Woolworths to Contest Class Action Over Promotional Pricing Practices
Source: DairyNews.today
Woolworths Group announced it will defend a class action filed by law firm Gerard Malouf & Partners (GMP) over allegations of misleading promotional pricing practices, the latest legal challenge following similar accusations by Australia's competition watchdog.
The class action follows Federal Court proceedings initiated in September by the Australian Competition and Consumer Commission (ACCC) against both Woolworths and rival Coles Group. The ACCC claims the retailers misled consumers with discount pricing promotions on hundreds of products, violating Australian Consumer Law.
According to the ACCC, Woolworths and Coles increased prices of long-term fixed-price products by at least 15% for a short period, before promoting them under banners like "Prices Dropped" (Woolworths) or "Down Down" (Coles). The promotions listed prices lower than the temporary spike but equal to or higher than the original long-term price.
The ACCC alleges Woolworths engaged in this practice with 266 products over 20 months, while Coles did so with 245 products over 15 months.
Class Action Focuses on Compensation
Gerard Malouf & Partners stated the class action is aimed at securing compensation for consumers rather than regulatory penalties.
"Unlike the ongoing ACCC proceedings, this class action specifically aims to recover the difference between the advertised discount prices and the actual prices charged, returning money directly to affected shoppers," GMP said in a statement.
Woolworths has denied the allegations and vowed to contest the legal action. "We take our obligations under Australian Consumer Law seriously and will vigorously defend these proceedings," the company said.
Broader Implications
The allegations and legal actions underscore growing scrutiny of promotional practices in Australia's retail sector, particularly as consumers grapple with inflation and rising living costs. The outcomes of the ACCC proceedings and the class action could set precedents for retail marketing and consumer compensation in the country.
Coles Group has also pledged to defend itself against the ACCC's allegations, though it has not been named in the GMP class action to date.
According to the ACCC, Woolworths and Coles increased prices of long-term fixed-price products by at least 15% for a short period, before promoting them under banners like "Prices Dropped" (Woolworths) or "Down Down" (Coles). The promotions listed prices lower than the temporary spike but equal to or higher than the original long-term price.
The ACCC alleges Woolworths engaged in this practice with 266 products over 20 months, while Coles did so with 245 products over 15 months.
Class Action Focuses on Compensation
Gerard Malouf & Partners stated the class action is aimed at securing compensation for consumers rather than regulatory penalties.
"Unlike the ongoing ACCC proceedings, this class action specifically aims to recover the difference between the advertised discount prices and the actual prices charged, returning money directly to affected shoppers," GMP said in a statement.
Woolworths has denied the allegations and vowed to contest the legal action. "We take our obligations under Australian Consumer Law seriously and will vigorously defend these proceedings," the company said.
Broader Implications
The allegations and legal actions underscore growing scrutiny of promotional practices in Australia's retail sector, particularly as consumers grapple with inflation and rising living costs. The outcomes of the ACCC proceedings and the class action could set precedents for retail marketing and consumer compensation in the country.
Coles Group has also pledged to defend itself against the ACCC's allegations, though it has not been named in the GMP class action to date.
