Facebook and consumer protection law: Its business as usual, but not as you know it

Published On 28/08/2012 | By Louise Beange | Consumer protection, Enforcement

In recent weeks, we’ve had two indications of the way in which misleading and deceptive conduct provisions apply to third party content on social platforms like Facebook. While we’ve known for a long time that normal legislative rules apply to the internet and social media (KWM was on it from 2010), it’s taking time to work out exactly what that means in practical terms. The outlook today – normal principles apply, even if you haven’t looked at it that way before.

First, a decision by the advertising standards board has indicated that third party comments in response to company material on an official Facebook page can be considered advertising under the definitions applied by the board. It is worth noting that, while the comments were considered to be advertising and were considered under the standards, they weren’t found to breach the code. Notably, the decision on whether they were advertising rested on the definition of ‘marketing or advertising’ used by the Standards, but this definition includes ‘a reasonable degree of control’ on the part of the advertiser. You can read our comments on the decision in this alert and on the IP Whiteboard.

Then, the ACCC made comments (reported, for example, here, here and here) that large companies could be expected to remove misleading and deceptive comments within as little as 24 hours. Smaller companies may be given longer timeframes, but it will come down to the resources the company has available and how it uses and monitors its Facebook page. It seems from these comments, that the issue will be whether you were, or should have been, aware of the comments and whether you could have, and therefore should have, removed them. Of course, ACCC comments aren’t law, but we will be watching closely to see what happens when the ACCC, and the Federal Court, get a chance to put these words into action.

Both of these items follow on from the 2011 decision of the Federal court in ACCC v Allergy Pathways (No 2). In that case, the company concerned was found  in contempt of court by failing to remove testimonials on its Facebook page, posted by  third parties, that repeated assertions which were held misleading and deceptive in an earlier action by the ACCC. The 2011 decision found that, while the company didn’t post the comments, once they knew about them it could have removed the comments. By deciding not to do so, it accepted responsibility for the conduct and breached its undertakings from the earlier case. The court also noted that by failing to remove the comments, the company ‘caused them to continue to be published’, in direct breach of its undertakings. What we haven’t seen yet is what happens when third party comments are posted without an existing court order to put the company on notice.

While it’s no surprise that companies are liable for what they post, it may be surprising (and worrying!) to see them being held responsible for what other users post. The thing that Allergy Pathways, the ASB decision and the ACCC comments indicate is that companies are and will be responsible for content they control or adopt – and that is nothing new.

Photo credit: dobrych / Foter / CC BY-SA

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About The Author

is a solicitor in the DR team at KWM. In addition to her commercial practice, Louise volunteers with the Downing Centre Duty Solicitor program and ASK!

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