The plaintiff buyer acquired several commercial units in a large, mixed-use building complex from the 1970s by notarized purchase agreement. The seller assured that no special assessments or extraordinary costs were to be expected and provided the buyer with minutes of the last owners' meetings. Shortly before the notarization, however, the seller posted a report in a designated data room containing a decision by the owners to impose a special assessment of EUR 50 million for construction measures. As a result, the buyer was obliged to pay a special assessment for repair work, which prompted the buyer to contest the purchase agreement on the grounds of fraudulent misrepresentation. The Federal Court of Justice ruled that the seller was obliged to inform the buyer about these construction measures even without being asked, which could lead to a claim for damages under the German Civil Code (BGB).

The Federal Court of Justice ruled that a seller only fulfills its duty to provide information in connection with a data room if it can reasonably assume that the buyer will obtain relevant information by inspecting the documents provided there.

The BGH further ruled that although the seller is not obliged to provide all information directly, they must ensure that the buyer can easily find the information. In the specific case, the seller had failed to adequately inform the buyer about the newly uploaded documents in the data room, which is why the duty to inform was deemed not to have been fulfilled. The court emphasized that the “expectability” that the buyer will use the information depends on various factors, such as the organization of the data room and the buyer's due diligence.

Critics see the BGH's decision as shifting the risk of inadequate due diligence to the seller. They emphasize that it should not be the seller's responsibility to assess whether the buyer has the right advisors or is conducting a thorough review. This could lead to an unjustified transfer of risk and uncertainty, especially in company acquisitions, where buyers are generally responsible for their due diligence.

In practice, this means that sellers should take greater care to provide information in the data room in a structured, complete, and timely manner. It is recommended that they not only ensure that the information is accurate, but also that the buyer has the opportunity to review this information in a timely and easy manner.