Channel Seven broadcasters* in Brisbane, Sydney, Melbourne and Perth had misled viewers during broadcasts of Today Tonight, the Federal Court found today.
Justice Bennett found also that Channel Seven was not protected by the so-called 'publisher's defence' in relation to particular statements in the broadcast.
The findings relate to stories broadcast on Channel Seven's Today Tonight program in late 2003 and early 2004 about a property investment training program known as 'the Wildly Wealthy Women'.
The ACCC alleged that in these broadcasts, Channel Seven broadcasters and the principals of the WWW program made misleading representations that one of the principals of the WWW mentoring program was a millionaire and the other owned in excess of 60 properties when in fact this was not the case.
Justice Bennett found that the Channel Seven broadcasters uncritically adopted these claims by the WWW principals in breach of the misleading representations section of the Trade Practices Act 1974 (section 52).
Justice Bennett held that the Channel Seven broadcasters "embraced and advanced the proposition that Ms Boholt and Ms Forster were millionaires and had achieved that status through investing in property."
Justice Bennett also found that the Channel Seven broadcasters did not adopt other particular representations made in the course of the broadcast which had been alleged by the ACCC as to the results that could be expected by participants in the training program.
The judgment is significant as Justice Bennett held that the Channel Seven broadcasters were unable to rely on s65A, the so-called 'publisher's defence', because they adopted statements made by WWW's and had an arrangement with the women as to the general content of the broadcasts.
In her judgment, Justice Bennett said: "For the broadcaster to engage in conduct in contravention of s52, that conduct involves more than merely broadcasting the misleading representation. The broadcaster must, in effect, adopt the representation. In those circumstances, the broadcaster is still provided with the protection envisaged by s65A. There is, however, no good reason for immunity from liability where a broadcaster enters into a contract or arrangement with a third party to publish matter concerning the third party's goods or services where the broadcaster engages in or adopts the misleading representation or conduct."
Justice Bennett also held that is was not necessary for Channel Seven broadcasters to have any commercial interest in the content of the broadcast for them to lose the protection of 65A.
"Audiences rely on current affairs programs to uncover the truth, not to adopt and encourage misleading promotions," ACCC Chairman, Mr Graeme Samuel, said today.
"This judgment is a warning to broadcasters who rely on promoters or public relations firms for stories: If you adopt their spin as your own and your broadcast is false or misleading, you may be breaching the Trade Practices Act."