Court rules only TPG TV ads misleading
The Full Bench of the Federal Court has overturned most of a ruling that had found TPG's advertising around its AU$29.99 fixed broadband plans to be misleading. Instead, it has now ruled that just the TV ads would likely deceive customers.
The Australian Competition and Consumer Commission (ACCC) took TPG to court over ads for its AU$29.99 fixed-line broadband plan at the end of 2010, claiming that the ads failed to disclose the full cost of the plan, which included a AU$30 line-rental charge.
The first set of ads that aired between September and October 2010 was broadcast on three national TV stations and seven capital city radio stations, and was published in one national and six capital city newspapers, as well as on the internet.
After a complaint from the ACCC, TPG changed the ads and then extended the advertising to another TV station, more newspapers, magazines, websites, cinemas, billboards, trains, buses, trams, stations, airports, and on noticeboards in public restrooms.
In November 2011, Justice Bernard Murphy ruled in the Melbourne Federal Court against the telco, finding that, although TPG advertised the unlimited plan for AU$29.99, it did not adequately disclose that the cost was AU$59.99 per month including line rental, and in June 2012, he handed the company a AU$2 million fine.
TPG appealed the ruling in November, and today, Justices Peter Jacobson, Annabelle Bennett, and John Gilmour overturned Murphy's ruling in most respects.
"We've found that all of the advertisements, other than the original television advertisements, were not misleading," Jacobson said in Sydney this morning.
In a statement, TPG's general counsel Tony Moffatt said the company was pleased with the result. While the court did rule that the single price in the initial ads was not sufficient to meet the law for advertising, Moffatt said it was something many telcos were doing at the time.
"The question of prominence is one of degree requiring some judgment," Moffatt said. "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 ACCC said it was reviewing the judges' reasons and would continue to seek to improve the clarity in advertising in the telecommunications industry.
The court directed the ACCC and TPG to liaise to seek an agreement on an appropriate penalty.