark searches, although trademark searches are often easier, and can more effectively minimize risks for the applicant. 

In case an initial search is not conducted, the applicant may file the application, wait more than a year for it to arrive to examination, and then discover that someone else acquired rights in the name before him. 

Some law firms include an initial search on their filing fees and it is advisable to ask beforehand, as it should be added that the applicant may perform a search himself, since the Israel Trademark Registry is open to the public even in English (http://patentim.justice.gov.il/db1.htm).  Due to the difference in local law statutes, the applicant should seriously consider providing a professional with the result and ask for their opinion.

According to Israel Law, if applicant filed an application and during the examination, it is revealed and cited by the Examiner that another confusingly similar application exists, the Registrar will then initiate a Competing Marks Proceeding, by which the foreign applicant will be forced to prove he has stronger rights in the requested marks, as opposed to his opponent.  This would mean that applicant would have to manage a full legal process without having a chance to plan such fees in the budget.

It is therefore highly important to conduct an initial search, even as an indication on potential problems that are currently known and are most likely to arise during the examination process. 

Continue reading »]]> The “Tommy Hilfiger” Parallel Importer Case in Israel

(Civ. File. [Tel-Aviv District Court] 11296-09-10 Tommy Hilfiger Licensing LLC. v. Elad Menachem)

For decades, it has been generally and almost axiomatically accepted that parallel (“gray”) importation of genuine goods, legitimately purchased from the trademark owner (or its licensed sales representative) is completely legal.

This concept was based on Section 47 of the Trademarks Ordinance stating that “registrations according to this ordinance shall not prevent a person from… using the true description of the nature or quality of his goods”.

However, since 2002, following the case of Toto Zahav Members Club Ltd. v. The Counsel for the Regulation of Gambling and Sports, Civ. File. 3559/02 [PD 59 (1), 873], this approach has changed. In the aforementioned case, the court adopted tests laid down by American courts, which suggest that parallel importation might be legitimate, subject to the following conditions:

1. The product cannot be easily identified without the use of the trademark;
2. The use of the trademark is made to the extent not exceeding the requirement of the said identification; and
3. The use of the trademark is not made in a manner that implies it to be under the authority of the trademark owner.

In the Tommy Hilfiger case, the court found that the goods could not be easily identified by the public without bearing the Tommy Hilfiger trademark and logo.

Regarding the second test, the defendants could have used the Tommy Hilfiger mark, provided that they had clearly stated that the goods are parallel imports. However, the defendants behaved otherwise, namely:

• They put a sign on their business place reading “IMPORTER WAREHOUSE-TOMMY HILFIGER” (in Hebrew);

• They registered and used the domain name www.tommy4less.co.il, and throughout the website the typical colors of the Tommy Hilfiger logo (blue, red, and white) were widely used;

• They used the trademark in their commercial advertising; and

• They decorated their business place both inside and outside with the typical colors of the Tommy Hilfiger logo.

The defendants did all this without stating clearly that they have not been appointed as authorized dealers by the trademark owner, when in fact, they were parallel importers.

Therefore, it is clear that the defendants made all efforts to deceive the public and are accordingly guilty of trademark infringement.

The court found that the facts as discussed above also establish the cause of “Unjust Enrichment” (this is the Israeli equivalent to unfair competition as known in other jurisdictions) and therefore the plaintiffs were awarded restitution of the defendants’ profits.

The court also considered the tort of “Passing Off” (known as “Palming Off” in the US) and found against the defendants.

The court issued an injunction prohibiting the defendants from using the Hilfiger trademark except under severe restrictions.

In addition, the plaintiffs were also awarded damages in the amount of NIS 457,500 (approximately US$ 115,000) and legal fees of NIS 80,000 (approximately US$ 20,000).