By Claire Reilly
Harvey Norman Holdings Limited has been hit with a $1.25 million fine by the Federal Court for misleading advertising in its ‘3D Finals Fever’ catalogue. The decision was handed down in the Brisbane registry of the Federal Court by Justice Berna Collier, following action taken by the Australian Competition and Consumer Commission against the retailer.
Speaking about her decision, Justice Collier said Harvey Norman had conducted “an expensive, misleading and calculated campaign of sizable proportions, characterised by blatant and deliberate disregard of the truth".
According to the ACCC, Harvey Norman published a 3D Finals Fever catalogue in September 2010 that “created the misleading and 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 format”.
However, the 3D broadcast was limited to metropolitan areas in metropolitan Brisbane, Newcastle, Sydney, Melbourne, Adelaide and Perth.
Furthermore, “the catalogue was distributed throughout Australia in places where there was no 3D broadcast of the football grand finals, including after Harvey Norman became aware that the 3D broadcast would be so limited”.
In addition to the misleading football finals advertising, the Court also found that Harvey Norman gave the impression that products advertised in its catalogues were available across Australia, when in fact they were only available in certain stores.
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Justice Collier said Harvey Norman’s advertising campaigns were typified by “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).
“The inference available to the Court is that this is yet another unfortunate example of a corporation with a compliance policy to which mere lip-service is paid,” she added. “Another inference available is that the compliance policy in the organisation was woefully inadequate.”
Justice Collier made orders “restraining Harvey Norman from engaging in similar conduct for a period of three years; requiring it to publish corrective notices in regional and metropolitan newspapers and on the Harvey Norman website; and requiring it to pay a contribution towards the ACCC's costs”.
ACCC chairman Rod Sims said that retailers had an obligation to provide the correct information to consumers.
“The conduct of [Harvey Norman] appeared intended to reach as many Australian consumers as possible, in all parts of the country, through such diverse media as internet, newspaper and letterbox drop,” said Sims.
“Retailers have a responsibility to ensure that accurate information is given to consumers about the uses and benefits of new and emerging technology, such as 3D television. Harvey Norman knew the facts; it should have got it right, and the Court agreed.
“A headline representation cannot be contradicted or turned on its head by fine print conditions or requiring consumers to navigate through terms and conditions to discover the truth. Fine print is not an antidote to misleading or deceptive conduct.”