Is sending the dip within the legal deadline sufficient to exclude the licensor's liability?

Under the terms of Article L.330-3 of the Commercial Code, the transmission of a pre-contractual information document, or dip, is mandatory within 20 days before the signing of the contract when a person makes available to another, a commercial name, a brand or a sign, requiring an exclusivity or quasi-exclusivity commitment for the exercise of his activity.

The information contained in a dip must be sincere and serious in order to allow the co-contractor to make an informed commitment.In the judgment we are commenting on today, the dip had been communicated to the licensee about a year before the signature of the trademark license agreement, so the transmission deadline had been respected.But following the placement in judicial liquidation of the licensee, the latter sued his co-contractor for nullity of the contracts concluded for fraud under the retention of pre-contractual information. The licensee reproached the licensor for not having described in reality the state of the network, many of whose operators suffered operating losses.

The Paris Court of Appeal had rejected the licensee’s claims, which he then appealed to the Court of Cassation.

The Court of Cassation, for its part, quashed the appeal judgment and provides us with details:

1- The description of the network status in the dip

The state of the network as described in the dip must be consistent with the situation of the network at the time of signing the trademark license agreement, even if the deadline for sending the dip has been met.

In this case, the Licensor was accused of not having updated the information on the actual number of exits from the network following judicial liquidations, as well as the legal proceedings initiated by members of the network against the Licensor.

The Court of Cassation considers that the dip should have been updated since its state was modified before the signing of the contract, this information being likely to influence the will to contract of the licensee.

2- The provisional accounts transmitted by the licensor in the dip

The provisional accounts are not a mandatory mention in the dip, but when they are communicated by the licensor, the latter is likely to incur his responsibility if he transmits insincere information.

In this case, the licensee considered that the licensor had established provisional figures on average much higher than the licensee’s results from the signing of the license agreement.

The Court of Cassation quashed the appeal judgment, noting that the Paris Court of Appeal could not consider that these were only “non-contractual standard forecasts” and that the licensee had not demonstrated that he would have contracted under different conditions if he had been aware of this information, even though this information revealed the high risk of failure of the project in question.

In conclusion, the mere transmission within the legal period of the dip is not sufficient to exclude the responsibility of the licensor who must communicate up-to-date, serious and sincere data to the licensee.

Com., December 4, 2024, No.23-16.684