The ACCC has fined Harvey Norman $1.25m for “seriously misleading and deceptive” ads.
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The Federal Court in Brisbane fined Harvey Norman Holdings Ltd $1.25 million for misleading advertising following action taken by the Australian Competition and Consumer Commission.
The offending ads contained in Harvey’s ‘3D Finals Fever’ catalogue created the deceptive impression that consumers in all places, where the catalogue was distributed could buy and use a 3D television to watch the 2010 AFL and NRL grand finals in 3D.
However, the 3D broadcasts were, in fact, limited to metropolitan Brisbane, Newcastle, Sydney, Melbourne, Adelaide and Perth.
Nonetheless, the catalogue were still distributed throughout Australia in places even where there was no 3D available even after Gerry Harvey’s outfit became aware of this.
Justice Collier described Harvey’s conduct as “seriously misleading and deceptive, on a significant and far-reaching scale.”
The Court also found the retailer guilty of a separate offense, misleading consumers about conditions in its catalogue and online between October 2008 and July this year.
The impression given by both the catalogues and website was that the goods advertised were available at Harvey Norman stores generally, the court found.
However, the offers were only being made by a single store in each State or Territory, while the website had a condition that the offers appearing on it were only being made by one store in Australia, and were thus misleading.
“The conditions were in fine print and not prominent, and contradicted the main impression otherwise given by the catalogues and the website,” the ACCC said in a statement yesterday.
The offences “a picture of an expensive, misleading and calculated campaign of sizable proportions, characterised by blatant and deliberate disregard of the truth, cynical strategies to capitalise on contemporary sporting events (in the case of the 3D Conduct) and the contemptuous manipulation of the expectations of ordinary consumers in respect of so-called “fine print” (in relation to the Catalogues),” Justice Collier said.
“Harvey Norman knew the facts; it should have got it right, and the Court agreed.”
Sims also criticised the fine print associated with the offers.
“Fine print is not an antidote to misleading or deceptive conduct.”
Justice Collier also made orders restraining Harvey Norman from engaging in similar conduct for three years and to publish corrective notices in regional and metropolitan newspapers and online.
Harvey Norman admitted it had contravened the former Trade Practices Act 1974 and the Australian Consumer Law and consented to the penalties and other orders sought from the Court.
It will also be required to pay a sum towards the ACCC’s costs.