Reckitt Benckiser cops biggest fine ever after losing misleading Nurofen specialist painkillers appeal

Reckitt Benckiser has been handed the biggest fine in Australian consumer law history after the High Court rejected an appeal against a $6m penalty imposed for claiming Nurofen could target specific pain areas, ending a two-year court battle.

The ACCC launched action against Reckitt in March 2015 alleging that claiming different varieties of the product could target back pain, period pain, migraine pain, and tension headache were misleading.Last year the Federal Court ruled there was no evidence that could support the claims and handed down a fine of $1.7m.

However, the ACCC then appealed the fine, saying it was not large enough to act as a deterrent to a multi-national company of the scale of Reckitt.

“This is particularly the case when the judge found that Reckitt Benckiser had made many millions in profits from sales of 5.9 million units of these products at around 8,500 outlets during the relevant period,” ACCC chairman Rod Sims said at the time.

The court upheld the appeal in December last year, more than tripling the original penalty to $6m.

In it its ruling the court noted: “The objective of any penalty in this case must be to ensure that Reckitt Benckiser and other ‘would-be wrongdoers’ think twice and decide not to act against the strong public interest.”

Reckitt immediately applied for special leave to appeal to the High Court of Australia on a number of grounds, including that the Full Court had erred in its assessment of consumer loss and in finding that the original penalty was manifestly inadequate.

Sims welcomed the upholding of the fine, saying companies needed to be sent a strong message.

“This is the highest corporate penalty awarded for misleading conduct under the Australian Consumer Law,” Simms said.

“The ACCC welcomes this decision, having originally submitted that a penalty of $6 million or higher was appropriate given the longstanding and widespread nature of the conduct, and the substantial sales and profit that was made.”

An ad highlighting the claims by Nurofen were also attacked on the ABC series The Checkout.

After the original decision was handed down, Nurofen was given several months to work through pre-printed packaging, adding a sticker to the targeted packs that noted the painkillers were equally effective against other forms of pain.

In statement Reckitt said the fine had been paid but the the company did not agree with the ruling.

“Nurofen is disappointed by this decision, as it considers that the application raised serious questions on whether the Full Court’s reasoning and amended penalty was correct in all of the circumstance,” the statement said.

“In 2015, Nurofen accepted that the representations made on the Nurofen Specific Pain Range webpage and packaging may have misled consumers, and at that time Nurofen co-operated fully with the ACCC and consented to the Court orders.

“Nurofen did not intend to mislead consumers and we apologise to those of our consumers who were misled.  We recognise that we could have done more to assist our consumers in navigating the Nurofen Specific Pain Range. That is, to show that each of the products in the range is equally effective for the other pains indicated on the Nurofen Specific Pain Range packaging.

“The Nurofen Specific Pain Range was introduced with the intention to provide easy navigation of pain relief options, particularly within the grocery environment where pharmacy support is not available.”


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