In a ruling dated 24 June 2026, the Commercial Chamber of the French Court of Cassation reaffirmed that, in matters of unfair competition, a causal link between the wrongful conduct and the alleged diversion of customers must be established in order to obtain compensation for the resulting loss.

In June 2017, two employees of a market research institute resigned from their positions as Associate Director and Research Director to join a competing market research firm.

The two employees were alleged to have solicited clients on behalf of their future employer while they were still employed by their former company.

The original institute claimed that the competitor had unlawfully poached its employees and diverted its customers, arguing that these acts constituted unfair competition.

The French Court of Cassation was therefore asked to determine whether the Court of Appeal could award damages for the alleged loss of customers solely on the basis of conduct deemed unfair, without establishing that such conduct had in fact resulted in the diversion of those customers.

📌 The Commercial Chamber did more than simply reiterate the requirement to establish causation. It overturned the Court of Appeal’s reasoning, finding that it had merely assumed that the unfair conduct was necessarily the cause of all the alleged customer losses.

The Court thus emphasized that, in unfair competition cases, unfair conduct can justify an award of damages only if it is proven to have caused the diversion of customers for which compensation is sought. Such proof must be provided in respect of each customer concerned.