Misleading advertising with 100 years of business tradition?

Is advertising with 100 years of business tradition misleading and thus unfair competition if the advertiser has in the meantime become insolvent? The Higher Regional Court (OLG) Frankfurt a.M. had to decide on this matter.

A craft business advertised on its website, after it had become insolvent and was subsequently operated by an acquirer, with the following statement:

"With our more than 100 years of business tradition and the consistent development of our know-how, we have extensive experience and high professional competence, which we are happy to place at your service."

The plaintiff considered this impermissible and brought an action for an injunction. She was of the view that this was misleading advertising and was thus contrary to fair competition law, because the insolvency of the company had resulted in an interruption of the continuity of the business.

The Regional Court (LG) Hanau dismissed the action on the basis of the continuity of business operations.

Court decision

The Higher Regional Court (OLG) Frankfurt a.M. upheld the decision of the Regional Court (LG) by order of 07.09.2015 – Az. 6 U 69/15. The appellate court decided that advertising with 100 years of business tradition was also permissible in the case of interim insolvency of the company. The decisive factor was that the acquirer had continued to operate the business in its core. In such a case, the company was permitted to rely on the business activities previously undertaken. The contested advertising did not create misleading impressions in the perception of the relevant public regarding the business circumstances of the advertiser, because despite the changes, the current company could still be regarded as essentially identical to the previous company.

Conclusion

If a company continues to operate in its core in the event of insolvency, it may rely on the business activities previously undertaken.