Städtische Werke Lauf a.d. Pegnitz GmbH – Court Ruling (Germany, 2022)

eprimo, a German electricity supplier, distributed advertisements consisting of displaying banners in the email inboxes of the T-Online free email service. When users opened their inbox, those advertisements were shown to them at random, indistinguishable from the list of emails in the users' inbox except for the fact that the date was replaced by the word ‘Anzeige’ (advertisement), no sender was mentioned and the text appeared against a grey background. When clicking on what looked like an email at first glance, the users were shown that advertisement. This procedure is known as inbox advertising. Städtische Werke Lauf a.d Pegnitz GmbH (‘StWL’) is a competitor of eprimo and considered eprimo's inbox advertising unlawful under the rules of unfair competition because there was no prior consent by the users. StWL, after at first succeeding with an action before the Regional Court of Nuremberg-Fürth, lost the case in the second instance before the Higher Regional Court of Nuremberg. When it appealed at the BGH, it referred the subject to the CJEU. In particular, it asked whether inbox advertising was compatible with the ePrivacy Directive and the Unfair Commercial Practices Directive which require consent for electronic mail that is sent to users for the purposes of direct marketing, prohibiting unsolicited communications. The CJEU decided that inbox advertisements require prior consent. The BGH agreed with the StWL and overturned the Regional Court's decision, taking into consideration the CJEU's ruling. It held that eprimo had violated competition law and had to compensate StWL. According to the court, pursuant to § 7(2)(3) Act against Unfair Competition (Gesetz gegen den unlauteren Wettbewerb - UWG), any direct marketing using the email inbox of the user requires prior consent. Such consent had not been obtained by eprimo. It assumed that it is irrelevant whether potential users of the free email service had been made aware of the use of parts of the internet pages by advertising providers. A merely general consent to receive advertisements, which is not related to the specific advertising complained of, in order not to have to pay for the use of the e-mail service, does not fulfil the requirements of consent pursuant to Article 13(1) ePrivacy Directive. For the court, one important factor for the unlawfulness and the impact on the user's privacy was the fact that the inbox advertisements are displayed at a position where one would normally find personal email, thus constituting a significant burden on the user.