Coles shoppers could be in line for up to $1,300 in class-action compensation payouts after the Federal Court found the supermarket guilty of misleading shoppers on discount prices.
Coles engaged in “misleading” marketing through its Down Down campaign, offering discounts that were not genuine, a judge has ruled.
Judge Michael O’Bryan found in favour of the Australian Competition and Consumer Commission’s (ACCC) case against the major supermarket chain in the Federal Court on Thursday.
The case against Coles was heard in February and will return to court on June 10. A similar federal court case of the ACCC taking action against Woolworths’ pricing concluded last month, with the judgment still pending
Sydney legal firm GMP Law plans to seek refunds for affected consumers and recover the difference between the discounted and original, undiscounted prices through a class action that has over 50,000 participants.
Gerard Malouf, Chairperson of GMP Law, told Yahoo News that he welcomes today’s outcome.
“This is a wonderful result for members and vindication for the everyday Australian who deserves clarity and honesty in pricing of products,” he said.
“Ultimately, we’ll have a situation where we’ll be able to refund group members significant sums of money depending on their purchases over the period in question.”
He said the promotions were “clearly” misleading, arguing there “wasn’t clarity and transparency about the manner and approach undertaken by these major food market groups”.
“This is not just a win for supermarket patrons, but a significant win for all consumers in Australia in the future, as clear and unequivocally transparent pricing practices must be maintained.”
245 household products at centre of ACCC’s case
The case against Coles centred on price fluctuations of 245 common household products placed on Coles’ Down Down promotions program between February 2022 and May 2023.
The ACCC alleged Coles briefly spiked the prices of products for a typical period of four weeks before placing them on promotion at higher, or equal to, a price that they had been.
A sample selection of 14 products was examined in detail during the court case, with Justice O’Bryan ruling 13 had been deceptively marketed.
The judge found Coles’ price increases were not “artificially high” and reflected the supplier price changes during a period of high inflation.
But he concluded Coles’ decision to increase prices for a short period before placing them on the Down Down tickets was misleading.
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50,000 Australians are part of a class action led by Gerard Malouf against the supermarket. Source: GMP Law/Getty
Court ruling won’t ‘automatically return money’ to shoppers
Malouf previously explained that the court may impose civil fines or penalties in light of the Federal Court’s decision, as well as corrective or other orders on the supermarket chain.
While regulatory penalties serve a purpose, they do not “automatically return money to the people who paid inflated prices”.
A ruling focuses on whether the law was contravened and will not result in refunds directly to shoppers, he explained.
“Civil penalties are paid to the government and are intended to deter misconduct, and they do not automatically result in money being returned to affected shoppers,” he said.
50,000 shoppers registered for class action
The class action against Coles is where customers may receive refunds from the supermarket.
Proceedings, which were paused until the ACCC judgement was handed down, will now move forward for the class action of over 50,000 Aussies against the supermarket.
GMP Law said it will provide further updates on the next steps in the compensation case in the coming weeks.
with Newswire
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