1 January 2010CopyrightMichael Factor and Aharon Factor

Business brief 2010: Israel

Patents

Registering patents in Israel is relatively inexpensive, since:

  1. Applications may be filed in English
  2. Excess claim fees are incurred only from the 50th claim onwards
  3. Both US and European-type claim structures are allowed
  4. Up to two independent claims are allowed in each category, e.g. apparatus, method, method of manufacture and Swiss-type use claims
  5. Provided a positive International Preliminary Examination Report has been issued, or claims in a corresponding application have been allowed in Australia, Austria, Canada, Denmark, the European Patent Office, Germany, Japan, Norway, the Russian Federation, the United Kingdom or the United States, then aligning the specification and claims of the Israel application to those allowed in the corresponding application will normally lead to allowance in Israel without examination of novelty, unity, adequate disclosure and inventive step.

Unless there is significant substantive examination, the cost from filing to grant will typically be approximately $3,000.

Applications are generally examined in turn; examination does not need to be requested. However, accelerated examination may be requested. There are no pre-allowance annuities. Applications are not published 18 months from priority, though there is pending legislation to change this.

Once allowed, the application is published for a three-month opposition period, after which it is granted unless an opposition is filed.

Patent litigation in Israel is much cheaper than in the US or Europe. One reason for this is that there are no discovery procedures. There are, however, no specialist IP courts.

Methods of therapeutic treatment and business methods are not patentable, nor apparently is software per se, but this is under review. Gene sequences are patentable by order of the Commissioner of Patents, but this has not been tested in the courts. Stem cell research is also patentable in Israel.

When prosecuting patents in Israel, submitting substantive new arguments that may adversely affect the validity of corresponding patents abroad should generally be avoided. Successful oppositions in Israel can result in patents becoming unenforceable elsewhere.

When suspecting third-party patent infringement, following expert advice, a cease and desist letter should be sent. If this fails, a lawsuit may be filed. It may be possible to obtain a preliminary injunction.

Trademarks

Israel uses the Nice Version of the International Classification. From September 1, 2010, after implementation of the Madrid Protocol, multi-class applications will be permitted.

With some exceptions, trademarks are awarded to the first to file. Paris Convention Priority from a foreign application may be claimed at the time of filing if the applicant submits a certified copy of the priority document and an English translation, if necessary.

Trademark applications are examined, generally, within 12 months of the filing date. It is also possible to petition for accelerated examination of an application in the event of a likely infringement of the trademark or in other special circumstances. Once the Israel Trademark Office (ITO) has considered and accepted the merits of such a petition, the examination will be completed within one month.

On examination, it may be necessary to demonstrate that a mark is inherently distinctive and is not generic, descriptive or laudatory in relation to the goods or services intended to be covered by the mark.

The applicant may be required to disclaim the exclusive use of non-distinctive elements of a mark. Where a trademark application covers a wide list of goods, the examiner may request the applicant to limit the list of goods to those within the applicant’s scope of business.

There is no requirement to show actual use to register a mark. However, lack of use over a period of three years is grounds for revocation. ITO is unlikely to register a mark that conflicts with an existing trademark, without first informing the trademark proprietor of the acceptance of the conflicting mark. Registration is a prima facie basis for claiming infringement and counterfeiting in the courts.

The agent on record of a registered trademark (usually a lawyer or patent attorney) will also be contacted by the Israel Customs Authority in cases of suspected trademark infringement. In such a case, consignments of suspected counterfeit goods are held by customs, which has the discretion to destroy, detain or release the goods, subject to opinions received from the proprietor.

The costs of registering a trademark are the official fee of NIS 1,486 (approximately $397) plus the professional fees of a service provider (we typically charge approximately NIS 5,000 to 6,000 ($1,335 to $1,600) with discounts for large portfolios), which depend on the number of items listed. Until September 1, 2010, applications require translation into Hebrew.

The official fee for filing an opposition against a conflicting trademark application or filing a cancellation against a registered mark is NIS 748 ($200). Opposition and cancellation work is generally charged per hour, and the hourly rate of Israel trademark attorneys is typically $230 to $380, depending on experience.

The key threat to trademark proprietors is from infringers using misleadingly similar marks that are likely to confuse the consumer as to the source of the goods. There is a particular problem with counterfeit goods originating in the Far East.

It is recommended to act swiftly against infringers. Ignoring infringement is liable to encourage counterfeiters and weakens the mark.

Where there is no indication of bad faith, friendly contact with the infringer may be considered. If this is unsuccessful, or where the issue is counterfeiting, a cease and desist letter should be issued. If this fails, the proprietor should pursue claims through the courts, including unfair competition, passing-off and false designation of origin.

Apart from trademark infringement, the tort of unjust enrichment may also be considered. In addition to injunctive relief, the proprietor may seek to recover damages for loss of profits, defendant’s profits, corrective advertising and the like.

Non-use is grounds for cancellation. Nonregistration of licences and franchises may result in the use of the trademark inuring to the benefit of another. Use by an unregistered licensee will not be deemed use by the registered proprietor of the trademark.

Consequently, the trademark may be revoked for non-use if there has been no use by the registered proprietor for a period of more than three consecutive years. Also, use of a trademark by an unregistered assignee may be considered to be a conflicting use, which may destroy the distinctiveness of the registered mark.

Generic use of a trademark presents an inherent risk to the effective enforcement of trademark rights and to the trademark itself.

Counterfeiting and online piracy

Customs actively inform the agent of record on discovering suspected counterfeit goods. There is also an IP enforcement branch of the Israel Police.

There is, however, a problem with counterfeit goods, particularly music, films and software, originating in territories administered by the Palestinian Authority.

The Israel Copyright Law 2008 neither empowers nor obligates Internet service providers to enforce copyright. The courts do, however, tend to favour the copyright owners in litigation concerning infringing websites.

The Commissioner of Patents and Trademarks has actively been introducing major patent, design and trademark reforms to remove anachronisms and anomalies from the Israel system. Arguably, however, some of these decisions are ultra vires.

Ascendancy to the Madrid Protocol is due on September 1, 2010. Online patent filing and prosecution is expected in 2011.

Dr. Michael Factor is partner at JMB, Fa©tor & Co. He can be contacted at: mfactor@israelpatents.co.il

Aharon Factor is an attorney at JMB, Fa©tor & Co. He can be contacted at: aharon@israelpatents.co.il

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