28. Feb 17

OLG Frankfurt: The term “centre” potentially misleading

A ruling of the Oberlandesgericht (OLG) Frankfurt [Higher Regional Court of Frankfurt] shows that difficulties can arise if there is a desire at a later date to change the name of a company which was taken over and its name carried forward (Az.: 20 W 411/12).

GRP Rainer Lawyers and Tax Advisors in Cologne, Berlin, Bonn, Düsseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London conclude: In the case before the Oberlandesgericht Frankfurt, an optician had taken over a specialist store in the relevant field from the previous owner. The former continued the business under the same name with the addition of the phrase “eingetragene Kauffrau” (registered merchant/trader) and had the firm entered into the commercial register as such.

Several years later, there was a desire to add the word “Sehzentrum” (visual centre) and register the business under the new name. However, this proved challenging. The OLG Frankfurt first of all noted that continuing an existing company is generally only permissible if there is no doubt regarding the identity of the former and continued firm, stating that this condition had been met because the name had merely been augmented with the required phrase “eingetragene Kauffrau” pertaining to the business’s legal form. It also ruled, however, that any further changes while fundamentally adhering to a policy of continuing the former business were only acceptable under a limited set of circumstances; for instance, if changing the name is desirable from the perspective of the general public in the event that the previous scope of the business is to be restricted or expanded or the company’s head office relocated, or the prevailing situation has since changed to such an extent that the owner of the company can objectively be said to have a justified and legitimate interest in changing the firm’s name.

Notwithstanding this, the choice of the word “Sehzentrum” in rebranding the company was said to be misleading and therefore unlawful. The Court held that the average consumer would take the term “centre” to mean a business of considerable scale and importance, with this potentially being key to consumers’ decisions. The OLG went on to say that this scale or importance did not apply to the present case. As such, the term “Zentrum” was said to be liable to mislead.

Misrepresentation and other violations of competition law can have far-reaching consequences. Lawyers who are experienced in the field of competition law can take preventative measures to ensure that these kinds of violations do not occur in the first place as well as assist in enforcing and fending off claims arising from infringements of competition law.

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