The decision of the German Federal Supreme Court was based on the following set of facts:
The defendant was a sole trader in Berlin selling carpets and carpeting. As an insert in a Berlin newspaper he distributed the brochure “Fantastic Choice of Chinese carpets”. On page 4 of this, under the heading “consistent good value”, carpets with Persian patterns were pictured which bore descriptions such as “K. Medaillon-Moud”. “K. Birdjend” or “K. Herati”. The carpets concerned were machine made. The claimant, an association with legal personality, established in order to oversee compliance with the rules relating to unfair competition, considered that this advertisement was misleading and sought an injunction. As the basis for this it was alleged that the format of the brochure and the lay-out of the advertising would lead the reader to think, in the absence of any express reference to the fact that the carpets concerned were woven, that hand-knotted oriental carpets were being advertised.
The courts at first and second instance allowed the claim for an injunction, but the Federal Supreme Court dismissed it. In substance the reason for this was that, in answering the question whether advertisements or leaflets conveyed a misleading impression, reference was not to be made to the passing consumer when the goods concerned were not without some value and were reasonably durable (here: carpets). The standard of care of the averagely well-informed and sensible average consumer, whose level of comprehension was decisive, depended on the situation in question. Furthermore, the expressions “passing” and “sensible” were not mutually exclusive. The reader of the advertising brochure in question, who was interested in the acquisition of a carpet, would also read the explanations in small print under each picture, and therefore would not be misled into thinking that an original oriental carpet was being advertised.
The following authors examine the decision from the point of view of Spanish and Austrian law.European Review of Private Law