ACCC successfully prosecutes misleading or deceptive conduct claim for sugary snack food

In Australian Competition and Consumer Commission v H.J. Heinz Company Australia Limited [2018] FCA 360, the ACCC successfully prosecuted a misleading or deceptive conduct claim pursuant to section 18 of the Australian Consumer Law.

The ACCC commenced action after a fruit product produced by Heinz called ‘SHREDZ’ and marketed as being beneficial to the health of toddlers aged one to three years old was found to be high in sugar content and of a sticky texture.

In reaching its decision, the Federal Court of Appeal was satisfied that Heinz and its nutritionists ought to have known that its representations regarding the health benefits of SHREDZ were false or misleading, particularly given the product was made up of almost two-thirds sugar content. The Court found that Heinz also should have been aware that it was making such a representation.

‘Shredz’ was marketed as nutritious and beneficial

The Court was satisfied that the packaging of the product represented it was nutritious and beneficial based on the imagery, colours and wording utilised. This was especially the case due to:

1. the depiction of a young boy climbing a tree (ie conveying natural and health growth);
2. a prominent statement that the product contained “99% fruit and veg”;
3. prominent imagery of fresh fruit and vegetables;
4. the words “no preservatives”, “no artificial colours or flavours” and a statement that the product was appropriate as an “on the go snack”;
5. statements that Heinz aspired to encourage a love of nutritious food, which implied that the product was nutritious; and
6. reference to Heinz’s “dedicated nutritionists who are also mums”, which implied that Heinz knew the product was wholesome and nourishing.

The Court was not satisfied that a disclosure to the effect that the product was a “treat” was sufficient to counteract or nullify the above representations as the packaging also described the product as a “snack”. This implied that the product was nutritious. Further, the actual nutritional information (which is required to be disclosed) acted more like ‘fine print’ and was not capable of overcoming the other representations the products made.

Consumers should always read nutritional information

The decision serves as a timely reminder to consumers to be wary of false representations by always reading nutritional information. For businesses, it serves as evidence of the ACCC’s increasing eagerness to prosecute misleading or deceptive conduct of businesses.

Should you have a consumer complaint you wish to make or alternatively be concerned about what representations you are legally entitled to publish, please feel free to contact Ramsden Lawyers’ business team on (07) 5592 1921 or alternatively via our online enquiry system.