Unfair competition lawyer in Paris

What is unfair competition?

Unfair competition is characterised by the abusive use of the right to do business by a company that adopts practices contrary to the rules of the market.

It is sanctioned by article 1240 of the French Civil Codewhich states: “Any act of man, which causes damage to another, obliges the person by whose fault it occurred to repair it”.

French law guarantees freedom of competition, but it must comply with certain strict rules of competition law in order to preserve an economic balance between market players. When a company oversteps these limits and deliberately disrupts your business, you have the right to take action.

Our unfair competition lawyers in Paris ensure that your business operates within a fair competitive framework by punishing fraudulent practices and protecting your interests.

3 conditions for establishing unfair competition

For a company to be held liable for unfair competition, three fundamental elements must be met:

• A fault: use of unfair practices (denigration, imitation, parasitism, disorganisation, etc.)
• Damage: loss of customers, drop in sales, damage to reputation.
• A causal link: demonstration that the wrongful act is directly responsible for the loss suffered.

As soon as these 3 conditions are met, you can take action to obtain compensation. Our lawyers, experts in unfair competition, will provide you with personalised assistance at every stage.

The various acts of unfair competition

Here you will find an overview of all the different types of unfair competition, their possible penalties and practical examples.

1- Denigration

Denigration in unfair competition consists of spreading malicious criticism or misleading information about a competitor in order to damage its reputation.

There isa difference between denigration and defamation:

• Denigration targets a product, a service or a company.
• Defamation concerns a natural or legal person.

Examples of denigration

• Denigration through public comments: A company publishes an article on its website or social networks criticising the quality of a competitor’s products or services without any objective basis.
• Denigration through the dissemination of false information: A service provider claims that its competitor is in financial difficulty and in danger of going bankrupt, when this is not the case.
• Disparagement by unfair comparison: A seller claims that the guarantees offered by its competitor are fraudulent or ineffective, whereas these guarantees comply with the regulations.
• Defamation by misappropriation of customers: An employee or manager contacts a competitor’s customers to tell them that this company is unreliable and that they should change supplier.
• Denigration through the media and digital media: A competitor posts a false negative review on Google or Trustpilot to damage a company’s image.
• Denigration in the context of a public tender: A company applying for a tender criticises a competitor in its tender documents in an attempt to disqualify the competitor’s bid.
• Internal disparagement and damage to brand image: A dismissed former employee spreads false information about his former employer to damage his reputation.

Legal remedies

Goldwin’s lawyers specialising in unfair competition will support and advise you in taking the necessary steps to put an end to this situation. With their expertise and experience in competition law, our lawyers will protect your interests to the best of their ability and tailor their strategy to the situation you are facing. An unfair competition lawyer will therefore be of great assistance to you.

2 Confusion: a disturbing similarity

Confusion occurs when a company adopts graphic, phonetic or marketing elements that are sufficiently similar to those of a competitor, thereby creating doubt in the mind of the public.

Examples of confusion :

• A competitor adopts a similar trade name, with a similar pronunciation or script (e.g. “Oréal” instead of “L’Oréal”).
• A company adopts a similar logo, with colours and typography close to those of an established brand.
• A company uses a registered designation of origin (AOC) or a recognised label, misleading consumers as to the origin of the products.

How do you prove confusion?

French and European law punish confusion, but concrete proof is required:

• Phonetic and visual analysis of the distinctive signs in question.
• Expert opinion on public perception (likelihood of confusion).
• Studies on the commercial impact of the disputed practice.

Penalties in the event of confusion:

The courts may order the immediate cessation of the practice in question and, in some cases, award damages to the company that has been the victim.

3 Imitation: a misappropriated copy

Imitation goes further than mere confusion. It involves a deliberate attempt to copy a competitor by using distinctive elements without reproducing them identically.

Examples of imitation :

• A company adopts the design and packaging of a competitor’s product, changing only a few details (e.g. a bottle of soda with colours and shape identical to a well-known brand).
• A brand creates a sales offer and marketing strategy similar to those of a market leader.
• A company adopts a competitor’s sound identity, slogan and communications.

Penalties for imitation:

The victim company may bring an action for unfair competition to prove that the imitation is intended to fraudulently capture its customers.

4 Counterfeiting: prohibited reproduction

Counterfeiting is a more serious offence than imitation or confusion. It is defined as the total or partial reproduction of a product, brand or patent without authorisation.

Unlike unfair competition, counterfeiting is not limited to misleading consumers, but constitutes a direct infringement of intellectual property rights (trademark, patent, copyright).

Examples of counterfeiting :

• The exact copy of a luxury product (watches, bags, clothing) by reproducing the logo and visual signature of the original brand.
• Manufacturing and selling pharmaceutical products identical to those of a patented laboratory without authorisation.
• Using protected software without the consent of the rights holder.

Penalties for counterfeiting:

Counterfeiting is a criminal offence punishable by heavy fines and prison sentences. It may give rise to :

• Destruction of counterfeit products.
• Financial penalties (high damages).
• Closure of the offending company in the event of a repeat offence.

Imitation vs. counterfeiting: a blurred line?

Counterfeiting and imitation can sometimes overlap. For example, a product may be slightly modified to escape classification as counterfeit, while still constituting unfair competition.

In a ruling by the Court of Cassation, it was held thataffixing a trademark to an infringing shoe could be punished for both counterfeiting and unfair competition.

5 Disorganisation: a sanctioned form of unfair competition

Disorganisation is defined as all the practices used by a rival company to destabilise the internal organisation of a competitor or to distort the market in an abusive manner. It is a form of unfair competition that can have serious financial and organisational consequences for the victim company.

Internal disorganisation: destabilising a competitor’s business

Internal disorganisation occurs when a competitor behaves in such a way as to destabilise the internal workings of a company, thereby damaging its productivity, know-how and competitiveness.

Examples of internal disorganisation:

• Mass poaching of employees: When a company competes by recruiting a competitor’s employees en masse, with the aim of disrupting its business.
• Misappropriation or theft of sensitive data: Fraudulent access to or disclosure of manufacturing secrets, customer files or internal data.
• Incitement to break commercial contracts: A company incites a competitor’s partners or suppliers to break off their collaboration, thereby creating a commercial imbalance.

What the case law says :

The Court of Cassation has ruled that the mere mass recruitment of employees is not enough to characterise unfair competition(Cass. Com, 26 September 2006, RJDA 2007, N°207). It is necessary to prove fraudulent intent or proven prejudice.

How do you prove internal disorganisation?

• Demonstrate that the competitor is denigrating your company in the eyes of your employees.
• Prove that the competitor is offering a higher salary to attract your employees.
• Establish that the competitor’s aim is suspect (misappropriation of know-how, access to strategic information).

General disruption: market disruption

General disruption differs from internal disruption in that it affects the entire market and not just a single company. It is similar to the concept of illegal competition, which sanctions abusive commercial practices aimed at distorting the rules of the market.

Examples of general disorganisation:

• Abusively low prices to squeeze out competitors and create a monopoly situation.
• Resale at a loss: Selling a product below its real cost in order to exclude a competitor from the market.
• Parallel distribution and diversion of sales channels to circumvent established commercial rules.
• Misleading bonus sales, where a company lures customers with fictitious advantages or unfair promotions.

Penalties and remedies in the event of disorganisation

A company that has been the victim of a disorganisation practice can take legal action and be assisted by our lawyers in unfair competition law to seek :

• Immediate cessation of the wrongful practices.
• Damages to compensate for the loss suffered.
• A formal notice to compel the opposing company to comply with the rules of the market.

6 Parasitism: an insidious form of unfair competition

Economic parasitism is an abusive commercial practice whereby a company takes advantage of a competitor’s efforts, know-how or investments without contributing to their development. Unlike other forms of unfair competition, parasitism is not necessarily based on direct imitation, but rather on the opportunistic appropriation of a competitor’s resources.

It can be perpetrated by a direct competitor or by another market player, and does not necessarily require a prior contractual relationship between the parties concerned.

Goldwin, experts in business law and unfair competition, can help you identify these practices and take the appropriate legal action.

Characteristics of parasitism: opportunistic exploitation

Parasitism is based on several elements:

• Absence of investment: The offending company makes no financial or human effort to develop a product or activity, but takes advantage of someone else’s work.
• Deliberate intent: There is a clear intention to exploit the success and reputation of a competitor.
• Negative impact on the victim company: Parasitism can cause a loss of market share, a weakening of reputation or a drop in revenue.

Please note: In law, proof of parasitism does not require proof of fault, as in the case of confusion or imitation. A simple presumption based on concrete facts may be sufficient to bring legal action.

Concrete examples of parasitism

• Use of a competitor’s reputation: A brand offers products that are compatible with those of a well-known company, without any official agreement, in order to benefit from its clientele.
• Reproduction of a business model without initial investment: A competitor copies an innovative concept or marketing strategy, without adding any new elements, and takes advantage of the advertising efforts already made by the pioneering company.
• Illegitimate appropriation of resources: A company exploits the results of research and development carried out by another company, without a patent having been filed.
• Usurpation of an image or expertise: A company pretends to be part of a franchise network or partnership, even though it has not signed any agreement with the brand concerned.

Possible penalties for economic parasitism :

• Immediate prohibition of parasitic practices by court order.
• The award of damages to compensate for the loss suffered.
• Publication of the sentence in newspapers or on professional platforms to restore the reputation of the victim company.

What to do when faced with an act of unfair competition?

If you are the victim of unfair competition, act quickly to avoid financial losses and protect your reputation.

Steps to take

• Consult a specialist lawyer to analyse your situation and determine the best strategy.
• Gather evidence (screenshots, testimonials, letters, etc.).
• Send a formal notice to the offending company.
• Take legal action if no amicable solution is found.

Why use our firm?

GOLDWIN has won some of the most important unfair competition cases in France . For example, it was behind the conviction of UBER on behalf of the French taxi federations and taxi collectives for infringement of the applicable regulations and illegal practice of the profession. Similarly, he represents trade bodies throughout the world in unfair competition actions, such as French hoteliers, whom he defends against AIRBNB, and numerous Interim companies against companies infringing their monopoly.

Cabinet Goldwin Avocat is for you:

• Recognised expertise in commercial law and unfair competition, with numerous cases defended.
• Personalised support to protect your business.
• Quick and effective solutions to defend your rights.

Conclusion: Call on an unfair competition lawyer in Paris

Are you a victim of unfair practices? Don’t let your business be weakened by abusive competition. Our business lawyers will work with you to enforce your rights and defend your business. We operate in Paris and throughout France.

Contact us now for a consultation on 01 45 33 50 73.