As well as imposing these penalties, Justice Tracey ordered injunctions against Digital Products Group, Mr Kemp and Mr Dopson preventing them from engaging in similar conduct in future. He also ordered that Digital Products Group implement a trade practices compliance program.
The orders were made with the consent of the parties.
"It is important that wholesalers understand that they cannot try to prevent retailers from advertising or selling their products below particular prices", ACCC Chairman, Mr Graeme Samuel, said today. "This case demonstrates that wholesalers and their individual representatives that do so face the risk of substantial monetary penalties being imposed against them.
"The ability of a business to advertise products at a discounted price can assist consumers in getting the best deal and encourages other businesses to compete on price".
"This was a genuine oversight by us and whilst that's not an excuse it's an expensive reminder that as a young company there are rules we need to follow," says CEO and General Manager Jai Kemp.
Since learning of the breaches, which occurred from 2003 to mid 2005, Digital Products Group has fully cooperated with the ACCC and as such was awarded a 30 per cent discount on the original proposed fines. In a joint submission to the court, the ACCC acknowledged that: "The Respondents have cooperated significantly with the Commission and acknowledged their liability at the earliest stage in the proceedingâ€¦ This has shortened the investigation, the proceeding and the trial, consequentially saved costs and enabled the Commission to focus on other investigations and proceedings.
"The Commission [submitted] that these mitigating features should result in a substantial discount from the penalties that would have been appropriate to impose without that cooperation and acknowledgment of liability.
"The 30% discount for cooperation and acknowledgment of liability proposed by the parties in this proceeding isâ€¦ the most generous compared to all other recent [retail price maintenance] penalty cases."
Jai Kemp says that Digital Products Group will comply with all orders from the Federal Court sought by the ACCC: including the implementation of a TPA compliance program.