Full Federal Court finds LG Australia made two false representations to consumers

After the ACCC appealed a court decision to dismiss a warranty and repair-related case against LG, the Full Federal Court has found the electronics giant made two representations to consumers that were false.

The Australian Competition and Consumer Commission (ACCC) has emerged somewhat victorious on Wednesday, after the Full Federal Court partially upheld an appeal it made against an earlier judgment dismissing the ACCC's case against LG Electronics Australia.

The Full Court found that LG made two representations to consumers that were false, a statement from the ACCC explains, which saw the initial court decision overturned.

The ACCC's appeal in respect of other LG statements made to consumers was dismissed.

According to the consumer watchdog, in the circumstances where the Full Court held that LG had made a false representation, LG had in effect represented that no rights other than those under LG's manufacturer's warranty existed.

"This was false because consumers who have purchased faulty products may have rights under the Australian Consumer Law consumer guarantees," the ACCC wrote.

ACCC Commissioner Sarah Court additionally noted that manufacturer warranties exist in addition to the consumer guarantee rights that are provided under Australian Consumer Law.

"Consumers will often still be entitled under the consumer guarantee to a repair, refund, or replacement when the manufacturer's warranty does not apply or has come to an end," the court said.

The watchdog said the Full Court also noted that LG's practice of telling staff not to mention Australian Consumer Law unless it was specifically raised risked LG making false or misleading representations, saying it is a "short distance from this to effectively denying the existence of the Australian Consumer Law consumer guarantees altogether".

The ACCC in September appealed the Federal Court's decision to dismiss the legal proceedings it brought forth against LG Electronics Australia in 2015.

The ACCC had at the time alleged the South Korean electronics company made false or misleading representations to consumers about their rights in relation to faulty LG products.

It also claimed that LG told customers that if a defect occurred on one of its TVs after warranty had expired, customers would only be entitled to a remedy if they paid for the cost of assessment.

However, on September 1, 2017, Justice Middleton dismissed the ACCC's allegations, concluding that LG was under no obligation to inform consumers of the existence of the Australian Consumer Law remedies available to them because the enquiry made by consumers related only to the manufacturer's warranty.

The competition watchdog had previously brought legal action against LG for misleading or deceptive conduct in 2005, 2006, and 2010.

In 2012, LG, along with Panasonic, Sony, Samsung, and Sharp, were warned by the ACCC for using the term "Wi-Fi ready" or "Wireless LAN ready" too loosely, and were made to amend their promotional and marketing material.

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