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When has a company engaged in misleading or deceptive conduct?

Misleading or Deceptive Conduct

ACL and the case against Nurofen – misleading or deceptive conduct.

The Australian Consumer Law (“ACL”) protects consumers from being a victim of misleading or deceptive conduct in trade or commerce. No company is immune from legal action if they are suspected of being in breach of the ACL.

ACCC case against Nurofen

The Australian Competition and Consumer Commission (“ACCC”) investigates alleged breaches and has the authority to commence legal proceedings against an offending company. This was most recently the case in proceedings brought against Reckitt Benckiser (Australia) Pty Ltd (“RB”), the company behind Nurofen.

RB had released four Nurofen products, each targeted at relieving a specific type of pain, ie back pain, migraines, tension headache and period pain. The pain targeted by each product was indicated not just on the packaging, but also on its website.

Federal Court Decision

In a Federal Court decision handed down on 11 December 2015, it was held that RB:

  1. Engaged in conduct that is misleading or deceptive or likely to mislead or deceive and
  2. Engaged in conduct that is liable to mislead the public about the nature, characteristics and suitability of its products

by representing that each product was formulated to treat that type of pain and the product would specifically/ solely treat that type of pain, even though:

  1. Each of the four products had the same active ingredient and was of the same formulation;
  2. The indications approved by the Australian Register of Therapeutic Goods were the same for each product; and
  3. No product was more or less effective than the others in treating pain.

Orders made against Nurofen

RB was ordered to:

  1. For a period of 3 years, refrain from selling, marketing or promoting the four products in the current packaging or in packaging that suggests the products were formulated to treat that type of pain or specifically/solely treat that type of pain;
  2. Within 4 weeks, stop further shipment and distribution of the products;
  3. Within 3 months, remove the products from display in retail outlets;
  4. Publish a corrective notice on its website and in The Australian newspaper;
  5. Update and maintain its Consumer Protection Law Compliance Program for 3 years;
  6. Pay the ACCC costs.

RB is also likely to receive a significant pecuniary penalty, which is yet to be determined. A penalty of up to $1.1 million is available to the Court for each offence.

It is important for all companies to ensure that the marketing of their goods/ services is accurate and is not likely to mislead or deceive consumers. Should you have any concerns about compliance under the ACL or what is deceptive or misleading conduct do not hesitate to contact our Commercial Litigation Team on 02 9521 6000.