Free Riding in Action: When ‘Inspired By’ Crosses the Line

How does Free Riding look like in practice?

One example of such a situation is the case of L’Oréal v Bellure NV (C-487/07), which concerned, among other things, comparative advertising of cheaper perfumes that directly or indirectly “suggested” to consumers that they were equivalent to well-known products.

In its judgment, the CJEU referred to a situation in which someone takes advantage of the attractiveness, reputation and prestige of a renowned trademark to ‘operate in its shadow’, pointing out that the finding of free riding does not depend on whether there is a risk of misleading consumers or whether there is “dilution” or ‘damage to reputation’.

Even if the customer knows that it is not the original, there may still be an infringement if someone is exploiting the reputation of the mark.

As a result, the trademark owner may prohibit the use of the mark even if the ‘basic’ function of the mark, i.e. the indication of origin, is not affected, but other functions, such as advertising or investment, may be affected.