Australian Competition and Consumer Commission v Teracomm Ltd [2009] FCA 903

FEDERAL COURT OF AUSTRALIA

Australian Competition and Consumer Commission v Teracomm Ltd [2009] FCA 903

TRADE PRACTICES – misleading representation – representation of one-off service whereas in fact subscription service – false representations – quality of content services advertised – declaration by Court where contravening conduct found Federal Court of Australia Act 1976 (Cth) ss 21, 80 and 86C Telecommunications Act 1997 (Cth) s 99 Trade Practices Act 1974 (Cth) ss 52 and 53(aa), (e) and (g) Campomar Socieded, Limitada v Nike International Ltd (2000) 202 CLR 45 applied AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v TERACOMM LTD

NSD 59 of 2009

MOORE J

20 AUGUST 2009

SYDNEY IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

GENERAL DIVISION NSD 59 OF 2009

BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION

Applicant

AND: TERACOMM LTD

Respondent

JUDGE: MOORE J

DATE OF ORDER: 20 AUGUST 2009

WHERE MADE: SYDNEY

THE COURT ORDERS AND DECLARES THAT:

1. The respondent, while engaged in trade or commerce within Australia, contravened s 52 of the Trade Practices Act 1974 (Cth) by causing to be published advertisements promoting Viva Content Services (the Viva Mobile Advertisements) in the May, June and July 2008 editions of Dolly magazine which: 1.1 represented that any consumer responding to the Viva Mobile Advertisements would, by sending an SMS message to the premium number 19 30 40, purchase a one-off service, when in fact, the consumer: 1.1.1 in sending an SMS to the premium number 19 30 40, requested access to a subscription service charged at premium rates; 1.1.2 paid an initial sign-up fee of $3 and a subscription fee of between $9-$12 per week which were billed to his or her mobile telephone account; 1.1.3 in order to end his or her subscription, was required to send an SMS message to the content provider which contains the word "stop"; and 1.2 failed to disclose, or failed to sufficiently disclose, that any consumer responding to the Viva Mobile Advertisements would have, by sending an SMS message at a standard SMS cost to the premium number 19 30 40: 1.2.1 requested access to a subscription service which is charged at premium rates; 1.2.2 paid an initial sign-up fee of $3 and a subscription fee of between $9-$12 per week which was billed to his or her mobile telephone account; 1.2.3 in order to end his or her subscription, was required to send an SMS message to the content provider which contained the word "stop". 2. The respondent, while engaged in trade or commerce within Australia, contravened s 53(aa) of the Act by causing the Viva Mobile Advertisements to be published in connexion with the supply and promotion of content services in circumstances where the Viva Mobile Advertisements made false representations with respect to the quality of the content services being advertised. 3. The respondent pay the costs of the applicant. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using eSearch on the Court's website.