Enforcing court orders in a proportionate way

A recent Court of Appeal decision highlights the value of taking a proportionate approach to the enforcement of a court order. By seeking the court’s declarations on the meaning of the order and making clear that it did not intend to use the court’s findings as the basis for contempt proceedings, the Claimant achieved its objectives.

What was the background?

The underlying case concerned the Defendants’ misuse of the “Merck” brand. There had been a long-running controversy between the Claimant and the Defendants about the use of the brand, following its parallel development over many decades by separate entities based in Germany and the USA respectively. In summary, the German entity (the Claimant) effectively holds the rights to the Merck brand globally, except in North America, where the rights are held by the Defendants.

The first set of proceedings

The Claimant and Defendants co-existed under the common Merck brand for many years, subject to a series of agreements. However, after the USA entity merged with Schering-Plough in 2009, the Claimant became increasingly concerned about the Defendants’ use of the Merck brand outside North America. This resulted in litigation in the English courts and elsewhere.

The English courts ultimately found that the Defendants had breached an earlier agreement regulating the use of the Merck brand and had infringed the Claimant’s trade marks. This resulted in a court order in July 2020 restricting the Defendants’ use of the Merck brand in the UK (the Order).

The second set of proceedings

The precise terms of the Order are not relevant for the purposes of this article. In summary, by October 2021, a dispute had arisen as to whether the Defendants were in breach of the Order. This resulted in an application to the English High Court by the Claimant in March 2022 for a declaration that the use of "Merck" by one or more of the Defendants was in breach of the Order (the Application).     

The High Court found the Defendants to be in breach of the Order in respect of some, but not all, of the activities which the Claimants had complained about, and made a court declaration to this effect. 

The appeal

The Defendants appealed to the Court of Appeal. Their grounds of appeal concentrated in part on the Judge’s finding of facts. However, the focus of this article is the Defendants’ contention that the Judge had no power to make a declaration concerning  the Defendants’ alleged breaches of the Order by making findings that specific acts committed by them constituted breaches. In this respect, the Defendants argued that the proper remedy for the Claimant was to bring contempt of court proceedings.    

Throughout the course of making the Application, the Claimant was careful to explain that it would not bring contempt proceedings in respect of the specific acts identified in the Application. However, it reserved the right to bring contempt proceedings in relation to any new acts or acts identified as breaches that continued or re-commenced after the date of the declaration they were asking the court to make. On appeal, the Claimant went further and gave an undertaking to this effect for the avoidance of any doubt. 

The importance of this distinction is that allegations of contempt of court involve procedural safeguards for defendants, including the application of the higher criminal standard of proof rather than the civil standard. This is because individuals found guilty of contempt of court can be sent to prison or fined, and companies can have their assets seized.

The Court of Appeal accepted that, given the Claimant’s clear explanation (and undertaking to the Court) that they would not bring contempt proceedings in respect of these allegations, there was no need for the additional protections for the Defendants. The legal standard for determining and making declarations about breaches of the Order was therefore the lower civil standard of proof, as the Judge in the lower court had correctly decided.

The Court of Appeal endorsed the Claimant’s approach of applying for declaratory relief as a low-key method of resolving the dispute about the interpretation of the Order and its application to a wide range of alleged breaches. The court pointed out that the Defendants’ alternative approach would lead to a position where the parties would be involved in high-stakes applications for contempt of court. This would be likely to heighten the level of dispute when the role of the courts should be to enable parties to have their disputes resolved in the most dispassionate, efficient and proportionate way possible.

What are the practical implications?

This case illustrates that the English courts do not require parties to go for the "nuclear option" of contempt proceedings when breaches of court orders are in issue. Of course, an applicant can pursue that route if they choose to, aware of the higher evidential burden and consequent risks involved. However, this decision demonstrates that a more measured approach can still lead to the applicant establishing that breaches of a court order have occurred and, in doing so, issue a final warning to a defendant regarding their conduct.    

The full Court of Appeal decision is here: Merck KGaA v Merck Sharp & Dohme LLC & Anor [2025] EWCA Civ 343 (28 March 2025)

This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, April 2025