Australian Competition and Consumer Commission v Medibank Private Limited

The Australian Competition and Consumer Commission (ACCC) initiated proceedings against Medibank Private Limited, alleging that Medibank had falsely represented to some of its customers that their health insurance policies did not cover certain medical procedures, while in fact they did. The ACCC further alleged that Medibank had wrongfully accepted payments from customers for health insurance coverage that it did not provide. Medibank admitted to contraventions of sections 18 and 29(1)(m) of the Australian Consumer Law (ACL), but denied the contravention of section 36(4) of the ACL. The court considered the appropriate pecuniary penalty for Medibank's admitted contraventions, focusing on the seriousness of the conduct, the loss and damage to consumers, and the deterrence effect of the penalty. The court concluded that a penalty of $5 million was appropriate, taking into account the totality of the contravening conduct, the loss and damage to consumers, and the deterrence effect of the penalty. The court also ordered Medibank to pay $70,000 towards the ACCC's costs and dismissed the proceeding otherwise.

The court considered the principles relevant to the making of consent orders in a civil penalty proceeding, including the public interest in the settlement of cases, the need for the orders to be consistent with the public interest, and the need for the court to exercise a degree of restraint when scrutinising the proposed settlement terms. The court also considered the mandatory statutory factors relevant to the assessment of the appropriate penalty, including the nature, extent, and duration of the contravening conduct, the loss and damage to consumers, and the deterrence effect of the penalty. The court concluded that a penalty of $5 million was appropriate, taking into account the totality of the contravening conduct, the loss and damage to consumers, and the deterrence effect of the penalty. The court also ordered Medibank to pay $70,000 towards the ACCC's costs and dismissed the proceeding otherwise.