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Archive for: competition law

Collective interests of consumers, case XVII Ama 125/08

November 26th, 2009, Tomasz Rychlicki

In the article entitled “Termin konkursu powinien być realny“, the Polish newspaper Rzeczpospolita reports a recent case of a buyer of CHIO CHIPS that are produced by The Lorenz Bahlsen Snack-World. He filed a complaint to the representation of the Office of Competition and Consumers Protection in Wrocław. This dissatisfied consumer argued that being in the shop, he chose CHIO chips and not the other products that were sold in a similar price because he was attracted by a draw where he could win some nice prizes. However, he became disappointed because when he did open the package and read the coupon, it turned out that the draw was already over. The date of the draw was shown on the inside part of a special bar attached to chips’ bag, but it could be difficult to read after the break of the package.

Because of the lack of a clear declaration with regard to the end date of the draw, the Company was fined 22000 PLN for the practice of contravention of collective interests of consumers. According to the Polish Act on Protection of Competition and Consumers – APCC – (in Polish: Ustawa o ochronie konkurencji i konsumentów) published in Journal of Laws (Dziennik Ustaw) No. 50, item 331, with later amendments, it was a violation of the obligation to provide consumers with reliable, true and complete information regarding the product.

The Polish Court of Competition and Consumer Protection upheld the contested decision in its judgment, case file XVII Ama 125/08. Such essential information as the period of promotion/draw or the validity date of the product cannot be hidden inside the bar of the package and thus not visible at first glance. Such information must be readily available. The Court ruled that the date of a draw should be indicated clearly on the product packaging and incomplete information is misleading. The judgment is not final yet, the company may file an appeal.

Meta tags in Polish case law

October 8th, 2009, Tomasz Rychlicki

The French company Marin’s International brought a case before the Court for the Community Trade Marks and Community Designs, located in Warsaw (in Polish: Sąd Okręgowy w Warszawie Wydzial XXII Sąd Wspólnotowych Znaków Towarowych i Wzorów Przemysłowych). The issue concerned the use of CTMs Marin’s and Lama by the Polish company Display Flash Poland sp. z o.o., within its website in NOSCRIPT tag. The Court in a judgment case file XXII GWzt 8/09, ruled that the use of someone else’s trademark in website’s metatags infringes trade mark rights of such person, and such behaviour may be also deemed as an unfair competition delict.

I know that I should mention the opinion of the Advocate General Poiares Maduro of 22 September 2009 in joined cases C‑236/08, C‑237/08 and C‑238/08, Google France, Google Inc. v. Louis Vuitton Malletier, Google France v. Viaticum, Luteciel and Google France v. CNRRH, Pierre Alexis Thonet, Bruno Raboin, Tiger, a franchisee of Unicis.

(1) The selection by an economic operator, by means of an agreement on paid internet referencing, of a keyword which will trigger, in the event of a request using that word, the display of a link proposing connection to a site operated by that economic operator for the purposes of offering for sale goods or services, and which reproduces or imitates a trade mark registered by a third party and covering identical or similar goods, without the authorisation of the proprietor of that trade mark, does not constitute in itself an infringement of the exclusive right guaranteed to the latter under Article 5 of First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks.

(2) Article 5(1)(a) and (b) of Directive 89/104 and Article 9(1)(a) and (b) of Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark must be interpreted as meaning that a trade mark proprietor may not prevent the provider of a paid referencing service from making available to advertisers keywords which reproduce or imitate registered trade marks or from arranging under the referencing agreement for advertising links to sites to be created and favourably displayed, on the basis of those keywords.

(3) In the event that the trade marks have a reputation, the trade mark proprietor may not oppose such use under Article 5(2) of Directive 89/104 and Article 9(1)(c) of Regulation No 40/94.

(4) The provider of the paid referencing service cannot be regarded as providing an information society service consisting in the storage of information provided by the recipient of the service within the meaning of Article 14 of Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market (‘Directive on electronic commerce’).

This is way more interesting if one realizes that almost month ago Google has announced that it doesn’t use the “keywords” meta tag in web search ranking.

Unfair commercial practices, case DOK-6/2008

September 4th, 2008, Tomasz Rychlicki

In December 2005, the OCCP instituted antitrust proceedings against ZAiKS and the Polish Filmmakers Association (SFP), suspecting that – in order to maximise their profits – these organisations had made an agreement and fixed uniform charges for using audiovisual works and refused to negotiate their rates.

Penalties for a total of more than $ 1.2 million Polish złoty were imposed by the Office of Competition and Consumer Protection (UOKiK) on The Association of Authors (ZAiKS) and the Polish Filmmakers Association (APF) because of their agreement “to eliminate competition between them”.

UOKiK has found that since 2003, ZAiKS and SFP, seeking to guarantee itself the highest profits, have operated under the unlawful antitrust agreement. SFP and ZAiKS concluded an agreement which established a uniform, rigid rates for the use of audiovisual works (such as DVD movies) and refused to negotiate them – announced Malgorzata Krasnodębska-Tomkiel (the President of the UOKiK) at a press conference in Warsaw.

The decision of the President of the Office of Competition and Consumer Protection of 29 August 2008, case file DOK-6/2008 The official press release is available at uokik.gov.pl website, in Polish language.

April 10th, 2008, Tomasz Rychlicki

An IP licensing agency which is working for the Lockheed Corporation has send C&D letter to John MacNeill and “requested” him to remove his works from TurboSquid website. Those works were professionally made 3D models of B-24 plane. The Equity Management alleged that such works infringes on B-24 trade mark, owned by Lockheed. There is a really good post about this issue on boingboing.net website so I’ll not repeat this news. However, I was interested in the case-law that was cited by Corynne McSherry (staff attorney working for the Electronic Frontier Foundation) as she published a post about her response letter PDF file, in John MacNeill case on eff.org website. One of cited cases was WCVB-TV v. Boston Athletic Ass’n, 926 F.2d 42 (1st Cir. 1991). The Court ruled that

Defendants failed to show that plaintiff’s broadcast with the use of the words “Boston Marathon” created a risk of public confusion that plaintiff’s broadcast had an official imprimatur.

In New Kids on the Block v. News America Pub., Inc., 971 F.2d 302 (9th Cir. 1992), United States Court of Appeals for the Ninth Circuit, held in the judgment written by Alex Kozinski, that the defendant has used “The New Kids On The Block” trade mark

to identify the group and not to imply the group’s endorsement. The court noted that a competitor could even use a rival’s trademark in advertising for profit if the use was not false or misleading and did not implicate the source-identification function of the trademark

Corynne McSherry also mentioned the case Cairns v. Franklin Mint Co., 292 F.3d 1139 (9th Cir. 2002) where the Court held that the Found

claim failed because the law of the deceased personality’s domicile did not recognize a post-mortem right of publicity. The court then held that the merchant was entitled to a fair use defense under 15 U.S.C.S. § 1115(b) because the merchant’s use of the name and likeness of Princess Diana was a permissible nominative fair use. The court further held that the false advertisement claim was groundless because the statements in the advertisements at issue were true and the charity fund had no reasonable basis to believe they were false. The court finally held that the award of attorneys’ fees to the merchant was justified and reasonable.

For the comparative approach in a similiar case I’d like to mention about The Court of Justice of the European Communities’s case C-48/05, Adam Opel (OJ C 56 of 10.03.2007, p.4). Adam Opel discovered that a 1:24 remote-controlled scale model of the Opel Astra V8 coupé, bearing the Opel logo on its radiator grille like the original vehicle, was being marketed in Germany. The trade mark holder for Opel mark has also found that toys’ producer is Autec. Opel sued Autec before the Landgericht Nürnberg-Fürth, but interpretation problems arose as regards to article 5(1)(a) and (2), and article 6(1)(b) of the First Directive 89/104/EEC (I always wonder where is the second directive ;) and in the consequence the case landed as a request for the preliminary ruling under Article 234 EC, before the Court. It held that:

1. Where a trade mark is registered both for motor vehicles – in respect of which it is well known – and for toys, the affixing by a third party, without authorisation from the trade mark proprietor, of a sign identical to that trade mark on scale models of vehicles bearing that trade mark, in order faithfully to reproduce those vehicles, and the marketing of those scale models:

– constitute, for the purposes of Article 5(1)(a) of First Council Directive 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks, a use which the proprietor of the trade mark is entitled to prevent if that use affects or is liable to affect the functions of the trade mark as a trade mark registered for toys;

– constitute, within the meaning of Article 5(2) of that directive, a use which the proprietor of the trade mark is entitled to prevent – where the protection defined in that provision has been introduced into national law – if, without due cause, use of that sign takes unfair advantage of, or is detrimental to, the distinctive character or the repute of the trade mark as a trade mark registered for motor vehicles.

2. Where a trade mark is registered, inter alia, in respect of motor vehicles, the affixing by a third party, without the authorisation of the proprietor of the trade mark, of a sign identical to that mark to scale models of that make of vehicle, in order faithfully to reproduce those vehicles, and the marketing of those scale models, do not constitute use of an indication concerning a characteristic of those scale models, within the meaning of Article 6(1)(b) of Directive 89/104.

Update on May 21, 2008.
It looks like Lockheed Martin has withdrawn its claims. More details at eff.org website.

Poland: unfair commercial practices

December 30th, 2007, Tomasz Rychlicki

The Act of 23 August 2007 on Combating Unfair Commercial Practices – CUCP – (in Polish: ustawa o przeciwdziałaniu nieuczciwym praktykom rynkowym) published in Journal of Laws (Dziennik Ustaw) No. 171, item 1206, came into force on 21 December 2007. It implemented the Directive 2005/29 of the European Parliament and of the Council of 11 May 2005 concerning unfair business-to-consumer commercial practices in the internal market and amending Council Directive 84/450, Directives 97/7, 98/27 and 2002/65 of the European Parliament and of the Council and Regulation 2006/2004 of the European Parliament and of the Council (“Unfair Commercial Practices Directive”).

Among others things, it defines in article 5(1) misleading commercial practices as actions connected with introduction of products into the market which may lead to mistake as regards to products, its packaging, trade marks, trade names or other signs capable of identifying entrepreneurs, particularly comparative advertising.

The Act also deals with crypto-advertising which is defined as using commentary content in mass-media sources to promote a product where the business/entrepreneur paid for such action but it is not clearly indicated in the content, images or sounds and it is not easily identified by the consumer.

The Act also covers aggressive commercial practices. It defines such actions as (i) onerous processes which are not connected with consumers’ actions or (ii) desisting from acting, i.e. inducing the purchase of products via phone, fax, electronic mail or other means used to communicate in distance.

Microsoft v. Commission

September 17th, 2007, Tomasz Rychlicki

Judgment of the Court of First Instance (Grand Chamber) from September 17, 2007 in the case T-201/04, Microsoft v. Commission.

1. Annuls Article 7 of Commission Decision 2007/53/EC of 24 March 2004 relating to a proceeding pursuant to Article 82 [EC] and Article 54 of the EEA Agreement against Microsoft Corp. (Case COMP/C-3/37.792 – Microsoft), in so far as:

– it orders Microsoft to submit a proposal for the establishment of a mechanism which is to include a monitoring trustee with the power to have access, independently of the Commission, to Microsoft’s assistance, information, documents, premises and employees and to the source code of the relevant Microsoft products;

– it requires that the proposal for the establishment of that mechanism provide that all the costs associated with the appointment of the monitoring trustee, including his remuneration, be borne by Microsoft; and

– it reserves to the Commission the right to impose by way of decision a mechanism such as that referred to in the first and second indents above;

2. Dismisses the remainder of the application;

3. Orders Microsoft to bear 80% of its own costs and to pay 80% of the Commission’s costs, with the exception of the costs incurred by the Commission in connection with the intervention of The Computing Technology Industry Association, Inc., Association for Competitive Technology, Inc., TeamSystem SpA, Mamut ASA, DMDsecure.com BV, MPS Broadband AB, Pace Micro Technology plc, Quantel Ltd, Tandberg Television Ltd and Exor AB;

4. Orders Microsoft to bear its own costs and to pay the Commission’s costs relating to the interim measures proceedings in Case T‑201/04 R, with the exception of the costs incurred by the Commission in connection with the intervention of The Computing Technology Industry Association, Association for Competitive Technology, TeamSystem, Mamut, DMDsecure.com, MPS Broadband, Pace Micro Technology, Quantel, Tandberg Television and Exor;

5. Orders Microsoft to pay the costs of Software & Information Industry Association, Free Software Foundation Europe, Audiobanner.com and European Committee for Interoperable Systems (ECIS), including those relating to the interim measures proceedings;

6. Orders the Commission to bear 20% of its own costs and to pay 20% of Microsoft’s costs, with the exception of the costs incurred by Microsoft in connection with the intervention of Software & Information Industry Association, Free Software Foundation Europe, Audiobanner.com and ECIS;

7. Orders The Computing Technology Industry Association, Association for Competitive Technology, TeamSystem, Mamut, DMDsecure.com, MPS Broadband, Pace Micro Technology, Quantel, Tandberg Television and Exor to bear their own costs, including those relating to the interim measures proceedings.

Categories: EU law | Judgments of Court of Justice of the EC | US law | competition law.

Tomorrow important judgment

September 16th, 2007, Tomasz Rychlicki

September 17, 2007, The Court of First Instance will rule in the case Microsoft v. Commission, T-201/04, OJ C 294 of 02.12.2006, p.56 (PDF file).

Annul the Commission Decision of 24 March 2004 in proceedings regarding the application of Article 82 of the EC Treaty (Case COMP/C-3/37.792 Microsoft), concerning competition conditions in the markets of work group server operating systems and multimedia players or, in the alternative, annul or reduce the fine imposed on the applicant.

Meanwhile, if you are a Polish language speaker/reader there is also a very interesting post and discussion started by Piotr Waglowski on his website. It concerns “foggy” ~~lobbing~~ PR action which is dedicated to protecting ~~companies~~ consumers. In general, the goal is to raise the awarness that one comapny has almost 80% of the Internet ad market share within the European Union. We wonder who sponsors this so-called “social movement” with the help of PR company. As someone points such action is visible in London’s tube since two months.

Categories: EU law | Judgments of Court of Justice of the EC | competition law.

Unfair competition, case V CSK 237/06

June 22nd, 2007, Tomasz Rychlicki

Hortex Holding SA Company (Hortex) filed a suit against Hortino, seeking (i) a preliminary injunction to prohibit Hortino labelling its products with its trade mark, (ii) an order that Hortino publish an apology in the press, and (iii) the return of unjustified and undeserved profits gained through the trade mark infringement.

The legal dispute between Hortex and Hortino spanned two different jurisdictions. Trade mark invalidation suits are based on the administrative procedure and this case was reported in my post entitled “Trade mark law, case II GSK 63/05“.

While the administrative procedure was running its course, Hortex commenced civil proceedings against Hortino. Its petition included a claim for trade mark infringement under articles 19 and 20 of the old Polish Trade Mark Act – TMA – (in Polish: Ustawa o znakach towarowych) of 31 January 1985, Journal of Laws (Dziennik Ustaw) No 5, item 15, with later amendments, repealed on 22 August 2001 by the Act of 30 June 2000 on Industrial Property Law – IPL – (in Polish: ustawa Prawo własności przemysłowej) of 30 June 2000, published in Journal of Laws (Dziennik Ustaw) of 2001 No 49, item 508, consolidated text of 13 June 2003, Journal of Laws (Dziennik Ustaw) No 119, item 1117, with later amendments, and breach of article 10 of the Polish Act of 16 April 1993 on Combating Unfair Competition – CUC – (in Polish: ustawa o zwalczaniu nieuczciwej konkurencji), Journal of Laws (Dziennik Ustaw) No. 47, item 211, with later amendments.

Article 10
(1) Such indication of products or services or its lack, which may mislead customers in relation to the origin, quantity, quality, components, manufacturing process, usefulness, possible application, repair, maintenance and another significant features of products or services as well as concealing the risks connected with their use, shall be the act of unfair competition.
(2) Releasing for free circulation products in the packing which may cause effects referred to in section 1 above shall be the act of unfair competition, unless the use of such packing is justified by technical reasons

Hortex asked the court to issue a preliminary injunction against Hortino and to order Hortino to publish a specified apology in the press. Hortex also asked the court to order the reimbursement of unfounded and undeserved profits gained by means of its trade mark infringement. The Court of the First Instance acknowledged the first two claims in its judgment but did not issue any order regarding the monetary award because, in its opinion, Hortex had not proved sufficiently that any of Hortino’s profits had been obtained through the use of its similar trade mark. Both parties appealed.

The appellate court varied the judgment in so far as it affected monetary damages and ordered Hortino to pay 304,000 zloty. The court based its calculations on a test of a fictional licence fee. Hortino then filed a cassation complaint before the Supreme Court, insisting that the judgment was decided in contravention of the CUC and the TMA, some procedural regulations, and even international treaties. The Supreme Court in its judgment of 10 August 2006, case file V CSK 237/06, dismissed the petition and upheld the contested judgment. Judge Tadeusz Zyznowski pointed that all courts, including the Supreme Administrative Court, had reached their decisions in a proper manner. Hortino’s actions were clearly made in bad faith and could lead many consumers to confusion about the origin of labelled and sold products.

The method of establishing the quantum of profits gained by the trade mark infringer is based on the Court of Second Instance’s findings. That court ruled that the measure should be a fictional and hypothetical licence agreement’s fee that would be owed to the trade mark holder if the disputing parties were to have signed a trade mark licence agreement. In the civil proceedings, the appellate court set the fee level at 3 per cent of all profits gained by Hortino when it was selling goods bearing the disputed trade mark.

The Republic of Poland is one of many European countries that, in the course of its legal history, adopted the civil law system. From the point of view of common law lawyers, it simply means that Polish courts do not follow their opinions and judgments. There are no legally binding precedents except for the Supreme Court’s legal rulings. Nonetheless, after the Supreme Court’s final judgment in the issue described above, based on the cassation procedure, one may be sure that all inferior courts will be eager to employ the methods stipulated in this instance.