Federal Court of Justice on Influencer Advertising

The I. Civil Senate of the Federal Court of Justice today ruled in three proceedings on the question of whether female influencers have violated the obligation to label advertising with their Instagram posts.

The plaintiff in all proceedings is an association whose statutory tasks include the protection of the commercial interests of its members, including the prosecution of infringements of fair trading law. The defendants are influencers who post pictures on their Instagram profiles on the social media platform Instagram, often with short accompanying texts. In some images they have inserted so-called “tap tags” that appear when clicking on products seen in the images, such as clothing, and name the companies or brands of the manufacturers or suppliers of these products. When clicking on a “tap tag”, the user is redirected to the Instagram profile of the respective company.

The plaintiff considers this to be inadmissible surreptitious advertising and is claiming injunctive relief against each of the defendants.

Regarding the proceedings I ZR 90/20 – Influencer I:

Facts:

In particular, the defendant publishes pictures of sports exercises as well as fitness and nutrition tips on Instagram. It also maintains a commercial website on which it offers fitness courses and personal training for a fee and operates an online store. If the Defendant’s profile on Instagram is accessed, a reference to this Internet address appears, among other things.

One of Defendant’s Instagram posts complained of by Plaintiff concerns a “Raspberry Jam.” When clicking on the pictured product, a “tap tag” appears with the name of the manufacturer. When clicking on the “Tap Tag”, the user is redirected to the Instagram profile of the manufacturer. For this contribution, the defendant received consideration from the manufacturer.

Previous process history:

The district court sentenced the defendant as requested. The Higher Regional Court dismissed the defendant’s appeal. It assumed that the plaintiff was entitled to injunctive relief pursuant to Section 8 (1) of the German Civil Code. 1 sentence 1 and para. 3 No. 2, § 3 para. 1, § 5a para. 6 UWG to.

Decision of the Federal Court of Justice:

The Federal Court of Justice dismissed the defendant’s appeal. The Instagram posts at issue are business acts of the defendant within the meaning of sec. 2 para. 1 No. 1 UWG in favor of its own company and, in any case, the third-party company from which it received consideration for the contribution to the “Raspberry Jam”. This contribution is not sufficiently clearly marked as advertising. This justifies the requested ban.

Influencers who use a social medium like Instagram to sell goods, offer services, or market their own image are running a business. The publication of posts by these influencers in the social medium is likely to raise their profile and advertising value and thus promote their own business. However, the publication of a contribution – apart from the case here where the Influencer receives consideration for it – only constitutes a commercial act in favor of another company if the overall impression of this contribution is excessively promotional, for example because it solely praises the advantages of a product of this company without any critical distance in such a way that the presentation leaves the framework of factually induced information. The mere fact that images depicting the product are provided with “tap tags” is not sufficient for the assumption of such advertising surplus. In the case of a link to an Internet page of the manufacturer of the product depicted, on the other hand, there is regularly an advertising surplus. The examination of whether a contribution is excessively promotional requires a comprehensive assessment by the court of facts, which is lacking in the case in question with regard to the other contributions, for the publication of which no consideration has been established.

The contribution concerning the “Raspberry Jam”, for which the defendant received a consideration from the manufacturer, violates § 5a para. 6 UWG, because the commercial purpose of this contribution, to promote the sales of products of this manufacturer, is not sufficiently made clear according to the findings of the Higher Regional Court, which are free of legal errors, and is also not apparent from the circumstances. In this respect, it does not matter whether consumers realize that the defendant is acting for the benefit of its own company by publishing posts on its Instagram profile. It is precisely the purpose of a contribution to promote another’s business that must be apparent to consumers. The failure to disclose the commercial purpose of such a post provided with “tap tags” and links is regularly capable of inducing the consumer to make a commercial decision – clicking on the link leading to the Instagram profile of the manufacturer – which he would not have made otherwise. Furthermore, the contribution to the “Raspberry Jam” violates § 3a UWG in conjunction with § 6 para. 1 No. 1 TMG and Section 58 para. 1 sentence 1 RStV or § 22 para. 1 sentence 1 MStV, because the commercial communication or advertising contained therein is not clearly recognizable as such.

The lack of findings on the advertising surplus of the other posts does not affect the continuance of the appeal judgment, because the claims asserted with reference to the specific form of infringement – the Instagram profile of the defendant – are already well-founded in view of the commercial act of the defendant in favor of the company that provided consideration for the publication of the post on “Raspberry Jam”.

Regarding the proceedings I ZR 125/20 – Influencer II:

Facts:

The defendant maintains an account on Instagram, which it uses predominantly commercially and to which 1.7 million users were subscribed. The account is verified and therefore has a blue check mark at the beginning of the profile. The defendant regularly publishes pictures of herself with short accompanying texts on the topics of beauty, fashion, lifestyle and travel.

Previous process history:

The district court sentenced the defendant as requested. On appeal by the defendant, the Higher Regional Court dismissed the action. It assumed that the plaintiff was not entitled to injunctive relief under Section 8 (1). 1 sentence 1 and para. 3 No. 2, § 3 para. 1, § 5a para. 6 as well as § 3a UWG in connection with § 6 para. 1 No. 1 TMG or § 58 para. 1 sentence 1 RStV.

Decision of the Federal Court of Justice:

The Federal Court of Justice dismissed the plaintiff’s appeal. According to the findings of the Court of Appeal, which are not challenged by the appeal, the contributions complained of constitute business acts on the part of the defendant. Insofar as these business acts were carried out for the benefit of the defendant’s own company, there is no infringement of § 5a para. 6 UWG, because this commercial purpose results directly from the circumstances according to the appraisal of the Court of Appeal, which is not objectionable under the law of review. Insofar as the defendant acted in favor of other companies, there can likewise be no infringement of Section 5a (1). 6 UWG can be assumed, because this conduct of the defendant complies with the provisions of § 6 para. 1 No. 1 TMG, § 58 para. 1 sentence 1 RStV or § 22 para. 1 sentence 1 MStV is sufficient. Accordingly, commercial communication or advertising must be clearly recognizable as such in the case of sales-promoting statements in telemedia. However, in the absence of consideration from a third party, the contributions objected to do not constitute commercial communication or advertising within the meaning of these provisions. These provisions are sector-specific special provisions that do not fall within the scope of application of the general provision on fair trading under Section 5a (1) of the Austrian Unfair Competition Act. 6 UWG restrict.

The requirements of a violation of No. 11 of the Annex to Sec. 3 para. 3 UWG are likewise not present, because the contributions complained of are not financed by third parties.

Author: Marian Härtel

Marian Härtel ist Rechtsanwalt und Fachanwalt für IT-Recht mit einer über 25-jährigen Erfahrung als Unternehmer und Berater in den Bereichen Games, E-Sport, Blockchain, SaaS und Künstliche Intelligenz. Seine Beratungsschwerpunkte umfassen neben dem IT-Recht insbesondere das Urheberrecht, Medienrecht sowie Wettbewerbsrecht. Er betreut schwerpunktmäßig Start-ups, Agenturen und Influencer, die er in strategischen Fragen, komplexen Vertragsangelegenheiten sowie bei Investitionsprojekten begleitet. Dabei zeichnet sich seine Beratung durch einen interdisziplinären Ansatz aus, der juristische Expertise und langjährige unternehmerische Erfahrung miteinander verbindet. Ziel seiner Tätigkeit ist stets, Mandanten praxisorientierte Lösungen anzubieten und rechtlich fundierte Unterstützung bei der Umsetzung innovativer Geschäftsmodelle zu gewährleisten.