Most Read Contributor in Australia, September 2016
A recent majority decision of the High Court in ACCC
v TPG Internet Pty Ltd  HCA 54 confirms that courts
should focus on the "dominant message" in determining
whether an advertisement is misleading or deceptive and that the
conduct need not actually mislead or cause loss to consumers in
order to attract pecuniary penalties.
From September 2010 until November 2011, TPG Internet Pty Ltd
(TPG) ran an advertising campaign across a variety
of media outlets promoting an ADSL2+ service with unlimited
downloads. The campaign advertised the services for the price of
$29.99 per month. Much less prominently, the campaign explained
that this offer was only available in conjunction with a home phone
service at the cost of $30.00 per month. A set up fee and telephone
charges were also payable.
The Australian Competition and Consumer Commission
(ACCC) brought proceedings in the Federal Court
against TPG for misleading and deceptive conduct. The primary judge
agreed that the advertising campaign was misleading as it failed to
prominently specify the single price for the package of services
offered by TPG. A number of orders were made against TPG including
a monetary penalty of $2 million.
On appeal, the Full Bench of the Federal Court overturned all
but 3 of the primary judge's findings that TPG had engaged in
misleading and deceptive conduct and reduced the penalty to
$50,000. The Full Federal Court found that the primary judge had
erred in focusing on whether the "dominant message" of
the advertisements was misleading, without having regard to the
attributes of the hypothetical viewer and the full context of the
The Full Federal Court accepted that many viewers would absorb
only the general thrust of the advertisement, but it found that an
ordinary and reasonable viewer would be aware that broadband
services are sometimes offered as a "bundle" with
telephone services. The Full Federal Court found that the
advertisements were not misleading because the bundling condition
could only be missed by a perfunctory viewing (except in the case
of 3 advertisements).
A majority of the High Court overturned the Full Federal
Court's decision and reinstated the penalty imposed by the
The majority judgment stated that the primary judge was correct
to focus on the "dominant message" of the advertisement
and that the hypothetical reader's knowledge of
"bundling" was not sufficient to neutralise the
misleading nature of the advertisements. The High Court found that
the correct test was not whether the advertisements induced
potential customers to enter into an agreement with TPG but whether
a potential customer would engage in negotiations with TPG rather
than a competitor on the basis of the misleading advertisement.
The fact that there was little evidence that any consumers had
actually been mislead by the advertisements was irrelevant. The
relevant consideration was not whether a consumer had suffered loss
or actually been mislead but whether the advertisement, viewed as a
whole, has a tendency to lead a consumer into error.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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