[Intellectual Property High Court, 13 November 2020, Case No. 1222 (Ne) of 2020]
[Case Summary]
A store manager at a Pachinko parlor (a slot machine parlor) operated by the appellee sent a message to other managers at other Pachinko parlors operated by the appellee that advertising and promotion using the game contents provided by the appellant for promoting sales for Pachinko parlors be prohibited. The appellant filed an appeal against the City Co.,Ltd. (the appellee) on the grounds that the act of the store manager constitutes the unfair competition act of the Unfair Competition Prevention Act. The Intellectual Property High Court dismissed the appeal on the ground that there is no competitive relationship between the appellant and the appellee.
[Point at Issue]
The point at issue is whether there is a competitive relationship between the appellant and the appellee or not.
【Decision】
(1) "Competitive relationship" under Article 2, Paragraph 1, Item 15 of the Unfair Competition Prevention Act
The term "competitive relationship" does not require the existence of a concrete competitive relationship in selling actual products. However, it does require the existence of a relationship in which the notifier puts the other party at a competitive disadvantage by notifying false facts that slander the other party's goods or damage the credibility of the other party, thereby gaining an unjust benefit in competition while the notifier handles the same kind of goods or providing the same kind of services, etc.
(2) Relationship between the appellant and the appellee
Since the appellant is a business operator that develops and sells sales promotion tools for Pachinko parlors, and the appellee is a stock company that plans and operates Pachinko parlors, the appellee is in the position of a customer who purchases the appellant's products, and there is no relationship between the two parties where they handle the same kind of products or provides the same kind of services. In addition, while consumers and trade partners of the appellant are mainly operators of Pachinko parlors, etc., consumers and partners of the appellee are general consumers, and there is no evidence that the appellee sells promotional tools to other Pachinko parlors, so the customers of the two companies are not common.
According to the above, the court finds that there is no "competitive relationship" between the appellant and the appellee under Article 2, Paragraph 1, Item 15 of the Unfair Competition Prevention Act.
[Analysis]
In this case, the point at issue is whether the appellee’s act constitutes a violation of Article 2, Paragraph 1, Item 15 of the Unfair Competition Prevention Act (Item 21 as of the 2018 amendment to the Act). The Item stipulates that the act of announcement or dissemination of a falsehood that harm the business reputation of another person who is a business competitor constitutes unfair competition.
In many cases, courts interpret the competitive relationship relatively broadly. In general, in order to say that there is a competitive relationship, it is not necessary that there is a specific competitive relationship with respect to the sale of goods.
The court held that there is no competitive relationship between the appellant, "a business operator engaged in the development and sale of sales promotion tools for Pachinko parlors," and the appellee, "a stock company engaged in the planning and operation of the Pachinko parlors.
The court gives importance to the fact that, regardless of whether the appellant's promotional tools are used or not used, there is no commonality of customers and the competitive relationship only arises between the Pachinko parlors operated by the appellant and other Pachinko parlors, and not between the appellant and the appellee.
This case better established parameters for interpreting competitive relationships.
IP High Court Found No Competitive Relationship between Game Parlor and its Provider of Promotional Material - Mobaslo case - Lexology
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