ITT marks stay on register due to reputation in Israel

In Ratfon Import Ltd v ITT Manufacturing Enterprises Inc (March 23 2009), the deputy commissioner of patents, trademarks and designs has held that use of a mark by apparently unauthorized third parties can be considered as evidence that the mark was not abandoned because it still enjoyed a reputation in Israel.
ITT Manufacturing Enterprises Inc (IMEI) is a German company specializing in the manufacture of electronic and industrial products. IMEI is the owner of the trademark INTERNATIONAL TELEPHONE & TELEGRAPH. IMEI also owns Israeli registrations for the device marks ITT and ITT EXTRA for various electric consumer products in Classes 7 and 9 of the Nice Classification.

In 1998 Ratfon Import Ltd, an Israeli company specializing in the importation of electronic goods, applied for the registration of the trademarks ITT (and design) and ITT INTERNATIONAL (and design) for various electric consumers goods in Classes 7, 9 and 11.
Later that year IMEI filed an opposition against Ratfon's applications based on its registered ITT marks. In response, Ratfon filed a petition for the cancellation of IMEI's marks on the grounds of non-use. Ratfon relied on the Israel Trademarks Ordinance, which provides that a registered mark that has not been in use for more than three years following registration may be subject to cancellation. According to Ratfon, IMEI sold its rights in the ITT marks in Classes 7 and 9 to ITT Sheraton in 1995 and reacquired them in 1999. During the period between 1995 and 1999, IMEI did not make use of the ITT marks with respect to the goods for which they were registered. It did not appear that ITT Sheraton had made use of the marks during that period.  
IMEI claimed that the fact that it reacquired the ITT marks had 'revived' them and that the marks still had a reputation at that time. The deputy commissioner held that, as a rule, the public interest will prevail over the ownership rights of a trademark owner. Therefore, even where a trademark owner has seemingly lost its ownership rights in a trademark, a third party will be prevented from acquiring rights in the mark if consumers still recognize the mark as belonging to the original owner. In the present case, the deputy commissioner ruled that the trademark ITT was a well-known mark and that Israeli consumers still recognized it as being connected to IMEI.
The deputy commissioner further found that since the ITT marks were also in use by unauthorized third parties (not otherwise identified in the decision), the marks were never abandoned in relation to the goods for which they were registered. The fact that they were being used by such third parties pointed to the continuing reputation of the mark and served to refute any claim of abandonment. The deputy commissioner thus concluded that when IMEI reacquired the marks from ITT Sheraton, the marks were revived with respect to both the private and public interest.
Accordingly, the deputy commissioner ordered that the trademark applications filed by Ratfon be rejected and dismissed Ratfon's petition for the cancellation of IMEI's marks.
Neil Wilkof and Gilad Shay, Herzog Fox & Neeman, Tel Aviv

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