The Commercial Court of Zurich assessed the admissibility of an advertising campaign of a household product manufacturer and commented on the issue of when comparative advertising was (in)admissible. The Commercial Court came to the conclusion that the contested messages in the advertisement would not be taken at face value by the public and were thus not unfair. What is remarkable about this decision is the fact that the Commercial Court defined the limits of what is admissible rather broadly.

Facts

This case is based on a tongue­in­cheek advertising campaign of a household product manufacturer of, which among other things distributes a manual coffee press. The sued manufacturer of the coffee press advertised its product with the message «clearly the best way to brew coffee» and with the slogan «make taste, not waste». In the advertisement crushed coffee capsules were depicted. This was a visual allusion to the coffee brewing system of the claimant.

Unfair Competition

Any behaviour or business practice that is deceptive or that in any other way infringes the principle of good faith and which affects the relationship between competitors or between suppliers and customers shall be deemed unfair and unlawful. Some typical unfair practices are mentioned in the Federal Law on Unfair Competition. Advertising shall be deemed unfair if it contains incorrect or misleading information. Information as referred to in the context of this provision means statements on a com­ pany’s own goods, services and prices or on those of competitors.

Only facts – as opposed to opinions – can be incorrect and thus be verified. However, opinions may also be dis­ paraging and therefore illegal in indi­ vidual cases, when it comes to com­ parative advertising.

The Commercial Court of Zurich stated that the understanding of such a mes­ sage by the average consumers and/or by advertising recipients was crucial for the assessment of an advertising message.

Comparative Advertising

The Commercial Court based its argu­ments on the principle that a comparison with competing products must not be misleading or unnecessarily disparaging. The Commercial Court confirmed that the admissibility of the comparison re­quires that the goods or services are comparable. This applies only in case of identical or equivalent goods or services.

In the contested coffee advertisement, the coffee brewing systems of the parties compared were deemed to be equiva­ lent goods. The slogan «make taste, not waste» and the image of the crushed capsules show to the consumers that the capsule system of the claimant pro­ duces waste, whereas the system of the defendant produces no or only little waste. According to the Commercial Court, the average consumer would not understand the advertisement in such a way that capsule systems produce cof­ fee without taste. In this respect, the advertisement does not convey an incorrect or misleading impression. The Commercial Court continued in stating that in case of a comparison, it is not necessary to mention all comparison criteria in advertising. It was admissible to limit the criteria to specific elements, such as the system of coffee brewing and waste disposal issue.

In the Commercial Court’s view, the con­ tested advertisement did not qualify as unnecessarily disparaging. Dispara­gement is not prohibited per se, but only if it is unnecessary. Blanket disqua­ lification of a competitor and unrelated criticism of its product are inadmissible. Disparaging advertising becomes illegal when the statements on the competitor’s product imply that the product is inferior overall. However, competitors are allowed to present their product under the best possible angle, as this was adjudicated in the present case.

To sum up, in the Commercial Court’s view, there was no unfair comparison in the advertisement of the defendant.

The judgement of the Commercial Court goes very far. The message «make taste, not waste» in combination with the image of the crushed coffee cap­ sules is a negative statement about the competitor’s product. Moreover, there is no apparent reason why it should be necessary and thus allowed to praise the benefits of a company’s own product by making negative statements on the competitor’s product. Finally, the Com­ mercial Court’s findings that in case of a comparison not all comparison criteria must be mentioned is also debatable. A comparison is critical when only those criteria are singled out which make consumers believe that a company’s pro­duct is better than the product of its competitor(s). This is precisely what the defendant did in its advertisement. 

Unique Selling Proposition Advertising

The claimant also criticised the second advertising slogan of the defendant, namely «clearly the best way to brew coffee». According to the claimant, this is inadmissible unique selling proposition advertising and at the same time sole position advertising. This type of advertising message claims that there are no other products with equi­ valent properties. 

The Commercial Court concluded that the average consumer did not understand the claims in the advertisement as fact­ ual statements but rather as pure over­ statements which consumers do not take for granted. According to the Commercial Court, the slogan «clearly the best way to brew coffee» is a general emotional ad­ vertisement. The question of which coffee tastes best depends on each individual person’s view. According to the Commer­ cial Court, the slogan «clearly the best way to brew coffee» is merely an opinion which cannot be verified and is thus not contestable.

Conclusion

The decision of the Commercial Court tends not to overestimate exaggerations of advertisement. However, it is sur­ prising that the Commercial Court even allowed comparing products by «cherry picking». It is premature to assess the im­ pact of the ruling of the Commercial Court for future cases. Some findings in the judgment of the Court are inconsis­ tent with the Rules of the self­regulation organization Swiss Commission for Fair­ ness («Schweizerische Lauterkeitskom­ mission»; Rule 3.5). These Rules are, of course, not binding on state courts, but may give some guidance.