Cat Media Pty Limited Carotino (Australia) Pty Limited Pharm-a-Care Laboratories Pty Limited and Minister for Health and Aged Care
[2023] AATA 2792
•31 August 2023
Cat Media Pty Limited Carotino (Australia) Pty Limited Pharm-a-Care Laboratories Pty Limited and Minister for Health and Aged Care [2023] AATA 2792 (31 August 2023)
Division:GENERAL DIVISION
File Number(s): 2022/3059
Re:Cat Media Pty Limited
Carotino (Australia) Pty Limited
Pharm-a-Care Laboratories Pty LimitedAPPLICANT
Minister for Health and Aged Care And
RESPONDENT
DECISION
Tribunal:Senior Member G Lazanas
Date:31 August 2023
Place:Sydney
The decision under review dated 13 April 2022 confirming the cancellation of the listing of the product FatBlaster MAX is affirmed.
................................[SGD]........................................
Senior Member G Lazanas
CATCHWORDS
HEALTH – therapeutic goods – listing of therapeutic goods on Australian Register of Therapeutic Goods – cancellation of listing of therapeutic goods - whether label of product known as FatBlaster MAX contains indications for fat loss and or weight loss – meaning of contains - whether a statement made in the application for listing of the product FatBlaster MAX was false or misleading in a material particular – whether product FatBlaster MAX was advertised by sponsor for fat loss and or weight loss – the ordinary and reasonable consumer test – assessment of expert evidence – decision under review affirmed
LEGISLATION
Administrative Appeals Tribunal Act 1975 (Cth), ss 27, 38AA, 43
Competition and Consumer Act 2010 (Cth), Sch 2, s 18
Therapeutic Goods Act 1989 (Cth), ss 3, 4, 9A, 9D, 26A, 26BF 28, 30, 31, 42DKB, 60
Therapeutic Goods Amendment (2017 Measures No 1) Act 2018 (Cth), Sch 2, Part 1, Item 1
Therapeutic Goods (Permissible Indications) Determination (No. 1) 2019 (Cth)
Trade Practices Act 1974 (Cth), s 52
CASES
Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27
Australian Competition and Consumer Commission v Google LLC (No 2) (2021) 391 ALR 346
Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2020) 278 FCR 450
Bullivant’s Natural Health Products Pty Ltd and Minister for Health and Family Service (1996) 43 ALD 305
Cat Media Pty Limited, Carotino (Australia) Pty Limited, Pharm-a-Care Laboratories Pty Ltd and Minister for Health and Aged Care [2022] AATA 1254
Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503
Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8
Tobacco Institute of Australia Ltd v Australian Federation of Consumer Organisations Inc (1992) 38 FCR 1
SECONDARY MATERIALS
Explanatory Memorandum to the Therapeutic Goods Amendment (2017 Measures No 1) Bill
Macquarie Dictionary Online
REASONS FOR DECISION
Senior Member G Lazanas
31 August 2023
INTRODUCTION
On 14 April 2022, Cat Media Pty Limited, Carotino (Australia) Pty Limited and Pharm-a-Care Laboratories Pty Ltd (collectively referred to as the Applicants) applied to the Tribunal for review of a decision of a delegate of the Minister for Health and Aged Care (the Respondent) made on 13 April 2022 (the Reviewable Decision). The Reviewable Decision confirmed an earlier decision by a delegate of the Secretary of the Department of Health made on 10 January 2022 to cancel the listing of the product, FatBlaster MAX (the Product) on the Australian Register of Therapeutic Goods (the Register), albeit for different reasons (the Cancellation Decision).
The Applicants manufacture and sell a range of products under various brand names, one such popular brand name is “FatBlaster”. The Product which is the subject of dispute in these proceedings is known as “FatBlaster MAX”. Pictures of the label and packaging of FatBlaster MAX are reproduced at Schedule A, at the end of this decision.
Cat Media Pty Limited is the sponsor of the Product and the First Applicant. The second and third applicants are persons whose interests are affected by the decision within the meaning of s 27 of the Administrative Appeals Tribunal Act 1975 (Cth) (the AAT Act) and, accordingly, have standing in these proceedings.
The Product in issue - FatBlaster MAX - was listed on the Register on 12 November 2020. It was sold in the form of a box of 60 film coated tablets in blister packs at retail outlets such as supermarkets and chemists as well as online. Until the taking of effect of the Cancellation Decision, the Product’s listing on the Register contained several “indications” for the purposes of the Therapeutic Goods Act 1989 (Cth) (the TG Act). Those “indications” are for specific therapeutic uses, including to “[m]aintain/support energy levels”; “[m]aintain/support body metabolism/metabolic rate”; “[m]aintain/support general health and wellbeing”; and “[a]id/assist/helps glucose/sugar/carbohydrate metabolism”. The Product was permissibly indicated for these health and wellness related “indications”.
The Respondent contended that the label of the Product, by virtue of incorporating in the Product’s name the brand name FatBlaster, contains a further “indication” for weight loss and or fat loss in respect of which the Applicants had not applied for the Product to be listed on the Register. The Respondent argued that an ordinary and reasonable consumer would have understood that the Product, based on the “label”, as defined in the TG Act or, alternatively, based on certain advertising of the Product, could have been used for weight loss and or fat loss. Therefore, the Respondent maintained the Cancellation Decision should effectively be confirmed by the Tribunal.
The Applicants argued that no part of the “label” of the Product, or the way it is advertised by the Applicants, would indicate to an ordinary and reasonable consumer that a specific therapeutic use of the Product is weight loss or fat loss.The Applicants urged the Tribunal to set aside the Reviewable Decision and substitute it with a decision revoking the Cancellation Decision.
The ultimate issue for determination by the Tribunal is whether the Product contains “indications” or was advertised for “indications” of “weight loss” and or “fat loss”. The determination of that issue depends on an analysis of three key questions which were the foundation for the Cancellation Decision. If the answer to any of those three questions is ‘yes’, the Reviewable Decision should be affirmed. There are also a couple of subsidiary issues, to which I will come shortly. It is also necessary to address the expert evidence that was adduced by both parties.
As these reasons will explain, I have decided that an ordinary and reasonable consumer would understand – based on the label of the Product and, additionally, based on certain advertising of the Product – that the Product can be used for fat loss and or weight loss. It follows that the Reviewable Decision must be affirmed.
Before setting out the analysis under the three relevant questions, it is convenient to first canvass the broad background of the dispute including the relevant statutory provisions relating to therapeutic goods and the relevant principles regarding the ordinary and reasonable consumer test. I then turn to the factual background which brought the parties to the Tribunal followed by the evidence and the submissions of the parties.
RELEVANT STATUTORY PROVISIONS RELATING TO THERAPEUTIC GOODS
It is helpful to start with an overview of the provisions relating to the listing of therapeutic goods on the Register followed by the process relating to the cancellation of listing by the Therapeutic Goods Administration (the TGA), being a department reporting to the Respondent.
Listing of therapeutic goods
The objects of the TG Act relevantly provide for the establishment and maintenance of a national system of controls relating to, amongst other things, the quality, safety and efficacy of therapeutic goods: s 4(1)(a) of the TG Act.
“Therapeutic goods” are defined in s 3(1) of the TG Act to mean:
goods
(a) that are represented in any way to be, or that are, whether because of the way in which the goods are presented or for any other reason, likely to be taken to be:
(i) for therapeutic use; or
(ii) for use as an ingredient or component in the manufacture of therapeutic goods; or
(iii) for use as a container or part of a container for goods of the kind referred to in subparagraph (i) or (ii); or
(b)included in a class of goods the sole or principal use of which is, or ordinarily is, a therapeutic use or a use of a kind referred to in subparagraph (a)(ii) or (iii);
and includes biologicals, medical devices and goods declared to be therapeutic goods under an order in force under section 7, but does not include.
…
Relevantly, for present purposes, they are goods that are represented in any way to be, or that are, because of how they are presented or for any other reason, “likely to be taken to be for therapeutic use” and include medicines.
“Therapeutic use” is, in turn, defined in s 3(1) as follows:
therapeutic use means use in or in connection with:
(a)preventing, diagnosing, curing or alleviating a disease, ailment, defect or injury in persons; or
(b)influencing, inhibiting or modifying a physiological process in persons; or
(c)testing the susceptibility of persons to a disease or ailment; or
(d)influencing, controlling or preventing conception in persons; or
(e)testing for pregnancy in persons; or
(f)the replacement or modification of parts of the anatomy in persons.
Relevantly, paragraph (b) of the above definition of “therapeutic use” is relevant to the Product.
Broadly, it is important for therapeutic goods for humans to be listed on the Register as otherwise the supply of therapeutic goods not listed may, amongst other things, attract criminal penalties. Section 9A of the TG Act requires the Secretary of the Department of Health to cause to be maintained the Register for the purpose of compiling information in relation to, and providing for evaluation of, therapeutic goods for use in humans. One part of the Register is for “listed goods”, which is different to the process for registration of goods.
“Listed goods” is defined in s 3(1) to mean “therapeutic goods that are included in the Part of the Register for goods known as listed goods”.
An application for the listing of therapeutic goods can be made under, relevantly, s 26A of the TG Act. It allows certain medicines that contain low-risk ingredients to be automatically listed following certification by the sponsor that the statutory requirements are met. That is, a sponsor of certain medicines can apply to list a medicine on the Register without the TGA conducting a pre-market evaluation. If a sponsor wishes to list a certain medicine using this process, then, provided certain mandatory requirements are met, including that certain certifications required to be made under s 26A(2) are made, “the Secretary must list the medicine in relation to the person”: s 26A(1). The Product was one such medicine listed on the Register via this automatic listing process.
Importantly, under s 26A(2) of the TG Act, at the time of making the application, the applicant must certify that:
(fba) if the medicine’s label contains one or more indications — each indication:
(i)is covered by a determination under paragraph 26BF(1)(a); and
(ii)is proposed to be accepted in relation to the inclusion of the medicine in the Register; and …
A couple of points should be observed at the outset about paragraph (fba) of s 26A(2). First, the statutory interpretation! of “contains” in paragraph (fba) of s 26A(2) is a key subsidiary issue. Secondly, the paragraph only applies where the label contains one or more indications. Thirdly, each “indication” on the label must meet the requirements of sub-paragraphs (i) and (ii). This is because the effect of the subparagraphs is that the applicant certifies that an “indication” will not be included on the “label” unless it is both covered by a determination and proposed to be accepted in relation to the listing of the medicine on the Register.
Section 3(1) defines “indications” in relation to therapeutic goods to mean “the specific therapeutic uses for the goods”. It is an exhaustive definition. When a sponsor applies for a medicine to be listed on the Register under s 26A, the application must include a list of “indications” drawn from the list of permitted indications. At the relevant time, these indications were set out in the Therapeutic Goods (Permissible Indications) Determination (No. 1) 2019 (Cth) (the Determination). The Determination was made under s 26BF(1) of the TG Act. As stated above, some of the permissible indications of the Product per the terms of the Determination are set out at [4] above.
It is clear from the precise terms of the Determination, that some indications, for example, “[m]aintains/ support body metabolism/ metabolic rate” can be included as indications without suggesting weight loss and the same indications can also separately be included as indications suggesting weight loss. That is, certain indications can be deployed with or without the weight loss suggestion.
Section 26A(2)(fba) is also concerned with the medicine’s “label”. “Label” is defined in s 3(1) as follows:
label, in relation to therapeutic goods, means a display of printed information:
(a)on or attached to the goods; or
(b)on or attached to a container or primary pack in which the goods are supplied; or
(c)supplied with such a container or pack.
Section 28(5) of the TG Act sets out the conditions to which the listing of therapeutic goods are subject. Section 28(5)(ab) provides as follows:
(5) In addition to any conditions imposed under subsection (1), (2B) or (3), the registration or listing of therapeutic goods (the subject goods) is subject to the conditions that the person in relation to whom the subject goods are registered or listed will: …
(ab) not, by any means, advertise the subject goods for an indication other than those accepted in relation to the inclusion of the goods in the Register; and …
The definition of “advertise” in s 3(1) of the TG Act is, as follows:
advertise, in relation to therapeutic goods, includes make any statement, pictorial representation or design that is intended, whether directly or indirectly, to promote the use or supply of the goods, including where the statement, pictorial representation or design:
(a)is on the label of the goods; or
(b)is on the package in which the goods are contained; or
(c)is on any material included with the package in which the goods are contained.
Cancellation of listing on the Register
Section 30 of the TG Act provides for cancellation of registration or listing. Section 30 relevantly provides:
30Cancellation of registration or listing
(1)The Secretary may, by notice in writing given to a person in relation to whom therapeutic goods are included in the Register, cancel the registration or listing of the goods if:
…
(e)in the case of a medicine listed under section 26A, it appears to the Secretary that any of the certifications under paragraph 26A(2)(a), (ca), (cb), (e), (fba), (fd), (fe) or (g) are incorrect or (if applicable) the requirements under subsection 26A(3) or (4A) are not fulfilled; or
…
(g)the Secretary is satisfied that a statement made in, or in connection with, the application for registration or listing of the goods was false or misleading in a material particular; or
…
(2)subject to subsection (3), the Secretary may, by notice in writing given to a person in relation to whom therapeutic goods are included in the Register, cancel the registration or listing of the goods if:
…
(c)the sponsor has refused or failed to comply with a condition to which the inclusion of the goods is subject (other than the condition under paragraph 28(5)(d));
…
(3)Where the Secretary proposes to cancel the registration or listing of goods in relation to a person under subsection (2), the Secretary must:
(a)inform the person in writing that the Secretary proposes to cancel that registration or listing and set out the reasons for that proposed action; and
(b)give the person a reasonable opportunity to make submissions to the Secretary in relation to the proposed action.
(4)Where a person makes submissions in accordance with paragraph (3)(b), the Secretary is not to make a decision relating to the cancellation until the Secretary has taken the submissions into account.
The ordinary and reasonable consumer
The parties agreed that the applicable principles regarding the test as to whether the label of the Product contains an indication or advertisement for fat loss and or weight loss, is to ask what is understood by the ordinary and reasonable consumer. The parties stated that this issue is not dealt with expressly in the TG Act, however, the Explanatory Memorandum to the Therapeutic Goods Amendment (2017 Measures No 1) Bill, which introduced s 26A(2)(fba) of the TG Act explained that the purpose of the amendment was that labels “must only contain certain low level permitted indications, and that there must not be inconsistency between the indications that are listed in the Register and on the label (as would be seen by the purchaser or user of the listed medicine)”: see Explanatory Memorandum to the Therapeutic Goods Amendment (2017 Measures No. 1) Bill at 26-30 and Therapeutic Goods Amendment (2017 Measures No 1) Act 2018 (Cth), Sch 2, Part 1, Item 1.
Additionally, both parties acknowledged that there does not appear to be any authority on the relevant test as to whether the advertising of the Product (including by way of its label for the purposes of s 30(2)(c)) indicates a specific therapeutic use for the Product such as fat loss and or weight loss. They agreed that it should also be assessed by reference to the ordinary and reasonable consumer. They referred to Bullivant’s Natural Health Products Pty Ltd and Minister for Health and Family Service (1996) 43 ALD 305 where, in the context of considering applications for review of decisions to refuse applications for listing under the TG Act, the Tribunal relied on decisions considering the former s 52 of the Trade Practices Act 1974 (Cth). The Tribunal (constituted by Forgie DP and Smithurst M) noted at [67] that, in the trade practices context, it had been suggested that “the effect on reasonable members of the class is to be considered”. The Tribunal concluded at [82] that the question was whether the products had the ability to mislead or confuse “a reasonable adult member of the community”.
The provisions at issue in Bullivant’s concerned whether the product's presentation was misleading or confusing, including under the then Therapeutic Goods Regulations. In Bullivant’s, the issue was whether the product’s presentation was likely to result in the goods being mistaken for or confused with confectionary or toys. To answer whether such was "likely" to result, the Tribunal had to determine whether they had to consider any particular group in the community. The Tribunal found no assistance in the TG Act or related regulations. The Tribunal turned to the cases that had considered s 52 of the Trade Practices Act 1974 and stated, as follows:
(67) Section 52 does not state what persons or class of persons should be considered but it has been held that consideration must be given to the class of consumers likely to be affected by the particular conduct (Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 42 ALR 1 at 7). Gibbs CJ and Mason J seemed to take the view that the effect on reasonable members of the class is to be considered. In Taco Co of Australia v Taco Bell Pty Ltd (1982) 42 ALR 177, the Federal Court said that s 52 must be considered by reference to all people who come in that class including the astute and the gullible, the intelligent and the not so intelligent and the well educated and the poorly educated. In 10th Cantanae Pty Ltd v Shoshana Pty Ltd (1987) 79 ALR 299 and Honey v Australian Airlines Ltd [1989] ATPR 40-961 considered the effect of an advertisement upon a significant segment of the readership of a newspaper and not upon the readership generally.
Further analysis of the differences in approach taken by the courts was, however, considered unnecessary in Bullivant’s as the Tribunal concluded at [69]: "…we have decided that, however broadly the class is drawn, there is nothing about the Vitamin C tablets and the Echinacea tablets themselves that is likely to result in their being mistaken for or confused with confectionary or toys."
At the hearing, counsel for the Respondent additionally provided a note on the relevant principles with respect to what is now s 18 of the Australian Consumer Law (being the Competition and Consumer Act 2010 (Cth), Sch 2) and also referenced the recent High Court decision in Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8. As the analysis in Self Care is directly relevant to how I have approached the consideration of the issues in this proceeding, it is appropriate to extract the relevant principles set out in the joint judgment in Self Care. First, the conduct must be considered by reference to "the class of consumers likely to be affected by the conduct" (at [86]). Second, "it is necessary to isolate an ordinary and reasonable "representative member" (or members) of that class, to objectively attribute characteristics and knowledge to that hypothetical person (or persons), and to consider the effect or likely effect of the conduct on their state of mind” (at [83]). It must be borne in mind the test is focused on "the effect of the conduct on reasonable members of the class" (at [83]).
The High Court also explained in Self Care at [83], as follows:
[t]his hypothetical construct “avoids using the very ignorant or the very knowledgeable to assess effect or likely effect; it also avoids using those credited with habitual caution or exceptional carelessness; it also avoids considering the assumptions of persons which are extreme or fanciful”. The construct allows for a range of reasonable reactions to the conduct by the ordinary and reasonable member (or members) of the class. (citations omitted)
Relevantly, the High Court also cited with approval several propositions set out by Thawley J in ACCC v Google LLC (No 2) (2021) 391 ALR 346 including the following at [92]:
…even if there must be an identification of a single hypothetical member of the class, it does not follow that in all cases the identified hypothetical person is only capable of one response or reaction. There may well be situations where a hypothetical person might reasonably have been misled and might reasonably not have been misled. The law recognises that there may be a number of different 'reasonable' responses to conduct.
While the High Court did not expressly endorse a number of related points made by Thawley J in ACCC v Google LLC (No 2), they are, relevantly, as follows:
[96] …Applying such an approach to assessing alleged misleading or deceptive conduct might, on many occasions, fail to protect ordinary or reasonable consumers, an outcome that is unlikely given the ACL is directed at broad consumer protections. One would not condone misleading conduct directed to the public at large just because 51% of consumers, or an even greater majority, of consumers would not be misled. The law in the consumer protection field does not confine a hypothetical member of the class to one response. As Allsop CJ stated in Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd (2015) 327 ALR 540 at [95]: "[t]he fact that some people may not be misled is not the point".
It follows that although it appears that some earlier Federal Court authorities required there to be a significant number of persons within the class being misled or deceived, more recent Full Court authority appears to have rejected that approach. In this regard, see for example, ACCC v TPG Internet Pty Ltd (2020) 278 FCR 450 at 459 [23]. Additionally, Thawley J in ACCC v Google LLC (No 2) at [96] rejected any notion that a "majority" of the class must be misled. Therefore, if one reasonable response by the reasonable (hypothetical) member was that they were likely to be misled, that is sufficient. Similarly, the Full Federal Court had held long ago that an advertisement may be misleading even if it fails to deceive wary readers: see Tobacco Institute of Australia Ltd v Australian Federation of Consumer Organisations Inc (1992) 38 FCR 1 at 49 (Hill J, Foster J agreeing at 27).
FACTUAL AND PROCEDURAL BACKGROUND
The Product was listed on the Register on 12 November 2020.
On 11 February 2021, the TGA sent the First Applicant a request for information under s 31(2) of the TG Act. On 24 February 2021, the First Applicant responded to that request and included evidence to support the claims made in relation to the Product.
On 9 August 2021, a delegate of the Secretary sent the First Applicant a notice advising that he proposed to cancel the listing of the Product under s 30 of the TG Act. On 8 September 2021, the First Applicant responded setting out the reasons it disagreed with the delegate’s proposed decision.
As stated above, on 11 January 2022, a delegate of the Secretary’s sent the Cancellation Decision to the First Applicant, being the initial decision within the meaning of s 60 of the TG Act.
Section 60 of the TG Act provides for a form of “internal review” of certain decisions made under the TG Act. Section 60(2) makes provision for an applicant to “request the Minister to reconsider” an “initial decision” within 90 days after notice was given. Section 60(2A) provides that such a request “may be accompanied by information in support of the request”. The “initial decision” here was the Cancellation Decision made on 11 January 2022. On 22 February 2022, the First Applicant sought internal review of the initial decision pursuant to s 60(1) of the TG Act.
Section 60(3) relevantly provides that the Minister must, as soon as practicable after receiving a request under subsection (2), reconsider the initial decision. He or she may then confirm or revoke the initial decision or revoke it and make a decision in substitution for the initial decision. A decision made by the Minister under s 60(3) is a “reviewable decision” as defined by s 60(1). As stated above, the Reviewable Decision was made by the Respondent’s delegate on 13 April 2022.
On the following day, 14 April 2022, the Applicants made an application for review to the Tribunal and submitted consent orders for the stay of the Reviewable Decision by the Tribunal on an interim basis. The stay orders were made by the Tribunal on 21 April 2022. The Applicants subsequently sought from the Tribunal, but were not granted, a stay of the Reviewable Decision until the determination of this proceeding: Cat Media Pty Limited, Carotino (Australia) Pty Limited, Pharm-a-Care Laboratories Pty Ltd and Minister for Health and Aged Care [2022] AATA 1254. Consequently, the Reviewable Decision took effect on and from 13 May 2022.
The Reviewable Decision is based on three grounds, in reliance on paragraphs (e) and (g) of s 30(1) and paragraph (c) of s 30(2) of the TG Act (see extracts at [26] above). The premise of all three grounds was that the label of the Product contains an indication, namely a “specific therapeutic use” for weight loss. (The Respondent subsequently argued and maintained at the Tribunal proceedings that the Product also contains an indication for fat loss). That contention is, in turn, based solely on the use of the brand name of the Product FatBlaster which is printed on its label.
Specifically, in relation to s 30(1)(e) of the TG Act, the Respondent stated that the “inclusion of the name FatBlaster MAX on the label of the medicine” read in the context of the label as a whole, is an “indication for the reduction of body fat, resulting in weight loss”. This was not an indication that was proposed to be accepted in relation to the inclusion of the medicine in the Register at the time of certification under s 26A(2)(fba)(ii) of the TG Act. The Respondent concluded, therefore, that the certification was incorrect.
In relation to s 30(1)(g), the Respondent’s reasoning was based on the same basis as relied on for s 30(1)(e), namely, that the certification under s 26A(2)(fba)(ii) was false or misleading in a material particular, because weight loss was not an indication proposed to be accepted in relation to the inclusion of the Product on the Register.
In relation to s 30(2)(c), the Respondent again relied on the presence of the brand name FatBlaster on the Product as advertising of the Product for “the purposes of the loss of body fat with a subsequent effect on weight loss”, and found that this breached a condition of listing under s 28(5)(ab) of the TG Act.
The Applicants submitted there were several critical difficulties with the delegate’s reasoning. For example, the Applicants argued that the delegate impermissibly conflated the Product’s permissible indications with one possible consequence (weight loss) of use of the Product. This and other asserted flaws in the delegate’s reasoning are considered further below.
The dispute between the Applicants and the Respondent was, relevantly, commenced in the Tribunal as an application may be made to the Tribunal for review of a reviewable decision: s 60(8). The decision-making function of the Tribunal under s 43 of the AAT Act requires that the Tribunal make the “correct or preferable decision”. The Tribunal’s task is to stand in the shoes of the delegate and decide based on all of the evidence before it at the time of its decision. The Tribunal may take into account additional evidence that was not before the delegate, and also consider issues that arise on the material before it.
THE EVIDENCE
The Applicants relied on lay and expert evidence. The lay witness for the Applicants was Ms Rose Gabrielle Jenkins who made a statutory declaration on 3 August 2022 (the Jenkins Declaration). The Jenkins Declaration relevantly attached and exhibited various materials such as screenshots of the advertising and promotion of FatBlaster products on the FatBlaster website, as well as photographs of the way FatBlaster MAX was offered for sale in April 2022, both in retail stores and online. An exhibit to the Jenkins Declaration was a sealed sample of the FatBlaster MAX product (Exhibit A1 in the proceedings). See also Schedule A of this decision for photographs of the Product extracted from the Jenkins Declaration. The expert evidence relied on by the Applicants is that of Professor Richard Donald O’Sullivan, who prepared a report which was annexed to his statutory declaration made on 26 August 2022 (Exhibit A4) (the O’Sullivan Report). Professor O’Sullivan provided a further report annexed to his second statutory declaration dated 23 November 2022 (Exhibit A5) (the O’Sullivan Reply Report).
The documents before the Tribunal filed by the Respondent were the T-Documents, the s 38AA Documents and lay and expert evidence. The Respondent’s lay evidence was an affidavit by Mr Joshua William Smith affirmed 29 April 2022 which annexed formal correspondence with the Applicants and, additionally, screen captures of the FatBlaster product range as of 28 April 2022, amongst other things. Mr Williams is a lawyer employed by the Department of Health. Professor Pascale G. Quester was engaged by the Respondent to give an expert report. Her report is dated 10 October 2022 (Exhibit R2) (the Quester Report).
Professor O’Sullivan is a professor of marketing at Melbourne Business School. He has over 25 years’ experience in the field of marketing with particular areas of expertise being branding and marketing communication, marketing performance and marketing effectiveness and metrics. Professor O’Sullivan gave evidence in relation to the role of branding in retail settings, consumer purchasing behaviour, and the influence of head brands on consumer purchasing behaviour. He also gave his opinion as to whether an ordinary and reasonable consumer would consider that the use of FatBlaster MAX is for weight loss having regard to the Jenkins Declaration and other documents filed by the Respondent.
Professor O’Sullivan explained in the O’Sullivan Report that the Product’s benefit claims are prominent on the packaging, being written in large text, centrally located, and on packaging that is otherwise remarkably plain. He stated that these attributes increase the attention given to the claims by consumers, because the principles of visual salience are such that objects receive attention in proportionality to their size, visual centrality, colour and contrast. Professor O’Sullivan noted that weight loss is not one of the three benefit claims on the front of the packaging (the front and back are identical), nor does weight loss appear anywhere else on the packaging. He concluded that an ordinary reasonable consumer of the Product was not likely to conclude based on the words Fat and Blaster that it is for weight loss.
Professor O’Sullivan further explained that his opinion is based on the principles of consumer involvement, and the steps or cognitive effort that consumers invest in making purchase decisions and that a consumer’s involvement is higher when the purchase is perceived as being more consequential. Professor O’Sullivan expressed the view that the fact that the Product makes specific functional claims, retails for a relatively high price (approximately $50) and is contained within a category of a large number of products offered at a wide range of prices, all mean that consumer involvement in the purchase of this Product is at a relatively high level. That high level of involvement means that consumers are unlikely to conclude it is a weight loss product, because that is not a benefit claim made on the label. Professor O’Sullivan proceeded to break his opinions down with respect to consumers who have different levels of awareness and experience with the Product and, more generally, the FatBlaster brand. Professor O’Sullivan concluded in relation to each category of consumer that they were unlikely to conclude that it is a weight loss product.
Other observations and opinions expressed in the O’Sullivan Report include:
(a)brand associations can change over time, in particular, the introduction of new products under a brand name can alter a brand’s associations; brand names may vary from names that are highly descriptive of the product or product benefits that consumers might expect to highly abstract names; over time, the extent to which an established brand’s name is descriptive of the associated products can evolve;
(b)consumers engaged in higher involvement purchasing of over the counter medications are significantly more likely to evaluate information on labels relative to consumers who are engaged in low involvement purchases; more highly-involved consumers tend to focus more on textual information on packaging;
(c)consumers place greater weight on cues that are perceived to be more useful in identifying a brand; consumer attention to cues aligns with the concept of consumers as ‘cognitive misers’ who seek to achieve a ‘cognitive economy’ by relying on the fewest possible cues to make their decisions when involved in purchasing decisions;
(d)consumers buying a product or brand for the first time engage in more careful consideration and evaluation; that is, more time and cognitive effort is exerted in examining the packaging and reading product descriptions and looking at the product and images on the packaging;
(e)the higher the level of involvement the more cognitively engaged a consumer becomes and less reliant on initial diagnostic cues such as signage in retail settings, and more reliant on an evaluation of the specific products being considered for purchase;
(f)in many instances, consumers have incomplete information, for example, when the packaging does not make explicit claims about all attributes that are important to a consumer, consumers can either search out information or draw inferences; the academic literature on inference formation has shown that when information about attributes is missing in a product description, consumers discount the assumed value of that attribute in the product; and
(g)when a brand is extended, the role of the brand in consumer search and purchase decisions is altered; when a brand is used to promote a range of products brand name becomes an insufficient cue for consumers looking for one of the products amongst the range of products marketed under the brand name; when the products marketed under a brand has large variances in price and other attributes, consumers are motivated to look beyond the brand name when making the purchase decision.
With reference to FatBlaster products, Professor O’Sullivan relevantly observed and expressed the following opinions:
(a)as FatBlaster products are widely available in the Australian market, many Australian consumers are likely to be aware of the brand either through its promotion or through product usage and to have developed associations with the FatBlaster brand and specific products promoted under that brand;
(b)FatBlaster operates as a master brand with a wide range of sub–brands and endorsed brands featuring various benefit claims; some sub-brands are marketed as weight loss products and other products appear to be promoted for weight management benefits; there is a high degree of variance in the portfolio of products marketed under the FatBlaster brand in terms of, for example, product formats, benefits, price points, packaging formats and packaging design;
(c)given the large range of products marketed under the FatBlaster brand name, and the fact brand associations evolve over time, it is likely that FatBlaster’s associations have also evolved; as a master brand that is used to promote a wide range of products, consumers are likely to associate FatBlaster with the category (broadly defined) of supplements or health or weight management;
(d)as the FatBlaster brand is used to promote a wide range of products, consumers searching for specific products for use are likely to view the brand as a necessary but insufficient diagnostic cue when purchasing products with certain benefits;
(e)the words ‘fat’ and ‘blaster’ may be seen as semantically suggestive that products marketed under the brand ‘blast’ or ‘get rid of fat’; however, the general principles of consumer involvement in purchasing decisions mean that consumers who decide to buy a product will exert meaningful cognitive effort in making that decision and are unlikely to conclude, based on those words (fat and blaster), that it is a weight loss product;
(f)where the purchase of a product is consequential, the principle of consumer involvement implies that consumers who purchase FatBlaster MAX will be highly involved in the purchase and thus, unlikely to mistakenly conclude that it is a weight loss product as weight loss does not feature among the three benefit claims;
(g)FatBlaster has a number of sub-brands and products offering various functional benefits; the principle of consumer involvement implies that consumers who purchase FatBlaster MAX will have engaged in at least a moderate consideration of its packaging and how it differs from other products under the master brand as well as other competitor’s products;
(h)consumers involved in the purchase of over-the-counter medications are more likely to evaluate information on the label and understand it; and
(i)for a consumer to make a mistaken purchase of FatBlaster MAX in the belief that it is a weight loss product, they would have to, amongst other things, not notice or care that weight loss does not feature as a specific benefit claim on the Product’s packaging, or infer a weight loss benefit from the brand name or packaging or not know, notice or care that there is a wide range of FatBlaster products with vastly different functional claims.
In summary, Professor O’Sullivan’s opinion was that a typical consumer, including one familiar with the FatBlaster brand, would not mistakenly consider FatBlaster is a weight loss product because not all FatBlaster branded products are promoted as being for weight loss. According to Professor O’Sullivan, while FatBlaster as a brand has high strength of association within the range of products promoted under the master brand, it is not a brand that is specific to only one type of product within its range, as the branding has evolved. Therefore, upon seeing the actual packaging of the Product, which does not have a weight loss claim, consumers would unlikely conclude it is a weight loss product. Professor O’Sullivan concluded that a consumer who is not familiar with the FatBlaster brand is again unlikely to conclude the Product is for weight loss, because the packaging has three stated functional benefits, and weight loss is not amongst them. Professor O’Sullivan accepted that most consumers would not necessarily understand all those benefits, including the meaning of thermogenesis.
Professor Quester is the director of Hexagon Marketing Services Pty Ltd which has a business of providing advice on consumer behaviour, marketing, advertising as well as promotional consulting services to government and industry clients. Professor Quester is employed by the Swinburne University of Technology as Vice Chancellor, however, she stated she provided her expert report in her academic capacity as an Emerita Professor of Marketing in the Adelaide Business School. Her main areas of research are consumer behaviours. She has undertaken three decades of consumer research including empirical evidence, survey, panel focus groups and experiments and quasi-experiments with consumers. She holds a Bachelor of Business Administration from Audencia in Nantes, France, a M.A Marketing from The Ohio State University and Ph.D. Marketing from Massey University in New Zealand.
The observations and opinions expressed in the Quester Report, including some areas of disagreement with Professor O’Sullivan were, as follows:
(a)consumers invest effort, time and cognitive capacity if they are highly involved and engaged in an extensive problem–solving processes; when their involvement is moderate, consumers will seek to find satisfactory solutions for their problem without continuing their search for an optimal solution;
(b)for limited problem-solving or routine response behaviour, two attributes are likely, one is price, and the other is brand;
(c)consumers tend to focus on benefits offered by products rather than the features or components of a product;
(d)she disagreed with Professor O’Sullivan in his description of the brand FatBlaster as being devoid of an intrinsic meaning for consumers; she disagreed that FatBlaster has somehow, over time, lost all descriptive value in the eyes of a consumer;
(e)she disagreed with Professor O’Sullivan’s characterisation of the purchase of FatBlaster MAX as being a high involvement or extended problem–solving purchase and would not categorise the purchase of food supplements as necessarily provoking higher involvement;
(f)the family of products under the name FatBlaster will be perceived, categorised and interpreted as all belonging to a general category of weight loss products;
(g)in relation to commenting on what an ordinary and reasonable consumer would believe with respect to the FatBlaster MAX packaging, the most prominent elements of the package are FatBlaster and MAX; this name, in and of itself, would signal to most reasonable consumers that they are looking at a product that belongs to the general family of weight or fat control supplements; and
(h)even if consumers were to read the details of the three claims provided on the package, they would understand those to be instrumental to the ultimate goal of weight or fat loss; the claims would be assumed by consumers to be means to an end, the end being understood to be weight or fat loss.
The O’Sullivan Reply Report addressed the areas of disagreement with Professor Quester. Professor O’Sullivan disagreed with Professor Quester’s statements that purchases of FatBlaster MAX would result from low involvement consumer decision-making. He also disagreed that consumers who purchase FatBlaster MAX would do so based on price and brand with little consideration for other factors. Professor O’Sullivan disagreed with Professor Quester’s view that consumers who purchase FatBlaster MAX would do so in the belief it is a weight loss product based on the semantic suggestiveness of the FatBlaster brand name. Professor O’Sullivan considered that brand name suggestiveness, on its own, would not determine purchase behaviour of reasonable consumers engaged in higher involvement decision-making as for the purchase of weight loss products. All consumers purchasing FatBlaster MAX, in his opinion, would review the benefit claims on the front of the packaging which is suggestive of weight management broadly rather than weight loss exclusively. Professor O’Sullivan noted that nothing in marketing or consumer behaviour literature showed empirically that for higher involvement purchases, semantic suggestiveness alone drives purchase decisions. Professor O’Sullivan concluded that as the FatBlaster brand promotes a portfolio of products, it strengthens the brand’s associations with dietary supplements and weight management generally. It followed, according to Professor O’Sullivan, that the brand name does not have utility as a heuristic for specific benefits, because typical consumers familiar with the brand name would not rely on the name alone when searching for weight loss products.
Professor O’Sullivan and Professor Quester participated in a joint conferencing process (before the hearing) which resulted in a document titled ‘Notes from expert meeting’, signed by both of them (the Notes). In summary, they agreed that “involvement” in the context of consumer decision making refers to the amount of effort that customers exert in purchase decisions and it sits on a continuum. Both experts agreed that consumers most of the time will try to simplify the process of decision-making unless they consider there is a lot at stake, in which event consumers will have an extreme level of involvement to ensure the decision is optimal. The sorts of facts that induce higher levels of involvement are the importance of the category of product, the amount of money to be spent, whether the consumption of the product is a public one and whether there are any social risks in using the wrong product.
As already stated above, Professor O’Sullivan and Professor Quester disagreed on many other matters. The “Areas of disagreement” between the experts, as per the Notes, included the following topics:
(a)Whether the purchase of weight loss products likely provokes higher involvement decision making.
(b)The likely extent of consumer involvement leading to purchases of FatBlaster MAX.
(c)Whether the use of a brand name to promote a wide range of products reduces the usefulness of the name as a diagnostic cue for any individual product within the range.
(d)Whether a reasonable or average consumer who purchases FatBlaster MAX would do so based on price and brand with little, if any, consideration of other factors.
(e)Whether the other products marketed under the FatBlaster name amplify the likelihood that consumers would view FatBlaster MAX as a weight loss product.
(f)Whether the benefit claim of the front of FatBlaster MAX creates consumers’ expectations that FatBlaster MAX is a weight loss product.
It is noted that more areas of disagreement emerged between Professor O’Sullivan and Professor Quester during their oral concurrent evidence at the hearing, and that they generally maintained their opinions.
My assessment of the evidence given by the experts, including their oral evidence, was that it was helpful in providing the broad framework in relation to areas of specialised knowledge including consumer behaviours with respect to decision making and the role of branding. As evident from the analysis below, I have accepted some of their views, especially where I considered them to assist in my evaluation of various elements and or to lend credence to my own conclusions. However, the expert evidence was ultimately of limited assistance, in all the circumstances. The essential issue for determination by the Tribunal is whether the label of the Product, or the way the Product is advertised by the First Applicant, would indicate to an ordinary and reasonable consumer that a specific therapeutic use of the Product is weight loss or fat loss. In considering the Product’s label, which was key to this proceeding, it is important to also bear in mind that it is not the function of experts to give evidence about the meaning of ordinary English words such as “fat”, “blaster” and “max” as they are matters for the Tribunal to determine.
Finally, with respect to the role of the experts in this case, my approach was also informed by the following comments of Branson J in the case of Cat Media Pty Limited v Opti-Healthcare Pty Limited [2003] FCA 133 at [55] (emphasis added), which I generally adopt:
… Each of the parties placed before the Court expert evidence in the form of a report of a marketing consultant touching on the issues, including the ultimate issue, which the Court is required to determine in this proceeding. The evidence was received in each case without objection. I make no criticism of the parties' conduct in this regard. However, I consider it appropriate to record that in the particular circumstances of this case, which is concerned with the packaging of a product intended to appeal to a wide segment of the general public, I have found the expert evidence of no real assistance. This is not only because there is, as is common in cases of this kind, conflict between the evidence of the two experts. It seems to me that evidence of opinions based on market research and expert appreciation of consumer behaviour will rarely be of assistance in litigation where the Court's primary concern is with the behaviour to be expected of, and the judgments likely to be made by, ordinary (even if it might be thought, somewhat credulous) members of the community intent on making a relatively modest purchase in a conventional way. I endorse the comment of Beaumont J in Pacific Publications Pty Ltd v IPC Media Pty Ltd [2003] FCA 104 at [92] that where a claim is essentially a matter for the Court' s impression, expert views which are merely 'impressionistic' can be given no more than nominal weight. These observations are not intended in any way to belittle the importance of market research and expert appreciation of consumer behaviour in other types of cases and for other purposes.
Relevantly, her Honour's comments were endorsed by the Full Court of the Federal Court in Domain Names Australia Pty Ltd v .au Domain Administration Ltd (2004) 139 FCR 215 at 221. See also ACCC v Trivago NV [2020] FCA 16 at [153]-[154] (per Moshinsky J) for a different perspective.
DOES THE LABEL OF THE PRODUCT CONTAIN AN INDICATION FOR FAT LOSS AND OR WEIGHT LOSS?
The Applicants’ overall position was that the label of the Product does not contain indications of fat loss and or weight loss. Rather, the Product’s brand name – “FatBlaster”– indicates to consumers that the trade source of the goods is the same as other products promoted by the Applicants under the brand “FatBlaster”.
The Applicants argued that the brand name does not describe the intended use of the Product as no ordinary and reasonable consumer would understand that the Product can “blast” “fat” from a consumer’s body for the purpose of weight loss. The Applicants stated that the Product’s claims are written clearly on the front of the packet in large white writing, and that an ordinary and reasonable consumer would read and understand those claims.
The Applicants relied on the O’Sullivan Report to support their view about the role of branding as well as the view that consumers who are buying an unfamiliar product for the first time will likely take more time to look at the packaging because they want to make the right choice, particularly where the purchase has consequences. Professor O’Sullivan opined that as there is a higher level of involvement in the purchase of a product in the health supplements category, the consumer will read the label. The consumer is therefore less likely to conclude or to even infer that the Product has a specific benefit claim such as weight loss where it does not appear on the packaging.
The meaning of “contains”
Before addressing the Product’s label, it is necessary to consider the proper construction of the term “contains” in s 26A(2)(fba) of the TG Act. The first two cancellation grounds (ss 30(1)(e) and (g)) rely on the proposition that the label of the Product “contains” an indication for “fat loss” or “weight loss”. Granted, there is no express statement on the Product’s label stating that it will help with “fat loss” or “weight loss”. Rather, the Respondent argued that those indications were contained on the label by implication from the prominent words “FatBlaster” read in the context of the label as a whole.
The Applicants submitted that on a proper construction of the statutory provisions, a label cannot “contain” an indication unless it does so expressly. The Applicants relied on the statutory text, considered in context, including by reference to its legislative history and extrinsic material consistent with authorities: see Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503 at [39], quoting Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at [47].
The Applicants argued that as the meaning of indication is “the specific therapeutic use of the goods”, it cannot mean anything possibly connected with the specific therapeutic use of the goods. Therefore, according to the Applicants, an “implication” “in connection with” a therapeutic use is not an “indication” within the meaning of that term in s 3(1). The Applicants reasoned that many medicines have uses, as well as side-effects, and if the Respondent’s interpretation were adopted, every single possible consequence of the use of a medicine would fall within the construction of an “indication”. The Applicants argued that the Respondent was conflating uses with consequences.
The Applicants pointed out that the word “contains” is used in other parts of the TG Act, including in the context of both a physical substance being “contained” in another substance, and in the context of information contained in documents or labels. In relation to the latter, for example, s 9D(1) refers to “if the entry contains information that is incomplete or incorrect”. On the other hand, in relation to advertising offences under the TG Act, the statutory expression used in s 42DKB(1)(b) (and related provisions), is whether the advertisement “contains” a “representation (whether in express terms or by necessary implication)”. The Applicants submitted that that latter wider expression can be contrasted with the very concise statutory language in s 26A(2)(fba) which directs attention to the question of whether the label “contains one or more indications”. Against that background of other usages of the word “contains” in the TG Act, the Applicants argued paragraph (fba) is therefore concerned with overt or explicit references to “indications” that are not proposed to be accepted in relation to the medicine and cannot be concerned with what could be implied from the label. Moreover, if the legislature had intended a broader meaning, it would have adopted the language “in express terms or by necessary implication” as that expands the normal meaning, noting also that paragraph (fba) was a later amendment to the TG Act and the legislature could have capitalised on that broader language.
The Applicants argued their construction is also consistent with the extrinsic material. The Explanatory Memorandum in relation to the inclusion of the paragraph 26A(2)(fba) stated that there must not be “inconsistency between the indications that are listed in the Register and on the label”: see Explanatory Memorandum to the Therapeutic Goods Amendment (2017 Measures No. 1) Bill at 26-30. According to the Applicants, the references to “inconsistency” and “listed” of themselves suggest that the legislature was concerned with express matters on the label that cut across the indications that are listed on the Register. The Applicants submitted that paragraph (fba), in that setting, cannot entail some vague analysis of text and pictures to speculate what could possibly be implied from one or the other, or both in combination. Rather, the sponsor is required to look at its label, look at the indications in the Determination, and be certain that they are consistent. In other words, “contain” is to be read as specifically referencing indications in the label.
The Applicants further argued that s 26A(2(fba) is directly concerned with indications that are in the terms specified in the Determination made by the Minister under s 26BF(1)(a), not with the more nuanced analysis of what a consumer might interpret the Product can be used for based on its brand name or the images on the box. The Applicants acknowledged that the nuanced meaning conveyed by a label is covered by s 28(5)(ab), which imposes a condition of registration. That condition is that the sponsor must not “by any means, advertise the subject goods for an indication other than those accepted in relation to the inclusion of the goods in the Register”. The Applicants emphasised that the terms “advertise” and “by any means” make clear that this broader inquiry is to be undertaken in the context of the conditions of listing under s 28(5).
I do not agree with the Applicants’ submissions that the word “contains” in s 26A(2)(fba) refers only to an indication that is expressly stated in the label for the primary reason that the Applicants’ arguments are not supported by the text of the provision, read in context. Their arguments are also incompatible with the ordinary and reasonable consumer test and would also undermine the evident protective purpose of the legislative scheme.
Specifically, as pointed out by the Respondent, the word “contains” appears in s 26A(2)(fba) in the context of the defined terms “label” and “indications” (see [23] and [21] above). It is within the context of those neighbours that the meaning of “contains” must first be analysed. To interpret the term “contains” so as to close off any possible specific therapeutic use other than those “expressly stated on the label” would inexplicably limit the scope of “contains” in an otherwise expansively defined passage. In particular, the passage in which it appears focuses on the “display of printed information”. These are necessarily wide terms, not limited only to printed letters. The question is whether that printed information contains a “use in or in connection with” one of the widely drafted therapeutic uses. This is where “in connection with” in the definition of ‘therapeutic use’ is itself suggestive of implication.
This interpretation is also supported by the ordinary meaning of “contain” which includes (relevantly) “1. To have within itself”, “4. To have as contents or constituent parts; comprise; include” per Macquarie Dictionary (online at 11 September 2022). The ordinary meaning of “contain” is, therefore, wide, and not restricted to the obvious or express parts.
Furthermore, I agree with the Respondent’s submission that no workable distinction can practically be drawn between a meaning that is expressly stated by text, and that which is impliedly stated by the same text. This is because an implied representation can equally be contained in the very same text. It is artificial to look at what is “express” and what is an "implication” arising from the same text.
The Applicants’ contentions are also incompatible with the ordinary and reasonable consumer test (see [27]-[35] above) and it is the understanding of an ordinary and reasonable consumer that matters. As an ordinary and reasonable consumer is capable of understanding text which both expressly and impliedly conveys representations, the suggestion that the meaning should be confined to express statements would be at odds with the application of the relevant test.
The Applicants’ contentions also undermine the evident protective purpose of the legislative scheme. As stated above, the post automatic listing review process provided for by s 30(1)(e) and (g) of the TG Act, which hinges on the assessment of whether or not the s 26A(2)(fba) certification was incorrect, or false or misleading in a material particular, go to the purpose of accuracy. To consider that purpose can be served best by only looking at what is express in typography or in images and not what is implied by that text or the images, or their combination, is to ignore the practical reality of how an ordinary and reasonable consumer comes to the task of reading the label themselves. I accept the Respondent’s view that the purpose of accuracy in the context of the TG Act cannot be served best by reference to express words (or images, to the extent they can even be express), divorced from their implied meaning.
The label
I turn now to consider the label of the Product and whether an ordinary and reasonable consumer would understand the Product to be for use in fat loss and or weight loss. The ordinary and reasonable consumer, having regard to the High Court decision in Self Care, is "the class of consumers likely to be affected by the conduct" (at [86]). That class of consumers is those considering purchasing a product in the broadly defined weight management category of goods. As per Self Care, "it is necessary to isolate an ordinary and reasonable "representative member" (or members) of that class, to objectively attribute characteristics and knowledge to that hypothetical person (or persons), and to consider the effect or likely effect of the conduct on their state of mind” (at [83]).
The Respondent relied on the heading “FatBlaster MAX” as well as the three dot points appearing under that heading both on the front of the Product’s label (see Schedule A). In particular, the Respondent stated that those three dot points would be “understood as instrumental to the ultimate goal of weight or fat loss” and that, therefore, the label contains an indication for fat loss and or weight loss. The Applicants argued that the Respondent’s approach to the Product’s label is flawed because the Respondent fails to grapple with the incontrovertible fact that each of the three claims on the label as dot points were accepted, listed indications on the Register for the Product. The Applicants argued that the Respondent’s construction results in the Product not being entitled to have listed on the Product’s label the permissible indications. On the Applicants’ view, if the Respondent were correct, the public was not permitted to know what specific therapeutic uses the Product has at all and that would be contrary to the legislative scheme.
The Applicants argued the Respondent’s slippage into language of “use in connection with” weight loss or fat loss is erroneous as the statutory test refers to the “specific therapeutic use” of the goods and not possible side-effect of the goods. As for the reliance on the use of the term “MAX”, the Applicants argued that if “FatBlaster” is not a specific therapeutic use of weight loss, then the use of the term “MAX” says nothing one way or another. The Applicants garnered support from the O’Sullivan Reply Report, where the conclusion was that the use of the word “max” in an advertising context is unlikely to be taken by consumers as an indication that the product has greater efficacy.
The Applicants cavilled with the Respondent’s suggestion that the image of the flame and red colour on the label indicates that the Product has a use of weight loss, although they acknowledged that a flame can convey the concept of “heat” which reinforces the claim of promoting thermogenesis. However, again, the Applicants reiterated that the claim on the label of promoting thermogenesis was a permissible indication.
I am satisfied that the Product’s label, in particular the words FatBlaster MAX would lead an ordinary and reasonable consumer to conclude that the Product can be used in, or in connection with, the therapeutic use of fat loss and or weight loss. Accordingly, I reject the Applicants’ submissions for several reasons. First and foremost, the words “FatBlaster MAX”, which appear in prominent font size, and much larger than other text, and in strong contrasting colours, would suggest to an ordinary and reasonable consumer that the Product can be used for fat loss and or weight loss. This is primarily because the made-up word and also the brand name - “FatBlaster” - is derived from the ordinary words “fat” and “blaster” which together convey, on their terms, fat loss and or weight loss. Additionally, the word “MAX” (in upper case on the label) suggests that the Product is particularly effective or the advanced or highest formulation of a FatBlaster product based on its apparent abbreviation of the ordinary word “maximum”.
Secondly, the dot points on the front and the back of the Label, especially those stating the Product “support metabolic rate” and “support thermogenesis”, would be understood by an ordinary and reasonable consumer as the processes leading to fat loss and or weight loss, that is, the means by which the Product works and achieves outcomes. They describe uses in connection with weight loss and or fat loss. Third, the image of the flame and the background red colour, especially in combination with the above matters, support the view that the Product can be used for fat loss and or weight loss. In reaching this conclusion, I was not satisfied that an ordinary and reasonable consumer would treat FatBlaster MAX (or FatBlaster), as merely a heading (or brand name) without any intuitive meaning and, at the same time, give a literal meaning to the three dot points appearing on the Product’s label, as appears to have been advanced by Professor O’Sullivan.
Accordingly, the Product’s label contains one or more indications (being fat loss and or weight loss) that were not proposed by the First Applicant to be accepted in relation to the inclusion of the Product on the Register, resulting in an incorrect certification. The fact that each of the three claims on the label as dot points were accepted, listed indications on the Register for the Product is not to the point because the analysis is not of those claims in isolation or in some quarantined setting. They are claims on the Product’s label which has the prominent and popular brand name “FatBlaster” immediately above them on the front and back of the packaging. Besides, as the Applicants pointed out, some indications, for example, “[m]aintains/ support body metabolism/ metabolic rate” can be deployed with or without the weight loss suggestion. Here, those claims are deployed with the weight loss suggestion, having regard to the Product’s label in its entirety.
I note that my views are broadly in line with the opinions expressed by Professor Quester to the effect that the Product’s label overwhelmingly suggest to a consumer that the Product can be used for fat loss and or weight loss because the brand name – FatBlaster – itself is a benefit claim. Professor Quester’s opinion was that a consumer “is unlikely to engage in a detailed analysis of each constituent part of the label and ponder all their potential meanings. They are, instead, likely to form an overall impression based on the common thread running through all of those elements of the label, which is reduction of fat leading to weight loss”. Professor Quester also expressed the opinion to the effect that most consumers would regard the concepts of fat loss and weight loss as “synonymous and interchangeable words”. My views and approach to determining what is conveyed by the Product’s label resonate with Professor Quester’s opinions. My views of the meaning of thermogenesis were reinforced by the views of both experts who agreed that most consumers would not necessarily understand what “thermogenesis” is, except that it has something to do with heat. It follows, that an ordinary and reasonable consumer would associate thermogenesis with heat. Heat, in turn, would be associated by the ordinary and reasonable consumer with burning fat and weight loss.
Furthermore, I agree with the Respondent’s contention that the decision to cancel the listing of the Product in the Register pursuant to s 30(1)(e) (and (g)) can be reached by the Tribunal without attributing any particular knowledge or exposure of an ordinary and reasonable consumer to “FatBlaster” as a brand, and other products sold under that brand. In the circumstances, it is strictly unnecessary to consider the Applicants’ related arguments in detail. However, I make a couple of observations noting, however, that the experts also disagreed on this aspect. First, FatBlaster appears to be a suggestive brand because it makes immediate and unambiguous claims about fat loss in its branding. Secondly, if it were necessary to consider the nature or degree of involvement of an ordinary and reasonable consumer considering purchasing the Product, I am satisfied that that representative consumer would, at the most, likely read the Product’s label and interpret the claims as though the Product is aimed at fat loss. Thirdly, I prefer the view of Professor Quester that “over time, as additional sub-brands have been added under the FatBlaster master brand, a stronger association with fat and weight loss would be built and enhanced” because of the brand name itself.
As stated above, s 30(1)(e) provides the Secretary with the power to cancel the listing of the Product if “it appears to the Secretary that any of the certifications, relevantly, under paragraph 26A(2)(fba)(ii), are incorrect …” Accordingly, the Reviewable Decision to confirm the cancellation under s 30(1)(e) of the TG Act should be affirmed.
WAS A STATEMENT MADE IN THE APPLICATION FOR LISTING OF THE PRODUCT FALSE OR MISLEADING IN A MATERIAL PARTICULAR?
As stated above, s 30(1)(g) of the TG Act provides the Secretary with the power to cancel the listing of the Product if “the Secretary is satisfied that a statement made in, or in connection with, the application for registration or listing of the goods was false or misleading in a material particular”.
The First Applicant certified that each indication contained on the FatBlaster MAX label was proposed to be accepted in relation to the inclusion of the medicine in the Register. However, for the same reasons as set out above in relation to the cancellation ground under s 30(1)(e), that certification was false or misleading, as the indications for fat loss and or weight loss contained on the Product’s label were not proposed to be accepted on the listing and the certification did not include them.
The provision of false or misleading certifications in a listing application undermines the integrity of the listed therapeutic goods regulatory framework. This demonstrates it is false or misleading in a material particular.
Accordingly, the Reviewable Decision to confirm the cancellation under s 30(1)(g) of the TG Act should be affirmed.
HAS THE FIRST APPLICANT ADVERTISED THE PRODUCT FOR FAT LOSS AND OR WEIGHT LOSS?
Section 30(2)(c) provides the Secretary with the power to cancel the listing of the Product if “the sponsor has refused or failed to comply with a condition to which the inclusion of the goods is subject (other than the condition under paragraph 28(5)(d))”. Pursuant to
s 28(5)(ab), one such condition is that the person in relation to whom the subject goods are listed will “not, by any means, advertise the subject goods for an indication other than those accepted in relation to the inclusion of the goods in the Register”.The main advertising considered was the Product’s label and, to a lesser extent, the way in which the Product is sold or advertised on the website of the Product. Both of these means are covered by the definition of “advertise” in s 3(1) of the TG Act.
Further to the arguments in relation to the Product’s label set out above, the Applicants argued, in relation to the website of the Product, that there is nothing there that advertises this Product for fat loss and or weight loss. The Applicants also claimed that only products that are linked to weight loss are advertised by it as such products. The Applicants further argued that the Respondent’s contentions based on the webpages fail to grapple with the concepts of brand strength, associations and recognition explained in the O’Sullivan Report with respect to brand names. Professor O’Sullivan opined that the fact that some of the FatBlaster range of products are concerned with weight loss does not mean that all of the FatBlaster products are so associated, nor that an ordinary and reasonable consumer would necessarily interpret them in that way.
I disagree as the relevant consideration is the Product’s label, viewed in its entirety, including where it is reproduced on the Product’s webpages. This is regardless of the Product’s positioning and categorisation on the webpages. I am satisfied that the inclusion of the words FatBlaster MAX on the label, both alone, and in combination with the three dot points appearing below it, advertise the Product for indications of fat loss and or weight loss to the ordinary and reasonable consumer.
Additionally, the Respondent persuaded me that the various claims made on the webpages for FatBlaster MAX (as of 30 July 2021) would be understood by an ordinary and reasonable consumer to advertise the Product for fat loss and or weight loss. In this regard, I accept Professor Quester’s statement that “[n]oteworthy is a reference to ‘achieve your workout goal faster’ which, without explicitly referring to weight loss is implicitly suggestive of it. References to ‘metabolic rate’, ‘burning energy’ and ‘assists in metabolising fats and carbs’ would create in consumers the perception that this product is aimed at losing weight or fat”.
In light of the conclusions reached, it is unnecessary to review the general FatBlaster website.
Consequently, the First Applicant has, by certain means, “advertised” the Product for an indication other than those accepted in relation to the inclusion of the Product in the Register, that is, for fat loss and or weight loss, in contravention of the condition imposed under s 28(5)(ab). Accordingly, the Reviewable Decision to confirm the cancellation under s 30(2)(c) of the TG Act should be affirmed.
DECISION
The Reviewable Decision dated 13 April 2022 which confirmed the cancellation of the listing of the product FatBlaster MAX is affirmed.
I certify that the preceding 102 (one hundred and two) paragraphs are a true copy of the reasons for the decision herein of Senior Member G Lazanas
....................................[SGD]....................................
Associate
Dated: 31 August 2023
Date(s) of hearing:
20-22 March 2023
Counsel for the Applicant:
Mr S Llyod SC and Ms N Wootton
Solicitors for the Applicant:
Mr D Gerakiteys, Clayton Utz
Counsel for the Respondent:
Mr N Wood SC and Mr C Viney
Solicitors for the Respondent:
Ms J Lau, Department of Health
SCHEDULE A
Front/back label
Side
Side
Top
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