The High Court has held that the rebranding of an imported epilepsy drug (sold as “Epanutin” in the exporting Member State) using the Claimant’s “FLYNN” word mark constituted trade mark infringement because the imported product had not been put on the market in the exporting Member State by the Claimant or with its consent.

The Defendants sought to argue that:

(a) their use of the “FLYNN” word mark was not trade mark use as it was only to be used as a description of the goods; and

(b) The Claimant’s reliance on their trade mark rights under domestic law to stop the imports constituted a disguised restriction on trade – contrary to the free movement provisions of the Treaty on the Functioning of the European Union (the ‘TFEU’).

In finding for the Claimant, Mrs Justice Rose determined that the Defendants’ use of the “FLYNN” word mark was akin to the use in Arsenal Football Club v Reed (Case 206/01) as determined by the CJEU and such use therefore was liable to affect the origin function of the trade mark. As a result, the Defendants’ use did not fall within the confines of s.11 (2) of the Trade Marks Act 1994 and could not be said to be descriptive.

After an analysis of the current law applicable to pharmaceutical rebranding cases, Mrs Justice Rose held that the Defendants could only rely on Article 36 of the TFEU to defeat the trade mark infringement claim if they could show that the Epanutin capsules had been placed on the market in the exporting member state by the same entity seeking to prevent its import into the UK or with its consent. This was said to be a pre-condition which needed to be satisfied before the Defendants could seek to engage the criteria outlined in the leading case of Bristol-Myers Squibb (‘BMS’) v Paranova (Cases C-427-93, C-429/93 and C-436/93).

On the facts, it could not be said that Epanutin had been placed on the market in the exporting Member State by the Claimant or with the Claimant’s consent. The product was being sold in the exporting Member State by a company called Pfizer. Whilst the Claimant had contractual relations with this entity, Mrs Justice Rose said the Claimant was not “directly or indirectly able to determine the products to which the trade mark may be affixed in the exporting State or control their quality”. The Claimant had not exhausted their trade mark rights in the exporting Member State and the trade mark infringement claim succeeded on this basis.

Interestingly the Judge went on to comment that, if the BMS criteria were engaged, in her opinion it would have been necessary for the Defendants to rebrand to gain “effective access to the market” in accordance with the ruling in Speciality European Pharma Ltd v Doncaster Pharmaceuticals [2015] EWCA Civ 54. However, since they were not, the infringement claim triumphed.

Link to Judgment

Judgment Date: 06 OCTOBER 2015