Germany: New Aspects Of A Core Theory?

Last Updated: 20 December 2011
Article by Astrid Gérard

In matters of infringement of a cease-and-desist order the question often arises of whether this new action still falls under the wording of an existing injunction, or rather forms the grounds for a new infringement, which can then be countered by a warning and/or an application for the issue of an interim injunction.

According to established case law, the effect of a final declaration extends as far as the scope of the prohibition of a cease-and-desist order, which the obligor has recognised as a definitive ruling. The prohibition of an injunction extends beyond actions identical to those forbidden to include variations which are in essence similar and in which the characteristic features of the specific form of infringement are expressed (established case law, cf. GRUR 2010, 855 - Folienrollos (Roller blinds), margin note 17).

The Federal Court of Justice distanced itself from this case law in a decision of 7 April 2011 (GRUR 2011, 742, file ref.: I ZR 34/09 - Leistungspakete im Preisvergleich (price comparisons of service packages)). The facts were as follows: the defendant, a provider of Internet and cable TV services advertised in the advertising supplement of a regional newspaper its offer of a service package (consisting of an Internet connection, an Internet flat rate, a telephone connection and a telephone flat rate), stating in order to attract attention that it was "50% cheaper" than specified comparable offers from purely Internet service providers . In much less conspicuous small print at the side it stated that the offer required a cable TV connection to be applied for first, for which further TV connection fees would be charged. The advertised price also did not include the monthly fee for using the cable connection.

In a preceding parallel case, the claimant had already successfully put a stop to another advert by the defendant, by which the defendant was prohibited from advertising, in a specific manner, telephone and/or Internet services implemented on the basis of a paid-for "iesy cable connection", if carried out as in the Annexes specifically referred to.

Two of the disputed issues in this legal dispute were whether the new claim was obstructed by the impediment of the conflicting res judicata, and whether the claim lacked a right of action. Both were rejected by the FCJ.

The FCJ referred to the fact that the new advert was not covered by the substance of the preceding, parallel injunction case before the Frankfurt Higher Regional Court (the appeal for non-admission brought by the claimant against the dismissal of its main claims brought at that court had been dismissed by the FCJ). In the preceding parallel case, the petition for an injunction was aimed at prohibiting the defendant from advertising in general with incomplete final prices. The prohibition finally adjudged by the Frankfurt Higher Regional Court was limited to a prohibition of the specific form of infringement, which the claimant had objected to (i.e. three newspaper supplements, in which the defendant had advertised the telephone services it offered).

In the disputed case the claimant also sought the prohibition of a specific disputed comparison advert, in which the defendant's service package was compared to corresponding service packages from the claimant and two other competitors.

The object of the dispute in the two cases was different. The court is bound to consider the present object of dispute, which is limited to the aim described in the claim and the actual circumstances on which it is based. The object of dispute in the parallel proceedings was defined by the fact that the adverts in the three supplements had been specified and an application had been made for an injunction, with the intention of achieving a general prohibition on quoting incomplete prices, with the following measures: "The defendant is obliged to take action as follows..." and "... to cease ... if it is done in such a way... ". The more precisely-designated subject-matter before the Frankfurt Higher Regional Court was not identical to that of the present proceedings.

The present application for an injunction was not therefore obstructed by the impediment of res judicata.

Nor did the claim fail on the issue of the right of action. On this point the FCJ ruled that the claim of lack of the right of action could not be held against the obligee of a claim for an injunction (who had already won an injunction on the basis of a similar infringement action and was therefore able to pursue the specific infringement action under dispute, potentially also through enforcement proceedings on the basis of the contravention of the injunction already granted) if the outcome of the enforcement proceedings is uncertain and there is a risk that the anti-competition claims to be made on the basis of the renewed infringement could become statute-barred.

This decision emphasises the requirement for the precise formulation of the cease-and-desist application. A precise cease-and-desist request also affects the scope of the res judicata. As the matter under dispute is made up of the petition and the circumstances on which it is based, a different application or different grounds for claim can be an obstacle to the identity of the subject-matter under dispute and thus the impediment of the conflicting res judicata.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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