Companies are allowed to hire lawyers for warning letters

In its judgement of 8 May 2008, I ZR 83/06, the First Civil Senate of the Federal Court of Justice (BGH), which is responsible, inter alia, for competition law, ruled that, as a rule, the lawyer's fees of the person issuing the warning must also be reimbursed in the course of issuing a warning.

The parties in the case to be decided are competitors in the field of telecommunications services. Two advertisers of the defendant had tried to win over a customer of the plaintiff, Deutsche Telekom AG, for the defendant and had made misleading claims. Although Deutsche Telekom AG has its own legal department, it had sent a warning to the defendant through a law firm. Since the defendant did not issue a cease-and-desist declaration, the plaintiff obtained an interim injunction, which the defendant finally accepted as a final settlement. Insofar as the legal costs were caused by the court proceedings, they had to be borne by the defendant anyway. Therefore, only the lawyer's fees incurred by the warning were still in dispute.

The Regional Court and the Court of Appeal upheld the action, relying on a provision in the Unfair Competition Act that gives the person issuing the warning notice a claim for reimbursement of the necessary expenses. Even if the infringement of competition was clearly evident, the plaintiff was entitled to consider the involvement of a lawyer necessary.

The Federal Supreme Court confirmed the decision of the lower courts. The starting point was the actual organisation of the company issuing the warning. A company with its own legal department was not required to use its own lawyers to review the competitive actions of competitors and, if necessary, to issue warnings. The prosecution of competition violations was not one of the original tasks of a commercial enterprise. Therefore, it was not objectionable if a company such as Deutsche Telekom AG used the lawyers with whom it otherwise cooperated in such matters for competition law warnings.

Judgment of the Federal Supreme Court of 8 May 2008, Ref.: I ZR 83/06

Previous instances:
Reimbursement of warning costs OLG Frankfurt a.M., judgment of February 9, 2006 - 6 U 94/05
Frankfurt a.M. Regional Court, Judgment of May 13, 2005 - 3/11 O 158/04 Karlsruhe, May 9, 2008

Source: Press release no. 93/08 of the Press Office of the Federal Court of Justice, 76125 Karlsruhe, telephone (0721) 159-5013, fax (0721) 159-5501 of 9.5.2008

Goldberg Attorneys at Law, Wuppertal-Solingen 2008
Attorney at Law Michael Ullrich, LL.M.(Information Law)
m.ullrich@goldberg.de

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