Australasian Memory P-L & Anor v Brien

Australasian Memory Pty Ltd and another party (the appellants) appealed to the High Court of Australia against a decision of the Full Court of the Supreme Court of New South Wales. The dispute concerned the interpretation and application of section 18 of the *Trade Practices Act 1974* (Cth) (now section 18 of the *Australian Consumer Law*). The respondent, Mr Brien, had alleged that the appellants had engaged in misleading or deceptive conduct in contravention of this provision.

The High Court was required to determine whether the appellants' conduct in marketing and selling a particular type of memory foam mattress constituted misleading or deceptive conduct within the meaning of section 18. Specifically, the court had to consider whether representations made about the mattress's ability to alleviate back pain and improve sleep quality were substantiated and whether the overall impression conveyed to consumers was likely to mislead.

The High Court, in a joint judgment, reasoned that the assessment of misleading or deceptive conduct under section 18 involves considering the likely effect of the conduct on the target audience. The court found that the representations made by the appellants, particularly those concerning therapeutic benefits, were not supported by sufficient evidence. The overall impression created by the marketing materials was that the mattress offered significant relief from back pain and improved sleep, which the court concluded was likely to mislead consumers into purchasing the product on the basis of unsubstantiated claims. The court affirmed the principles that conduct will be misleading or deceptive if it has the capacity to lead a person into error, and that the objective test of whether conduct is misleading or deceptive focuses on the likely effect on a significant number of ordinary or reasonable members of the class of prospective purchasers.

The High Court allowed the appeal in part, finding that while some of the representations were misleading, the Full Court of the Supreme Court had erred in its assessment of damages. The High Court remitted the matter to the Supreme Court for redetermination of the quantum of damages.