Can an unfair practice form the basis of an action for unfair competition

In a judgment of 14 May 2025, the Court of Cassation questioned the possibility of bringing an action for unfair competition relating to a commercial practice, with no direct link to the consumer, whereas this practice would not substantially alter the consumer’s economic behaviour.  

In the context of this case, a company in the pharmaceutical field “Pharmacorp” criticizes a competing company for having invoked more than twenty years of experience, which it did not have, to claim a higher number of members than reality and to reference a pharmacy not part of its group  on its website.  

Pharmacorp sues the competing company before the Commercial Court on the basis of Article 1240 of the Civil Code, for unfair competition and on the basis of Article L121-1 of the Consumer Code, for misleading commercial practices.  

A decision of first instance is rendered, giving rise to a judgment of the Toulouse Court of Appeal, rejecting the requests of the company Pharmacorp considering that the bailiff’s report communicated did not mention the assertion of a number of members greater than fifty and that such an assertion appears only from an extract from the website of the competing company, with mention of a date of printing, which has no certain date and is not contemporary with the findings of the bailiff.  

The Touloise Court of Appeal concluded that the documents produced did not establish that the competing company claimed at least fifty members. 

Pharmacorp disputes this interpretation, in that the judge allegedly misrepresented the writing submitted to him and files an appeal in cassation before the Court of Cassation.  

In response to this argument, the Court of Cassation considers that the Court of Appeal misrepresented the writing submitted to it insofar as the bailiff’s report actually showed on page 14 the mention “Maxipharma is a group of more than 50 pharmacies spread throughout France“.  

Then, in a bold manner, the Court of Cassation departs from the complaints of Pharmacorp and ex officio, pursuant to Article 620 of the Code of Civil Procedure, finds a new plea relating to the question of whether a commercial practice that does not have a direct link with the promotion, sale or supply of a product to consumers can, if it appears to be at fault, lead to the conviction of its author on the basis of unfair competition, even if it would not or would not be likely to substantially alter the economic behaviour of the consumer who is reasonably well-informed and reasonably observant and circumspect, with regard to a good or service.  

To this question the Court of Cassation recalls beforehand that Article L121-1 of the Consumer Code, on unfair commercial practices, is a transposition of Directive 2005/29/EC, the material scope of which extends to any commercial practice that has a direct link with the promotion, sale or supply of a product to consumers.  

It therefore recalls that unfair commercial practices which only harm the economic interests of competitors or which concern a transaction between professionals are excluded from its scope (CJEU, judgments of 14 January 2010, Plus Warenhandelsgesellschaft, C-304/08, paragraph 39)

  Consequently, an unfair commercial practice with a direct link to the consumer must alter or be likely to materially alter the consumer’s economic behaviour to form the basis for an action for unfair competition.  

Conversely, the Court of Cassation specifies that a commercial practice that does not have a direct link with the promotion, sale or supply of a product to consumers may, if it appears to be at fault, lead to the conviction of its author on the basis of unfair competition, even if it would not or would not be likely to substantially alter the economic behaviour of the consumer who is reasonably well-informed and reasonably observant and circumspect, with regard to a good or service. 

References: 14 May 2025, Court of Cassation, Appeal No. 23-23.060