Misleading advertising for internet flat rate

Every internet provider advertises flat rate tariffs. But what is a consumer entitled to understand by an internet flat rate? The Regional Court (LG) Munich I has expressed its view on this matter and decided that advertising for an internet flat rate is misleading if the transmission speed is throttled after consumption of a certain data volume and insufficient clear notice is not given to this effect.

The internet provider Kabel Deutschland had advertised internet fixed-line flat rates in advertising letters and on its website and in particular highlighted the fast transmission speed. Depending on the tariff, the company promised download speeds of 10 to 100 Mbit/s.

However, the company reserved the right to limit the transmission speed to 100 Kbit/s until the end of the same day for file-sharing applications after consumption of a certain data volume (namely a total data volume of 10 GB per day).

The company had indeed pointed to this restriction option – but only in a tiny footnote, which moreover was not linked to the specification of the internet speed.

The Federal Association of Consumer Centres and Consumer Associations therefore objected to this advertising as misleading and sued for an injunction.

Court decision

The LG Munich I granted the claim by judgment of 25.06.2014 – Az. 37 O 1267/14 and assessed the advertising as misleading.

According to the LG Munich I, the advertising statement "Internet flat rate: with up to 10 Mbit/s in download for fast internet" did not in itself reveal that from a certain data volume onwards, the download speed would be throttled for certain applications until the end of the day.

The consumer expected unrestricted internet access from an internet flat rate in the fixed-line sector. In the case of such fixed-line flat rates – unlike possibly with mobile contracts – consumers do not assume that the speed would be throttled from a certain amount of data onwards.

The customer thus evaluates the advertising in such a way that he will always receive and be able to use the full bandwidth. Because it is of primary importance to the average customer that with a flat rate and a selected specific download speed, he does not have to consider and check whether a certain amount of data has been reached. The disputed advertising therefore creates a false impression in the customer regarding the data volume agreed upon in the contract.

According to the court's view, this misleading nature could not be remedied in the present case by the respective footnote, since it was neither correctly assigned nor sufficiently clearly presented.

In so far as the reserved throttling option (merely) related to "file-sharing applications", the court expressly established that the limitation of the transmission speed was not restricted to "illegal file-sharing sites", but also encompassed legitimate uses such as for example Skype or likewise the non-copyright-infringing use of a file-sharing platform.

Conclusion

In cases where eye-catching advertising is not objectively incorrect but contains only the "half truth", an asterisk or other sufficiently clear sign must direct the viewer to a clarifying notice. Asterisks and explanatory notices must always be presented sufficiently clearly according to the circumstances of the individual case and above all must be placed in the correct location.