Exploitation of a Third Party's Breach of Contract in Competition

Facts

Parfums Christian Dior SA, Paris, has been distributing perfumes and cosmetic products through a selective distribution system in France and Switzerland since 1947. Impo Import Parfümerien AG, Zurich, also deals in perfumery and cosmetic goods and sells Dior products, which it obtains from the so-called grey market.

In January 1986, Parfums Christian Dior SA and its Swiss subsidiary obtained a provisional measure against Impo Import Parfümerien AG, prohibiting it from selling Dior products in its store in Lucerne. In September 1986, the two Dior companies sued Impo, seeking to prohibit it from selling Dior products, to have the seized goods destroyed, to order it to pay damages, and to have the judgment published. They accused the defendant of unfair competitive practices and violation of their personality rights.

The Cantonal Court of Lucerne dismissed the claim and lifted the seizure. The plaintiffs appealed against this judgment.

Considerations

The Federal Court states that the impairment of third parties' claims is only considered unlawful under competition law if special circumstances make it appear to be a breach of good faith. The mere exploitation of a third party's breach of contract is not sufficient for this.

Special circumstances that may make exploitation appear unfair can result in particular from the nature and purpose of the conduct, such as intent to cause harm or fraudulent deception. However, the mere circumvention of a closed market system or contractual price…