What to do in case of warning letters and cease-and-desist declarations from Germany?
In Germany, cease-and-desist letters with a request to issue a cease-and-desist declaration and to pay attorney's fees and damages are a permissible means of pursuing various legal infringements out of court: For example, infringements of personal rights, untrue allegations, copyright infringements, trademark infringements, unfair competition. Especially in the case of Swiss websites, there is a risk of a warning notice under German law if the website can be accessed in Germany and/or offers its goods or services on the German market. Questions and answers as well as the correct procedure are explained in our article.
On what legal basis is the warning based?
The warning and request to submit a cease-and-desist declaration with a penalty clause is based on German law. In addition to the cease-and-desist letter, claims for removal, damages, and reimbursement of the warning's legal fees are asserted, usually by a law firm:
Copyright law: According to Section 97a (1) UrhG (D), the infringed party shall issue a warning to the infringer to cease and desist before initiating legal proceedings, and the infringer shall settle the dispute by issuing a cease-and-desist declaration with an agreement on an appropriate contractual penalty.
Right of personality: In the case of untrue statements of fact, the right to injunctive relief arises from Section 823 (1 ) in conjunction with Section 1004 BGB. In the case of a violation of a criminal law norm also from § 823 para. 2 and § 100 4 BGB in conjunction with § 185 ff. § 185 ff. BGB.
Trademark law: According to Section 14 (5) of the German Trademark Act (MarkenG ), the owner of the trademark may sue the infringer for injunctive relief if there is a risk of repetition.
Unfair competition: Pursuant to Section 13 (1) UWG (D), the entitled party shall issue a warning to the debtor prior to initiating legal proceedings and give the debtor the opportunity to settle the dispute by issuing a cease-and-desist declaration with an agreement on an appropriate contractual penalty.
The examples of rights violations are many,:
Copyright:
Use of other people's photos, including, for example, unauthorized editing, copying or use on commercial websites.
Use of music or video content
Use of logos or designs
Failure to comply with license terms, e.g. Creative Commons (CC) License for freely available images.
Use of third-party website content or designs
Use of foreign fonts
Personal rights:
untrue claims on social networks or websites;
Violation of privacy and intimate sphere, e.g. through publication of private or highly private photos or videos
Violation of the rights to the spoken word
Right of informational self-determination, including compliance with data protection (*)
Trademark law
Use of the logo of another's trademark
Mention of someone else's brand, e.g. with the online store
Naming of own products after well-known brand names
Use of likenesses with third party trademarks
Competition law
Use of an incomplete imprint, missing mandatory information in the imprint
Incorrect terms and conditions in the web store or on the website
Unauthorized advertising or use of photos
(*) In this regard, the Munich Regional Court(judgment of January 20, 2022, Case No. 3 O 17493/20) recently granted a claim for injunctive relief and damages because the website visited by the plaintiff had included so-called Google fonts by downloading them from the server, thereby transmitting the dynamic IP address of the website user to Google without consent. EUR 100 in damages was awarded. Such warnings are conceivable not only because of Google fonts, but also because of the integration of other web services without the user's consent.
Why is the warning issued by a law firm?
A warning by a law firm is issued for various reasons: On the one hand, formal requirements must be met when issuing a warning, otherwise the warning may be ineffective. On the other hand, warnings are a lucrative business for the lawyers involved. The legal fees are calculated according to the German Lawyers' Fees Act (Rechtsanwaltsvergütungsgesetz , D), which uses the amount in dispute as the basis for calculating the fees.
If the amount in dispute for the copyright infringement of a picture is EUR 5,000 to EUR 7,000, more than EUR 700 in legal fees will be incurred. If the amount in dispute is EUR 25,000 for a trademark case, for example, it is almost EUR 1,400 in legal fees.
Some law firms have focused on cease-and-desist letters, i.e. they specifically seek out infringements in order to issue cease-and-desist letters. Particularly in the case of mass cease-and-desist letters, some also call this "rip-off" or "cease-and-desist industry", since the focus is not on eliminating the infringement, but on enforcing fees.
However, warnings can also be issued by interest groups or consumer protection associations, some of which specialize in market or consumer protection compliance.
Why is it possible to issue warnings to Swiss website operators with German law and German fees?
If the website can be accessed in Germany, the German or European regulations apply, e.g. with regard to the imprint or the privacy policy. Copyright does not end at the national border either: anyone using photos and images must find out about the scope of the license to use them. The determination of the amount in dispute, attorney's fees and damages is based on the law of the country in which the infringed party is domiciled or whose rights are infringed, in this case Germany.
And of course it is much easier today to place cease-and-desist letters across borders, simply because e-mail makes the communication channels much simpler.
What can you do if you receive a warning? Our 5 most important tips
Check the cease-and-desist declaration carefully: Even if a short deadline has been set, do not sign a cease-and-desist declaration without prior legal review. Cease-and-desist declarations drafted by the warning party are often far too broad or the contractual penalty is unreasonable. Once a cease-and-desist declaration has been issued, it is valid for 30 years. Therefore: Never sign without a lawyer's review.
Do not call: In my experience, it is not very promising to call the warning party's attorney. First, you may be admitting to circumstances that are detrimental or lead to another warning. Secondly, the opposing attorney will not and may not advise you. He will therefore not offer you a beneficial solution. Only your own lawyer will do that.
Respond within the deadline: Short deadlines are often set for responding, sometimes only a few days. This is permissible due to the urgency of the matter, as legal proceedings can be initiated if the deadline expires. Those who do not react risk legal proceedings for injunctive relief and damages in Germany. In addition, there will be court costs and hassle. You should therefore react within the set deadline, if necessary by requesting an extension of the deadline for a few days. Within this time you can consult a lawyer.
Checking a warning: A warning notice must meet various formal requirements. The attorney's fees and damages must also be accurately quantified. If the warning is unjustified, the warned party can, for example, claim compensation for its legal defense costs(Section 97a (4) UrhG). If the warning is incorrect, there is no obligation to reimburse the costs. Issuing a preventive cease-and-desist declaration prevents a corrected warning.
Do not be afraid: Even if a cease-and-desist letter from another country seems threatening at first, laws that must be observed also apply there. In many cases, with the help of a lawyer, it is possible to avoid issuing a cease-and-desist declaration, to reduce monetary payments or even to reject a cease-and-desist letter completely.
Last but not least: How do Swiss courts deal with warning letters?
A German photographer received an expensive cease-and-desist letter for the use of photos by a stock corporation based in Zurich. The photos could be used under a so-called "Creative Commons License", but the corporation used them without stating the copyright and license. The corporation issued the required cease-and-desist declaration, but refused to pay the damages and attorney's fees and finally filed a negative declaratory action before the Commercial Court of the Canton of Zurich(Case No. HG180107-O).
The action in Switzerland was admissibly brought under the Lugano Convention; the cantonal commercial court has jurisdiction over disputes relating to intellectual property. German copyright law was applicable in the present case.
"The defendant cannot have suffered any damage from (any) missing links
either, since such electronic links would only have led to further free photographs of the defendant. In other words, lost follow-up orders are not apparent in the present case."
The defendant photographer did not succeed in the trial in presenting concrete evidence for the damage calculation or the circumstances for the occurrence of the damage and failed in the presentation and evidence requirement. The reimbursement of attorney's fees was also rejected by the Commercial Court, as the warning notice did not contain any concrete explanations of the infringing act and the infringed right and was thus not substantiated enough.
Conclusion
The corporation owed the defendant neither damages nor attorney's fees. In addition, the defendant had to pay the court costs of CHF 1,500. According to German substantiation standards, the defendant had arguably made sufficient submissions; however, this was not sufficient for the Commercial Court. If a German court had ruled on the claim, the verdict would probably not have been so happy in favor of the stock corporation.
Update 21 October 2022: warnings Google fonts
There is currently a so-called "wave of warnings" in Germany because of dynamic use of Google Fonts fonts. Dynamic means that the fonts are retrieved from the Google server and thus a transfer of the IP address as personal data to the USA takes place without the consent of the person concerned. After the LG Munich (judgment of 20.01.2022, Az. 3 O 17493/20) awarded damages of EUR 100 due to "discomfort" of the transmission of the IP address when retrieving Google fonts from the server of the Internet giant (dynamic integration), masses of website operators are being warned off. Swiss website operators can also be warned.
What to do:
1. The Google fonts should be made available locally on the web server for retrieval by the website (instead of downloading from the Google server)
2. Adjust your privacy policy and declaration of consent if you want to continue to dynamically download the fonts from the Google server.
3. never sign a cease and desist letter hastily, because it is effective for 30 years. Have a lawyer review a cease-and-desist letter and amend the cease-and-desist letter (if it is to be issued at all).
The current recommendation from colleagues in the IT sector is not to pay the demanded amounts of between EUR 100 - 300 under any circumstances and to disregard the warning letters. As of today, we agree with this recommendation.
It is questionable whether the courts will go along with this "mass warning" and award damages. For
(i) anyone who visits a website with knowledge of the use of dynamic Google fonts is unlikely to feel "unwell",
(ii) anyone who deliberately visits websites after dynamic integration of Google fonts in order to then issue a warning against them with costs is likely to be acting in abuse of rights,
(iii) the person concerned would have to prove that he or she actually called up the website and not just used a so-called crawler or automated program.
If a claim for information under data protection law is demanded, the claim may arise from Art. 15 GDPR and would (actually) have to be fulfilled. However, it is questionable whether the supervisory authorities will take mass action against recipients of the warnings if the information is not provided and the warnings could be abusive as described above.
If you have received a warning letter, we will be happy to assist you with advice and legal defense. Please contact Sven Kohlmeier for this purpose. As a German lawyer and specialist attorney for IT law, he has professional experience in dealing with warning letters from Germany and can provide you with comprehensive advice.