Israel: Patent Litigation Comparative Guide

1 Legal framework

1.1 Which laws and regulations govern patent litigation in your jurisdiction?

The laws and regulations that govern patent litigation in Israel are:

• the Patents Act, 1967 and the regulations thereunder;
• the Judicators Act, 1984; and
• the Civil Procedure Regulations, 2018.

1.2 Which bilateral and multilateral agreements with relevance to patent litigation have effect in your jurisdiction?

In terms of substantive patent law, Israel is party to several bilateral and multilateral agreements. These include:

• the Paris Convention for the Protection of Industrial Property;
• the Patent Cooperation Treaty; and
• the Agreement on Trade-Related Aspects of Intellectual Property Rights.

1.3 Which courts and/or agencies are responsible for interpreting and enforcing the patent laws? What is the framework for doing so?

The district courts have jurisdiction over patent infringement cases and other patent-related disputes. A district court before which a patent infringement case is litigated may enforce the patent through:

• injunctions (temporary or final); and
• the award of damages.

If the defendant successfully defends the patent infringement case based on invalidity:

• the patent will be deemed invalid in rem; and
• the Patents Register will be amended accordingly.

The district courts also have jurisdiction over actions seeking declaratory judgment of non-infringement (but may not address validity issues within the framework of such an action). Decisions of the district court may be appealed to the Supreme Court, with the final judgment being appealable by way of right.

Pre-grant opposition proceedings and post-grant revocation proceedings are conducted before the Patent Office.

Service inventions disputes (ie, disputes over entitlement to inventions conceived by an employee and disputes over remuneration claimed by an employee for a service invention conceived by him or her) may be heard by:

• a special tribunal within the Patent Office;
• the registrar of patents; or
• the civil system courts.

All of the foregoing instances may interpret the Patents Act during the course of litigation before them.

2 Forum

2.1 In what forum(s) is patent litigation heard in your jurisdiction? Are patent infringement and validity decided in the same forum or separate forums?

See question 1. Except for the special case of an action for declaratory judgment of non-infringement, validity and infringement are decided by the same forum.

Arbitration of patent disputes is also possible.

2.2 Who hears and decides patent disputes (eg, a judge, a panel and/or a jury)?

Patent infringement disputes litigated before the district courts are heard by one professional judge. Unlike some legal systems, Israel does not have a jury system. Therefore, patent disputes are decided by legal professionals, rather than by a jury.

Appeals on final judgments of the district court are heard by a panel of three judges of the Supreme Court.

Pre-grant oppositions and post-grant revocation actions are heard by:

• the registrar of patents;
• the deputy registrar of patents; or
• a hearing officer of the Patent Office.

2.3 Are there any opportunities for forum shopping in your jurisdiction? If so, where and how do those opportunities exist?

Israel, being a small country, has only five district courts and opportunities for forum shopping are relatively limited. Most infringement cases are heard before the Tel Aviv District Court or the Jerusalem District Court.

In addition, a party fearing that it might be sued for patent infringement may pre-emptively file a post-grant revocation action with the Patent Office. If such an action is filed before commencement of the infringement proceedings, the Patent Office may continue hearing the action, unless the district court issues a decision enjoining further hearing of the post-grant revocation action. A subtle practice of forum shopping is a patent infringement defendant filing a request with the district court to order a stay of the infringement proceedings pending filing of a post-grant revocation action with the Patent Office subsequent to filing of the infringement action.

While there is no duty to clear the way in Israel, potential defendants – particularly in the pharma and biotech industries – closely monitor the Patents Gazette and lodge pre-grant oppositions. This results in most disputes taking the form of pre-grant oppositions, rather than infringement actions.

3 Parties

3.1 Who has standing to file suit for patent infringement? What requirements and restrictions apply in this regard?

The following entities have standing to file a suit for patent infringement:

• the patent owner;
• a co-patent owner; and
• an exclusive licensee.

A non-exclusive licensee does not have standing to bring a patent infringement action.

If there is more than one entity with standing to bring a patent infringement action, the plaintiff must join all other such entities as parties to the litigation.

3.2 Can a patent infringement suit be brought against a defendant who is a foreign entity with only a residence or place of business outside the jurisdiction?

Yes. If the plaintiff has a cause of action of patent infringement against a non-resident, the Israeli courts can have jurisdiction over a patent infringement suit in Israel against a defendant which is a foreign entity with only a residence or place of business outside the jurisdiction, under certain conditions. The availability of the cause of action of patent infringement generally requires some activity within the territory of Israel.

If the defendant is not an Israeli resident, acquisition of international jurisdiction over the defendant requires service of a court process. This may be done by:

• serving the court process while the defendant is temporarily resident in Israel;
• serving the court process to the defendant's business representative in Israel, where one exists; or
• seeking leave from the district court to serve the court process outside the jurisdiction based on certain enumerated grounds.

3.3 Can a single infringement action be brought against multiple defendants? What requirements and restrictions apply in this regard?

Yes, it is possible to bring a single infringement action against multiple defendants.

If all defendants are involved in the infringement of the same patent, joining all as co- defendants is customary and routine. The legal basis for this practice is Rule 26 of the civil rules of procedure, which provides that:

That said, the court has discretionary power to order separation of the litigation, if justice so requires.

3.4 Can a third party seek a declaration of non-infringement or invalidity in your jurisdiction? If so, how?

A party seeking to exploit a product or process can file a request with the court to obtain a declaration that its intended exploitation does not infringe a specified patent. The applicant must:

• provide detailed information about the origin or process it plans to use; and
• ask the patent owner to voluntarily confirm non-infringement, on condition of initiating such litigation.

The patent owner and/or the exclusive licensee of the patent will be named as respondents in this request. Only the Jerusalem District Court and the Tel Aviv District Court have jurisdiction to adjudicate such requests.

Additionally, the registrar of patents has the authority to cancel a patent upon petition by any person that is not the patent owner if there are valid grounds to oppose grant of the patent. The statute of limitations does not apply to a petition for cancellation under this section. District courts do not have jurisdiction to adjudicate requests for declaratory judgment of invalidity (but can declare a patent invalid if the defendant in an infringement action successfully shows that the patent is invalid).

4 Patent infringement

4.1 What constitutes patent infringement in your jurisdiction?

'Patent infringement' is defined as exploitation of the invention for which the patent has been granted, either in the manner prescribed in the claims or in any manner which involves the essence of the invention subject matter of the patent, considering the definition in such claims, without consent or unlawfully. The term 'exploitation of an invention' is defined as follows:

4.2 How is infringement determined?

Section 49 of the Patents Law defines 'patent infringement' as the unauthorised exploitation of a patented invention, either in a manner precisely described in the claims or in a similar way that captures the essence of the invention. Therefore, patent infringement can generally occur in two main ways:

• Literal infringement: This is infringement where all features of the claim are found in the accused product or service.
• Doctrine of equivalents: See question 4.3.

Moreover, the Supreme Court has acknowledged the concept of 'contributory infringement'. This refers to situations where a person manufactures, sells or markets components that by themselves do not infringe, but where those components:

• are crucial parts of the protected invention;
• do not have an independent significant use; and
• are offered to customers with the understanding that, when combined in a specific way, they will result in a product that infringes the patent.

In such cases, the person involved can be held liable for contributory infringement.

4.3 Does your jurisdiction apply the doctrine of equivalents?

Yes. The doctrine of equivalents is a legal principle that allows a patent owner to claim protection for an invention that is not literally identical to the patented invention, but performs substantially the same function in substantially the same way to achieve substantially the same result.

4.4 Is wilful infringement recognised? If so, what is the applicable standard?

Yes. The court may order the defendant to pay double damages for infringement that was made by the defendant after the patent owner or an exclusive licensee warned the infringer. The amount of such damages may not exceed the actual compensatory damages, namely double damages.

This is a punitive remedy that should be granted in rare instances only. The court must exercise its authority with caution and stringency, applying it only in exceptional circumstances where it is proven that the infringer knowingly continued its infringing actions, causing additional harm to the patent owner. Moreover, the rate of punitive damages should be determined in a manner that does not excessively burden the infringer.

5 Bringing a claim

5.1 What measures can a patent holder take to enforce its rights in your jurisdiction? Are interim measures available before receiving a ruling on the merits?

A patent owner can take several measures to enforce its patent rights, such as the following:

• Cease and desist letter: The patent owner can send a cease and desist letter to the alleged infringer, informing it of the patent infringement and demanding that it cease its actions. The letter is an opportunity for the alleged infringer to voluntarily stop the infringement and avoid legal proceedings.
• Lawsuit: Assuming the alleged infringer did not cease the infringement following the letter, the patent owner can apply to a district court for an infringement claim. If the patent is held valid and infringed after trial, a permanent injunction will usually follow, as well as an award of damages.
• Temporary injunction: Where an urgent and immediate remedy is necessary to prevent irreparable harm, the court may issue a temporary injunction restraining infringement pending a further decision in the case. The entry into force of a temporary injunction will be on the condition that the plaintiff submits monetary guarantees to indemnify the defendant should it subsequently transpire that the temporary injunction should not have been issued – for example, if the patent is subsequently invalidated.

5.2 What is the limitation period for patent infringement in your jurisdiction?

The limitation period for filing a lawsuit of patent infringement claims in Israel is fixed in the Limitation Law, 1967. The limitation period for filing a claim for patent infringement is usually seven years from the date on which the cause of action occurred.

The running of the limitation period for a claim may be suspended in certain circumstances. For example, if the defendant or someone acting on its behalf knowingly misleads the plaintiff, uses force against it, threatens it or takes advantage of its distress, the limitation period will be suspended when the plaintiff refrains from filing a claim as a result. Additionally, if the facts that form the basis of the claim disappear from the plaintiff due to reasons beyond its control and that could not have been prevented even with reasonable care, the limitation period will start to run from the date on which the plaintiff becomes aware of these facts.

5.3 Must the alleged infringer be notified in advance before a claim is brought?

In Israel, there is no obligation to notify the patent infringer before filing a claim. That said, the practice of sending cease and desist letters is common. However, the advantages and disadvantages of sending a cease and desist letter must be decided on a case-by-case basis.

5.4 What are the procedural and substantive requirements for bringing a claim for patent infringement? How much detail must be presented in the complaint?

Bringing an action for patent infringement follows certain procedural and substantive requirements:

• Procedural requirements:
• • The action must be submitted to a district court with venue jurisdiction.
  • Court fees must be paid in an amount equal to:
  • • 2.5% of the amount claimed up to approximately ILS 26 million; and
    • 1% of the amount claimed exceeding ILS 26 million.
  • Half of the court fees must be paid upon bringing the action and the second half must be paid prior to the evidence phase.
  • The infringement action is commenced by submission of a statement of claim:
  • • identifying the parties;
    • detailing the alleged facts to support the plaintiff's case; and
    • establishing the jurisdiction of the court, as well as the remedies requested.
• Substantive requirements:
• • The plaintiff must verify that the patent was valid at least at the time of the alleged infringement.
  • During trial, the plaintiff must prove that the patent has been infringed. The defendant may try to show that:
  • • the patent is invalid;
    • the action is time barred; or
    • other defence arguments are available.
  • If the patent is valid and infringed, the plaintiff must prove the claimed damages.
  • The plaintiff must have standing to sue (see question 3.1).

5.5 Are interim remedies available in patent litigation in your jurisdiction? If so, how are they obtained and what form do they take?

The main temporary remedies available in patent litigation are as follows:

• Temporary injunctions: See question 1.3.
• Anton Piller orders: In appropriate cases, the court may issue an order for seizure of evidence regarding the infringement at the defendant's premises.
• Temporary attachment (lien): If the plaintiff can show high chances of success, coupled with a likelihood of the defendant smuggling assets and thus hindering the collection of damages, the court may grant a temporary attachment order.

As a general rule, in order to obtain a temporary remedy:

• the relief applicant must prove the existence of a cause of action and good chances of winning it; and
• the applicant must demonstrate that the balance of convenience tilts in the applicant's favour. The applicant must show that not obtaining the order could result in greater harm or damage to it compared to the harm that would be caused to the alleged infringer if the order were granted.

Other considerations to be considered by the court include:

• undue delay (laches);
• the good face ('clean hands') of the applicant; and
• proportionality.

5.6 Under what circumstances must security for costs and/or damages incurred by the other party be provided?

In certain circumstances, a court may require a party to provide security for costs and/or damages incurred by the other party. The purpose of this requirement is to ensure that if the party loses the case, there is a financial safeguard in place to cover the potential legal costs awarded to the opposing party.

In certain circumstances, such as the following, a court may require a party to post a guarantee for expenses and/or damages that will be caused to the other party:

• Where the plaintiff is a non-resident plaintiff and does not have sufficient assets in Israel, the court may order it to provide security for the defendant's costs. This requirement helps to reduce the risk of the defendant being unable to recover its gains if it wins the case.
• Where the plaintiff is a limited liability company, the defendant can request the courts to order it to provide security for costs. The court should grant the request unless the plaintiff can prove that:
• • it has the means to pay; or
  • there are other circumstances justifying refusal of the request.
• However, in the case of an individual plaintiff, the court will typically not prevent a lawsuit due to the plaintiff's financial situation, except in the case of a foreign resident that does not have assets in Israel. However, residents of member countries of the Hague Convention relating to Civil Procedure 1954 are deemed Israeli residents for this purpose.

Section 96 of the Civil Procedure Regulations 2018 requires a self-undertaking and a security for expenses in every request for interim remedies.

6 Disclosure and privilege

6.1 What rules on disclosure apply in your jurisdiction? Do any exceptions apply?

The discovery rules in civil litigation are governed mainly by the Civil Procedure Regulations 2018.

Section 57 provides for the exchange of document disclosure affidavits between the parties, which verify all documents in their possession. Section 58:

• establishes procedures for completion of the document review; and
• allows the other party to photograph or scan documents, and even exchange copies.

It is possible to request a specific document if one of the parties knows that:

• it exists;
• it is in the other party's possession; and
• it has not been disclosed.

A party that does not disclose a document which must be disclosed will not be entitled to use that document in the lawsuit, except with permission of the court. If it is a harmful document, the court can order the deletion of the statement of claim or the statement of defence.

In proceedings conducted before the registrar of patents according to the Patents Law, discovery procedures are not established in the law. However, if necessary, the registrar of patents can order discovery procedures and document review.

Also, there are exceptions to document discovery procedures, such as the following:

• privileged documents that are protected by confidentiality (eg, attorney-client confidentiality), unless the client has waived immunity.
• disproportionate or unduly burdensome requests – that is, requests which are excessively burdensome and whose relevance to the case is extremely low;
• irrelevant or immaterial documents – the court has the discretion to determine their relevance; and
• documents relating to public interest or national security, whose disclosure the court may limit to protect sensitive information.

6.2 What rules on third-party disclosure apply in your jurisdiction? Do any exceptions apply?

General discovery against third parties – that is, entities which are not party to the litigation – is not available. However, the court may issue a summons requiring third parties to:

• appear before the court; and
• produce specifically identified documents or other tangible evidence for use at a hearing or trial (subpoena duces tecum).

6.3 What rules on privilege apply in your jurisdiction? Do any exceptions apply?

There are two types of privilege:

• absolute privilege; and
• relative privilege.

Relative privilege gives the court the power to lift or remove privilege in the interests of justice. Absolute privilege negates this power of the court and the document will remain privileged unless such privilege is waived by the person entitled to assert the privilege.

Examples include the following:

• Attorney-client communications and documents prepared in anticipation of litigation are immune from discovery by absolute privilege. However, the privilege that applies to documents prepared in anticipation of litigation is absolute only with respect to the proceedings with respect to which the documents were prepared; if privilege is asserted against the production of such documents in another, unrelated litigation, the privilege will be relative.
• Confidentiality/trade secret protected information are immune from discovery by relative privilege.
• Doctor-patient privilege, journalist privilege and psychologist-patient privilege are all relative privilege.

Privilege may be:

• expressly waived by the person entitled to create a certain privilege; and
• deemed impliedly waived if that person reveals some of the privileged information.

In case of dispute as to whether certain information is privileged, the court may inspect the relevant documents and decide whether they are privileged.

7 Evidence

7.1 What procedure(s) exist for collecting and presenting evidence in patent infringement litigation?

In patent litigation, the procedure for collecting and presenting evidence is generally the same as that under the standard rules and procedures of civil litigation. The rules of civil procedure do not provide a means for collecting of information prior to the commencement of legal proceedings by submission of a statement of case. Thus, information must be collected independently, including by private investigators.

Evidence is presented during trial by way of:

• witness testimony; and
• expert opinions. Expert opinions are submitted in writing and the other party is entitled to cross-examine the expert on his or her opinion.

The general rule is that witness testimony is provided by oral testimony in chief and the other party may conduct cross-examination. However, this is a relatively recent rule; prior thereto, evidence in chief used to be submitted by way of written affidavits. It remains to be seen whether judges will be more lenient in allowing submissions of written testimonies on fact witnesses in complex patent infringement actions.

7.2 What types of evidence are permissible in your jurisdiction? Is expert evidence accepted?

Evidence may be submitted by way of:

• witness testimony; and
• expert opinions.

Certain public records may be submitted as evidence to their content. This applies to records of the government, municipalities and other entities that provide service to the public, if:

• such records were made by such a public entity in the course of its regular contact of business;
• the entity has an established practice of creating such records near the event; and
• the method of collecting the data, the subject of the record and the manner of editing their record testify to the veracity of the content.

7.3 What are the applicable standards of proof?

In civil cases, including patent infringement cases, the standard of proof is generally 'the balance of probabilities' or 'a preponderance of the evidence' – that is, more than 50%. This means that the party making a claim must present evidence that is more convincing or probable than the evidence presented by the opposing party.

7.4 On whom does the burden of proof rest?

The burden of proof generally rests on the party asserting a claim or seeking relief – typically the patent owner or the plaintiff:

• Patent infringement: The patent owner bears the burden of proving that the defendant's activities or products fall within the scope of the patent's claims.
• Patent validity: If the defendant challenges the validity of the patent, the burden is on the defendant. The defendant must present evidence and arguments to establish that the patent does not meet the legal requirements for patentability.
• Damages: Where the patent owner seeks damages for infringement, it has the burden of proving the amount of damages suffered as a result of the infringement.

8 Claim construction

8.1 Is there a procedure for construing claims during a patent infringement action? If so, when and how is it performed?

No. There is no separate procedure for interpreting the patent claims and the interpretation is done in the trial itself. During the trial, the court hears the testimony of the parties and is assisted by experts, who may provide analysis and interpretation of the patent claim, based on their expertise.

8.2 What is the legal standard used to define disputed claim terms?

The accepted legal standard used to define disputed claim terms is the understanding of an average professional in the field.

8.3 What evidence does the court consider in defining the claim terms?

The court has wide discretion and may use various sources for the purpose of construing the claims. These may include:

• the patent document itself; and
• other extrinsic evidence, such as:
• • the prosecution history;
  • dictionaries and textbooks; and
  • testimony of witnesses.

8.4 Can the claims of a patent be amended in the course of the proceedings?

Yes. A patent owner may seek leave to amend the patent during the course of litigation. However, the amendment:

• must be made only to serve one of the three following purposes:
• • for the sake of clarification;
  • to eliminate an error; or
  • to narrow the claims; and
• must not:
• • broaden the scope of the claims; or
  • add to the specification anything that was not essentially included in it from the start.

9 Defences and counterclaims

9.1 What defences are typically available in patent litigation?

Various defences may be available to defendants facing allegations of patent infringement, such as the following:

• Non-infringement: The defendant may argue that its product, process or service does not infringe the asserted patent.
• Invalidity: The defendant can challenge the validity of the asserted patent by asserting that the patent is invalid. Common grounds for invalidity include:
• • lack of novelty;
  • lack of inventive step;
  • insufficient disclosure; or
  • improper claiming.
• The plaintiff has granted it a licence or waiver.
• The limitation period has expired.
• The plaintiff is not the owner of the patent.
• Market overt

9.2 Can the defendant counterclaim for revocation or invalidation of the patent? If so, on what grounds and what is the process for doing so?

There is no need for a defendant counterclaim for revocation or invalidation. It is enough to raise this as a defence against the patent infringement action.

Similar to a request for revocation, any reason that can be used to reject the original patent application can be asserted during the revocation or invalidation procedure – for example:

• lack of novelty;
• lack of inventive step;
• improper claiming; or
• statutory exclusions from subject matter.

9.3 Are there any grounds on which an otherwise valid patent may be deemed unenforceable against a defendant?

There are certain grounds on which an otherwise valid patent may be deemed unenforceable against a defendant, such as the following:

• Abuse of rights: The patent owner engages in abusive or anti-competitive behaviour related to the enforcement of its patent rights.
• Failure to disclose information: Patent applicants must report to the Patent Office prior publications with which they are familiar and which relate to the patentability of the invention. Failure to comply with this requirement may result in invalidation of the granted patent.
• Estoppel: The opposing party may be estopped from raising certain arguments if such arguments are inconsistent with positions it previously took.

10 Settlement

10.1 Are mediation and/or other forms of settlement discussions required by the court in your jurisdiction or merely optional to the parties?

Mediation or settlement discussions are not mandatory in the district courts, before which patent infringement litigation is conducted.

Nevertheless, during the pre-trial phase, the judge may suggest mediation to the parties if there is a possibility of effectively resolving the dispute in this manner. While there is no obligation to accept the judge's recommendation, parties tend not to refuse, unless there is a good reason to do so.

10.2 Can the proceedings be stayed or discontinued in view of settlement discussions?

If the case is referred to mediation, stay of proceedings is the default rule. However, as mediation is voluntary, the party may agree to mediation subject only to refraining from such a stay. Parties engaged in direct settlement discussions may request a stay of proceedings. Such a stay is discretionary and typically will not be approved unless the request is consented to. Even if consented to, the court may refuse such a request – particularly if a stay has been granted and did not yield a settlement within a reasonable time.

10.3 Is it necessary to report the results of settlement discussions to the court? If so, how; and what are the implications?

There is no formal requirement to report the results of settlement discussions to the court. If the settlement discussions are successful, the successful conclusion of the discussions must be reported in order to close the case, without being required to disclose the specific details of the agreement. The disclosure of further details regarding the positions taken during mediation or settlement discussions is prohibited by law and by the rules of ethics applicable to attorneys at law.

11 Court proceedings for infringement and validity

11.1 Are court proceedings in your jurisdiction public or private? If public, are any options available to the parties to keep the proceedings or related information confidential?

Court proceedings are generally public. However, there are certain circumstances and exceptions where the court may:

• allow for confidentiality; or
• restrict public access to the proceedings or related information.

The court may order closed hearings for specific reasons, such as:

• protection of trade secrets; or
• preservation of privacy in sensitive matters.

If a hearing is conducted behind closed doors, an automatic statutory gag order will apply, prohibiting any person from making available to the public the contents of such a hearing.

Additionally, the court may grant a gag order or an order prohibiting the disclosure of evidence containing confidential commercial information if:

• it determines that the interest in non-disclosure outweighs the necessity of disclosure for the purpose of achieving justice; and
• alternative options prove ineffective.

Another exception to the general rule is found in Section 176 of the Patents Law. In case of an appeal against the registrar of patents' refusal of a patent application not yet open for inspection by the public, this will be conducted in a closed session by default, unless the court orders otherwise at the request of the appellant.

11.2 Procedurally, what are the main steps in patent infringement proceedings in your jurisdiction? Is patent validity handled in the same proceedings as infringement or is it handled separately? If separate validity proceedings are available, what are the main steps in those proceedings?

There is no bifurcation system between validity and infringement in Israel. Accordingly, as a general rule, the district court will deal with both validity and infringement. However, the court may order a stay of proceedings pending resolution of a revocation action that is co-pending before the Patent Office.

The main steps in patterns infringement proceedings are:

• exchange of written pleadings;
• pre-trial proceedings such as discovery and written interrogatories;
• the evidence phase;
• summations; and
• judgment.

Until recently, all evidence was submitted in writing, with the witnesses and experts being subject to cross-examination. According to a recent reform, the general rule is that evidence in chief is now heard orally during the trial. However, expert opinions will continue to be submitted in writing and the court has discretion to order that complicated fact statements be submitted in advance by way of an affidavit.

It is customary to divide the trial into two phases. In the first phase, the judge decides whether the patent is valid and infringed; if infringed, a permanent injunction will typically follow, together with an order requiring the defendant to provide accounts for revenues and expenses. The second phase of the trial is devoted to quantification of the damage suffered by the patent owner and the second judgment will order the defendant to pay the proven damages.

11.3 What is the typical timeframe for patent infringement proceedings? If separate patent validity proceedings are available, with is the typical timeframe for those proceedings?

The first phase of an infringement action (see question 11.2) typically lasts several years. If the case is not settled by then, the second phase of the trial will also last a few years.

11.4 To what extent do the decisions of national or foreign courts or bodies influence the court's decision?

The decisions of foreign courts or bodies are not binding on the Israeli courts. However, such decisions – particularly of the US courts, the European Patent Office tribunals and the English courts – have a persuasive effect.

Judgments of the Supreme Court (granted by a panel of at least three judges) are binding on lower courts, including the district court. Judgments of the district court – whether the same court or a court in another district – are not binding, but may have a persuasive effect.

12 Remedies

12.1 What remedies for infringement are available to a patent holder in your jurisdiction?

At the end of the trial, a successful patent owner is entitled to:

• a permanent injunction; and
• an award of damages.

As a remedy ancillary to the remedy of injunction, the court may also order delivery of infringing products for destruction.

With respect to temporary remedies, see question 5.5.

12.2 Are punitive or enhanced damages available in your jurisdiction? If so, how are they determined?

Punitive or enhanced damages are generally not available for patent infringement. Instead, the damages awarded in patent infringement cases are typically compensatory in nature. The court aims to provide the patent owner with compensation for:

• the actual loss suffered as a result of the infringement; or
• the infringer's profits attributable to the infringement.

With respect to wilful infringement, see question 4.4.

12.3 What factors will the courts consider when deciding on the quantum of damages?

The courts exercise discretion when deciding on the quantum of damages. The Patents Law provides a non-exhaustive list of factors, as follows:

• the direct damage caused to the plaintiff;
• the extent of the infringement;
• the profits that the infringer derived from the act of violation; and
• reasonable royalties that the infringer would have had to pay had it been granted a licence to exploit the patent to the extent to which the infringement was committed.

The court must ensure, however, that the damage amount will not exceed the higher of the loss suffered by the plaintiff from all profits made by the defendant.

13 Appeals

13.1 Can the decision of a first instance court or body be appealed? If so, on what grounds and what is the process for doing so? Please also describe the availability and process for additional levels of appeal.

The final judgment of a first-instance court is subject to appeal by way of right. Because the first-instance court in patent infringement litigation is the district court, the appeal will be to the Supreme Court, which is the highest appellate court. Appeal of a non-final decision requires to leave to appeal. In rare cases, the Supreme Court may order a rehearing.

Final judgments of the registrar of patents may be appealed by way of right to the Jerusalem District Court or the Tel Aviv District Court. An appeal on a final judgment of those courts of appeal requires leave. Non-final decisions of the registrar of patents, such as a request for leave to appeal and requests for such leave, will more likely than not be refused, so as not to interfere with the course of the litigation before the Patent Office.

Grounds for appeal can include:

• legal errors in interpreting or applying the law;
• procedural errors that may affect the case's outcome; or
• errors of fact that influenced the decision.

However, the courts are inclined not to interfere with factual findings by the Patent Office and show deference to its legal findings as well.

The process of appeal comprises several steps. It commences with the appellant submitting a notice of appeal or a request for leave to appeal. This submission is accompanied by an appeal brief that delineates the basis for the appeal and articulates the supporting arguments. Subsequently, the court may afford the opposing party the opportunity to counter with a written response addressing the appellant's assertions. If the appeal or request for leave to appeal is dismissed, the court has the authority to decline without engaging with the opposite party's position. In certain instances, oral hearings might be scheduled, enabling both parties to present their contentions and address any queries from the court.

13.2 What is the average time for each level of appeal in your jurisdiction?

The duration of appeals in Israel can vary, depending on factors such as:

• case complexity;
• court workload; and
• procedural challenges.

Appeals to the district court may be decided between half a year and two years after filing.

Appeals to the Supreme Court typically take a few years to be resolved.

14 Costs, fees and funding

14.1 What costs and fees are incurred when litigating in your jurisdiction? Can the winning party recover its costs?

When engaging in litigation, various costs and fees are typically incurred throughout the legal process, including:

• court fees;
• attorneys' fees;
• expert witness fees;
• document production and discovery costs;
• translation expenses; and
• miscellaneous costs.

In principle, the losing party will usually be obliged to pay the winning party's attorneys' fees and reimbursement of costs in an amount to be determined by the judge. When determining the recovery of costs, the court may consider several factors, including:

• the conduct of the parties during the litigation;
• the reasonableness of their positions; and
• whether one party significantly prevailed over the other.

The court has discretion in deciding the extent of cost recovery and takes into account the specific circumstances of the case. The amount of attorneys' fees awarded to the prevailing party is usually substantially lower than the cost actually incurred.

14.2 Are contingency fee and/or other alternative fee arrangements permitted in your jurisdiction?

Contingency fee arrangements are generally permitted. However, this relates to attorneys' fees and an attorney at law cannot fund the actual costs of litigation.

14.3 Is third-party litigation funding permitted in your jurisdiction?

Although the English legal doctrines of champerty and maintenance, which restrict third-party financing of litigation, were recognised under Israeli law in the past, the practice of third-party litigation funding has recently emerged in Israel.

15 Trends and predictions

15.1 How would you describe the current patent litigation landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

The patent litigation landscape is active, with various cases involving both domestic and international parties. The Patents Law does not require formal publication to clear the way. However, at least in the pharmaceutical field, it is a common practice of prospective defendants to lodge a pre-grant opposition, with the aim of:

• completely preventing grant; or
• securing narrowing of the claims or settling for a licence or covenant not to sue.

Accordingly, the number of oppositions commenced significantly exceeds the number of patent infringement actions filed each year. The majority of patent oppositions filed concern:

• the pharmaceutical and biotech industries; and
• the homeland security industry.

Because of the current political situation in Israel, IP legislation efforts have been generally put on hold. The legislative initiatives discussed prior to this de facto stay included proposals to:

• introduce a manufacturing exemption to the patent term extension system;
• reform the rules of procedure applicable to pre-grant oppositions;
• introduce grace period protection; and
• codify the remedy of delivery up for destruction.

16 Tips and traps

16.1 What would be your recommendations to parties facing patent litigation in your jurisdiction and what potential pitfalls would you highlight?

Patent litigation involves potential pitfalls that are important to recognise, including:

• inadequate preparation;
• insufficient evidence;
• weak legal arguments;
• limited understanding of the scope and limitations of patent claims; and
• failure to comply with court procedures and deadlines.

By conducting thorough preparation, parties can effectively improve their chances of success.

Moreover, it is essential to consider the potential costs associated with patent litigation.

It is prudent to assess the financial implications and carefully weigh them against the potential benefits of a favourable outcome. This evaluation enables parties to make informed decisions and determine the feasibility of pursuing or defending a patent infringement case.

To mitigate potential pitfalls, it is advisable to undertake the following steps:

• Conduct extensive due diligence before filing an infringement action, encompassing items such as the following:
• • Evaluate the potential defendant's past activity, especially regarding any first user rights it might possess.
  • Assess the ability to obtain a temporary injunction and the time to final judgment.
  • Evaluate the potential defendant's ability to design around.
  • Scrutinise the potential defendant's portfolio meticulously to ensure it has no counterattack capabilities.
  • Carefully analyse the patent's examination dossier slated for assertion, encompassing applications and international patents, with a particular focus on US and European patents.
  • Engage an expert proficient in the subject matter to serve as a witness throughout the procedure, from the inception of drafting the initial statement of claims.
  • Align the litigation strategy closely with the overarching business strategy, whether taking a prosecution or defence stance, and exercise caution against legal manoeuvres that do not align with the business objectives.
  • Verify the chain of title of the asserted patent(s) and the entitlement to priority.
• Verify that witnesses are aware that they will have to travel to Israel for cross-examination.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.