Get Out of My Facebook!
Says German Merck to U.S. Merck.
German drug maker Merck KGaA has threatened legal action after it said it lost its Facebook page to rival Merck & Co. in the U.S.
According to a recent Wall Street Journal article, German Merck said its Facebook page has been "misappropriated," adding that it wasn't clear how that happened, nor who was at fault.
The November 21st filing reflects the growing importance of social networks as marketing tools, with companies willing to go to court to safeguard their perceived rights on these networks.
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The Merck Facebook page contained information on Merck & Co. Inc. (Whitehouse Station, New Jersey), which is described as "a global healthcare leader working to help the world be well". The site is said to be intended only for residents of the U.S. and its territories. On Sept. 16, it carried a post welcoming users to "Merck's official Facebook page!"
German Merck said that it entered into an agreement with Facebook for the exclusive use of the Web page in March of last year, but in October 11 this year, Merck KGaA discovered that it no longer had administrative rights to the page, which was filled with content related to Merck & Co.
Who's Watching the Store?
The two Mercks became separate companies under the Treaty of Versailles, each owning rights to the Merck trademark in different geographic areas, as part of Germany's reparations after World War I.
Merck & Co. Inc. (NYSE: MRK) is one of the largest pharmaceutical companies in the world by both market capitalization and revenue. Merck KGaA (EMD Chemicals in the U.S. and Canada), also known as “German Merck” and “Merck Darmstadt”, is the world's oldest operating chemical and pharmaceutical company. According to Hoovers.com, U.S. Merck outpaces German Merck by over 4x in sales volume (2010 sales = $4,598B versus $1,231B, respectively).
Confusing? Perhaps. But it points to the very serious issue of protecting brands, trademarks, and a company's goodwill and reputation - and keeping a keen eye to defend the store.
For many, brand theft, rather than piracy, is the biggest intellectual property risk. Brand theft occurs where one party establishes a brand but another party acquires rights to the brand (in bad faith). Not all trademark disputes are brand theft — many involve disputes between parties all acting in good faith, but cases of brand theft are those where people abuse trademark laws. Brand theft can make a legitimate brand owner essentially an infringer in using its own brand and is all the more dangerous because it is done through perfectly legal means. The costs of fighting brand theft are high, so the best defense is to reduce the risk of it happening.
In this case, no one at German Merck was keeping an eye on the store. Just look at the time frame: German Merck establishes its Facebook page in March 2010; U.S. Merck somehow gains administrative rights to the page and repopulates in September 2011, but German Merck does not notice until October 2011, and then finally sues in November 2011.
We can all learn from the mistakes made here. In particular, the top 5 social media pitfalls to avoid:
- Not Investing Adequate Time: A common mistake is underestimating the amount of time a successful Facebook strategy entails. Many social media consultants report seeing a pervasive “set it and forget it” mentality among small businesses - apparently the case here between the two Merck's.
- Broadcasting: Ask any social marketing consultant what the number-one "no-no" is on Facebook, and he’ll likely tell you it’s “broadcasting” your messages instead of providing fans with relevant content and engaging on an continual basis.
- Being Boring or Predictable: When they’re thinking about marketing, some business owners forget that Facebook is a social place where people share things they find funny, interesting or useful with their friends. Think about what kind of content your fans would actually want to share when planning your posts.
- Failing to Learn about Facebook Mechanics and Tools: Since Facebook is a relatively new medium, some businesses have yet to explore all its functionality and they’re missing out on creating an optimal brand experience.
- Violating Facebook's Terms: Not only is it critical to know how Facebook works and what tools are available, it’s also important to know the rules of the road — something that many businesses miss.
“We have removed the vanity URL,” said Facebook's Andrew Noyes, manager, public policy communications. “Facebook.com/Merck will be unavailable unless and until the two companies mutually agree that one can use it.” Either company, he added, is welcome to create a new username or vanity URL for themselves.
“We apologise for any inconvenience this may have caused,” the Mr. Noyes added.
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Apparently, an agreement has been worked out. Earlier today, the following posting was made by U.S. Merck on Facebook.
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Later, this was replaced by a new Facebook page by German Merck (albeit with dated information; again - who's watching the store!).
Merck KGaA said the loss of the Facebook page deprived it of an ‘important marketing device’, and would continue to look into the matter, but was happy with Facebook’s apology.
Sources:
1. Facebook.com/Merck and "Facebook.com/Search"
2. Neetha Mahadevan and Sten Stovall, "German Merck to U.S. Merck: Get Out of My Facebook," The Wall Street Journal, November 25, 2011
3. John Ribeiro, "Germany's Merck Wants Facebook Page Back," PC World, November 25, 2011
4. Leyl Master Black, "Top 5 Facebook Marketing Mistakes Small Businesses Make," Mashable, April 2, 2011
5. Company Results: Merck; Hoovers.com
6. "Merck and Merck Look to Settle Facebook Naming Dispute," InPharm.com, November 29, 2011
7. Matthew Arnold, "Merck v. Merck Facebook fracas a "tempest in a teapot" says US firm," Medical Marketing & Media, November 29, 2011
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