Latfood company is the official and exclusive importer in Israel for the Latvian company which manufactures chocolate products marketed under the brand 'Laima'. In January 2017 Foodstock imported a single delivery of these chocolates as a parallel import. There were some 13,000 items with a value of about Euro 20,000. Latfood filed an application with the District Court requesting an interim injunction prohibiting Foodstock from importing and marketing the chocolate and also requesting the collection of those which it had already marketed.
According to Latfood, this parallel importation of the chocolates is misleading the consumer. This is because the details of Latfood appear on them, on the back of the packaging and as the importer. Thus, the impression is given that Latfood is the imported thereof and therefore responsible for the products, when in fact this is not the case.
The court decided, basing its decision on the Tommy Hilfiger case, that parallel importation in and of itself is not prohibited – to the contrary – this is a practice which is blessed and which promotes competition and the decrease in prices to the consumer. On the substance of the case, the court rejected the application since Latfood had given its wide approval the manufacturer to print Latfood's details on the packaging of the products including those which were not in fact imported by it to Israel. Thus the court decided that Latfood should have foreseen circumstances in which its name would appear on the products imported by parallel importers. It was decided that Foodstock had purchased the products legally and in these circumstances, neither the manufacturer nor Latfood had control over the means of marketing the products carrying the Latfood name, therefore Latfood could not prevent the parallel importation of these products.
Foodstock imported the original product. The court found that the name of the manufacturer was embedded into the original product and also a sticker with the name of the parallel importer, so there was no suspicion that the customers were misled. With respect to products where the parallel imported had not placed a sticker as aforesaid, the court decided that even here there was no risk of the customers having been misled given the mark of the manufacturer's name. The court decided that the official importer, which had approved the embedding of its name on the product, should have to carry the risk that in this case it would be responsible for the situation created. With that in mind, however, the court considered the risk to be low.
The application for the interim measure against the parallel importer was rejected and the applicant was ordered to pay legal costs.
Reference: TA 27455-02-17 Latfood Ltd v Foodstock Ltd (published in Nevo 29.3.2017, His Honour Judge Magen Eltuvia)
