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Unfair competition: how can the use of a private detective be of great support?

Unfair competition and private detective
PROCAP DETECTIVE TOULON - Unfair competition: what is it? How can the use of a private detective be of great support?

Unfair competition: an attack on the principle of commercial fairness

If freedom of enterprise, and its corollary the principle of free competition, are rights with constitutional value, they are however not absolute principles, but are subject to delimitations, including the principle of commercial loyalty. Unfair competition is a breach of the principle of healthy competition between competing economic agents, as well as a breach of the obligation of commercial loyalty.

A concept coined by case law to qualify reprehensible behavior constituting a transgression of commercial freedom, unfair competition is the result of the transposition of “tort liability” to the commercial domain. Unfair competition is defined as a set of practices, behaviors or abusive actions of one company towards another, causing harm and contrary to the principle of loyalty which should govern a healthy relationship between competing economic actors. . It is most often an action committed by a competitor harming another company belonging to the same sector of activity (competitive link), causing economic damage (loss of turnover, performance ) or reputational (deterioration of value).

Although related to the field of competition law, unfair competition is essentially based on article 1240 of the Civil Code which states: "Any act whatsoever of man, which causes damage to another, obliges the person through whose fault it happened to repair it." It exposes its author to damages.

Unfair competition necessarily presupposes the meeting of four cumulative conditions:

  • A competitive link

  • A mistake made

  • Damage suffered

  • A causal link between the fault and the damage

Evidence of unfair competition

Freedom of proof is, with exceptions, the principle in evidentiary matters in the civil and commercial domain. This means that proof of a legal fact, and in this case unfair competition, can be provided by any means, subject however to compliance with the conditions of proportionality and fairness. The burden of proof lies with the applicant. In the case of unfair competition, it should be specified that the proof must have as its object the four cumulative conditions cited above, namely proof of the competitive link, proof of the fault committed, proof of the damage and, finally, proof of the link of causality.

Examples of practices deemed unfair

There is not just one form of unfair competition, but several. Over time, case law has identified a set of actions constituting unfair competition, as follows:

Unfair competition through confusion

Confusion designates a situation, resulting from imitation processes, tending to induce an error regarding the identity of the operator vis-à-vis the consumer. Unlike parasitism, which arises from the interference of one economic agent in the wake of another, confusion results from identification by imitation of the competitor with the aim of diverting customers or market share. The competitor seeks, through this mechanism, to win over the copied brand's customers. Confusion is, by far, one of the most common forms of unfair competition.

Characterize unfair competition through confusion:

  • Imitation or copy of the competing brand, trade name, logo-typical signs;

  • Imitation of the organization, processes, products and services;

  • Imitation of competitor's advertising;

  • Use of marketing procedures tending to create confusion between two competing companies;

Clarification regarding confusion: if the imitation concerns signs and characteristics protected under intellectual property, it will then be an infringement . In this case, the action for unfair competition is only admissible if the facts invoked under unfair competition are distinct from those constituting the infringement.

Unfair competition through denigration

Disparagement is the act of publicly discrediting a competing company.

The following fall within the scope of this qualification:

  • Making malicious remarks about the competitor

  • The dissemination of false information about the competitor (products, services, managers)

  • Systematic criticism of the competitor

  • Discredit on the quality of products and services, but also on staff

We generally speak of denigration when the attacks almost exclusively affect the services, products and reputation of the victim company. When the discredit is personally aimed at the manager or an ad hominem person, the facts fall under criminal law and can be prosecuted under the offenses of defamation or insult .

Unfair competition through parasitism

Parasitism refers to a set of behaviors and actions by which a company slavishly interferes in the wake of another in order to profit, at a lower cost, from its efforts, its know-how or its notoriety. . Unfair parasitic competition refers to the biological image of the parasitic agent which thrives by taking advantage of the resources of its host.

Are qualified as parasitism:

  • The plagiarist resumption of a competitor's catalog;

  • The fact, for a distributor, of reproducing and marketing an item at lower cost without any design costs using the manufacturer's know-how;

  • Taking unfair advantage of the reputation and notoriety of the competitor;

  • The unjustified attachment of the company to the competitor to benefit from its notoriety;

  • The use of trade names or well-known brands to designate a product;

  • The use of similar marketing pitches;

Unfair competition through disorganization

Disorganization consists of the implementation of processes aimed at destabilizing the competitor in the normal management of his business, with a view to weakening him and, ultimately, simply removing him from the game to monopolize customers or a market. .

The following constitute unfair competition due to disorganization:

  • Massive or selective poaching of employees;

  • Incitement to internal unrest;

  • Incitement to strike;

  • Staff corruption;

  • Poaching of employees bound by a non-competition clause (complicity in violation of a non-competition clause)

Unfair competition through unfair canvassing of customers

Unfair canvassing punishes aggressive commercial behavior, consisting of the use of quasi-predatory processes, targeting acquired customers in order to divert them.

The following are qualified as unfair canvassing:

  • Systematic, repeated or exclusive prospecting of customers of the competing company;

  • The use of false recommendations from the competing company;

  • Claiming non-existent links or relationships with the competing company;

  • Misappropriation of customer files (crime);

  • False, misleading advertising;

  • Canvassing on behalf of the competitor;

  • Abusive commercial canvassing

Unfair competition through diversion of orders

Unfair competition through the diversion of orders constitutes a form of disorganization. However, this takes place in the very execution of the activity and does not only target the general organization of the company. Here it is the processes (contracts, orders) which are compromised by unfair behavior, and no longer just organizational resources (poaching, social unrest, etc.).

  • The fact of an employee delaying the execution of orders in order to transfer them to the company he created;

  • The voluntary non-execution of orders for the purpose of diverting them to the competitor;

  • Unfair termination of orders or contracts;

  • Termination of contract for the benefit of the new company;

Unfair competition through illicit exploitation of protected know-how

  • The revelation to a third party of technical or commercial know-how (protected or not);

  • Disclosure of strategic information;

  • The exploitation of unauthorized know-how;

  • Prohibited use of a competitor's documentation;

  • The use of information obtained during talks;

Unfair competition: which competent jurisdiction(s)?

Unfair competition action is, in principle, within the jurisdiction of the commercial court of the competitor's headquarters. But unfair competition being a qualification covering protean situations, this rule of jurisdiction has multiple exceptions. Indeed, the plaintiff can also choose the commercial jurisdiction of the place where the acts were committed, or the jurisdiction in which the damage was suffered.

Likewise, if the unfair competition action is directed against a non-trader (independent natural person, liberal professional), in this case it is the Judicial Court which has full jurisdiction.

If the action is brought against a former employee bound by a non-competition clause, the action must be brought before the Industrial Tribunal. Likewise, in the case of complicity in non-compliance with a non-competition clause, the action for unfair competition first involves going before the Industrial Tribunal to resolve the dispute against the offending ex-employee, before to authorize the request of commercial jurisdiction against the complicit competitor.

Finally, if the acts of unfair competition reported are accompanied by an infringement of a private right relating to intellectual property (e.g. counterfeiting), it is the Specialized Judicial Court (Correctional Court) which has jurisdiction. But let us remember, in this specific case, that the action for unfair competition against the infringing competitor must necessarily be based on facts distinct from that of the infringement.

The jurisdictional jurisdiction for unfair competition action is therefore multiple and has numerous exceptions due to the characteristics of the infringement, the nature of the damage and its location, but also the status of the persons involved in the dispute.

How can a private detective help a company facing unfair competition?

Sometimes operating through hidden mechanisms, escaping the vigilance of the victim company, unfair competition is unique in that it is often discovered retrospectively, once its effects have been realized. The victim company then belatedly notices a loss of turnover, a deterioration in its performance and in some cases a leak of its internal resources (employees, know-how, etc.). It is about safeguarding the interests of the victim brand, but also its sustainability, that we aim to stop the trouble, pursue the perpetrators and repair the damage suffered. In the context of legal action in unfair competition, recourse to the services of an approved private detective can prove beneficial, if not decisive, and constitute a powerful lever for success.

Professional investigators and experts in the administration of evidence, private detectives are today essential players in the legal landscape. Exercising a regulated profession, recognized and subject to professional secrecy, the action of private detectives consists of helping their clients in the research and constitution of the evidence which is essential for them to take legal action, consolidate a procedure and resolve a dispute with success. To do this, they implement various effective solutions, processes and investigation techniques, to achieve the evidentiary objectives of their clients, while ensuring their usability under the law. Nowadays, whether in civil or commercial matters, more and more litigants, natural or legal persons, are using the services of private investigators to initiate or complete legal action; their reports are not only recognized by the courts, but they also often make all the difference in a given procedure.

In the context of an unfair competition action, a private investigator can help the victim company in several ways. He may be required to:

  • Gather, discreetly and legally, the factual elements constituting unfair competition;

  • Identify the perpetrator(s) of unfair competition;

  • Reveal the operating methods and expose the processes used;

  • Search, via discreet surveillance and shadowing operations, for elements of individual participation in acts of unfair competition, harmful illegal agreements or fraudulent actions;

  • Identify witnesses and organize hearings;

  • Draw up circumstantial reports of suspicious movements, meetings, appointments, agreements or dealings of an illicit nature;

  • Organize, through prior preparatory work, the intervention of a justice commissioner for the purposes of a report or interpellative summons;

  • Gather preliminary probative information with a view to a preliminary motion (art. 145 of the Code of Civil Procedure);

  • Collect evidence in the event of suspicion of criminal offenses (counterfeiting, smuggling, fraud, undeclared work, breach of trust, fraud, etc.) with a view to reporting or filing a complaint.


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