Key points

  • In June 2008, we reported on the Federal Court's decision in Bond v Barry, which upheld a defence to a claim of misleading and deceptive conduct based on s 65A of the Trade Practices Act (TPA). Section 65A provides a "safe-harbour" for "prescribed information providers".
  • A "prescribed information provider" (a person who carries on the business of providing information) has a defence to a claim for misleading and deceptive conduct provided that the publication was made in the course of carrying on a business of providing information, most notably, media outlets. In Bond v Barry, the defence was extended to draft publications authored by freelance journalist Paul Barry.
  • The s 65A defence has recently been considered by the High Court in a claim brought by the Australian Competition and Consumer Commission (ACCC) against Today Tonight. The High Court determined that Today Tonight could not rely on that defence because it was not providing "information". Instead, it had an arrangement in place with a supplier of goods and services to effectively "sell" or advertise those goods or services in its broadcast.

ACCC v Channel Seven Brisbane Pty Ltd [2009] HCA 19

In ACCC v Channel Seven Brisbane Pty Ltd [2009] HCA 19, the ACCC alleged that in late 2003 and early 2004 Channel 7's Today Tonight broadcast and thereby effectively adopted misleading representations about the benefits of the services offered by a property investment training program, Wildly Wealthy Women (WWW).

The broadcasts resulted from an agreement, brokered by a marketer, between Today Tonight and WWW, pursuant to which the marketer would receive a commission for every woman who signed up to the WWW investment program.

Channel 7 did not dispute that untrue representations were made about the success of WWW, nor that they were misleading and deceiving. However, it sought protection for its misleading and deceptive conduct under s 65A of the TPA.

Findings

The High Court upheld the primary judge's findings that s 65A of the TPA did not provide a defence to Today Tonight. It was held that the "safe-harbour" does not apply to situations in which a media outlet, pursuant to an arrangement with a supplier of goods or services, publishes and, by adoption or otherwise, makes representations of a misleading or deceptive character in relation to those goods or services.

The Court acknowledged that the media "safe-harbour" provided for in s 65A of the TPA is important in order to maintain a vigorous free press, but that an effective and enforceable TPA is also imperative.

Lessons

Media outlets should be aware, that where an arrangement has been made with a supplier of goods and services to effectively "sell" or advertise those goods or services in a broadcast, the broadcaster itself can face liability for misleading and deceptive conduct, and will not be able to rely upon s 65A of the TPA for protection.

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.