Australian Competition and Consumer Commission v Arnott's Biscuits Limited
[2008] FCA 590
•29 April 2008
FEDERAL COURT OF AUSTRALIA
Australian Competition and Consumer Commission v Arnott’s Biscuits Limited [2008] FCA 590
Trade Practices Act 1974 (Cth), ss 52(1), 53(a), 55
AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v ARNOTT'S BISCUITS LIMITED
NSD 2252 of 2007
GYLES J
29 APRIL 2008
SYDNEY
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
NSD 2252 of 2007
BETWEEN:
AUSTRALIAN COMPETITION AND CONSUMER COMMISSION
ApplicantAND:
ARNOTT'S BISCUITS LIMITED
Respondent
JUDGE:
GYLES J
DATE OF ORDER:
29 APRIL 2008
WHERE MADE:
SYDNEY
THE COURT ACCEPTS THE UNDERTAKINGS TO THE COURT BY THE RESPONDENT THAT:
1.The Respondent will cease manufacturing and supplying the Snack Right biscuit products referred to in the Amended Statement of Claim in the packaging depicted in the Annexures to the Amended Statement of Claim within three months from the making of these orders.
2.The Respondent will not, with effect from the date specified in order 1 above, whether by its directors, employees, agents or otherwise, supply fruit pillow or fruit slice-type biscuits in the formulation of the Snack Right biscuits referred to in the Statement of Claim in packaging that conveys the overall impression, whether by words, images or a combination of words and images that the filling in the biscuit:
(a) consists predominantly of a particular fruit or particular fruits; or
(b)includes a not insubstantial proportion of a particular fruit or particular fruits, unless:
(i)the filling consists predominantly of the particular fruit or particular fruits; or
(ii)the filling includes more than an insubstantial proportion of the particular fruit or particular fruits.
3.The Respondent will publish a corrective notice in the form of Annexure A to these orders on the “Our Products” page of the Respondent’s website ( for a period of six months from the making of these orders.
BY CONSENT, THE COURT DECLARES THAT:
4.From 1 March 2007 the Respondent, by supplying to retailers for sale to consumers biscuits called “Arnott’s Snack Right Apple & Blackberry fruit pillow” in packaging which had the following characteristics:
4.1use of the name “Apple & Blackberry fruit pillow”;
4.2the words “Apple & Blackberry” appear in a large and prominent font on the top and front of the package;
4.3no other fruit is referred to in the name of the biscuit;
4.4underneath the name of the biscuit on the top and front of the package the following words appear: “a delicious golden baked biscuit, crammed with apples, blackberries and sultanas”;
4.5prominent pictorial representations of apples and blackberries appear on the front and sides of the package;
4.6no pictorial representations of any other fruit appear on the package;
4.7 a prominent pictorial representation of a pillow shaped biscuit, open at one end revealing the filling, appears on the top and front of the package adjacent to the pictorial representations of apples and blackberries,
represented to consumers that the filling in the Apple & Blackberry fruit pillow biscuit:
4.8 consisted predominantly of apple and blackberry; and
4.9 included a not insubstantial proportion of blackberry,
which representations were false, misleading or deceptive by reason of the fact that:
4.10the approximate proportion of sultana in the filling in the Apple & Blackberry fruit pillow biscuit is 38.8%; and
4.11the approximate proportion of apple concentrate in the filling in the Apple & Blackberry fruit pillow biscuit is 12.9%; and
4.12the approximate proportion of dried apple concentrate in the filling in the Apple & Blackberry fruit pillow biscuit is 8.6%; and
4.13the approximate proportion of blackberry concentrate in the filling in the Apple & Blackberry fruit pillow biscuit is 1.7%,
and thereby, in trade and commerce:
4.14engaged in conduct that was likely to mislead or deceive, contrary to s 52(1) of the Trade Practices Act 1974 (Cth) (the Act);
4.15in connection with the supply or promotion of the Apple & Blackberry fruit pillow biscuits, falsely represented that the biscuits were of a particular composition, contrary to s 53(a) of the Act;
4.16engaged in conduct that was liable to mislead the public as to the nature or characteristics of the biscuits, contrary to s 55 of the Act.
5.From 1 March 2007 the Respondent, by supplying to retailers for sale to consumers biscuits called “Arnott’s Snack Right Wild Berry fruit pillow” in packaging which has the following characteristics:
5.1 use of the name “Wild Berry fruit pillow”;
5.2the words “Wild Berry” appear in large and prominent font on the top and front of the package;
5.3 no other fruit is referred to in the name of the biscuit;
5.4underneath the name of the biscuit on the top and front of the package the following words appear: “a delicious golden baked biscuit, crammed with apples, strawberries, raspberries, blueberries and sultanas”;
5.5prominent pictorial representations of strawberries, raspberries and blueberries appear on the front and sides of the package;
5.6 no pictorial representations of any other fruit appear on the package;
5.7a prominent pictorial representation of a pillow shaped biscuit, open at one end revealing the filling, appears on the top and front of the package adjacent to the pictorial representations of strawberries, raspberries and blueberries,
represented to consumers that the filling in the Wild Berry fruit pillow biscuit:
5.8 consisted predominantly of strawberry, raspberry and blueberry;
5.9 included a not insubstantial proportion of berry; and
5.10 included:
5.10.1 a not insubstantial proportion of strawberry;
5.10.2a not insubstantial proportion of raspberry; and
5.10.3a not insubstantial proportion of blueberry,
which representations were false, misleading or deceptive by reason of the fact that:
5.11the approximate proportion of sultana in the filling in the Wild Berry fruit pillow biscuit is 38.8%; and
5.12the approximate proportion of apple concentrate in the filling in the Wild Berry fruit pillow biscuit is 12.9%; and
5.13the approximate proportion of dried apple concentrate in the filling in the Wild Berry fruit pillow biscuit is 8.6%; and
5.14the approximate aggregate proportion of strawberry, raspberry and blueberry in the filling in the Wild Berry fruit pillow biscuit is 4.3% berry concentrate (derived from raspberries, blueberries and strawberries);
5.15the approximate proportion of strawberry in the filling in the Wild Berry fruit pillow biscuit is less than 4.3%; and
5.16the approximate proportion of raspberry in the filling in the Wild Berry fruit pillow is less than 4.3%; and
5.17the approximate proportion of blueberry in the filling in the Wild Berry fruit pillow is less than 4.3%,
and thereby, in trade and commerce:
5.18 engaged in conduct that was likely to mislead or deceive, contrary to s 52(1) of the Act;
5.19in connection with the supply or promotion of the Mixed Berry fruit pillow biscuits, falsely represented that the biscuits were of a particular composition, contrary to s 53(a) of the Act;
5.20engaged in conduct that was liable to mislead the public as to the nature or characteristics of the biscuits, contrary to s 55 of the Act.
6.From 1 March 2007 the Respondent, by supplying to retailers for sale to consumers biscuits called “Arnott’s Snack Right Apricot fruit slice” in packaging which has the following characteristics:
6.1 use of the name “Apricot fruit slice”;
6.2the word “Apricot” appears in a large and prominent font on the top and front of the package;
6.3 no other fruit is referred to in the name of the biscuit;
6.4underneath the name of the biscuit on the top and front of the package the following words appear: “a lightly baked fruit slice made with succulent apricot and sultanas”;
6.5prominent pictorial representations of apricots appear on the front and sides of the package;
6.6 no pictorial representations of any other fruit appear on the package;
6.7a prominent pictorial representation of a biscuit with one corner removed revealing the filling, appears on the top and front of the package adjacent to the pictorial representations of apricots,
represented to consumers that the filling in the Apricot fruit slice biscuit:
6.8consisted predominantly of apricot; and
6.9included a not insubstantial proportion of apricot,
which representations were false, misleading or deceptive by reason of the fact that:
6.10the approximate proportion of sultanas in the filling in the Apricot fruit slice biscuit is 64.8%; and
6.11the approximate proportion of apple juice in the filling in the Apricot fruit slice biscuit is 10.5%; and
6.12the approximate proportion of apricot in the filling in the Apricot fruit slice biscuit is 1.7%,
and thereby, in trade and commerce:
6.13engaged in conduct that was likely to mislead or deceive, contrary to s 52(l) of the Act;
6.14in connection with the supply or promotion of the Apricot fruit slice biscuits, falsely represented that the biscuits were of a particular composition, contrary to s 53(a) of the Act;
6.15engaged in conduct that was liable to mislead the public as to the nature or characteristics of the biscuits, contrary to s 55 of the Act.
7.From 1 March 2007 the Respondent, by supplying to retailers for sale to consumers biscuits called “Arnott’s Snack Right Apricot & Yoghurt fruit slice” in packaging which has the following characteristics:
7.1 use of the name “Apricot & Yoghurt fruit slice”;
7.2the word “Apricot” appears in a large and prominent font on the top and front of the package;
7.3no other fruit is referred to in the name of the biscuit;
7.4underneath the name of the biscuit on the top and front of the package the following words appear: “a lightly baked fruit slice made with succulent apricot, sultanas and yoghurt”;
7.5prominent pictorial representations of apricots appear on the front and sides of the package;
7.6 no pictorial representations of any other fruit appear on the package;
7.7a prominent pictorial representation of a biscuit with one corner removed revealing the filling, appears on the top and front of the package adjacent to the pictorial representations of apricots,
represented to consumers that the filling in the Apricot & Yoghurt fruit slice biscuit: 7.8 consisted predominantly of apricot; and
7.9included a not insubstantial proportion of apricot,
which representations were false, misleading or deceptive by reason of the fact that:
7.10the approximate proportion of sultanas in the filling in the Apricot & Yoghurt fruit slice biscuit is 64.8%; and
7.11the approximate proportion of apple juice in the filling in the Apricot & Yoghurt fruit slice biscuit is 10.5%; and
7.12the approximate proportion of apricot in the filling in the Apricot & Yoghurt fruit slice biscuit is 1.7%,
and thereby, in trade and commerce:
7.13engaged in conduct that was likely to mislead or deceive, contrary to s 52(1) of the Act;
7.14in connection with the supply or promotion of the Apricot & Yoghurt fruit slice biscuits, falsely represented that the biscuits were of a particular composition, contrary to s 53(a) of the Act;
7.15engaged in conduct that was liable to mislead the public as to the nature or characteristics of the biscuits, contrary to s 55 of the Act.
8.From 1 March 2007 the Respondent, by supplying to retailers for sale to consumers biscuits called “Arnott’s Mixed Berry fruit slice” in packaging which has the following characteristics:
8.1use of the name “Mixed Berry fruit slice”;
8.2the words “Mixed Berry” appear in a large and prominent font on the top and front of the package;
8.3no other fruit is referred to in the name of the biscuit;
8.4underneath the name of the biscuit on the top and front of the package the following words appear: “a lightly baked fruit slice made with succulent mixed berries and sultanas”;
8.5prominent pictorial representations of strawberries, raspberries, blueberries and red elderberries appear on the front and sides of the package;
8.6no pictorial representations of any other fruit appear on the package;
8 7a prominent pictorial representation of a biscuit with one corner removed revealing the filling, appears on the top and front of the package adjacent to the pictorial representations of strawberries, raspberries, blueberries and red elderberries,
represented to consumers that the filling in the Mixed Berry fruit slice biscuit:
8.8consisted predominantly of strawberry, raspberry, blueberry and red elderberry; and
8.9 included:
8.9.1 a not insubstantial proportion of strawberry;
8.9.2 a not insubstantial proportion of raspberry;
8.9.3 a not insubstantial proportion of blueberry; and
8.9.4 a not insubstantial proportion of red elderberry,
which representations were false, misleading or deceptive by reason of the fact that:
8.10the approximate proportion of sultanas in the filling in the Mixed Berry fruit slice biscuit is 49.1%;
8.11the approximate proportion of banana in the filling in the Mixed Berry fruit slice biscuit is 6.6%;
8.12the approximate proportion of strawberry, raspberry, blueberry and red elderberry in the filling in the Mixed Berry fruit slice biscuit is 14%;
8.13the approximate proportion of strawberry in the filling in the Mixed Berry fruit slice biscuit is 6.6%;
8.14the approximate proportion of raspberry juice in the filling in the Mixed Berry fruit slice biscuit is 6.6%;
8.15the approximate proportion of blueberry in the filling in the Mixed Berry fruit slice biscuit is 0.4%; and
8.16the approximate proportion of red elderberry juice in the filling in the Mixed Berry fruit slice biscuit is 0.4%,
and thereby, in trade and commerce:
8.17engaged in conduct that was likely to mislead or deceive, contrary to s 52(1) of the Act;
8.18in connection with the supply or promotion of the Mixed Berry fruit slice biscuits, falsely represented that the biscuits were of a particular composition, contrary to s 53(a) of the Act;
8.19engaged in conduct that was liable to mislead the public as to the nature or characteristics of the biscuits, contrary to s 55 of the Act.
BY CONSENT, THE COURT ORDERS THAT:
9.The Respondent pay the Applicant’s costs in the amount of $20,000.
10.The proceeding otherwise be dismissed.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
Annexure A
CORRECTIVE NOTICE
A correction from Arnott’s Biscuits
Following legal action by the Australian Competition and Consumer Commission (ACCC), by consent, the Federal Court has declared that Arnott’s Biscuits Limited (Arnott’s) has engaged in conduct that was likely to mislead or deceive in relation to the packaging and labelling of the following Arnott’s Snack Right products:
- Snack Right Apple and Blackberry Fruit Pillow;
- Snack Right Wild Berry Fruit Pillow;
- Snack Right Apricot Fruit Slice;
- Snack Right Apricot and Yogurt Fruit Slice; and
- Snack Right Mixed Berry Fruit Slice
The Court declared that Arnott’s breached the Trade Practices Act 1974 by conveying to consumers in the packaging and labelling of the Arnott’s Snack Right products an overall impression that:
- the filling in the biscuits consisted predominantly of the particular fruits depicted on the packaging; and
· there was a not insubstantial proportion of the depicted fruits in the biscuit filling,
when instead the fruit filling of the Arnott’s Snack Right products consisted predominantly of fruits not depicted on the packaging.
Arnott’s has undertaken to the Court that it will change the labelling and packaging of the products concerned and will refrain from similar conduct in the future.
Arnott’s regrets any instances in which its customers may have been misled.
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
NSD 2252 of 2007
BETWEEN:
AUSTRALIAN COMPETITION AND CONSUMER COMMISSION
ApplicantAND:
ARNOTT'S BISCUITS LIMITED
Respondent
JUDGE:
GYLES J
DATE:
29 APRIL 2008
PLACE:
SYDNEY
REASONS FOR JUDGMENT
In this matter the amended statement of claim and the defence to the amended statement of claim, respectively, establish a factual foundation for the declarations and orders which the parties jointly seek and form a basis for accepting the undertakings to the Court which are proffered. The form of the admissions is such that the Court is able to sufficiently judge the merit of the allegations made. In my opinion, the case pleaded in the amended statement of claim is properly established in view of the admissions made. Under those circumstances, I accept the undertakings to the Court proffered by counsel for the respondent which are reflected in the short minutes of order which I have initialled and dated. The declarations contained in the same set of minutes are made and the order as to the costs is made. The proceeding is otherwise dismissed. It is noted that the corrective notice is Annexure A to those short minutes of order. At the request of the parties I have made an alteration to the corrective notice, and initialled that change.
I certify that the preceding one (1) numbered paragraph is a true copy of the Reasons for Judgment herein of the Honourable Justice Gyles. Associate:
Dated: 1 May 2008
Counsel for the Applicant: Mr T Brennan Solicitor for the Applicant: Australian Government Solicitor Counsel for the Respondent: Mr A Bannon SC Solicitor for the Respondent: Mallesons Stephen Jaques
Date of Hearing: 29 April 2008 Date of Judgment: 29 April 2008
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