Civil Case (Haifa) 80960-12-24 Benny George Shukha (Haifa) Ltd. v. Antoine Shukha & Sons Ltd.

Decision

(Request No.  10)

1. The plaintiff, Bnei George Shukha (Haifa) in a tax appeal and the defendant, Antoine Shukha Ltd., are registered companies in Israel engaged in the import, marketing and sale of food products and related products in Israel.
2. In the lawsuit filed by the plaintiff in this case, she is a petitioner for the issuance of orders, according to Sections 27 and30 The Companies Law, 5759 - 1999, which prohibit the defendant from making use of her name, since it bears a resemblance to trademarks registered in the plaintiff's name. She also petitions to instruct the defendant to change her name so that it does not include the name "Shukha", in order not to mislead the public into thinking that there is a connection between her and the plaintiff.
3. The lawsuit was filed after the defendant's shares were purchased, as part of a judicial proceeding in an insolvency case, by S. Nevertheless.  Am Bakery Ltd., from the Bnei Fawzi Shamshom Group (2009) Ltd.
4. In the motion that is now pending a decision, the defendant petitions to dismiss the claim in limine. The focus of the discussion is the question of whether a change in the ownership rights in the defendant company creates a cause for the plaintiff to prevent the defendant from using its name.  The parties also disagree on the question of whether the plaintiff's position, and judicial decisions in previous proceedings between the parties, silence the plaintiff from raising claims against the defendant's use of her name.

Background and Previous Proceedings

5. The family has been engaged in trading, marketing and selling food products for many years, at least since 1930. In the early years, the late George Shukha z"l worked to import, market and sell products in his name.  After his death, his children, Antoine, Jules, Samaan, Edward and Francis, formed a partnership called "My Son George Shukha", which continued and expanded the business of trading in food products.  In 1978, the late Antoine retired from the partnership and continued to trade in food products alone.  In 1983, Antoine founded the company Antoine Schoccha & Sons in a tax dispute and transferred its trading and marketing activities to it (hereinafter: The defendant or the Antoine Company).  The rest of the brothers, the sons of the late George, continued to operate in partnership and in 1984 founded the George Sons Company in a tax appeal (hereinafter: The plaintiff or the Bnei George company).
6. After Antoine's death in 1988, the company's shares passed to his sons Gavi and Hani Shukha. Gavi was the one who managed the defendant.  It should be noted that at some point, apparently following insolvency proceedings filed against Gavi, the shares were transferred to Gavi's wife, Umamia Shukha, and after bankruptcy proceedings were filed against her, the shares were transferred again to Gavi.  In any case, there is no dispute that throughout the years, from the date of the defendant's establishment until the events underlying the present lawsuit, the shares of the Antoine company were owned by members of Antoine Shukha's family.
7. There is also no dispute that the plaintiff has worked over the years to register various trademarks that include the name "Shukha". These are trademarks on a number of different products, including food products.  The plaintiff marketed its products bearing the name "Shukha" in Hebrew, English and Arabic (the list of trademarks registered in the plaintiff's name that include the name Shukha is detailed in paragraph 31 of the statement of claim).  The plaintiff also claims that over the years it has gained the trust of consumers and has invested considerable sums in advertising and marketing its products bearing the trademarks that include the name Shukha.
8. The defendant also marketed products over the years and used its full name, Antoine Shokeha & Sons in a tax appeal and in the name of Shokeha. A number of trademarks were also registered in favor of the defendant, including the name Shukha.  It should be noted that over the years, the defendant entered into commercial relations with the Benny Fauzi company in a tax appeal or with other companies connected with it (hereinafter: Benny Fawzi Group).  Benny Fawzi is a company controlled by Anan Shamshom and is also engaged in the marketing and sale of products, including food products under various brands.
9. As part of the commercial relations between the defendant and the Benny Fawzi Group, the defendant entered into a distribution agreement in 2010 with Sun Oil Oil Processing and Marketing Company in a tax appeal (hereinafter: Sun Oil) which is a company related to the Benny Fawzi company. In accordance with this agreement, Sun Oil engaged in the marketing and sale of the defendant's oil products, including under the plaintiff's name (see the details of the facts in my decision of February 11, 2022 in insolvency case 55022-08-20, which I will refer to below) (this agreement hereinafter: "Distribution Agreement").
10. Over the years, the plaintiff and the defendant have conducted various legal proceedings regarding the use of the trademarks and the name "Shukha". These proceedings were conducted before the Registrar of Trademarks and before the courts.  In the present proceeding, only some of the proceedings that took place between the parties were detailed, but a review of the pleadings in the previous proceedings shows that already during the 1980s, the plaintiff raised various claims against the defendant's use of the name "Shukha".
11. It further turns out that on February 13, 2011, Bnei George filed a lawsuit in this court against the defendant, its controlling shareholders, and against Sun Oil and its management, for injunctions prohibiting them from marketing and selling food products using the plaintiff's trademarks and prohibiting them from using the name Shukha (Civil Case 24032-02-11). This claim was clarified before the Honorable Judge A.  Zarnakin and ended in a settlement agreement reached between the parties and approved by the court on July 13, 2011 (the settlement was marked as Appendix 4 to the statement of claim).  According to the settlement, the parties agreed that the defendants there (i.e., the defendant and Sun Oil) would be able to continue to use the name "Shukha" on oil products sold by them only under limited conditions, as agreed.  Thus it is stated:

For the avoidance of doubt, the defendants undertake to use the word "Shukha" only in the context of the sequence "Antoine Shukha & Sons Ltd.", as the name of the company in a horizontal sequence reduced from the size in which the words "Antoine" and "Sons" appear in Arabic on the labels that are the subject of the dispute [...].