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Inside track: Competition and Consumer Law

22 January 2019

#Competition & Consumer Law

Inside track: Competition and Consumer Law

In the media

Ultra Tune to pay $2.6 million penalty
The Federal Court has imposed a $2,604,000 penalty against Ultra Tune Australia Pty Ltd (Ultra Tune) for breaching both the Franchising Code of Conduct and the Australian Consumer Law (ACL). Justice Bromwich found that Ultra Tune had failed to act in good faith in breach of the Franchising Code, and had made false or misleading representations in breach of the ACL, in its dealings with a prospective franchisee (18 January 2019).  More...

Kleenheat pays $25,200 penalties over gas discount claims in WA
The ACCC alleged that Kleenheat's representation of what constituted as a discount was false and misleading because the discount only applied to a customer’s gas usage charges (but not to other charges, like the gas supply charge or account fee). In addition, the overall impression created by the advertisements was that the discount would apply while the consumer remained a customer, when in fact the discount only applied for 12 months (3 January 2019).  More...

Domain Register Pty Ltd - Court outcome
Domain Register has been found to have engaged in misleading and deceptive conduct by sending out certain types of unsolicited notices for domain name registrations. They have been ordered to offer a $249 refund each to more than 9,800 customers (27 December 2018).  More...

Employsure in court over misleading advertising and unconscionable conduct allegations
Civil proceedings have been instituted against employment relations company Employsure Pty Ltd for allegedly misleading small business consumers that it was, or was affiliated with, a government agency when that was not the case (21 December 2018).  More...

ACM to pay $750,000 for misleading, harassing and coercing consumers
The Federal Court has ordered one of Australia’s largest debt collection firms, ACM Group Ltd, to pay $750,000 in penalties for ACM’s misleading, harassing, coercive and unconscionable pursuit of unpaid debts from two vulnerable consumers. The Court has made a number of other orders, including that ACM pay the ACCC’s legal costs (21 December 2018).  More...

Full Federal Court dismisses ACCC appeal against Medibank
An appeal by the ACCC against a Federal Court judgment in relation to Medibank Private Limited (Medibank) over alleged Medibank made false, misleading or deceptive representations and engaged in unconscionable conduct has been dismissed by the Full Federal Court. Although the Full Court held that Medibank acted harshly and unfairly, it found this is not enough to establish statutory unconscionability (20 December 2018).  More...

ASIC commences action against financial publisher and its director for misleading publications
ASIC has commenced civil penalty proceedings in the Federal Court against Port Phillip Publishing Pty Ltd (PPP), an online financial publisher and Australian financial services licence (AFSL) holder. ASIC alleges that the article and the guide were misleading and deceptive because consumers could not mimic the performance of the Future Fund by adopting the promoted investment strategy, and that the testimonials contained in the article were false (21 December 2018).  More...

ASIC warns Coffs Harbour locals to watch out for super spruikers
The Australian Securities and Investments Commission (ASIC) is warning the public that superannuation spruikers are promoting illegal use of self-managed super funds (21 December 2018).  More...

Undischarged bankrupt and banned NSW builder charged with making false and misleading statements to ASIC
The allegations relate to Mr Rixon lodging forms with ASIC to register companies and appoint directors without their consent or using fictitious director names and, upon registration of those companies, lodging forms with ASIC to register business names (19 December 2018).  More...

Wotif forced to refund holidaymaker given 'basement' after tribunal finds misleading conduct
One of Australia's biggest holiday booking providers, Wotif, is misleading and deceptive in its promises that customers can "book with confidence" because the company has "heaps of local knowledge", a tribunal in Canberra has found (18 December 2018).  More...

$35 million boost to protecting consumers from cartels and anti-competitive conduct
The Australian Treasurer, Josh Frydenberg, has announced a $35m funding boost for the ACCC to appoint 16 additional investigators (six in cartels and 10 in the ACCC's anti-competitive conduct teams) in the hope this will result in an increased number of cartel prosecutions and "greater capacity to investigate competition issues, particularly in the financial sector" (15 December 2018).  More...

Northern Australian insurance needs immediate action
The Northern Australia Insurance Inquiry first interim report, found insurers are not actively trying to win market share in some high risk areas, but are instead seeking to deter customers and limit their exposure by raising premiums, leading to soft competition. Submissions in response to the draft recommendations are due by 12 April 2019 (18 December 2018).  More...

Jetstar singled out as the 'worst offender' for misleading ticket refund policies
Qantas, Virgin Australia, Jetstar and Tigerair are reviewing their refund policies after an ACCC investigation reveals they refused to offer refunds even if a flight was cancelled or there were significant delays (17 December 2018).  More... 

In practice and courts

ACCC discussion paper: Electricity monitoring
The ACCC has released a discussion paper relating to how it will conduct its new role of monitoring and reporting on supply of electricity in the National Electricity Market. Submissions are sought on three key areas. Submissions closed 19 December 2018, and the first report is due to the Treasurer on 31 March 2019. Read the media release and the discussion paper.

Therapeutic Goods Advertising Code
The Therapeutic Goods Advertising Code (the Code) ensures that the marketing and advertising of therapeutic goods is conducted in a manner that promotes the quality use of the product, is socially responsible and does not mislead or deceive the consumer. On 1 January 2019, the Therapeutic Goods Advertising Code (No. 2) 2018 took effect. The differences between the 2018 code and the 2018 code #2 are summarised here.

Cases

Telstra v Singtel Optus [2018] VSCA 347
CONSUMER LAW – Misleading or deceptive conduct – advertisement – representation as to rival telecommunications services – composition of class of persons to whom advertisement directed – whether recently arrived immigrants included – knowledge of reasonable member of class – exclusion of extreme reactions – whether court must consider nuances of pleaded representation – dominant message of advertisement – relevance of competitor advertising – Australian Consumer Law s 18 – Australian Competition and Consumer Commission v Snowdale (2016) 339 ALR 455, Tobacco Institute of Australia Ltd v Australian Federation of Consumer Organisations Inc [1992] FCA 630; (1992) 38 FCR 1, considered; Google Inc v Australian Competition and Consumer Commission (2013) 249 CLR 435; Campomar Sociedad Limitada v Nike International Ltd [2000] HCA 12; (2000) 202 CLR 45, applied.

Australian Competition and Consumer Commission v Medibank Private Limited [2018] FCAFC 235
CONSUMER LAW – Misleading or deceptive conduct – whether alleged representations made – whether primary judge gave overly technical meaning to words – whether primary judge required to have regard to range of characteristics of target audience – whether primary judge failed to draw inferences from evidence – whether primary judge failed to consider dominant message – where Respondent provided private health insurance – where target audience public at large – unconscionable conduct – failure to notify decision – whether conduct unconscionable in contravention of s 21 of the Australian Consumer Law.
Competition and Consumer Act 2010 (Cth), Sch 2, Australian Consumer Law, ss 21 and 22; Health Insurance Act 1973 (Cth); Private Health Insurance Act 2007 (Cth).

Australian Competition and Consumer Commission v ACM Group Limited (No 3) [2018] FCA 2059
CONSUMER LAW – Consideration of appropriate relief where the Court previously found that the respondent contravened ss 18, 20 and 50 of the Australian Consumer Law (ACL) – whether appropriate to grant injunctive relief under s 232 of the ACL – consideration of the appropriate quantum of pecuniary penalty to be awarded under s 224 of the ACL – whether appropriate to order that the respondent enter into a compliance program and publish corrective advertising under s 246 of the ACL – whether appropriate to make an adverse publicity order under s 247 of the ACL.
Australian Consumer Law (being Sch 2 to the Competition and Consumer Act 2010 (Cth)), ss 18, 21(1)(a), 50(1)(b), 224, 232, 246, 247
Competition and Consumer Act 2010 (Cth), ss 137H, 236, 237, 239
Australian Securities and Investments Commission Act 2001 (Cth), ss 12DA, 12DJ
ORDER 5: FORM OF NOTICE: CORRECTIVE NOTICE ORDERED BY THE FEDERAL COURT OF AUSTRALIA
Following action by the Australian Competition and Consumer Commission, the Federal Court of Australia has declared that ACM Group Ltd (ACM) engaged in undue harassment and coercion and misleading or deceptive and unconscionable conduct in its dealings with two consumers in the course of its business of debt collection.
The Federal Court has ordered ACM to pay pecuniary penalties in the amount of $750,000, establish a compliance program and publish this notice.

Neville's Bus Service Pty Ltd v Pitcher Partners Consulting Pty Ltd [2018] FCA 2098
TORTS – Applicant brought proceedings against three respondents, being two different Pitcher Partner entities and a former partner and director of each – allegations of deceit and negligence – where respondents engaged to provide services to the applicant to assist it prepare its tender bid for Transport for New South Wales (TfNSW) for provision of bus services – where costs calculated by the respondents contained an amortisation error which affected the tender bid – where applicant won the tender and entered into contract and novated leases based on erroneous figures – where result was that the contract with TfNSW was not as profitable as anticipated and the applicant was bound by novated lease obligations – where applicant alleges that respondents discovered the error and fraudulently concealed it – finding of fraudulent concealment – damages awarded in deceit.
AGENCY – Whether second respondent was an agent of the first and therefore liable – finding of agency relationship.
CONSUMER LAW – Where same circumstances gave rise to allegations of misleading and deceptive conduct in breach of the Australian Consumer Law.
CONTRACTS – Where same circumstances gave rise to allegations of breach of contract and claims for lost opportunities.
Competition and Consumer Act 2010 (Cth), Sch 2.

Unilever Australia Ltd v Beiersdorf Australia Ltd [2018] FCA 2076
CONSUMER LAW – Misleading or deceptive conduct contrary to s 18 Australian Consumer Law – false or misleading representations contrary to s 29(1) Australian Consumer Law – whether respondent represented to ordinary reasonable consumers of antiperspirant deodorants in Australia that its product had “similar antiperspirant efficacy” to the applicant’s product, or that its product had “greater antiperspirant efficacy” than all other “non-clinical” antiperspirant deodorants ordinarily available from supermarkets in Australia – representations not expressly made – representations implied or inferred from conduct in marketing, distributing and selling products – whether there was a “clinical” subcategory of the market for antiperspirant deodorants in Australia – what qualities or characteristics membership of the “clinical” subcategory conveyed to ordinary reasonable consumers – representations found not to be made – whether, if made, representations were false or misleading – where evidence sufficient to prove the falsity of some of the representations – whether laboratory test results were capable of proving that the applicant’s and respondent’s products were “similar” or that the respondent’s products were “superior” to all other “non-clinical” antiperspirant deodorants ordinarily available from supermarkets in Australia – whether, if made, respondent had reasonable grounds to make representations as to future matters – where respondent did not have reasonable grounds for making representations as to future matters – application dismissed.
Competition and Consumer Act 2010 (Cth) Sch 2, Australian Consumer Law , ss 4, 4(2), 18, 29, 29(1)(a), 29(1)(g); Evidence Act 1995 (Cth) ss 69, 135; Trade Practices Act 1974 (Cth) (repealed) s 52; Fair Trading Act 1987 (NSW) s 41(2).

Taylor & Anor v Hobson & Ors [2019] QSC 4 (No 15 of 2014)
PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – PLEADINGS – GENERALLY – Where the plaintiffs applied to amend the further amended statement of claim after the expiration of the limitation period – whether the new cause of action arises out of the same facts or substantially the same facts.
TRADE AND COMMERCE – COMPETITION, FAIR TRADING AND CONSUMER PROTECTION LEGISLATION – CONSUMER PROTECTION – MISLEADING OR DECEPTIVE CONDUCT OR FALSE REPRESENTATIONS – FALSE REPRESENTATIONS GENERALLY – Where the second plaintiff as purchaser entered into a share sale agreement with the second defendant as vendor – whether the first defendant made representations to the first plaintiff - whether representations were false – whether representations were relied upon in entering into agreement – whether representations were misleading –whether second plaintiff would have entered into agreement had representations not been made. The land upon which the Saltwater aquaculture venture had been conducted is crown land which had been leased by the crown to Hobson Investments.

Contacts:
Melbourne

Howard Rapke, Managing Partner, Melbourne
T: +61 3 9321 9752
E: howard.rapke@holdingredlich.com

Sydney
Ian Robertson, National Managing Partner
T: +61 2 8083 0401
E: ian.robertson@holdingredlich.com

Brisbane
Paul Venus, Managing Partner, Queensland
T: +71 7 3135 0613
E: paul.venus@holdingredlich.com

Disclaimer
The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this publication is accurate at the date it is received or that it will continue to be accurate in the future. We are not responsible for the information of any source to which a link is provided or reference is made and exclude all liability in connection with use of these sources.

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