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LG Fined $160K Over Misleading TV Warranties

LG Electronics Australia has been fined $160,000 by the Federal Court for misleading consumers about their legal rights over faulty televisions.

It comes after the ACCC instituted proceedings against LG in late 2015, which was then dismissed at first instance in September 2017, and partially upheld by the Full Federal Court in June 2018.

The Full Court has ruled LG made misleading representations to two consumers who allegedly bought faulty TVs, implying they had no rights other than those on its manufacturer warranty.

“Consumer guarantee rights are separate to warranties offered by manufacturers and will always be available to consumers who find they have been sold a faulty product,” affirms ACCC Commissioner, Sarah Court.

“The Court’s decision is a reminder that making misleading statements about consumer guarantee rights, even to only one or two consumers, can result in penalties being imposed.”

The ACCC highlights guarantees in Australian Consumer Law (ACL) cannot be excluded or modified by a company’s warranty “or general statements.”

In a written statement, LG Australia asserts it did not show a “disregard for its obligations”, with the Court accepting it was “understandable human error” within a call centre that receives thousands of calls monthly.

“Importantly the Court stated that there was no finding that there was a widespread or systematic programme of LG misleading consumers in the manner alleged by the ACCC,” claims LG.

“LG Australia did not intend to misrepresent the rights that the two individual consumers had under the Australian Consumer Law and remains committed to honouring our obligations at law and providing quality service experiences for our customers.”

Proceedings were instituted following complaints of allegedly faulty LG TVs, and consumer advice made to retailers and repairers:

  • 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; and/or
    • LG had no further obligations, and any step it took in relation to the television was an act of goodwill; and/or
    • the consumer was only entitled to have the television repaired (and not to a refund or a replacement); and/or
    • the consumer was liable for the labour costs of the repair.

Further information is available on the ACCC’s website here, inclusive of consumer guarantees.

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