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Potential Advertising Risks

The recent Federal Court decision of Specsavers Pty Ltd v Luxottica Retail Australia Pty Ltd illustrates the potential legal risks of businesses advertising their products or services as being “superior or improved” compared to those of their competitors.

This case centred on Luxottica’s (“OPSM”) advertising campaign for its new Accufit system which commenced in February 2013. The Accufit system is exclusive to OPSM stores and uses a virtual mirror, a lens simulator and fit sensor to assist customers in choosing their prescription glasses. As part of the Accufit campaign, OPSM made various representations, including the following:

“Better Frames, Better Lenses, Better Fit, Accufit Exclusive to OPSM”; “Better Frames, Better Lenses, Better Fit”; and “Better Frames, Better Lenses, And The Best Fit You’ve Ever Had” (collectively, the Better Frames Representation).

The Complaint

In response to these representations Specsavers, OPSM’s fierce rival and major competitor, commenced Federal Court
proceedings against OPSM for misleading or deceptive conduct pursuant to s 18(1) of the Australian Consumer Law 2010 (Cth).

In particular, Specsavers claimed that the Better Frames Representation made by OPSM was misleading or deceptive because it falsely represented that OPSM’s frames were of a superior or improved quality than those previously available at OPSM or available at other optical retailers.

The Court’s Decision

After considering the matter the Federal Court rejected Specsavers’ claims on the following grounds. The Court found that the Better Frames Representation was mere advertising puffery because the key phrases “Better Frames, Better Lenses, Better Fit” were very general and incapable of being proven correct or incorrect. Further, it did not convey to a hypothetical member of the relevant class of consumers that the frames or lenses were made of better material at OPSM, but instead that because of the Accufit system, a customer could have glasses that fitted better, felt more comfortable and worked better. In other words, they could have better glasses.

COMMENT

Although OPSM was ultimately successful in defending Specsavers’ claims that it had engaged in misleading or deceptive conduct, this case is a good example of the potential legal risks that may arise when a business makes claims, in its advertising, that its products or services are “superior or improved” compared to those of its competitors, and the fine line
between mere puffery and misleading or deceptive conduct.

Businesses need to take care to ensure that they do not overstep the line when making comparisons to their competitor’s products or services. If they do not, they may find themselves defending a claim brought by their competitor for misleading or deceptive conduct.