The Court of Appeal has upheld a lower court ruling between two pharmaceutical companies over the use of the word ‘Merck’, finding that Merck Sharp & Dohme (MSD) had used ‘Merck’ in the UK in a way that was prohibited by previous injunctions.

The decision, handed down on 28 March by Lord Justice Richard Arnold, Lord Justice Stephen Phillips and Lady Justice Geraldine Andrews, is part of a long running global dispute between German pharmaceutical company Merck KGaA and the US-headquartered MSD group relating to the use of ‘Merck’.

Merck KGaA initially brought proceedings again MSD for breach of contract and trademark infringement. This resulted in a court order in 2020 which included injunctions that MSD should not use ‘Merck’ in the UK as either a trademark or a contraction of a company name when furthering or promoting its business. 

Merck KGaA, represented by Bird & Bird, however, complained that despite the injunctions, MSD was continuing to use Merck in the UK. Mr Justice Edwin Johnson agreed, finding in April last year that MSD had indeed breached the order.

In the latest ruling, the Court of Appeal has agreed with the Johnson judgment, describing it as “a meticulously reasoned judgment running to 514 paragraphs in which he considered each of Merck Global’s [Merck KGaA] allegations in turn”.

Overall, MSD had appealed the first instance decision on four grounds including that the judge had incorrectly applied the targeting test set out in the UK Supreme Court decision in the cross border trademark dispute Lifestyle Equities v Amazon.

Merck KGaA had complained of the use of the word Merck in relation to jobs based in the UK being advertised on MSD’s www.merck.com site, and links from MSD websites targeted at the UK to news releases on www.merck.com. 

MSD argued, among other things, that www.merck.com was targeted at US and Canadian consumers only so there was no use in the UK.

Arnold noted that MSD contends that there “was no evidence that the average consumer in the UK would have found or come across jobs.merck.com or what journey they would have taken to get there”.

Arnold added: “It is true that there was no positive evidence to that effect, but I accept Merck Global’s submission that the judge was entitled to find that a person in the UK searching for ‘Merck jobs’ using a search engine would have found it given that the MSD defendants had not identified any technical or other reason why they would not have done.”

Bird & Bird said in a statement that the case will also be of interest to practitioners as the ruling approved a procedure of seeking a declaration that an injunction had been breached, rather than having to make an application for contempt.

The firm said: “This was held to be a useful procedure particularly where the meaning of the order was contested.”

It added: “Although as this was an alternative to a contempt of court action, there needed to be appropriate safeguards for the defendants.”

Peter Brownlow, a partner at Bird & Bird who led the team who represented Merck KGaA, commented: “The Court of Appeal’s ability to deliver its judgment so swiftly, just seven working days after the two-day hearing, is a reflection of the robustness of the lower Court’s ‘meticulously reasoned judgment’ as well as the efficiency of the English Court system in IP cases.”

Merck KGaA was represented by the London office of Bird & Bird. The team included Brownlow and associates Mark Day and Alex Grigg and barristers 8 New Square’s Adrian Speck KC and 11 South Square’s Benet Brandreth KC. 

MSD was represented by Linklaters partner Ian Karet and barristers One Essex Court’s Geoffrey Hobbs KC and Guy Hollingworth.

The original Merck dates back to Germany in 1668. In 1889, a member of the family established another business in the US which was economically supported by, but not part of, the family business. In time this business was incorporated as Merck & Co.

For many years the two businesses cooperated over their use of the name ‘Merck’. In broad terms the US business used the name in the US and in Canada, while the original German business used the name in the rest of the world.