False advertising is the use of misleading, false, or unproven information to advertise products to consumers. False advertising is of particular importance under German competition law. Advertising patent protection for a product when the relevant product is in fact a utility model (and not a patent) constitutes misleading advertising of the relevant consumers.
The relevant consumers might mistakenly assume that a patent will be granted after having been examined by the Patent Office which is not, however, the case where a utility model is concerned. Such an assertion therefore leads to a misleading of the relevant customers. In the mind of the public it is assumed that a product, which is based on an inventive device, can only be acquired with the patent holder or his license holders. On the other hand, the utility model is unexamined and has no legal validity. This is misleading advertising by use of false assertion.
Other examples for a misleading advertising by use of false assertion is advertising for a price reduction by comparing prices that at no time before have been charged by a seller. The alleged difference between the false price and the reduced price creates the impression for the consumers that this is a particularly favourable offer when in fact customers are deceived by informing them with facts that are not true. When comparing identical products of other sellers, this leads the consumer to believe that this offer is a particularly favourable one which constitutes misleading advertising.
Apart from the cases of misleading advertising by conduct, e. g. using false information on the product description, the Act of Unfair Competition has been modified by § 5 a with the concept of misleading by omission. Unfairness shall have occurred where a person uses a misleading commercial practice. A commercial practice shall be deemed to be misleading if it contains untruthful information or other information suited to deception. It is also considered misleading practice if at the time of acquisition any special requirements and provisions which might influence the purchase price are not indicated sufficiently clearly and precisely. Advertising in respect of an obsolescent model at a specific price is, for instance, misleading if it is not clearly stated that it is an end model of a particular series (obsolescent model).