KGaA v Merck Sharp & Dohme Corp & Ors

For partial revocation of pharmaceutical trade mark specifications, the court must identify a fair category by considering therapeutic indication and the perception of the average consumer. The category should reflect products that are not essentially different and cannot fairly be divided except arbitrarily. A recognised classification scheme may provide a framework, but a single product does not automatically justify protection across an entire broad category.

Trade mark use in the course of trade does not require the user to sell or offer for sale goods bearing the sign in the United Kingdom. Promotional, informational and commercial activity may qualify where it creates a material link between the sign, the undertaking and relevant goods or services, affecting the mark’s origin function. The assessment is made from the overall impression on the reasonably informed and observant consumer.

This was a supplemental first-instance judgment following the remittal of five matters by the Court of Appeal in [2017] EWCA Civ 1834, after the original trial judgment in [2016] EWHC 49 (Pat). The dispute concerned the use of the word “Merck” by Merck Sharp & Dohme entities in the United Kingdom, against the background of registered trade marks and contractual arrangements between the parties.

The court reconsidered further partial revocation of the registered marks, whether specified online and offline activities constituted trade mark use in the course of trade in relation to goods or services, whether infringements were de minimis, and the appropriate declaratory and injunctive relief.

1. Partial revocation. The relevant sub-category of pharmaceutical goods was to be identified by reference to therapeutic indication and the perception of the average consumer, with the aim of producing a fair specification. The BNF was adopted as a convenient framework. Protection across the whole category of pharmaceutical substances and preparations was unjustified because significant BNF categories had not been used, while a restriction solely to narrowly stated indications would be too narrow and unfair. The court ordered specifications covering the particular fair categories identified at paragraph [22].
2. Use in the course of trade. The applicable inquiry required use of the sign in a way capable of distinguishing goods or services or creating a material link between them and the undertaking from which they originated. Hypothecation of goods for sale in the United Kingdom was not an essential component of the inquiry. Promotional and informational activity could qualify where, viewed in context, it linked the sign with products or services and affected the essential origin function of the registered mark.
3. The relevant consumer would generally assess a webpage or material section as a whole, considering the accumulation and context of references to “Merck”. On that basis, numerous website, social-media and email uses were infringing, although pure entity use, confidential technical material, and material whose overall impression did not designate origin were not.
4. The infringements were not negligible or insignificant. Their significance depended on their content, likely individual and cumulative impact, and the fact that they reflected an organised policy rather than isolated accidents.
5. The court granted declarations recording breach of the contractual obligation and infringement of the registered marks, together with prohibitory injunctions. The injunctions included proportionate carve-outs for compliant geographical identifiers, pop-up warnings, geo-blocking, financial disclosures, metadata, internal use, non-UK employees’ email addresses, social-media functionality and prompt correction of inadvertent breaches. No publicity order was made.

• Court of Appeal — The appeal judgment, [2017] EWCA Civ 1834, remitted five matters for redetermination.
• High Court (Chancery Division) — The present supplemental judgment determined the remitted matters and formulated the final declarations and injunctions.