Australia: Competition & Consumer Law News – 27 June 2018

Last Updated: 2 July 2018
Article by Howard Rapke, Ian Robertson and Paul Venus

Most Read Contributor in Australia, September 2018

In the media

ACCC targets misleading organic claims
Dreamz Pty Ltd, trading as GAIA Skin Naturals (GAIA), has paid $37,800 in penalties for alleged false or misleading representations after the ACCC issued three infringement notices. GAIA described its Natural Baby Bath & Body Wash, Baby Shampoo and Baby Moisturiser as "Pure Natural Organic". However, these products contain two synthetic chemical preservatives: sodium hydroxyl methyl glycinate and phenoxyethanol (20 June 2018). More...

ACCC: Alinta Energy misled consumers on discounts
Alinta Energy (Alinta) has undertaken to compensate thousands of Victorians for making misleading electricity price comparisons which the ACCC considered were likely in breach of the Australian Consumer Law. Between 9 December 2017 and 28 February 2018, Alinta's advertisements compared increases in its competitors' standing or undiscounted tariff rates to decreases in Alinta's discounted tariff rates (20 June 2018). More...

Misuse of SMSF funds sees adviser convicted
After a history of non-compliance, a former financial adviser has been convicted for engaging in dishonest conduct with investor funds, including money from SMSFs. The investigation also found that Mr Nakhl made false and misleading statements and engaged in misleading and deceptive conduct, including making statements about the returns clients could expect and the risks of the investments he promoted (19 June 2018). More...

Apple fined $9 million as Federal Court finds repairs policy breached Australian Consumer Law
The Federal Court of Australia has fined Apple $9 million after it ruled that the company's repair policies breached the Australian Consumer Law (ACL). Justice Michael Lee ruled that Apple engaged in misleading or deceptive conduct, or conduct that was likely to mislead or deceive, ruling that its refusal to provide free repairs to Apple devices previously serviced by a third party was in contravention of the ACL (19 June 2018). More... More...

Domain name registrars ordered to pay nearly $2M over billing claims
The Federal Court of Australia has ordered domain registrars Domain Name Corp and Domain Name Agency a combined amount of $1.95 million in penalties after they sent out approximately 300,000 unsolicited notices to businesses. The ACCC alleges that because these notices looked like they were renewal invoices, many businesses paid them thinking they were simply renewing the domain name for their business (15 June 2018). More... More...

Priestley steps down from ASX, Future Fund amid cartel case 'distraction'
The former chief executive of JP Morgan in Australia, Rob Priestley, is resigning from the boards of the ASX and the Future Fund, saying the cartel case over ANZ's capital raising may become a "distraction" (18 June 2018). More...

A Sydney retailer is suing the NSW government claiming its profits were halved by the delayed light rail project
Watches of Switzerland is the first retailer to launch legal action against the government and Transport for NSW over the 12-kilometre project. Spanish subcontractor Acciona is suing the government for more than $1 billion in compensation for "misleading or deceptive conduct" over the contract to design and build the line (18 June 2018). More...

ASIC powers over Initial coin offerings in Australia
The ACCC's powers under the ACL have recently been delegated, in relation to ICO/token sales only, to ASIC. What this means is that ASIC now has jurisdiction to raise issues of misleading and deceptive conduct in relation to ICOs without needing to establish that an ICO is the offer of a security (13 June 2018). More...

Bananacoast Community Credit Union pays $50,400 for misleading advertising and provides remediation to consumers
ASIC enforcement action has resulted in four infringement notices totalling $50,400 to Bananacoast Community Credit Union Pty Ltd (BCU) for potentially misleading statements in several online advertisements, as well as remediation to affected consumers (13 June 2018). More...

Australia Post 'misled' franchisees, Senate inquiry told
Australia Post misrepresented the growth potential and banking accreditation of a franchise model it pitched to licensed post office owners in 2006, but the aggrieved franchisees have no affordable recourse, a Senate inquiry into franchising has been told (11 June 2018). More...

Criminal charges against banking 'cartels' show Australia is getting tough on competition law
The case, brought by the Commonwealth Director of Public Prosecutions (CDPP) after an investigation by the Australian Competition and Consumer Commission (ACCC), is the second prosecution of its kind to be brought in Australia since competition laws were tightened almost a decade ago (08 June 2018). More...

Published reports

2018 Retail energy competition review
Australian Energy Market Commission: 15 June 2018
This year's review found that while competition in the retail energy market continues to evolve, it is currently not delivering the expected benefits to consumers.

Water monitoring report 2016–17
Australian Competition and Consumer Commission: 12 June 2018
The ACCC has completed its eighth annual report under the Water Act 2007 (Cth). This report provides information on the state of the rural water sector in the Murray-Darling Basin for the 2016–17 financial year.

Cases

Australian Competition and Consumer Commission v The Construction, Forestry, Mining and Energy Union (No 4) [2018] FCA 684
COMPETITION – secondary boycott – pecuniary penalties – course of conduct and totality principles – relevance to penalty of actual loss and damage occurring in secondary boycott – injunctions – compliance program – form of declarations.
COSTS – Calderbank offer – relevant factors – special consideration of regulator's role.
COSTS – apportionment of costs Fair Work Act 2009 (Cth); Trade Practices Act 1974 (Cth).

Robinson v 470 St Kilda Road Pty Ltd [2018] FCAFC 84
DAMAGES – loss or damage – assessment of damages – causation – where the claim for damages was run as an "all or nothing" case – whether the primary judge erred in concluding that the consequence of the appellant's failure to disclose its financial position was that the respondent would not have paid a sum in respect of the payment claim – where the primary judge's conclusion at trial was open on the evidence adduced and the case as pleaded.
CONSUMER LAW – misleading or deceptive conduct – loss or damage – assessment of damages – proportionate liability – application of Competition and Consumer Act 2010 (Cth) Pt VIA, Proportionate liability for misleading and deceptive conduct – "apportionable claim" – "concurrent wrongdoer" – Tesco liability – whether the director's liability for an act should be reduced from 100% to 50% to be shared with the company.

Australian Competition and Consumer Commission v Pfizer Australia Pty Ltd [2018] FCAFC 78
COMPETITION – appeal by the Australian Competition and Consumer Commission against an order of the Federal Court dismissing a proceeding against Pfizer in which the ACCC alleged that Pfizer had contravened s 46 and s 47(1) of the Competition and Consumer Act 2010 (Cth) when it took certain steps pursuant to a plan designed to enable Pfizer to compete in the market for the wholesale supply of a pharmaceutical (atorvastatin) to community pharmacies in Australia after the expiry of the Australian patent for atorvastatin held by Pfizer.
COMPETITION – misuse of market power – whether the primary judge erred in market definition – whether the respondent had a substantial degree of market power in the relevant market – whether the respondent took advantage of its market power – whether the respondent had the purpose of "deterring" a person from engaging in competitive conduct in the atorvastatin market – whether the ACCC's case as pleaded was legally incoherent.
COMPETITION – exclusive dealing – whether the respondent supplied upon "condition" – whether the respondent had the purpose of substantially "hindering" competition in the atorvastatin market – whether s 51(3) defence was established.

Midland Metals Overseas v Australian Cablemakers Association [2018] NSWSC 938
Proceedings dismissed with costs; liberty to apply for some further or varied costs orders.
COMMERCE – misleading or deceptive conduct – where the Australian Cablemakers Association sent letters to government Ministers informing them of safety concerns with Midland's cable – common ground that the letter contained incorrect representations – whether the letters had tendency to lead the recipient Ministers into error – enquiry to be conducted by reference to the objectively known characteristics of the recipient – each recipient had available considerable expert resources which they would inevitably consider before forming a conclusion on the letter – no likelihood that the letter by itself would lead any Minister into error – this conclusion is supported by reference to what actually took place – no misleading or deceptive conduct – proceedings dismissed.
Australian Consumer Law , Schedule 2 to the Competition and Consumer Act 2010 (Cth).

Hilchrist Pty Ltd v Visual Integrity Pty Ltd [2018] QDC 097
CONTRACT – Agreement contemplating formal document – whether formal agreement superseded informal agreement – effect of change of parties.
CONTRACT – Conditions and warranties – interpretation of terms – whether breaches of warranties proved – whether substantial damages proved.
EQUITY – Equitable estates and interests – vendor's lien – whether available over personalty – whether arising.
FRAUD, MISREPRESENTATION AND UNDUE INFLUENCE – Alienation of property with intent to defraud – nature of intent – whether proved.
TRADE PRACTICES – Misleading and deceptive conduct – whether representation made – whether relied on.

Telstra Corporation Ltd v Singtel Optus Pty Ltd (No 2) [2018] VSC 280
CONSUMER LAW – Alleged misleading or deceptive conduct – Whether defendant's advertisements breach Australian Consumer Law (sch 2 to the Competition and Consumer Act 2010 (Cth)) – False or misleading representations – Whether representations liable to mislead as to performance characteristics of services – held advertisement did not convey pleaded representations – Claim dismissed.

Commissioner for Consumer Affairs v Koutropoulos & Anor [2018] SASC 79
Trade and commerce - Competition, fair trading and consumer protection legislation - enforcement and remedies - penalty - principles of assessment - consumer protection contraventions.
Trade and commerce - competition, fair trading and consumer protection legislation - consumer protection - misleading or deceptive conduct or false representations.
Trade and commerce - competition, fair trading and consumer protection legislation - enforcement and remedies - penalty.
The defendants admitted to 18 contraventions of sections 18(1), 29(1)(m) and 36(4) of the Australian Consumer Law (ACL) in connection with the provision of international travel services.
Defendants ordered to pay compensation to specific consumers named in the judgment, and to any other consumers who are assessed by Consumer and Business Services as having been adversely affected.
Pecuniary penalties of $50,000 in relation to the first defendant and $100,000 in relation to the second defendant imposed.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

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