Recently, a client at Priority Business Lawyers retained us to review their online documents to determine whether they might be in breach of the Australian Consumer Laws (ACL) specifically with regard to a potential misrepresentation.
The advice itself appears timely given the Australian Competition and Consumer Commissions (ACCC) willingness to issue penalties for breaches of the ACL where businesses have misled, whether intentionally or not, their customers.
Today the Federal Court ordered Apple Inc (Apple US) to pay roughly $9 million in penalties for making false or misleading representations to customers with faulty iPhones and iPads about their rights under the ACL.
The ACCC took action against Apple US and Apple Pty Ltd (Apple Australia) following an investigation of complaints relating to ‘error 53’. This error disabled some iPhones and iPads after owners downloaded an update to Apple’s ‘iOS’ operating system.
Apple US admitted it had represented to at least 275 Australian customers affected by error 53 that they were no longer eligible for a remedy if their device had been repaired by a third party. These representations were made from February 2015 to February 2016 on Apple US’ website, by Apple Australia’s staff in-store and on its customer service phone calls.
Unbeknownst to Apple Australia’s US counterparts, under the ACL If a product is faulty, customers are legally entitled to a repair or a replacement. Furthermore, if customers would prefer a replacement, they are entitled to a new device as opposed to refurbished, if one is available.