BREAKING: German FCJ declares AdBlock Plus legal
Germany’s Federal Court of Justice has today decided in a year-long dispute between the German news publisher Axel-Springer-Verlagand Eyeo, the Cologne-based company behind AdBlock Plus.
AdBlock Plus is a browser-addon that blocks banners, pop-ups and other ads. Eyeo claims it is being used on more than 100 Mio. devices around the world. Unwanted ads are listed in a ‘blacklist’ and automatically hidden from every website a user visits. However, Eyeo provides advertisers the opportunity to have their ads added to a ‘whitelist’, if they comply with certain standards that are set by Eyeo. Additionally, advertisers need to pay Eyeo to have their ads added to the whitelist. Once on the whitelist, ads will be shown to users even if they have AdBlock Plus installed.
Axel-Springer-Verlag took offence at this business model and took Eyeo to court in 2014, essentially requesting a ban of the software on the grounds of competition law. The Regional Court of Cologne dismissedthe claim, Axel Springer appealed. Upon appeal, the Higher Regional Court of Cologne partially reversedthe first instance decision and agreed with Axel Spinger that by requesting advertisers to pay in order to have their ads added to the whitelist, Eyeo displayed forbidden ‘aggressive commercial practices’.
Such practices are deemed illegal by Section 4a UWG, the German Act against unfair competition. Section 4a UWG reads:
“Unfairness shall have occurred where a person engages in an aggressive commercial practice which is suited to causing the consumer or other market participant to take a transactional decision which he would not have taken otherwise. A commercial practice shall be regarded as aggressive where, in the factual context and taking account of all its features and circumstances, it is suited to significantly impairing the consumer’s or other market participant’s freedom of choice by
1. harassment,
2. coercion, including the use of physical force, or
3. undue influence.”
The Higher Regional Court found that Eyeo’s business model could be seen as an ‘undue influence’ in the sense of the law. The judges saw a large market power of Eyeo due to the sheer number of AdBlock Plus users. Advertisers would be excluded from access to customers and had to buy their way out of this situation.
Eyeo took the case to the FCJ, which today ruled in the defendant’s favor (case No. I ZR 154/16). So far, only a press release is available and it usually takes several months before the written reasons are published. From the press release, it is clear that the judges saw no acts of unfair competition by Eyeo. They found that the provision of an ad-blocker does not constitute a deliberate obstruction of competitors (Section 4 UWG). The judges also denied a deliberate interference with the plaintiff’s business. According to the FCJ, it remains the end-users’ decision whether they install and use and ad-blocker. Because of this autonomous decision of the users, any interference would only be ‘indirect’. An indirect interference could not be considered unfair, the court found.
Finally, the FCJ disagreed with the Higher Regional Court regarding ‘aggressive commercial practices’ by Eyeo. The judges stated that AdBlock Plus was not suited to significantly impair market participant’s freedom of choice, especially with regards to the plaintiff, who is not a consumer but a large news publisher. The details of this argument remain to be seen once the written reasons become available.
*UPDATE*: for the first time ever in Germany, it was allowed to film during the oral proclamation of a judgment. You can view the proclamation in full here.
