ACCC institutes proceedings against Crazy John's for allegedly misleading moble phone advertising

The Australian Competition and Consumer Commission has instituted proceedings in the Federal Court against Mobileworld Operating Pty Ltd (trading as Crazy John's) for alleged contraventions of the Trade Practices Act 1974 in relation to the promotion of certain of its mobile phone plans.

The ACCC alleges that Crazy John's has engaged in misleading or deceptive conduct by representing that handsets on its Crazy Phone Plans are available 'FREE' or for '$0', when in fact consumers are required to pay for the handsets through higher call rates than those available on comparable plans which do not include a handset.

The ACCC alleges that these representations contravene sections 52 and 53 of the TPA.  The ACCC is seeking a range of remedies including declarations regarding the alleged contravening conduct and corrective advertising.

The ACCC's proceedings utilise the Fast Track List in the Victorian registry of the Federal Court, which is intended to streamline court procedures in matters of this nature, thereby reducing the time and cost of litigation.

A scheduling conference has been provisionally set down for 29 February 2008.

Background

Section 52 of the Trade Practices Act 1974 states that a corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

Section 53 of the Trade Practices Act 1974 refers to conduct of a corporation in trade or commerce in connexion with the supply or possible supply of goods, or the promotion of the supply of goods or services.  Section 53(e) prohibits a corporation from making a false or misleading representation with respect to the price of goods or services.