In the age of the internet, the legal instrument of the warning letter is becoming more and more present and increasingly important. However, not every warning is lawful.
In its ruling of August 11, 2016 (case reference: 3 U 56/15), the Higher Regional Court of Hamburg decided that warning letters based on simple and easily identifiable competition law infringements can be abusive in the case of a company’s own economic interest.
Multiple warnings for violation of the Health Claims Regulation
In the case before the Higher Regional Court of Hamburg, the operator of an online pharmacy was warned by a competitor. In response, the operator of the online pharmacy issued a cease-and-desist declaration with a penalty clause and removed the infringement of the Health Claims Regulation (HCVO) from its website. However, he refused to pay the legal fees incurred for the warning letter. This was because, in the opinion of the operator of the online pharmacy, the competitor and its lawyer were abusing the law by using the warning letters.
Multiple warnings: Competitor sends over 100 warning letters
The Higher Regional Court of Hamburg then upheld the online pharmacy’s counterclaim. In the past, the competitor had already issued well over 100 warnings for easily recognizable violations of the Price Indication Ordinance. The same lawyer always represented them in the warnings.
The clear disproportion between the low economic interest of the plaintiff in the asserted infringements and its limited income situation on the one hand and the considerable cost risk associated with the assertion on the other, make these warning letters appear to be an abuse of rights. The economic advantage in the form of lawyers’ fees was essentially gained by the third-party defendant. This situation leads to the conclusion that the assertion of the claims served primarily to give rise to a claim against the infringer for reimbursement of expenses or costs of legal action.
Same structure of multiple warnings as an indication of abuse of rights
In the case in dispute, it did not matter that the warnings actually concerned the core area of the competitor’s product range. The mere fact that the warnings had the same structure in eleven cases was an indication of abuse of rights.
lawyer was not concerned with the enforcement of the injunctive relief
The court also criticized the fact that the lawyer directly claimed the warning costs in court without first making use of a threatening order. The warnings had therefore not yet been sufficiently “sharpened”.
This approach by the lawyer also shows that he was primarily concerned with the warning costs, but not with enforcing the claim for injunctive relief under competition law.
It is worth checking the warnings
The legal instrument of the warning letter was created in order to eliminate infringements of competition law efficiently and, above all, quickly and cost-effectively. Time and again, however, this instrument is also used to abuse the law. If such an abuse of rights can be proven, the warning is unlawful and the party issuing the warning must bear the costs required for representation. It is therefore always worth examining the warning letter carefully after receiving it – especially before signing a mandatory cease-and-desist declaration with penalty clause.