ACCC dealt a bad hand in TPG appeal but will not fold
TPG has had its $2 million fine substantially reversed on appeal but the ACCC is refusing to accept the second significant penalty reduction in the telecommunications arena.
On 20 December 2012 the full Federal Court allowed an appeal by the internet provider TPG against the judgment of Justice Murphy, who had found TPG’s advertising of its $29.99 a month ‘unlimited’ ADSL2+ bundle misleading. You can read our note on the original decision here.
The court overturned the $2 million pecuniary penalty imposed by Justice Murphy and instead ordered that TPG and the ACCC should reach an agreement on the new penalty. Based on the Court’s comment that a sum of about $500,000 would be appropriate, the ACCC may walk away from any court-mandated conference with a pot totalling less than a quarter of the original amount imposed.
The Court concluded that a significantly reduced penalty was appropriate having regard to the totality principle and the Court’s findings that only TPG’s initial television advertisement was misleading (as distinct from Justice Murphy’s findings that the entire suite of initial and revised radio, television and print campaigns were misleading or deceptive).
The Court also overturned the injunction originally imposed by Justice Murphy (which required TPG to ‘prominently’ display the total monthly charges of all its bundled internet services for a period of three years) and further corrective advertising, largely because of TPG’s substantial compliance to date.
Given the ACCC’s focus on pursuing contraventions in the telecommunications industry, it is interesting to note that this is the second telecommunications proceeding where the penalty was substantially reduced on appeal – following the SingTel Optus peak/off-peak allowances advertising case – on which you can read our post here.
But the ACCC is refusing to fold in this round, with the watchdog announcing its intention to appeal the TPG decision to the High Court.