Executive Liable for Misleading Advertising

Oct 17, 2025 Benn-Ibler Rechtsanwälte

The Austrian Supreme Court (Oberster Gerichtshof, OGH) has confirmed that the distribution of misleading advertising materials, which may create false impressions regarding the risk profile and value stability of securities, can establish liability for members of the management board. In the case at hand, the defendant, acting as chairman of the board, had authorized such advertising activities, recognized their potential to mislead prospective investors, and accepted that such misinformation could influence investment decisions. Consequently, the chairman was held liable for aiding and abetting in the dissemination of deceptive advertising.

Active participation or acquiescence as grounds for liability

The OGH clarified that mere passive awareness of misleading statements is insufficient to establish liability. For liability to arise, it is necessary that the individual either actively contributed to the formulation or dissemination of the information, or at minimum, knowingly acquiesced to the deception. In the case at hand, the defendant endorsed the content of the brochures despite their objectively inaccurate depiction of the financial product's security and stability. These representations went beyond mere opinion or marketing exaggeration; they were interpreted as specific factual assertions that held substantial significance for the investment decisions of the average retail investor.

The OGH emphasised that the details concerning the supposed security of the investment played a major role in influencing the plaintiff’s decision to invest.The board, aware of the misleading communication and its impact on investors, was justly accused of aiding deception.

OGH 6 Ob 81/25t (6 July 2025)