The meaning of "any act of making a mark misleading the quality, contents, manufacturing method, use or quantity of the goods, or selling the goods with such mark" as provided for in the latter part of Article 2 subparagraph 1 (f) of the Unfair Competition Prevention and Trade Secret Protection Act, and where the act of falsely indicating the manufacturing cost of the goods or selling such goods constitutes such act.

"Act of making a mark to mislead consumers as to the quality, contents, manufacturing method, use, or quantity of the goods, or selling the goods bearing such mark" in the latter part of Article 2 subparagraph 1 (f) of the Unfair Competition Prevention and Trade Secret Protection Act (hereinafter referred to as the "Unfair Competition Prevention Act") means an act of making a false or exaggerated mark to mislead general consumers as to the quality, content, manufacturing and processing method, usage such as efficacy and method of use, or the number, volume, volume, etc. of the goods, or selling the goods bearing such mark. On the other hand, in a case where the concept of quality is embodied in the manufacturer of the goods and the indication contributes to the formation of the concept of quality of the goods in the trade society to which the consumers or traders of the goods belong, the act of expressing such manufacturing source on the goods or selling such goods constitutes an act that is likely to mislead general consumers as to the quality of the goods, and constitutes an unfair competition act under the latter part of Article 2 subparagraph 1 (f) of the Unfair Competition Prevention Act.

Article 2 subparag. 1 (f) and Article 18(3)1 of the Unfair Competition Prevention and Trade Secret Protection Act

Supreme Court Order 91Ma613 dated February 29, 1992 (Gong1992, 1267)

Defendant 1 and one other

Defendants

Attorney Kim Jong-sung

Seoul Central District Court Decision 2010No2630 Decided October 22, 2010

All appeals are dismissed.

The grounds of appeal are examined.

1. Article 2 subparagraph 1 (f) of the Unfair Competition Prevention and Trade Secret Protection Act (hereinafter "the Unfair Competition Prevention Act") provides a false or exaggerated mark which misleads consumers as to the quality, content, manufacturing method, use, or quantity of the goods, or the sale of the goods with such mark "the act of making a mark to mislead consumers as to the quality, content, manufacturing method, use of the goods, such as efficacy and method of use, or quantity of the goods, the number of the goods, the volume and weight of the goods, or selling the goods with such mark" (see Supreme Court Order 91Ma613, Feb. 29, 1992, etc.). Meanwhile, in a case where the concept of quality has been embodied in the manufacturing source of the goods and it contributes to the formation of the concept of quality of the goods in the trading society to which consumers, traders, etc. belong, the act of falsely indicating manufacturing source or selling such goods constitutes an unfair competition act under Article 2 subparagraph 1 (f) of the Unfair Competition Prevention Act.

2. We examine the above legal principles and records.

According to the evidence duly admitted by the court below, Defendant 1 sold a super-high speed outlet, etc., such as a machine pent, home pent, which was manufactured and supplied from the victim’s ○○○○○○○○○, who reported a food manufacturing and processing business from February 2007. However, as the supply of goods was delayed due to disputes with the victim, Defendant 1’s representative director from January 22, 2008 to the 30th day of the same month, and Defendant 2 Co., Ltd. (hereinafter “Defendant 2”)’s factory, which did not report the food manufacturing and processing business, did not appear to have made it impossible for ○○○○ to report the quality of goods to sell food to the above large food manufacturing and processing business entity, by falsely indicating “○○○○, Gyeonggi-si, Seoul Special Metropolitan City, which was the other party to the food manufacturing and processing business.” However, such large scale outlet, such as a product pent, made it impossible for ○○ to separately check the product labelling to sell the product.

Therefore, the manufacturing source "○○○ Materials" refers to an enterprise which reported the food manufacturing and processing business in relation to the pentry goods, and whose quality concept is embodied. Thus, the manufacturing source is deemed to contribute to the formation of concept about the quality of the goods in the trade society to which the consumers or traders of the pentry goods belong. As such, Defendant 1’s act of selling the pentry by falsely marking the manufacturing source of the pentry manufactured by Defendant 2, who did not report the food manufacturing and processing business, with the ○○○ materials as above, constitutes an unfair competition act under the latter part of Article 2 subparag. 1(f) of the Unfair Competition Prevention Act, and constitutes an unfair competition act under the latter part of Article 2 subparag. 1(f).

Although the reasoning of the court below is inappropriate, the court below's conclusion that Defendant 1's above act constitutes an unfair competition act under the latter part of Article 2 subparagraph 1 (f) of the Unfair Competition Prevention Act is justifiable. Thus, the court below's judgment does not err by misapprehending the legal principles on interpretation and application of the above provision, as otherwise alleged in the ground of appeal.

3. Therefore, all appeals are dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Sang-hoon (Presiding Justice)