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ACCC Appeal LG Misleading Conduct Case

The battle between LG and the Australian Competition and Consumer Commission is continuing with the Federal regulator appealing a recent loss against the Korean Company.

The ACCC this morning said that they have lodged a Notice of Appeal from the Federal Court’s decision on 1 September 2017 dismissing the ACCC’s proceedings against LG Electronics Australia Pty Ltd (LG).

The ACCC had alleged that LG made false or misleading representations to certain consumers about their right to a repair, replacement or refund in relation to faulty LG televisions.

The Court dismissed the ACCC’s allegations, finding that LG was under no obligation to inform these 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 ACCC has appealed this decision in order to seek clarity from the Full Federal Court. In particular, this appeal is about the extent to which manufacturers should inform people seeking a remedy for a faulty product about their consumer guarantee rights,” ACCC Deputy Chair Delia Rickard said.

“Products and services come with consumer guarantees which may provide remedies over and above those in any manufacturer’s warranty. The ACCC will take appropriate action to ensure that consumers are not misled about their consumer guarantee rights.”

The ACCC commenced proceedings in the Federal Court in December 2015. See: ACCC takes action against LG for alleged false or misleading representations relating to consumer guarantees

The ACCC’s case was dismissed in September 2017.During this case the ACCC alleged LG misrepresented to consumers, retailers, or repairers that:

the remedies available to consumers were limited to the LG manufacturer’s warranty;

where the defect occurred after the LG manufacturer’s warranty had expired:

the consumer was only entitled to a remedy if the consumer paid for the costs of assessing the failure

LG had no further obligations, and any step it took in relation to the TV was an act of goodwill

the consumer was only entitled to have the TV repaired (and not to a refund or replacement)

the consumer was liable for the labour costs of the repair.

Justice Middleton in dismissing the allegations said “The consumer guarantees under the Australian Consumer Law are in addition to a manufacturer’s warranty. Consumers should be aware that even if a manufacturer’s warranty expires, they may still be entitled to a repair, refund, or replacement under the consumer guarantees,” ACCC Deputy Chair Delia Rickard said.

“Consumer guarantees are not limited to a set time period. Instead, they last as long as it is reasonable to expect depending on factors such as the nature and price of the item or any representations made about the item.”

“Consumer guarantees are an enforcement priority for the ACCC, and we will take appropriate enforcement action against businesses that misrepresent a consumer’s rights in relation to faulty products,” Ms Rickard said.

“The ACCC took this case because we were concerned that LG’s representations to consumers who had complained about faulty televisions were misleading about the remedies available to them under the Australian Consumer Law.”

The Australian Competition and Consumer Commission commenced proceedings in the Federal Court in December 2015.

LG has previously provided the ACCC with three separate undertakings relating to allegations of misleading or deceptive conduct in 2005, 2006 and 2010.

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