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Israeli District Court Rejects Disney’s Forum Shopping in Infringement Case

A multinational mass media and entertainment conglomerate decides to sue a small Israeli import company – New Time Food Machines Ltd. (“New Food”) – for alleged intellectual property infringements. The conglomerate seeks to set the procedural rules to its convenience to pressure the small business. This is a short story of a contemporary struggle between David and Goliath in the Holy Land that also provides a valuable lesson – courtesy of Winnie the Pooh.

Establishing the Facts

In August 2016, the Israeli Customs in Haifa port seized a shipment of inflatable devices bearing animated figures of Disney. Subsequently, Disney filed a claim in Tel-Aviv District Court against New Food (the importing company) claiming copyright and trademark infringements.

Disney decided to add the State of Israel as a defendant since the Haifa port Customs unit that held the allegedly infringing goods is an Israeli government entity. Adding the state as a defendant, albeit a technical one, would allow, according to the Israeli territorial jurisdiction regulations, the Tel Aviv District Court to have jurisdiction. That way, Disney thought, they would be able to hold the trial at Tel-Aviv, which is more convenient for their corporate lawyers who will save the 65-mile drive to Haifa. This is not an uncommon tactic. However, in relying on the civil procedure regulations, Disney did not provide any rationale for the decision to file the claim in Tel Aviv other than relying on the grounds that adding Customs to the claim allows them to file the claim throughout Israel.

In that case, the defendant tackled Disney’s procedural act and petitioned to have the case transferred to the Haifa District Court. The Defendant argued that since that the Customs seizure was in Haifa, the Defendant place of business is in Haifa, and the dispute has no substantial connection to Tel-Aviv, holding the trial in Tel Aviv creates an unnecessary burden for the parties. Disney, on the other hand, argued that filing the claim in Tel Aviv is according to the civil procedure regulations since one of the parties is, as stated earlier, the State of Israel, an action can be brought against the State at any court in the country.

Tel-Aviv District Court Decision

The Court rejected Disney’s claim and transferred the case to Haifa. In his decision, Judge Maor stated that ‘the dispute is between the Petitioners and the Plaintiff. The State is not a necessary and not a substantial party to the disagreements between them, but merely a “technical” one since it is holding the allegedly infringing goods…’. The judge ruled the dispute’s connection to Haifa greatly outweigh its connections to Tel Aviv, stating that we cannot set aside the facts that in all ways lead to Haifa – the Customs unit is in Haifa, the business of the Defendant is in Haifa, and the disputed goods is in Haifa. Likewise, State officials and witnesses that might be needed for the trial also reside in Haifa. In fact, the Court held ‘save for the general and vague argument that action can be brought against the State at any Court in the country, Disney has no real argument.’

Judge Maor concluded his decision reminding us that sometimes we should be willing to be attentive to the needs of others, rhetorically asking, ‘For what reason are we to trouble everyone to the big city? The Plaintiff – who is a foreign company domiciled in the US might have the answers, but if any such exists it did not share them with us”. The Court closed his decision with the words of Disney’s most prominent representatives, Winnie the Pooh: “A little consideration, a little thought for others, makes all the difference.” I could not agree more.

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