NUROFEN FALSE ADVERTISING FINE INCREASED TO RECORD AMOUNT
Written on the 16 December 2016
RECKITT Benkiser has been slogged an extra $4.3 million by the Federal Court for misleading advertising of its Nurofen Specific Pain products after an Australian Competition and Consumer Commission (ACCC) appeal against the penalty was upheld.
The UK-based company must now pay a revised penalty of $6 million - the highest recorded for misleading conduct under Australian Consumer Law.
The Full Court found that the initial penalty of $1.7 million was manifestly inadequate given the need for deterrence and the substantial consumer loss suffered.
"The ACCC welcomes this decision, having originally submitted that a penalty of $6 million or higher was appropriate given the longstanding and widespread nature of the conduct, and the substantial sales and profit that was made," says ACCC chairman Rod Sims.
In their joint decision, Justices Jagot, Yates and Bromwich state: "The objective of any penalty in this case must be to ensure that Reckitt Benckiser and other 'would-be wrongdoers' think twice and decide not to act against the strong public interest".
In December 2015, the court found that Reckitt Benckiser made representations on its website and product packaging that Nurofen Specific Pain products were each formulated to specifically treat a particular type of pain, when this was not the case.
In fact, each Nurofen Specific Pain product contains the same active ingredient, ibuprofen lysine 342mg, which treats a wide variety of pain conditions and is no more effective at treating the type of pain described on its packaging than any of the other Nurofen Specific Pain products.
On 29 April 2016, the trial judge Justice Edelman ordered Reckitt Benckiser to pay a penalty of $1.7 million for making misleading representations about its Nurofen Specific Pain products.
The Nurofen decision follows a similar case where Dulux was recently fined $400,000 for false advertising in relation to its Weathershield and InfraCOOL paints.
Sims says the ACCC will continue to advocate for higher penalties for breaches of consumer law to deter other companies from making misleading claims.