The Australian Competition and Consumer Commission has filed proceedings in the Federal Court, Adelaide, against Australian Billboard Connections Pty Ltd, Mr Michael Hollingsworth, the Managing Director of the company, and Mr Kevin Hall, the National Sales Manager, alleging misleading representations.
The respondents sold franchises or regional managerships in South Australia in 1994 and 1996. The price of the franchises ranged from $40,000 to $69,750.
The ACCC alleges that, in the course of selling the franchises, the franchisor misrepresented:
- the level of income which could be earned;
- the profitability of the business; prospective capital gains;
- the level of training and support which would be provided; and the existing and future demand for the products.
The ACCC alleges that these were misleading representations and in breach of sections 52 and 59(2) of the Trade Practices Act 1974.
The ACCC is seeking injunctions, declarations and findings of fact.
A directions hearing has been set down for 27 July 1999.