Modern Australian
The Times

Coles accused of ‘utterly misleading’ discounts as major court case kicks off

  • Written by Jeannie Marie Paterson, Professor of Law (consumer protections and credit law), The University of Melbourne

Coles has appeared before the Federal Court in Melbourne, as hearings for a high-stakes case launched against the supermarket by Australia’s consumer watchdog officially begin.

The Australian Competition and Consumer Commission (ACCC) is alleging Coles misled consumers with “illusory” discounts between February 2022 and May 2023.

The watchdog alleges that in this period, Coles temporarily increased the prices of “at least 245 different products”, then placed them on “Down Down” promotions which were:

higher than, or the same as, the price at which each product had ordinarily been offered for sale.

In opening arguments on Monday, head counsel for the ACCC, Garry Rich SC, described the supermarket’s conduct as “utterly misleading”.

While Coles’ legal team only addressed the court for a short time on Monday, barrister John Sheahan KC said Coles customers were aware of price movements before making purchases.

Coles has signalled it will argue the price increases in question represented a genuine response to surging costs.

So, what exactly is at stake for one of Australia’s largest supermarket giants?

Behind the allegations

The ACCC alleges Coles offered misleading discounts on a wide range of products over the relevant period – ranging from Colgate toothpaste to Sanitarium Weet-Bix cereal.

In its court filing, the ACCC provides the example of a 16 pack of Strepsils Throat Lozenges Honey & Lemon. According to the ACCC, this product had been for sale on a “Down Down” promotion at a price of A$5.50 for at least 649 days.

The ACCC says on 12 October 2022, Coles increased the price to $7 for 28 days, then reduced it back to $6 on a “Down Down” promotion, 9% higher than the previous price of $5.50.

What does ‘Down Down’ mean?

In making this accusation, the ACCC is emphasising the overall impression created in the mind of the reasonable consumer was that the price drop related to a price set more than a short period before.

It argues consumers should be able to take the “Down Down” campaign at face value, without scrutinising the fine print price change or researching prices over the recent history.

Notably, the ACCC is arguing that the conduct by Coles was “planned”. In other words, that the allegedly misleading representations were deliberate.

Under Australian Consumer Law, conduct can be misleading without being intentional. However, if the ACCC can show that the conduct was indeed planned then an inference that the conduct was also misleading is easier to establish. Additionally, intentional misleading representations are likely to attract a larger penalty.

What might Coles argue?

By contrast, Coles’ case is likely to rest on two things. First, its right to raise prices, especially in response to what Coles has said were “significant cost increases”, including:

a surge in global commodity prices, and in the cost of packaging, freight, utilities and international shipping.

And second, that the “Down Down” price on the ticket was, strictly speaking, accurate – there was a price reduction from the shelf, just not a reduction compared to the historical, pre-increase price.

So it is a legal battle with potentially significant consequences for all parties.

A separate action by the ACCC against Woolworths, also alleging “illusory” discounts, will be heard later this year.

Clearly the outcome of the case against Woolworths will be influenced by what happens in the Coles litigation.

What’s at stake?

If Coles is found to have made the alleged misleading representations, any penalties will be determined by the court in a separate hearing. However, the amounts are potentially significant.

ACCC chair Gina Cass-Gotlieb
ACCC chair Gina Cass-Gotlieb. Lukas Coch/AAP

The maximum penalty could be $50 million per contravention, or more.

By comparison, in 2024, Qantas was ordered to pay $100 million for misleading consumers by accepting bookings for flights that had already been cancelled.

Separately, the Federal Court last year ordered Optus to pay $100 million after the telco admitted it had engaged in unconscionable conduct involving aggressive debt collection and mis-selling to vulnerable customers.

The big issues at play

A supermarket such as Coles is entitled to raise prices.

But the question raised by this case is whether it is misleading under consumer law to advertise a discount on a product that has only briefly risen in price, using a well recognised promotion strategy, without disclosing that not so long before, it was even cheaper.

In other words, can consumers rely on the headline of a “Down Down” discount to tell them they are getting a deal? Or should they be scrutinising the fluctuations in retail pricing more carefully and shopping around?

The case continues on Tuesday.

Authors: Jeannie Marie Paterson, Professor of Law (consumer protections and credit law), The University of Melbourne

Read more https://theconversation.com/coles-accused-of-utterly-misleading-discounts-as-major-court-case-kicks-off-276041

What’s Trending in Men’s Jewellery This Father’s Day!

Finding a Father’s Day gift that feels personal, stylish and genuinely wearable is not always easy. While socks and novelty mugs have traditionall...

Road Signs: Understanding Their Role in Clear and Effective Signage

Effective signage and display hardware can help businesses communicate information, promote products and organise customer or visitor movement. Road...

Bottle Label Printing: Key Factors to Consider Before Your Next Packaging Run

Effective packaging begins with understanding the product, bottle material, artwork and production requirements when planning bottle label printing. H...

Planning a Long-Distance Move With Interstate Movers Melbourne

Moving between states involves more planning than a typical local relocation. Along with packing and transporting household belongings, you need to...

Understanding the Role of an I/O Controller in Industrial Automation

Modern industrial systems depend on accurate communication between sensors, machines and control systems. An I/O controller can help manage this commu...

How the Right Mining Hose Supports Demanding Operations

Mining environments place considerable demands on equipment used for material transfer, water management and processing. Hoses operating in these co...

Simple Ideas for Making Social Gatherings More Memorable

We have all been to those parties where everyone just stands around the kitchen island, staring at their phones, waiting for someone else to make a mo...

Outdoor Wall Lights: Improving Exterior Lighting Around Your Home

Lighting can influence how a room looks, feels and functions, so the right fitting should be selected according to both appearance and practical req...

Commercial Office Cleaning: Combining Routine Office Cleaning With Melbourne Service

Keeping a workplace clean requires a service that can accommodate everyday tasks as well as the particular needs of the business. Professional comme...

Caravan Sales in Queensland: How to Find the Right Caravan for Sale QLD

Caravan ownership is about more than having somewhere to sleep while travelling. For many Queenslanders, it is one of the best ways to explore regio...

What Sir Walter Buffalo Turf Actually Costs in 2026 (And Why Quotes Vary So Much)

Two quotes landed on a Hills District homeowner's kitchen table last spring for the exact same 80-square-metre backyard. One said $12 a metre. The o...

Nearly 1,300 NSW Hospital Beds Are Occupied By People Who Are Ready To Go Home

1,276 people in NSW hospitals have been medically cleared for discharge but remain in hospital because they're still waiting for NDIS or aged care sup...

National Survey Launched to Measure Operational Impacts of Federal NDIS Policy Reforms

The effects of recent NDIS reforms are beginning to move beyond policy papers and into day to day service delivery. A new national survey is asking ...

Beyond the Nappy Cake: Baby Shower Gifts That Get Used

What new Australian parents unwrap, keep, and quietly thank you for months later. Six weeks after my daughter was born, I did an audit of the baby sh...

Parent-Advocates Are Reshaping Frontline Disability Service Delivery

Parents have always been part of the disability sector. They advocate, coordinate services, challenge decisions and often become the person holding ev...

Vista Cruises Enters "Two-Flagship Era" as Vista Aurora Completes Inaugural Voyage

Vista Aurora Sets Sail along the Yangtze. (Photo courtesy of the company)YICHANG, China — August 5, 2026 — Vista Aurora, a high-end interprovinc...

A Digital Preparation Checklist For International Medical Conferences

An international medical conference compresses many responsibilities into a few days. A delegate may need to present research, move between venues, ...

The Growing Popularity of Lab Grown Diamonds in Sydney and Hong Kong

The diamond industry has changed significantly in recent years as more buyers seek ethical, affordable, and sustainable alternatives to mined diamon...