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ACCC taking LG to court for misleading consumers

16 Dec 15

The ACCC is taking LG Electronics Australia to court for allegedly making ‘false or misleading representations’ to consumers about their rights in regards to faulty products.

The consumer watchdog alleges LG misrepresented a number of things in relation to complaints about defects with its televisions, including that, consumers had to pay the cost of assesment and labour if the defect occurred after the LG manufacturer’s warranty had expired. The ACCC says LG claimed it had no further obligations and any step it took in relation to the televisions was ‘an act of goodwill’.

Rod Sims, ACCC chairman, says products come with a consumer guarantee under the Australian Consumer Law that they will be of acceptable quality.

“This guarantee is in addition to any express manufacturer’s warranty,” Sims notes.

“Although the manufacturer’s warranty only applies for a specific period of time, consumers will often still be entitled under the consumer guarantee to a repair, refund or replacement after the manufacturer’s warranty ends,” Sims says.

The ACCC is also alleging consumers were told they were only entitled to have the television reparied, and not a refund or replacement.

The current action isn’t the first time LG has run foul of the ACCC.

In 2006 the watchdog took court action against the company for misleading or deceptive conduct with respect to the existence and duration of stautory warranties, with the Federal Court finding in favour of the ACCC.

LG was ordered to refrain from making similar representations in future, along with being required to upgrade its trade practices compliance program, and pay ACCC costs, among other things.

The ACCC says LG provided it with three separate undertakings – in 2005, 2006 and 2010 – relating to  allegations of misleading or deceptive conduct.

“The ACCC will not hesitate to take appropriate action against manufacturers who misrepresent consumers’ rights and remedies for defective products under the Australian Consumer Law,” Sims says.

“The Australian Parliament has conferred these important rights on consumers, and these rights should not be undermined by misrepresentations.”

The ACCC is seeking declarations, injunctions, pecuniary penalties, corrective notices, a trade practices compliance program and costs in the current action which is due to be heard in the Federal Court in Melbourne in early February.

LG has declined to comment on the current action given that it is now before the courts.

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