The Full Federal Court has dismissed an appeal by the Australian Competition and Consumer Commission against a Federal Court judgment in relation to environmental claims made by Woolworths about their ‘W Select eco’ picnic products.
In March 2018, the ACCC commenced legal action in the Federal Court, alleging that environmental representations Woolworths made about its ‘W Select eco’ picnic products were false, misleading or deceptive, and in contravention of the Australian Consumer Law.
On 5 July 2019 the Federal Court found Woolworths’ claims were not misleading, which led the ACCC to appeal the decision the following month.
A Woolworths spokesperson told Food & Drink Business the company was pleased the Federal Court’s ruling was upheld. “We treat our obligations under the Australian Consumer Law very seriously and understand how important it is that our customers can trust the environmental claims we make.”
The spokesperson said the products were released in 2014 and had received independent certification. All products in the range were made from materials derived from corn starch or sugarcane and other natural materials, they said.
The ACCC had argued claims made by Woolworths between November 2014-17 about its range of disposable plates, bowls and cutlery – which were labelled ‘biodegradable and compostable’ – were false and misleading.
The ACCC alleged that Woolworths represented to consumers that the picnic products would biodegrade and compost within a reasonable period of time when disposed of in a domestic compost bin or conventional landfill site.
It also alleged Woolworths had failed to make reasonable or adequate efforts to substantiate these claims before making them, and that the claims were about ‘future matters’.
Under the Australian Consumer Law, representations about ‘future matters’ are deemed to be misleading unless the business has reasonable grounds to make the representation.
The trial judge found that Woolworths had not made the representations in the form alleged by the ACCC and, in any event, the representations made by Woolworths were not about ‘future matters’.
The Full Federal Court found that the trial judge had not made an error when finding that the words ‘biodegradable and compostable’ referred to an inherent characteristic of the picnic products, and not about a future matter.
ACCC chair Rod Sims said: “We appealed this case because we believe that businesses should be able to support claims they make about their products, especially when consumers are likely to pay more for the product because of the claims made.
“Consumers may select products based on the claims made by the seller or manufacturer and should be able to rely on environmental claims made by businesses about their products.”
The ACCC will now consider the judgment, Sims said.
