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Using the Internet to Spread Malicious Rumours Is Not Fair Competition!

caravanLegitimate competition is one thing, but using the Internet to spread false rumours about a rival’s products is quite another. In a recent case, a businessman who resorted to such methods found himself under threat of imprisonment.

A company that produced stabilisers for use when towing caravans objected to videos that had been posted on YouTube by the businessman, who claimed to have developed a rival product. The videos variously alleged that the company’s business was fraudulent and that its stabilisers were inherently unsafe. They also made accusations of dishonesty against the company’s marketing manager.

After the company took legal advice and launched proceedings, alleging malicious falsehood and breaches of the Data Protection Act 1998, the High Court issued an injunction against the businessman that was designed to bring his harmful online activities to an end. The Court found that various claims made in the videos were false and that their continued publication would amount to a malicious act.

After the businessman breached the injunction, the company launched contempt proceedings. The Court found that, using pseudonyms, he had posted two further videos online in the knowledge that their contents breached the order. Although sentencing was adjourned, the Court has the power to impose a maximum two-year term of imprisonment or a substantial financial penalty.

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