Lessons from false advertising case
Lessons from false advertising case - Griffith Hack
|23 April 2012|
|The Australian Competition and Consumer Commission (ACCC) and the Federal Court of Australia take a serious stance when it comes to dealing with false and misleading advertising. This article discusses some of the consequences of advertising misconduct and how these can be avoided, using the La Ionica case as an example.|
What you need to know
|The Federal Court of Australia ordered Turi Foods Pty Ltd, the La Ionica brand owner (La Ionica), to pay an AUD$100,000 fine for having made false and misleading statements that its poultry chickens are ‘free to roam’ and ‘free roaming’, in breach of relevant provisions of the Australian Consumer Law (ACL), which can be found in Schedule 2 to the Competition and Consumer Act 2010 (Cth). Images of the advertisements in question and the Court’s judgment can be viewed here.|
|La Ionica’s wrongdoing consisted of publishing promotional posters in retail stores and adopting signage on its branded delivery trucks which falsely conveyed the message that its chickens were raised in spacious areas in which they were free to roam around. For example, one of La Ionica’s promotional posters contained the statement that La Ionica chickens are ‘free to roam in large open sheds – NO CAGES’. In fact, it was found that La Ionica chickens were raised exclusively in a shed or barn in which their freedom to move was far more restricted than claimed.|
La Ionica conceded that its ‘free to roam’ statements were false, misleading and deceptive. It also accepted that its breaches of the relevant provisions of the ACL were serious.
In addition to the fine, and on the basis of La Ionica’s consent to a number of orders proposed by the ACCC, the Federal
Court ordered La Ionica to:
|La Ionica could have avoided this enforcement action, and any consequent negative publicity, by carefully considering whether the overall impression conveyed to the average consumer by its advertisements would be considered truthful and accurate in view of its poultry-rearing practices.|
Before releasing any consumer-facing marketing material, in any type of medium, anyone marketing a product or service should ensure they:
|Also of note is the fact the ACCC has the power under the ACL to require the substantiation of any claim or representation. Failing to comply with a request from the ACCC can lead to financial penalties.|
If necessary, seek legal advice. Griffith Hack assists a number of clients in ensuring that their marketing materials and broader campaigns are legally robust by providing legal review and feedback, while maximising the intended marketing ‘punch’.
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