Vodafail – The saga continues…

Published On 04/04/2013 | By Alysia Abeyratne | Consumer protection, Litigation

You may remember the widespread problems Vodafone customers experienced in 2010 – 2011.  More than 23,000 customers complained of call drop outs, slow internet performance and poor reception.  This incident resulted in the birth of the “Vodafail” website – a forum in which customers could voice their complaints about Vodafone’s network issues.

As an obvious result of this, Vodafone suffered significant reputational damage with a 96% rise in customer complaints to the TIO, and a report summarising the complaints of 12,000 customers being sent to the ACCC and the ACMA.   Significantly, Piper Alderman also raised the prospect bringing a class action for losses suffered by Vodafone’s customers.   The hype died down, as the firm was unable to secure finance for the litigation.

In recent months, however, possible action has again been revived as Piper Alderman has secured funding from the LCM Litigation Fund.  Press releases indicate that the claims will be based on alleged misleading or deceptive conduct and ‘other breaches of the Australian Consumer Law (ACL).’  We think it possible that this could include a claim that Vodafone has not supplied a service of acceptable quality and/or that the services were not fit for their particular purpose.

It is interesting to note that the ACCC chose not to take action to test the guarantees issues in this case. Under the ACL, a Regulator is able to take action on behalf of consumers (with their consent) for breach of the consumer guarantees regime.  This power was deemed necessary by the Commonwealth Consumer Affairs Advisory Council at the time these provisions were drafted, as a means of providing incentives to comply with the regime and to address the fact that many consumers would be unlikely to take action themselves (even in instances where their rights were clarified and redress mechanisms accessible).  The ACCC has often stated that the consumer guarantees regime represents an area of key concern and an enforcement priority and has stated that test cases would be brought to test new provisions.  It is curious that the ACCC did not think this would be a suitable test case.

About The Author

Alysia Abeyratne is a solicitor in the Melbourne office of King & Wood Mallesons specialising in competition, consumer protection and general commercial law.

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