Merck KGaA wins injunction after MSD trademark suit

The English High Court has finalised the terms of a trademark injunction against US pharmaceutical company  Merck Sharp & Dohme (MSD), in favour of German rival  Merck KGaA.

The German company brought the proceedings against MSD in 2013, claiming that its US rival had violated the terms of a 50-year old ‘co-existence agreement’ governing each company’s use of the name ‘Merck’.

Under the agreement, MSD can brand itself as ‘Merck’ in the US and Canada, while Merck KGaA has the rights to the name internationally, with a handful of exceptions.

Sir Alastair Norris, a judge at the High Court, had already issued an injunction against MSD in 2016, but this was challenged by the US company at the Court of Appeal.

The appeals court sent the case back to the High Court, finding that it had not clearly explained its reasons for issuing the injunction, or identified which uses of ‘Merck’ by MSD did and didn’t infringe Merck KGaA’s trademarks.

Yesterday’s High Court judgment, also authored by Norris, clarified the full extent of MSD’s infringement, and pressed ahead with injunctive relief in favour of Merck KGaA.

Speaking to LSIPR, Peter Brownlow, a partner at  Bird & Bird who worked on Merck KGaA’s legal team, said the German company had obtained the “majority of what it was asking for” in yesterday’s ruling.

MSD had said an injunction was unnecessary, and that it should be left to the two companies to negotiate a practical resolution.

But Norris said MSD had not demonstrated a “spirit of cooperation”, and had instead adopted a policy of “pushing the boundaries where possible”.

Infringing use

This was primarily evidenced by MSD’s expanded use of the ‘Merck’ brand outside of North America since 2009, the court found.

Most of the uses of ‘Merck’ looked at by the High Court were online, including social media posts, and MSD employees in the UK having ‘@merck.com’ email addresses.

The court ruled that MSD’s use of ‘Merck’ was infringing where it related to goods and services, but not where it was simply referring to a “corporate entity”.

A MSD website ‘merckresponsibility.com’, containing resources for medical professionals and information on products, did infringe, for example, but a statement describing MSD’s chairman as the ‘CEO of Merck’ did not.

In a statement sent to LSIPR, a MSD spokesperson said the company was “considering our options, including whether to appeal”.

They added: “Many of the matters discussed at the remitted issues hearing were by 2018 already historical, as our digital presence has changed significantly since the initial claim began in 2013. We believe our digital presence in the UK is in line with the UK court findings, however, it is likely that all MSD employees in the UK will change their email addresses from @merck.com to @msd.com.”

‘Carveouts’

The ruling was not a total victory for Merck KGaA, as Brownlow accepted the court had allowed several “carveouts” for MSD in the terms of the injunction.

The injunction does not cover the email addresses of non-UK MSD employees, even where they are contacting UK-based customers.

MSD will also be allowed to use ‘Merck’ on social media where it uses methods like geoblocking to the fullest extent possible to prevent UK customers from accessing the content.

The High Court also refused Merck KGaA’s request for an order requiring MSD to publicise a summary of the judgment.

That’s because it would not be possible to summarise the outcome of the three judgments issued by the High Court and Court of Appeal in a “helpful” way.

Norris added that linking to the judgments would not work either, since the public was unlikely to “wade through 275 pages of legal and factual analysis”, although he said the “IP community will do so anyway”.

In addition to the carveouts, Norris also ordered that Merck KGaA’s trademark registration be trimmed down to include a narrower range of pharmaceutical goods, but this did not affect the finding that MSD had infringed Merck’s IP.

Did you enjoy reading this story?  Sign up to our free daily newsletters and get stories sent like this straight to your inbox.