Anti-competitive obstruction through misuse of returns

In the Competition law entrepreneurs not only vis-à-vis consumers, but also vis-à-vis competitors act unfairly. A recent ruling by the Hamm Higher Regional Court (OLG) shows just how far these actions can go. If a company deliberately places orders and then returns them in order to harm a competitor, this constitutes an unlawful obstruction of competition. This ruling illustrates how important it is to adhere to fair practices in competition and shows that those affected are not without protection.

The ruling by the Higher Regional Court of Hamm concerns a case in which employees of an online mattress retailer repeatedly placed orders with a competitor and then had them returned under false pretenses. The aim of this practice was to cause economic damage to the competitor. In the following, we take a closer look at the facts and the legal assessment of this case.

Important findings

• Unlawful restraint of competitionIntentionally ordering and returning goods in order to harm a competitor is illegal.
• Legal basisAbuse of returns violates the Unfair Competition Act (UWG) and the German Civil Code (BGB).
• Limitation of claimsInjunctive relief claims under the UWG expire after six months, but claims under the BGB only after more than three years.

Abusive orders and returns by a competitor

In 2019, two employees of an online mattress retailer placed a total of eleven orders with a competitor. In eight of these cases, they placed return orders under the pretext of alleged packaging or quality defects and left negative product reviews. It could not be proven that the complaints were based on true facts.

The competitor concerned considered this to be a deliberate obstruction pursuant to Section 4 No. 4 UWG and intentional immoral damage pursuant to Section 826 BGB. Following an unsuccessful warning, the competitor applied to the Paderborn Regional Court for a temporary injunction, which was granted but did not result in a final declaration. He therefore sued for injunctive relief in the main proceedings.

The Paderborn Regional Court rejected the objection of the statute of limitations pursuant to Section 11 (1) and (2) UWG and sentenced the defendant company largely in accordance with the application.

The decision

In the appeal, the OLG Hamm on 16.04.2024 (Ref. 4 U 151/22) dismissed the appeal and confirmed the judgment of the regional court. The conduct of the employees was attributed to the defendant company in accordance with Section 8 (2) UWG and Section 831 BGB. The court found that the systematic abandonment and reversal of orders constituted a deliberate obstruction of competition and immoral damage.

In the absence of facts to the contrary, the court assumed that the employees' conduct was aimed at causing economic damage to the competitor company by using its resources and incurring costs. Limitation claims under Section 826 BGB had not expired, so the action was successful.

Conclusion

The Hamm Higher Regional Court's ruling clearly shows that unfair practices in competition will not be tolerated. Companies must ensure that their employees do not engage in such practices in order to avoid legal consequences. If you are affected by similar unfair practices, you should contact a specialist intellectual property lawyer such as Robert Meyen and the law firm marken medien meyen to protect your rights.

FAQs

What is an unlawful restraint of competition? Unlawful restraint of competition exists if a company intentionally takes measures to harm a competitor economically, e.g. through systematic orders and returns.

What legal principles are relevant here? The relevant legal bases are the Unfair Competition Act (UWG) and the German Civil Code (BGB), in particular Section 4 No. 4 UWG and Section 826 BGB.

How long is the limitation period for competition law claims? Claims for injunctive relief under the UWG expire after six months, while claims under Section 826 BGB are subject to a three-year limitation period.