While meeting the needs of many users, ad blocking software also affects the income of app operators whose ads are blocked, and causes disputes over unfair competition. On the afternoon of April 17, the Beijing Intellectual Property Court pronounced a verdict in the case of "Mango TV" v. "Blocking Elf" for automatically blocking splash screen advertisements, and the court finally found that the act of blocking splash screen ads by "Block Elf" software constituted unfair competition, and rejected the appeal and upheld the original judgment. According to the judgment, Beijing Yangao Jiutai Advertising Co., Ltd., the developer and operator of "Blocking Elf", must compensate "Mango TV" for economic losses of 80,000 yuan and reasonable expenses of 10,000 yuan.
The scene of the trial
Facts: Sued for helping users skip splash ads
It is understood that in this case, the software called "Blocking Elf" can allow users to skip the "Mango TV" opening screen advertisement. Therefore, Hunan Happy Sunshine Company, the operator of "Mango TV", believed that Beijing Yangao Jiutai Advertising Co., Ltd. was unfair competition and sued the court. Hunan Happy Sunshine Company believes that the sued act prevented the company from obtaining direct revenue from the "Mango TV" mobile phone software opening screen advertisement, causing the company to suffer a loss of profits and reducing its market competitiveness. However, Yangao Jiutai Company believes that the skipping function of the "Blocking Elf" software does not belong to the technical means of "hindering and destroying", nor does it affect the "normal operation" of "Mango TV", and the "Blocking Elf" software is to "skip and close" the opening screen advertisement through technical auxiliary means, which is to better realize the user's right to "one-click closing", and it is not an act of unfair competition.
The Chaoyang People's Court held in the first instance that Yangao Jiutai Company constituted unfair competition, and ruled that Beijing Yangao Jiutai Advertising Co., Ltd. should immediately stop the alleged unfair competition and compensate 80,000 yuan for economic losses and 10,000 yuan for reasonable expenses. Houyan Gao Jiutai Company appealed.
Disputes: There are legal risks for the convenience of users
At present, all kinds of mobile apps generally set up splash screen ads, among which, the design of some ad close buttons is often easy to cause users to touch it by mistake, thus jumping to other websites, affecting the user's experience. Since July 2021, the Ministry of Industry and Information Technology (MIIT) has begun to rectify software splash screen advertisements, strengthening the implementation of requirements for software operators to restrict click areas, prominently display "skip/close" buttons, and prominently display "click-to-jump third-party" logos. Since then, various interactive methods such as "shake", "twist", and "slide" have appeared one after another, causing user dissatisfaction.
In order to cater to the needs of users to skip ads, various ad blocking software and plug-ins have emerged in the market. The reporter searched and found that advertising slogans such as "one-click to skip the annoying App opening screen ads" and "the latest way to quickly block the opening screen ads to make the mobile phone clean and refreshing" can be seen everywhere, which seems to accurately hit the pain points of users.
At the same time, due to the impact on the normal advertising revenue of related apps, the unfair competition controversy about the screen open ad blocking software has also been around for a long time. For the relevant software developers, the development and operation of such software may be subject to legal risks. In August 2023, a piece of software called "Li Hopping" received a lawyer's letter from an Internet company accusing it of unfair competition because it provided related services, and finally "Li Hopping" announced that it would stop updating indefinitely.
Court: Blocking and intercepting constitutes unfair competition
On the afternoon of April 17, the Beijing Intellectual Property Court pronounced a verdict on the case. The court finally found that the behavior of the "Blocking Elf" software constituted unfair competition, and rejected the appeal and upheld the original judgment.
The judgment pointed out that "Mango TV" seeks corresponding economic benefits for itself while satisfying the consumption needs of Internet users, which is the normal state of market operation, and "Mango TV" has set up an open screen advertisement, but at the same time has set up a one-click close button, and Internet users can choose to watch or not watch the open screen advertisement according to their own needs. The evidence on record was not sufficient to prove that the appellee's splash screen advertisement infringed upon the legitimate rights and interests of consumers.
Although the appellant claimed that the "Block Genie" software was based on the skip method to close the opening screen ads, there was no blocking and blocking. However, the forensic video shows that after the user uses the "Block Genie" software and turns on the option to automatically skip ads, he clicks on "Mango TV", and the opening screen ads fail to display many times. Therefore, the "Blocking Genie" software actually blocks the splash screen advertising page legally provided by "Mango TV", instead of using only technical means to achieve skipping operations. The skipping method of the "Blocking Elf" software will make it impossible for "Mango TV" to achieve its commercial purpose of advertising to obtain revenue, which will essentially damage its business interests and reduce its competitive advantage in the market. In summary, the court held that the conduct involved in the case met the constitutive elements of an act of unfair competition.
The court held that technological innovation should be encouraged, but when using innovative technology to conduct market competition, it must not disrupt the order of market competition and harm the legitimate rights and interests of other business operators and consumers. In this case, Yan Gao Jiutai Company emphasized that the "Blocking Elf" software involved in the case used technical means to simulate clicking the skip button to achieve the closure of the opening screen advertisement, rather than directly blocking the opening screen advertisement. Even if the functional implementation of the "Blocking Genie" software is based on the independent choice of Internet users, the implementation of its functions should be limited to replacing users to click and skip to achieve the skipping effect of splash ads, and cannot directly block splash screen ads. Therefore, on the basis that the "Blocking Genie" software involved in the case not only helped users click and skip through technical means, but also directly blocked the splash screen advertisement, its conduct could hardly be justified, and the relevant appeal claims were not supported.
Zhu Wei, deputy director of the Communication Law Research Center of China University of Political Science and Law and member of the Expert Committee of the China Consumers Association, pointed out that from the perspective of the trial, "blocking elves" directly blocked the opening screen ads to a certain extent, which is two different concepts from "jumping instead of users". The practice of "blocking elves" is to embed something in a legally operated software to make a blocking choice on behalf of the consumer, which is an infringement.
Some netizens who watched the live broadcast compared the case to a business that posted an advertisement on the door of their home, and the resident entrusted the "security guard" to clean it up, so the business sued the security guard. What to make of this statement?
Zhu Wei responded that after allowing "security guards" to clean up small advertisements, it may "mean that in the future, the security guards at the entrance of the community can have the final say on behalf of the owner, the developer, and everyone, and only he has the final say." Then if he transports anything to the community in the future, he may charge a 'protection fee'. ”
"Suppose the case is won by the 'Stopping Elf'...... Today it is your splash screen ad, and tomorrow it may block your updated software patch. 'Security' becomes the dominant power of the owner's choice. He explained.
The reporter combed through and found that this is not the first unfair competition case caused by blocking App opening screen ads. According to reports, in August last year, the "Li Jumping" app, an open-screen ad blocking software, announced that it would stop updating indefinitely because it received a lawyer's letter from a well-known domestic Internet manufacturer, saying that the app was suspected of violating the relevant provisions of the Anti-Unfair Competition Law by blocking and filtering browser advertising services, constituting unfair competition.
Source: Southern Metropolis Daily, Beijing Daily
Editor: Sharon