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URL: http://www.bailii.org/uk/cases/DRS/2002/593.html
Cite as: [2002] DRS 593

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Merck & Co, Inc -v- Direct Response Marketing (Jersey) Limited

DRS 00593

Merck & Co, Inc -v- Direct Response Marketing (Jersey) Limited

Decision of Independent Expert

1. Parties:

Complainant: Merck & Co, Inc
Country: USA

Respondent: Direct Response Marketing (Jersey) Limited
Country: Channel Islands

2. Domain Name:

propecia.co.uk ("the Domain Name")

3. Procedural Background:

The Complaint was received by Nominet on 30 August 2002. Nominet validated the Complaint and sent a copy to the Respondent on 3 September 2002.

A Response was lodged on 25 September 2002 (with hard copies received on 30 September 2002) and forwarded to the Complainant on 30 September 2002.

The Complainant lodged a Reply on 9 October 2002. On the same day a copy of the Reply was sent to the Respondent.

The Informal Mediation failed to produce an agreed resolution. On 29 October 2002 the Complainant paid Nominet the required fee for a decision of an Expert pursuant to paragraph 6 of the Nominet UK Dispute Resolution Service Policy ("the Policy").

On 30 October 2002 Nominet invited the undersigned, Jason Rawkins ("the Expert"), to provide a decision on this case and, following confirmation to Nominet that the Expert knew of no reason why he could not properly accept the invitation to act in this case and of no matters which ought to be drawn to the attention of the parties which might appear to call into question his independence and/or impartiality, Nominet duly appointed the undersigned as the Expert with effect from 5 November 2002.

4. The Facts:

The Complainant is a major pharmaceutical company. One of its products, a drug for the treatment of hair loss, is marketed under the name PROPECIA. The Complainant owns a UK trade mark registration for the mark PROPECIA.

On 15 June 1998 the Respondent registered the Domain Name.

The Domain Name resolves to www.propecia.co.uk, from where the Respondent operates a website offering PROPECIA tablets for sale by mail order to members of the public in the UK.

5. The Parties' Contentions:

Complainant:

In summary, the Complainant's submissions are as follows:

1. The Complainant has rights in a trade mark which is identical to the Domain Name:

(1) The Complainant is the proprietor of UK registered trade mark number 2023941, dated 14 June 1995, for the mark PROPECIA in respect of (inter alia) medicinal and pharmaceutical preparations and substances for human use.

(2) The PROPECIA mark is identical to the Domain Name after discounting the domain suffix.

2. The Domain Name is an Abusive Registration in the hands of the Respondent:

(1) The Domain Name has been used by the Respondent in a manner which took unfair advantage of and/or was unfairly detrimental to the Complainant's Rights in the PROPECIA mark.

(2) The Respondent operates a website at www.propecia.co.uk, which provides mail order services for the supply of prescription products, including the Complainant's PROPECIA product, to the UK mainland. By using the Domain Name in this way to attract Internet users to its website for commercial gain, the Respondent is benefiting from a distinctive mark in which the Complainant has rights.

(3) The Complainant has not licensed the Respondent to use the PROPECIA mark in the operation of the website (or at all).

(4) In the light of the above the Respondent's use of the Domain Name takes unfair advantage of the Complainant's rights.

(5) The Complainant has established considerable goodwill and reputation in the PROPECIA mark. The Respondent's use of the Domain Name creates the impression that its website is in some way authorised by or otherwise connected with the Complainant. The Respondent is thereby taking unfair advantage of the Complainant's goodwill and reputation in the PROPECIA mark.

(6) The Complainant further relies on the evidence of actual confusion by visitors to the Respondent's website, as evidenced by telephone calls made to its medical information line. The Respondent recognised the likelihood of confusion by including a disclaimer on its website following correspondence between the parties' solicitors. The disclaimer is ineffective, particularly having regard to the small font and indistinct colour used and the fact that the disclaimer does not appear on the majority of pages of the website.

(7) PROPECIA is a prescription-only drug which is not suitable for certain types of patient. Physical examination by a medical practitioner is required to ensure that the drug is not prescribed to the wrong person and proper guidance needs to be given with regard to its use. Sales of the drug without an appropriate medical examination are potentially very dangerous to patients. The use of the Domain Name in connection with the offer for sale of PROPECIA without prescription, appropriate physical examination or proper guidance is unfairly detrimental to the Complainant's goodwill and reputation in the PROPECIA mark.

Respondent:

In summary, the Respondent's submissions are as follows:
1. The Respondent markets and sells products from leading pharmaceutical manufacturers. It takes great care to ensure that all its advertising and sales of such products comply with legislation in Jersey, where it is based.

2. The Respondent invests substantial time and resources in promoting its business. An example of this is an article from the "Good Health" section of the Daily Mail of 6 August 2002. Such promotion of the Respondent's business also promotes, both directly and indirectly, the products of the Complainant.

3. The Respondent was given licence or authority by the Complainant to use the PROPECIA mark. It was contacted by a business which stated itself to be the "webmaster" for the Complainant. It was agreed to create reciprocal links between various websites owned by the Respondent and the Complainant.

4. The Respondent submits that the medical information line call log documents relied on by the Complainant are not proper evidence of confusion. Even if they were, four instances amount to a level of confusion which is de minimis in relation to the number of people visiting the Respondent's website.

5. Since registering the Domain Name, the Respondent has invested significant sums of money in seeking to ensure that anyone searching on the Internet for, inter alia, hair loss products, will be directed towards the Respondent's website.

6. The Respondent's retail sales of the PROPECIA product have exceeded £1.7 million. As the manufacturer of the product, it follows that the Complainant has benefited directly from this.

7. The Respondent refutes the Complainant's allegations regarding the way in which it offers PROPECIA for sale on its website. Every sale of PROPECIA is backed by a prescription from an appropriately qualified medical practitioner, which is dispensed by an appropriately qualified pharmacist. Regarding physical examination, the Respondent's customers complete a medical questionnaire and declaration prior to purchasing PROPECIA. It is for the medical practitioner who writes the prescription to decide whether or not to prescribe PROPECIA and whether or not any physical examination is required before prescribing. As for proper guidance, in addition to the information and links on the Respondent's website, each order of PROPECIA is sent to the customer in the Complainant's original UK packaging, which has within it the Complainant's instructions and guidance notes.

8. The Complainant is unable to sell PROPECIA direct to the public. It follows that the Respondent's ownership of the Domain Name cannot be detrimental to and/or unfair to the rights of the Complainant.

Complainant's reply

In summary, the Complainant's submissions in reply are as follows:

1. The Daily Mail article provides ample evidence of the damage to the Complainant's rights in the PROPECIA mark caused by the Respondent's abusive registration of the Domain Name. The article also led to a complaint to the Complainant from one of its competitors which wrongly assumed that the Complainant was responsible for the promotional piece.

2. Regarding the website links referred to by the Respondent, these were to be limited to links which would be invisible to consumers. This is standard industry practice and does not in any way condone the abusive registration of the Domain Name. In addition, a reciprocal link with the website at www.propecia.co.uk was not put in place.

3. The call logs to its medical information line demonstrate that the callers believed either that the Respondent was in some way linked with the Complainant or that the Complainant was in some way responsible for dealing with questions which were unanswered by the Respondent's website. The level of confusion is not de minimis. The fact that four people took the trouble to identify the manufacturer of the product, find contact details for it and make their complaints or queries to the information line shows that there is a level of confusion which is unacceptable when dealing with a prescription-only medicine.

4. Regarding the Respondent's sales of PROPECIA, the demand would have been met either by the Respondent or by some other retailer, whether or not the Respondent secured the abusive registration of the Domain Name.

5. Regarding the way in which the Respondent sells PROPECIA from its website, there is no reference on the site to the need for a prescription. There is also no mention that supply is subject to review by a physician. The General Medical Council states that consultations and prescribing by telephone or email may seriously compromise standards where the patient is not previously known to the doctor; no examination can be undertaken; and there is little or no provision for appropriate monitoring of the patient or follow-up care. The website only asks customers eight simple questions and the Respondent has not indicated that any further steps are taken to discharge their proper responsibilities. The Respondent's procedures are not an adequate substitute for a proper physical examination. Insofar as proper guidance is concerned, pharmaceutical products are typically supplied in the UK in response to a prescription after a full medical examination, during the course of which a full explanation of the product's characteristics and relevant side effects is given. Against such background, the patient information provided with the product is adequate. In the absence of such a full consultation and explanation, however, the patient information provided with the product is not adequate.

6. If the Domain Name is transferred to it, the Complainant intends to use it for educational purposes only, aimed exclusively at UK physicians.

6. Discussion and Findings:

General
Paragraph 2 of the Policy provides that, to be successful, the Complainant must prove on the balance of probabilities that:
i it has Rights in respect of a name or mark which is identical or similar to the Domain Name; and

ii the Domain Name, in the hands of the Respondent, is an Abusive Registration (as defined in paragraph 1 of the Policy).

Complainant's Rights

The Complainant has a UK trade mark registration for PROPECIA. I therefore find that it has Rights in the name/mark PROPECIA.

Disregarding the generic .co.uk suffix, the Domain Name is identical to the PROPECIA mark.

The Complainant has therefore proven what is required under the first part of paragraph 2 of the Policy.

Abusive Registration

Paragraph 1 of the Policy defines an "Abusive Registration" as:

"A Domain Name which either:
i was registered or otherwise acquired in a manner which, at the time when the registration or acquisition took place, took unfair advantage of or was unfairly detrimental to the Complainant's Rights; OR
ii has been used in a manner which took unfair advantage of or was unfairly detrimental to the Complainant's Rights."

With regard to the manner of use of a domain name, one of the factors set out in the non-exhaustive list under paragraph 3a of the Policy of factors which may be evidence that the Domain Name is an Abusive Registration is as follows:

"Circumstances indicating that the Respondent is using the Domain Name in a way which has confused people or businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected with the Complainant" (paragraph 3aii)

In the present case, the issue of confusion is an important factor. Looking first at the Respondent's website at www.propecia.co.uk it is correct that there is a disclaimer at the top of the home page which reads as follows:

"This website is owned and operated by DRM and is not associated with Merck & Co Inc, Merck Sharp & Dohme Limited or Upjohn".

However, the wording of the disclaimer is in a very small font and also in a pale colour. The combined effect is that it is very easy not to notice the disclaimer at all. The disclaimer could easily have been made much more prominent. There is nothing else on the website which serves to make it clear that there is no connection between it and the Complainant. Taking the overall content of the site and the indistinct nature of the disclaimer into account, it is in my view likely that an appreciable number of people visiting the site will be confused into believing that it is either operated by, or authorised by or connected with, the Complainant.

Paragraph 3aii of the Policy refers to circumstances indicating that confusion has taken place. It does not as such refer to the likelihood of confusion which I have found. Nevertheless, the list of factors in paragraph 3 is expressly non-exhaustive and, in my opinion, a likelihood of confusion is sufficient.

The Complainant seeks to rely on four telephone calls which it received on its medical information line as being evidence of actual confusion amongst members of the public. The call logs are, however, extremely brief and do not serve to make the content of the telephone calls clear. In my view, the call log notes are equally consistent with each of the callers believing the Respondent's website to be unconnected with the Complainant, but nevertheless having found out that the Complainant is the manufacturer of the product and therefore contacting it for further information. I am therefore not persuaded that the call logs are sufficient evidence of actual confusion in the case of the four members of the public in question. Nevertheless, I remain of the view that such confusion is likely to have occurred and to occur again in the future. Even if members of the public are prepared to admit that they have been confused, it is not particularly common for people then to go to the effort of finding out whom they should contact and by what means. Evidence of actual confusion is accordingly always very difficult to obtain. It does not follow from the absence of such evidence that confusion is not likely to be occurring.

The Complainant also relies on the complaint which it received from one of its competitors after the article in the Daily Mail was published. The article itself is headed "The Baldness Cure" and highlights the apparent efficacy of the PROPECIA product. It is clear from the Respondent's own evidence that they were behind the article and references are made to the Respondent in the article, for example a note which states:

"For more information about Propecia call 01534 510 271 or visit the website www.propecia.co.uk".

The complaint which the Complainant received is evidence that its competitor believed it to be behind the article, and indirect evidence of the competitor believing the website www.propecia.co.uk to be operated or authorised by the Complainant.

Within the article itself, there is also evidence of confusion on behalf of one of the men interviewed. He refers to PROPECIA and then goes on to state:

"I found it difficult to get hold of in the UK, so I turned to the Internet and quickly found the company website".

The wording used by the interviewee strongly suggests that he thought that the website belonged to the PROPECIA company, namely the Complainant.

These two pieces of evidence support the conclusion that the way in which the Respondent uses the Domain Name is likely to be causing an appreciable level of confusion. However, even in the absence of that evidence, I would find there to be a likelihood of confusion and, as I have stated, I believe that such a likelihood is sufficient.

The fundamental question to be addressed is whether the Domain Name has been used by the Respondent in a manner which has taken unfair advantage of or caused unfair detriment to the Complainant's Rights in the PROPECIA name. In my view, the way in which the Respondent uses the Domain Name does take advantage of and does cause unfair detriment to the Complainant's Rights.

Taking each of these in turn, the Respondent has obtained an advantage because its use of the Domain Name is bound to have attracted visitors to its site who would not otherwise have entered it. The website address will almost certainly have caused a significant number of people to believe that it is operated by, or at least connected with, the manufacturer of the product, namely the Complainant. The content of the Respondent's website does not clearly dispel such a belief. In particular, the form of the disclaimer does not achieve that purpose and one has to wonder why, if the Respondent was going to include a disclaimer, it did not include one of reasonable prominence, rather than one which it is very easy to miss altogether.

The advantage which the Respondent obtains in this way is an unfair one because it is, in fact, not in any way licensed or authorised by the Complainant. Amongst other things, this gives the Respondent an unfair advantage over other companies which wish to market the PROPECIA product, including those which the Complainant may wish to license or authorise.

The documents filed by the Respondent in these proceedings show that the main website which it uses is at www.directresponsemarketing.com. The content of this site is either the same as, or extremely similar to, the site at www.propecia.co.uk. This demonstrates that it is perfectly possible for the Respondent to run its business without use of the Domain Name. In order to sell PROPECIA products, there is no need for the Respondent to use a Domain Name which consists purely of the Complainant's trade mark which, together with the content of the website at www.propecia.co.uk, creates the impression of the Respondent's business being connected with or authorised by the Complainant.

Turning to detriment, the Respondent's use of the Domain Name is unfairly detrimental to the Respondent's Rights. I have already found that the Respondent's website is likely to be associated with the Complainant, a conclusion which is supported by two pieces of evidence to which I have referred. This is unfairly detrimental to the Complainant because the site is outside its control. The Complaint which the Complainant received from one of its competitors is an example of the sort of negative impact on the Complainant which can occur. As a further example, there is a dispute between the parties as to whether the way in which the Respondent supplies the PROPECIA product is lawful and/or in accordance with the guidelines of medical bodies. There is no need for me to make a finding as to which party is right on this. The point is that the Complainant should be free to choose with what practices it is associated and the way in which the Respondent uses the Domain Name (which creates a likelihood of association with the Complainant) takes such matters outside the Complainant's control, to the unfair detriment of the Complainant.

Finally, I turn to the Respondent's submission that it was authorised and/or encouraged in its use of the Domain Name by a company acting on behalf of the Complainant. The Respondent refers to reciprocal links having been agreed between the websites belonging to the parties. It is, however, to be noted that no links with the www.propecia.co.uk site were agreed or implemented. In my view, there is therefore insufficient evidence of the Complainant having in some way authorised or encouraged the Respondent's use of the Domain Name. I therefore find against the Respondent on this submission.

7. Decision:

Having found that the Complainant has Rights in respect of a name or mark which is identical to the Domain Name and that the Domain Name, in the hands of the Respondent, is an Abusive Registration, the Expert directs that the Domain Name, propecia.co.uk, be transferred to the Complainant.

___________________________________________________________________
Jason Rawkins 6 November 2002