Thursday, 20 December 2012 14:58

TPG wins in court, but ads still wrong


TPG has won a victory in a court appeal against an ACCC ruling. But the court’s original finding that some TPG’s advertisements were misleading still stands.

The appeal was against orders made by Justice Murphy in favour of the Australian Competition and Consumer Commission (ACCC) which included a penalty of $2 million for false and misleading conduct by TPG under the Australian Consumer Law. How big TPG’s win is depends on who you listen to. TPG described it as “substantial” the ACCC describes it as “”partial”. And we still don’t know if the fine will stand, or be waived or reduced.

TPG appealed Justice Murphy’s orders on liability and relief in relation to TPG’s $29.99 ADSL 2 + Advertising Campaign which ran between 2009 and 2011. The Court found that Justice Murphy erred in applying the legal test of whether the advertisements misrepresented the offer, and also by not giving appropriate consideration of consumers’ knowledge relating to bundling practices and set up charges.

But his orders relating to the first initial television advertisement were upheld by the Full Federal Court. Justice Murphy’s orders regarding TPG’s contraventions of s.53C, which related to the prominence of the total single price, continue to stand. TPG did not appeal Justice Murphy’s finding that it had contravened section 53C in relation to the initial television advertisement and the Full Federal Court upheld His Honour’s section 53C findings in relation to the first set of advertisements.

“TPG is pleased with the result” said Tony Moffatt, TPG’s General Counsel. “The ACCC initially wrote to TPG in September 2010 and we immediately revised the ads in a manner that we believed exceeded the requirements of the law. In spite of this, the ACCC pressed ahead, claiming that both the initial ads and the revised ads were misleading. The Full Court found that the revised ads, which ran for over 12 months and represented the bulk of the campaign, complied with advertising laws.

“The Full Court did find that the single price in the initial ads was not sufficiently prominent to meet the requirements of the relatively new section 48 of the Australian Consumer Law but the Court said “This was not a case of a corporation acting deliberately or covertly in contravention of legislative requirements.”

“The question of prominence is one of degree requiring some judgment” said Moffatt. “Many of our competitors were placing their single price in the disclaimer section of their ads. We placed our single price in the main body of the ad where we felt it would easily be noticed. The court found that, for the initial ads which ran for about 12 days, it simply was not large enough”.

The parties have several weeks in which to consider making submissions on further orders in relation to costs and penalty. It’s not over yet.


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Graeme Philipson

Graeme Philipson is senior associate editor at iTWire and editor of sister publication CommsWire. He is also founder and Research Director of Connection Research, a market research and analysis firm specialising in the convergence of sustainable, digital and environmental technologies. He has been in the high tech industry for more than 30 years, most of that time as a market researcher, analyst and journalist. He was founding editor of MIS magazine, and is a former editor of Computerworld Australia. He was a research director for Gartner Asia Pacific and research manager for the Yankee Group Australia. He was a long time IT columnist in The Age and The Sydney Morning Herald, and is a recipient of the Kester Award for lifetime achievement in IT journalism.



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