Australian Competition and Consumer Commission v ACN 117 372 915 Pty Limited

Federal Court of Australia|2015-12-17|Before: Moshinsky J

Counsel for the Applicant: Mr JWK Burnside QC with Ms LM Nichols

Solicitor for the Applicant: Corrs Chambers Westgarth

Solicitor for the Respondents: StevensVuaran Lawyers

BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION

AND: ACN 117 372 915 PTY LIMITED (IN LIQUIDATION)

JUDGE: MOSHINSKY J DATE OF ORDER: 17 december 2015 WHERE MADE: MELBOURNE

By having caused to be broadcast each of the statements numbered 1 to 6 in Annexure "A" to the reasons of the Court accompanying these declarations (Annexure "A") on the dates there referred to, the sixth and seventh respondents (together, NRM) made statements or representations to patients or prospective patients as to the efficacy of NRM treatments (as defined in paragraph 4 of the orders of the Court made 22 April 2015 (April 2015 orders)) other than by statements made directly to a patient or potential patient by a duly qualified medical practitioner during a consultation either in person or by video-link, and therefore have breached paragraph 9(c)(i) of the April 2015 orders and are guilty of contempt.
By publishing or having caused to be published each of the statements numbered 7, 8, 10, 11, 12, 14, 15, 17 and 18 in Annexure "A" on the dates there referred to, NRM made statements or representations to patients or prospective patients as to the efficacy of NRM treatments (as defined in paragraph 4 of the April 2015 orders) other than by statements made directly to a patient or prospective patient by a duly qualified medical practitioner during a consultation either in person or by video-link, and therefore has breached paragraph 9(c)(i) of the April 2015 orders and is guilty of contempt.
By having caused to be broadcast the statement numbered 20 in Annexure "A" on the dates from 25 April 2015 there referred to, NRM made statements or representations to patients or prospective patients as to the efficacy of NRM treatments (as defined in paragraph 4 of the April 2015 orders) other than by statements made directly to a patient or potential patient by a duly qualified medical practitioner during a consultation either in person or by video-link, and therefore has breached paragraph 9(c)(i) of the April 2015 orders and is guilty of contempt.

THE COURT ORDERS THAT: 4. The applicant's interlocutory application dated 20 August 2015 be listed for further hearing, on a date to be fixed, in relation to any fine to be imposed, and costs. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 1113 of 2010

BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION

AND: ACN 117 372 915 PTY LIMITED (IN LIQUIDATION)

JUDGE: MOSHINSKY J DATE: 17 December 2015 PLACE: MELBOURNE

The application for declarations of contempt 1 The Court has before it an application by the applicant (ACCC) for declarations that the sixth and seventh respondents (together, NRM) have breached the orders made by North J on 22 April 2015 (April 2015 orders) following the trial of the proceeding, and for the imposition of fines for contempt. 2 The proceeding before North J was brought by the ACCC against a number of corporate respondents trading under the name "Advanced Medical Institute" and some individual respondents. The ACCC's case at trial, which was largely accepted by North J, was that the corporate respondents had engaged in unconscionable conduct in their marketing and sale of medical treatments for premature ejaculation (PE) and erectile dysfunction (ED). See Australian Competition and Consumer Commission v ACN 117 372 915 Pty Limited (in liq) (formerly Advanced Medical Institute Pty Limited) [2015] FCA 368 (Reasons). The Court made declarations and orders restraining NRM from engaging in certain types of conduct. 3 Since judgment was delivered and orders were made on 22 April 2015, NRM has caused to be broadcast a number of radio and television advertisements and published or caused to be published a number of statements on the Advanced Medical Institute website which the ACCC alleges are in breach of the April 2015 orders. 4 At the hearing of this application, the parties addressed only the question of whether declarations of contempt should be made and did not deal with the amount of any fine. Accordingly, these reasons relate only to whether declarations of contempt should be made. 5 All of the contempt charges brought by the ACCC relate to paragraph 9(c) of the April 2015 orders. That paragraph reads as follows: Each of the sixth and seventh respondents be permanently restrained, whether by themselves, their servants or agents or otherwise, in trade or commerce, from: … (c) making any statement or representation to any patient or prospective patient as to: (i) the efficacy of NRM treatments; (ii) the efficacy of any medications or medical services offered by parties other than the sixth and seventh respondents; or (iii) the patient's need for the NRM treatments and any adverse consequences that might result if the patient: (A) does not acquire the NRM treatments, or (B) does not receive NRM treatments for male sexual dysfunction. except if that statement is made directly to a patient or potential patient by a duly qualified medical practitioner during a consultation either in person or by video-link. 6 The ACCC alleges that, through a series of radio and television advertisements, and statements on the Advanced Medical Institute website, NRM breached paragraph 9(c) of the April 2015 orders. The Amended Statement of Charge filed by the ACCC identifies 20 statements which are alleged to have breached the orders. Schedule 1 to the Amended Statement of Charge sets out the 20 statements, together with details of where, how and when the statements were made. That schedule is replicated in Annexure "A" to these reasons, save that the evidentiary references have been omitted. 7 All 20 statements are alleged to have breached paragraph 9(c)(i); seven of the statements are alleged to have also breached paragraph 9(c)(iii). 8 There was no issue before me that NRM had caused to be broadcast the radio and television advertisements as alleged by the ACCC or that NRM had published or caused to be published the statements on its website as alleged by the ACCC. 9 NRM's principal contentions against a finding of contempt were, in brief summary, that: (a) the words "prospective patient" in the opening lines of paragraph 9(c) of the April 2015 orders are not "clear and unambiguous"; alternatively, the statements were not made to patients or prospective patients, as they were made to the general public; (b) the word "efficacy" in paragraph 9(c)(i) is not "clear and unambiguous"; alternatively, the statements in items 4 to 20 were not statements as to the "efficacy" of NRM treatments; (c) the terms of paragraph 9(c)(iii) are not "clear and unambiguous"; alternatively, the statements alleged to have also breached that paragraph of the orders did not breach the paragraph. 10 In relation to those contentions, in my view, for the reasons that follow: (a) the words "prospective patient" in the opening lines of paragraph 9(c) are clear and unambiguous; and the statements were made to patients or prospective patients; (b) the word "efficacy" in paragraph 9(c)(i) is clear and unambiguous; and most of the statements set out in Annexure "A" were statements as to the efficacy of NRM treatments; (c) the terms of paragraph 9(c)(iii) are clear and unambiguous; however, the statements alleged to have also breached paragraph 9(c)(iii) did not breach that paragraph. 11 My overall conclusions in relation to the charges can be summarised as follows: (a) each of the radio advertisements, most of the statements on the website, and the television advertisement breached paragraph 9(c)(i) of the April 2015 orders; (b) the statements alleged to have also breached paragraph 9(c)(iii) did not breach that paragraph of the orders. 12 Accordingly, declarations should be made that NRM is guilty of contempt of this Court for breaching paragraph 9(c)(i) of the April 2015 orders.

Overview of the proceeding 13 Before addressing the contempt allegations, I provide a brief overview of the proceeding which culminated in the April 2015 orders. 14 The proceeding brought by the ACCC was initially brought against five respondents; this subsequently expanded to seven respondents. 15 The first and second respondents, which were formerly known as Advanced Medical Institute Pty Limited and AMI Australia Holdings Pty Limited, were in liquidation at the time of the trial. They were referred to together as AMI in the Reasons. AMI did not participate in the trial. 16 The third respondent was Dr Jacov Vaisman, who was the sole director and Chief Executive Officer of AMI. 17 The fourth and fifth respondents (Dr Brian Lonergan and Dr James Vandeleur) were doctors who were engaged by AMI to treat patients with ED and PE. In 2011, the ACCC discontinued the proceeding against Dr Vandeleur in accordance with a settlement reached with him: Reasons at [7]. In 2012, the ACCC and Dr Lonergan made an agreement including that Dr Lonergan would take no further part in the proceeding except as a witness, that there would be no order for costs between them, and that if the Court determined to make declarations against AMI, there would be similar agreed orders and an injunction against Dr Lonergan: Reasons at [10]. 18 The sixth and seventh respondents were NRM Corporation Pty Ltd and NRM Trading Pty Ltd, referred to together as NRM in the Reasons. These companies purchased the business of AMI in 2011 after the companies constituting AMI had been placed into voluntary administration. As stated in the Reasons at paragraph [757], Dr Vaisman was the sole shareholder in NRM Family Pty Ltd, which was the ultimate holding company of both the sixth and seventh respondents; hence, Dr Vaisman had control of the business operated by NRM and previously operated by AMI. Further, at paragraph [759], North J found that the way in which patients interacted with NRM was a continuation of the business system operated by AMI; and, at paragraph [762], that the core personnel of NRM were the same as the core personnel of AMI. 19 The ACCC's case at trial, in brief summary, was that AMI had engaged in unconscionable conduct in contravention of s 51AB of the Trade Practices Act 1974 (Cth) (TPA) in connection with the supply and possible supply of medications and medical services for the treatment of male sexual dysfunction. The ACCC made substantially similar allegations against NRM, alleging that it had contravened the successor provision, namely s 21 of the Australian Consumer Law (ACL) contained in Sch 2 of the Competition and Consumer Act 2010 (Cth). 20 As recorded in paragraph [18] of the Reasons, the proceeding was contested on almost every issue of fact and law, and the hearing occupied 33 sitting days. 21 On 22 April 2015, North J delivered his reasons for judgment and made orders in relation to the trial. As noted above, the ACCC was largely successful.

The April 2015 orders 22 Although the contempt charges focus on one particular paragraph of the April 2015 orders − paragraph 9(c) − I describe the other orders that were made to provide context. 23 Paragraphs 1 to 6 of the April 2015 orders comprised declarations. Paragraph 1 related to AMI, and declared that it had engaged in conduct that was unconscionable in contravention of s 51AB of the TPA in connection with the supply and possible supply of medications and medical services for the treatment of male sexual dysfunction (defined as the AMI treatments) in the circumstances set out in the paragraph. The paragraph has six sub-paragraphs - (a) through to (f) - which set out the circumstances in some detail. It is relevant for present purposes to set out the following sub-paragraphs of the declaration in paragraph 1 of the April 2015 orders: (a) AMI promoted its business as the "Advanced Medical Institute" and advertised extensively across the media, including television, radio, newspapers and billboards, with such advertisements containing statements encouraging men suffering from male sexual dysfunction to "call the doctors at Advanced Medical Institute" and thereby represented to men seeking treatment for male sexual dysfunction (patients) that they would receive a proper and objective medical assessment of their condition by a qualified medical doctor and would only be prescribed medication if consistent with that assessment; (b) on contacting AMI, patients were offered the opportunity to be medically assessed in either a telephone consultation or a consultation at one of AMI's clinics, and: (i) patients who chose a telephone consultation spoke initially with a salesperson who described themselves as a "Clinical Coordinator", "Medical Coordinator" or "Administrative Assistant" (Clinical Coordinator), then spoke to an AMI doctor, and then spoke to the Clinical Coordinator again; (ii) patients who chose an in-clinic consultation met initially with a nurse at the clinic, then spoke to an AMI doctor by telephone, and then met with a Clinical Coordinator; (c) the AMI doctors: (i) in consultations with each of the patients identified in Annexure B to the Further Amended Statement of Claim (Annexure B patients): (A) did not offer or prescribe any medication other than the AMI medications, which the AMI doctors had not selected from the range of all medications available for prescription by Australian medical practitioners, and did not inform the patient that they prescribed only the AMI medications; (B) conducted a consultation by telephone only and did not see or conduct any physical examination of the patient; (C) recommended to the patient treatment plans, including plans of a length of 12 or 18 months; and (D) did not seek to diagnose whether it would have been medically appropriate to refer the patient to a specialist or other medical practitioner for treatment or diagnosis; and (ii) in consultations with 150 of the Annexure B patients, did not seek to diagnose any underlying cause for the presenting problem and only questioned the patient to ascertain whether the AMI medications were contraindicated; (iii) in consultations with most of the Annexure B patients, did not inform the patient about the common side-effects of the medications prescribed adequately or at all; (d) the Clinical Coordinators: (i) were salespeople who were not medically trained and were paid by AMI on a commission, calculated by reference to the cost of the treatment plans sold to patients (the longer the contract period, the greater the commission) but described themselves as "Clinical Coordinators", "Medical Coordinators" or "Administrative Assistants"; (ii) in conversations with: (A) each of the Annexure B patients, did not disclose to the patient that they were salespeople paid on a commission; (B) most of the Annexure B patients, made statements to the patient concerning the efficacy of the AMI treatments; (C) most of the Annexure B patients, made statements to the patient that he needed treatment or would suffer adverse medical and social consequences if he did not get treatment, including that his penis may shrink or he may become impotent; and (D) most of the Annexure B patients, represented to the patient that he would be entitled to a refund of money paid if the AMI treatment purchased was ineffective, and did not disclose the conditions on which a refund would be offered under AMI's "satisfaction guarantee"; … 24 The expression "Annexure B patients" which appears in the declaration refers to a list of patients in respect of whom there was specific evidence at trial. 25 Paragraph 2 of the 2015 orders was a declaration in relation to the third respondent, Dr Vaisman, and paragraph 3 was a declaration in relation to the fourth respondent, Dr Lonergan. 26 Paragraph 4 of the April 2015 orders was a declaration in relation to NRM. It was declared that NRM had engaged in conduct that was unconscionable in contravention of s 21 of the ACL in connection with the supply and possible supply of medications and medical services for the treatment of male sexual dysfunction (defined as the NRM treatments) in the circumstances set out in the paragraph. The circumstances in relation to NRM are broadly similar to those relating to AMI, but there are differences of detail. Of relevance for present purposes are the following parts of the declaration in paragraph 4 of the April 2015 orders: (a) NRM promoted its business as the "Advanced Medical Institute" and advertised across the media, including radio, newspapers and billboards, with such advertisements containing statements encouraging men suffering from male sexual dysfunction to "call the doctors at Advanced Medical Institute" and thereby represented to patients that they would receive a proper medical assessment of their condition by a qualified medical doctor and would only be prescribed medication if consistent with that assessment; (b) on contacting NRM, patients were offered the opportunity to be medically assessed in either a telephone consultation or a consultation at one of NRM's clinics, and: (i) patients who chose a telephone consultation spoke initially with a salesperson who described themselves as an "Administrative Assistant", then spoke to an NRM doctor, and then spoke to the Administrative Assistant again; (ii) patients who chose an in-clinic consultation met initially with a nurse at the clinic, then spoke to an NRM doctor by telephone, and then met with an Administrative Assistant; (c) the NRM doctors: (i) in consultations with each of the patients identified in Annexure C to the Further Amended Statement of Claim (Annexure C patients): (A) did not offer or prescribe any medication other than the NRM medications, which the NRM doctors had not selected from the range of all medications available for prescription by Australian medical practitioners, and did not inform the patient that they prescribed only the NRM medications; (B) only conducted the consultation by telephone; (C) recommended to the patient treatment plans, including plans of a length of 12 or 18 months; (D) did not seek to diagnose any underlying cause for the presenting problem but only questioned the patient to ascertain whether the NRM medications were contraindicated; and (E) did not adequately diagnose whether it would have been medically appropriate to refer the patient to a specialist or other medical practitioner for treatment or diagnosis; and (ii) in consultations with 14 of the Annexure C patients, did not adequately inform the patient about the common side-effects of the medications prescribed; (d) the Administrative Assistants: (i) were salespeople who were not medically trained and were paid on commission by NRM, calculated by reference to the cost of the treatment plans sold to patients (the longer the contract period, the greater the commission), but described themselves as "Administrative Assistants" thereby representing that they were acting impartially in relation to the patients' medical interests in selling the NRM treatments; (ii) in conversations with: (A) each of the Annexure C patients, did not disclose to the patient that they were in fact salespeople paid on a commission; and (B) six of the Annexure C patients, made statements to the patient concerning the efficacy of the NRM treatments, the effect of which was to apply pressure to the patient to purchase the NRM treatments; … 27 The expression "Annexure C patients" which appears in the declaration refers to a list of patients of NRM in respect of whom there was specific evidence at trial. 28 Paragraph 5 was a declaration relating to the involvement of Dr Vaisman in the contravening conduct of NRM. Paragraph 6 was a declaration relating to a refund term in the contracts between NRM and its patients. 29 Following the declarations in paragraphs 1 to 6, paragraphs 7 to 14 contain orders of the Court. Paragraphs 7 and 8 relate to Dr Lonergan. Paragraph 8 contains an injunction restraining him from engaging in certain conduct. Because the meaning of the word "efficacy" is an issue that arises on the present application, I note that paragraph 8 includes the following paragraphs which use the words "efficacy" and "efficacious": The fourth respondent be permanently restrained from being knowingly concerned in, party to, aiding and abetting, counselling or procuring the provision by a corporation of any medical treatment plan or medication for the treatment of male sexual dysfunction by contract which: … (b) provides for the supply or possible supply for any treatment or medication which a qualified medical practitioner has not assessed as the most suitable or efficacious for the patient from the range of all appropriate medications available for prescription by Australian medical practitioners; … (f) provides for the supply of any treatment or medication, without prior consultation with a qualified medical practitioner who has provided information as to the efficacy, suitability, prior use and most common side effects of the treatment or medication. 30 Paragraph 9 of the April 2015 orders is an injunction restraining NRM from engaging in certain conduct. While the contempt charges relate only to paragraph 9(c), it is important to see that paragraph in the context of paragraph 9 as a whole. It provides as follows: Each of the sixth and seventh respondents be permanently restrained, whether by themselves, their servants or agents or otherwise, in trade or commerce, from: (a) making an agreement with a patient for or in respect of the supply of medications or medical services for the treatment of male sexual dysfunction, unless the patient for whom the medications or medical services are intended has had a consultation with a duly qualified medical practitioner either in person or by video-link; (b) making an agreement with a patient for the supply of medications or medical services for the treatment of male sexual dysfunction unless: (i) before the agreement is made: (A) the patient has been provided with a written statement by the sixth and seventh respondents by post, electronic mail, or in person: a. setting out in plain English the terms of the agreement including a description of the medication or medical services to be provided, the total cost of the agreement, the proposed payment plan (if any), the period of treatment, and a statement that the patient has a right to terminate the agreement during the period of five business days commencing on the date on which the agreement is made (Cooling-Off Period); b. stating that male sexual dysfunction may be a symptom of other medical conditions but NRM does not seek to diagnose those other medical conditions; and c. stating that NRM does not provide general medical advice and that NRM's doctors only consider whether the patient is suitable for NRM medications; and (B) the sixth and seventh respondents receive from the patient a written acceptance of the terms of the agreement; and (ii) the agreement contains terms which: (A) give the patient a right to terminate the agreement, by notice in writing to the sixth and seventh respondents dispatched during the Cooling-Off Period; and (B) provide that if the patient exercises the right to terminate the agreement during the Cooling-Off Period, the agreement is taken to be rescinded by mutual consent with all payments made refunded; and (C) provide that the patient may at any time after the Cooling-Off Period terminate the agreement by giving 14 days' notice, and that once this notice has been provided, the sixth and seventh respondents will cancel any direct debit arrangement referrable to the patient; (c) making any statement or representation to any patient or prospective patient as to: (i) the efficacy of NRM treatments; (ii) the efficacy of any medications or medical services offered by parties other than the sixth and seventh respondents; or (iii) the patient's need for the NRM treatments and any adverse consequences that might result if the patient: (A) does not acquire the NRM treatments, or (B) does not receive NRM treatments for male sexual dysfunction. except if that statement is made directly to a patient or potential patient by a duly qualified medical practitioner during a consultation either in person or by video-link; (d) making an agreement with a patient for the supply of NRM treatments, unless during pre-contractual negotiations, the patient is offered an agreement with a term of no more than two months; and (e) accepting in advance any payment or any other consideration from a patient in connection with the supply of NRM treatments for a future period of more than two months. 31 Paragraph 10 of the April 2015 orders is an injunction relating to Dr Vaisman. Paragraph 11 required NRM to make refunds to certain patients. Paragraph 12 required NRM to cause to be published a notice in the form of Annexure A to the orders on its website. Paragraph 13 related to costs. Paragraph 14 gave the ACCC and NRM liberty to apply in relation to the issues referred to in certain specific paragraphs of the Reasons, namely paragraphs [975], [988], [989], [993] and [1026]. Those paragraphs raised specific issues relating to the form or extent of certain aspects of the declarations or injunctions. (Subsequently, Dr Vaisman and NRM applied to vary the costs order and the ACCC applied for a variation of the orders in relation to the issues referred to in paragraph [993] of the Reasons: Australian Competition and Consumer Commission v ACN 117 372 915 Pty Limited (in liq) (formerly Advanced Medical Institute Pty Limited) [2015] FCA 1087.) 32 The form of paragraph 9(c) of the April 2015 orders followed the form of the injunction sought at trial by the ACCC: Reasons at [983], [990]. NRM did not make any submissions of substance at trial contesting the terms of the injunctions sought against it: Reasons at [995]. 33 The orders as made on 22 April 2015 did not contain an endorsement as described in r 41.06 of the Federal Court Rules 2011 (Cth). Subsequently, in July 2015, the ACCC applied to the Court for the endorsement to be added to the order. On 14 July 2015, the orders with the endorsement were served on NRM. In this interlocutory application, no point is taken by NRM regarding the absence of the endorsement from the original 22 April 2015 orders. In these circumstances, the ACCC did not, at the hearing of the present application, press the application contained in its interlocutory application for a dispensation from r 41.06.

Appeal from the April 2015 orders 34 An appeal has been instituted by NRM and Dr Vaisman in relation to the April 2015 orders. The appeal has not yet been heard. (The hearing of the appeal has been delayed due to the ill health of Dr Vaisman.) An application by NRM and Dr Vaisman for a stay of the April 2015 orders pending appeal was largely unsuccessful: NRM Trading Pty Ltd v Australian Competition and Consumer Commission [2015] FCA 595. In its submissions on the present application, NRM accepted that it cannot avoid a finding of contempt by showing that the orders made by North J were not justified or should not have been made. In this regard, see Siminton v Australian Prudential Regulation Authority (2006) 152 FCR 129 at [28] per North, Goldberg and Weinberg JJ.

The Amended Statement of Charge 35 The Amended Statement of Charge contains four charges of contempt which are as follows. It is alleged that: (a) by having caused to be broadcast each of the statements numbered 1 to 6 and 20 in Schedule 1 of the Amended Statement of Charge (replicated in Annexure "A" to these reasons) on the dates there referred to, NRM made statements or representations to patients or prospective patients as to the efficacy of the NRM treatments (as defined in paragraph 4 of the April 2015 orders) other than by statements made directly to a patient or potential patient by a duly qualified medical practitioner during a consultation either in person or by video-link, and therefore has not complied with paragraph 9(c)(i) of the orders and is guilty of contempt; (b) by having caused to be broadcast each of the statements numbered 1, 3, 4, 5 and 20 of the Schedule 1 to the Amended Statement of Charge on the dates there referred to, NRM made statements or representations to patients or prospective patients as to their need for the NRM treatments and any adverse consequences that might result if the patient (i) does not acquire the NRM treatments; or (ii) does not receive NRM treatments for male sexual dysfunction, other than statements made directly to a potential patient by a duly qualified medical practitioner during a consultation either in person or by video-link, and has therefore not complied with paragraph 9(c)(iii) of the orders and is guilty of contempt; (c) by publishing or having caused to be published each of the statements numbered 7 to 19 of Schedule 1 to the Amended Statement of Charge on the dates there referred to, NRM made statements or representations to patients or prospective patients as to the efficacy of NRM treatments other than by statements made directly to a patient or prospective patient by a duly qualified medical practitioner during a consultation either in person or by video-link, and has therefore not complied with paragraph 9(c)(i) of the orders and is guilty of contempt; and (d) by publishing or having caused to be published each of the statements numbered 18 and 19 of Schedule 1 to the Amended Statement of Charge on the dates there referred to, NRM made statements or representations to patients or prospective patients as to their need for the NRM treatments and any adverse consequences that might result if the patient (i) does not acquire the NRM treatments for male sexual dysfunction, or (ii) does not receive NRM treatments for male sexual dysfunction, other than by statements made directly to a potential patient by a duly qualified medical practitioner during a consultation either in person or by video-link, and has therefore not complied with paragraph 9(c)(iii) of the orders and is guilty of contempt.

The evidence 36 In support of the contempt charges, the ACCC filed a number of affidavits. Much of this evidence goes to establishing that the radio and television advertisements were broadcast, and that the statements on the Advanced Medical Institute website were published, with the content and on the dates alleged in Schedule 1 to the Amended Statement of Charge. NRM did not file any evidence disputing these facts and indicated in its submissions that it did not dispute these facts. 37 The evidence filed by the ACCC also included correspondence passing between the parties following the making of the April 2015 orders, including letters sent on behalf of the ACCC warning NRM that its conduct was in breach of paragraph 9(c) of the orders and letters sent on behalf of NRM seeking clarification of the meaning of the orders. 38 NRM filed an affidavit of a solicitor exhibiting some additional correspondence passing between the parties. It did not file any evidence from an officer of NRM. 39 Items 1 to 6 in Schedule 1 to the Amended Statement of Charge are radio advertisements. By way of example, item 1 is a radio advertisement during which the following words are spoken by a woman: Guys, premature ejaculation doesn't just affect you. It has an enormous effect on your partner. But you're the only one who can do something about it. Guys, make the call to AMI right now. AMI's revolutionary oral strips put a stop to premature ejaculation. So you can both enjoy room shaking, show stopping sex. Be her longer, stronger lover. Call AMI right now 40 The advertisement was broadcast in Sydney on 5 May 2015 on the radio station 2DAY FM and on 25 May 2015 in Perth on the radio station 92.9 FM. 41 The text of the other radio advertisements, and details of when and where they were broadcast, appear in items 2 to 6 of Annexure "A" to these reasons. 42 The evidence included audio files of the radio advertisements and, as foreshadowed during the hearing, I have listened to these files. Some of the radio advertisements are spoken by a woman, some by a man, and some by both a man and a woman, alternating between the man's and the woman's voice. 43 Items 7 to 19 are statements published by NRM on the Advanced Medical Institute website. By way of example, item 10 includes the following statement: AMI has developed their unique Oral Strip treatment option which have (sic) path breaking results which have helped many patients prevent premature ejaculation and treat erectile dysfunction 44 The evidence included screenshots of the relevant parts of the Advanced Medical Institute website. 45 Item 20 is a television advertisement which was broadcast from 23 April 2015 to 30 July 2015 in Brisbane on channels GEM, Go and Nine; in Melbourne on channels GEM, Go, Nine, Seven and 7mate; and in Sydney on channels GEM, Go, Nine, Seven and 7mate. The advertisement was broadcast on 2,421 occasions. 46 The evidence included a video file of the advertisement and, as foreshadowed during the hearing, I have watched the advertisement. The advertisement comprises a series of brief scenes acted by a man and a woman, together with a male voiceover and words appearing on the screen. Annexure "B" to these reasons is a document which sets out eight screenshots from the advertisement together with the text of the accompanying voiceover, and the text that appears on the screen. 47 During the advertisement, the viewer is simultaneously receiving messages from the scenes, the voiceover, and the words appearing on the screen. The scenes in the advertisement progress from a scene in which the man and woman are lying on a bed not facing each other and looking pensive (implicitly, given the accompanying voiceover, because of premature ejaculation issues), to a scene where they are facing each other and looking happy and satisfied (implicitly, given the voiceover and words on the screen, because the premature ejaculation issues have been resolved).

Applicable principles 48 This Court's power to punish for contempt of its power and authority is contained in s 31(1) of the Federal Court of Australia Act 1976 (Cth). The power is the same as that of the High Court to punish for contempt of that Court. The High Court's power in this regard is the same as that of the Supreme Court of Judicature in England at the commencement of the Judiciary Act 1903 (Cth): s 24 of that Act. 49 An application by a party who alleges a contempt of court is governed by Div 42.2 of the Federal Court Rules 2011 (Cth). If a party alleges that a contempt has been committed by a person in connection with a proceeding in the Court, an application for punishment for the alleged contempt is to be made by the party by interlocutory application in the proceeding: r 42.11(1). An application that a contempt has been committed must be accompanied by a statement of charge, specifying the contempt with sufficient particularity to allow the person charged to answer the charge, and the affidavits on which the person making the charge intends to rely to prove the charge: r 42.12. 50 A distinction is drawn between civil and criminal contempt. An alleged breach of a court order generally falls to be considered under the principles applicable to civil contempt. Deliberate conduct which is in breach of a court order will constitute wilful disobedience of the order, and therefore a civil contempt, unless the conduct is casual, accidental or unintentional: see Australasian Meat Industry Employees' Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 at 113 per Gibbs CJ, Mason, Wilson and Deane JJ; Hurd v Zomojo Pty Ltd [2015] FCAFC 148 at [90]-[91] and [97]-[101] per Besanko and Gilmour J, at [164] per Beach J. Whether the charge be for civil or criminal contempt, it must be proved beyond reasonable doubt: Witham v Holloway (1995) 183 CLR 525 at 534 per Brennan, Deane, Toohey and Gaudron JJ; Construction, Forestry, Mining and Energy Union v Boral Resources (Vic) Pty Ltd (2015) 320 ALR 448 at [42] per French CJ, Kiefel, Bell, Gageler and Keane JJ, at [59] per Nettle J. 51 In Advan Investments Pty Ltd v Dean Gleeson Motor Sales Pty Ltd [2003] VSC 201, Gillard J set out the elements necessary to establish a civil contempt involving a breach of an order of the court. He said (at [31]): In order to prove a civil contempt of court involving a breach of an order of the court, the plaintiff has to prove the following: (i) that an order was made by the court; (ii) that the terms of the order are clear, unambiguous and capable of compliance; (iii) that the order was served on the alleged contemnor or excused in the circumstances, or service dispensed with pursuant to the Rules of Court; (iv) that the alleged contemnor has knowledge of the terms of the order; (v) that the alleged contemnor has breached the terms of the order. 52 It has been said that injunctions should be granted in clear and unambiguous terms which leave no room for the person to whom they are directed to wonder whether or not their future conduct falls within the scope of the injunction; and that contempt proceedings are not appropriate for the determination of questions of construction of the injunction or the aptness of the language in which it is framed: see ICI Australia Operations Pty Ltd v Trade Practices Commission (1992) 38 FCR 248 at 259 per Lockhart J and cases there cited; Australian Competition and Consumer Commission v Dataline.Net.Au Pty Ltd (in liquidation) (2007) 161 FCR 513 at [104] per Moore, Dowsett and Greenwood JJ. See also Miller, Contempt of Court (3rd ed, 2000), paragraphs [14.36]-[14.37]. However, in my view this is not intended to foreclose consideration of any questions of construction in the context of contempt proceedings. It does not necessarily follow from the raising of a question of construction, which the court must determine, that the terms of the order are unclear or ambiguous. In Universal Music Australia Pty Ltd v Sharman Networks Ltd (2006) 150 FCR 110 (Universal Music), Branson J (Lindgren J substantially agreeing and Finkelstein J agreeing) said (at [38]): Assuming the above contention to raise an issue as to the proper construction of order 4, the authorities discussed above reveal that an injunction is not rendered invalid, or incapable of founding a charge of contempt, merely because it leaves a respondent with room to wonder whether future conduct falls within it. At least where the true construction of the order is one which ought fairly to have been in the contemplation of the person to whom the order was directed…, the Court which entertains the charge of contempt will be required to determine that construction. Of course, it may be highly relevant to the question of punishment that a respondent failed to comply with the order because he, she or it placed a construction on the order that was not its true construction. 53 An issue that has arisen in relation to the construction of court orders is whether, and if so the circumstances in which, regard may be had to the reasons of the court for making the orders. In Yates Property Corporation Pty Ltd v Boland (1998) 89 FCR 78, a Full Court of this Court, albeit not in a contempt context, held that in interpreting an order of a court framed in unambiguous language, regard should still be had to the reasons given by the court for making the order, because they form part of the context in which the order was made; and that this approach applies a fortiori where there is any suggestion that the order may be expressed in unclear terms. See also Australian Energy Ltd v Lennard Oil NL (No 2) [1988] 2 Qd R 230; Tarrant, "Construing undertakings and court orders" (2008) 82 ALJ 82. In the context of contempt proceedings, some care must be taken in going beyond the terms of the order itself because it is important that the party bound should know what it is required by the court order to do or refrain from doing. Nevertheless, it seems to me that even in the context of contempt proceedings, in an appropriate case, regard may be had, in construing the order, to the reasons given by the court for making the order. See Athens v Randwick City Council (2005) 64 NSWLR 58 at [27]-[36] per Hodgson JA, at [129]-[140] per Santow JA, at [141] per Tobias JA.

Consideration of whether NRM is guilty of contempt 54 NRM did not put in issue the fact that the April 2015 orders were served on NRM or that, at least after 24 April 2015, it had knowledge of the terms of the orders. Further, as noted above, NRM did not put in issue that it caused to be broadcast the radio and television advertisements, or that it published or caused to be published the statements on the Advanced Medical Institute website, with the content and on the dates set out in Schedule 1 to the Amended Statement of Charge. In circumstances where NRM did not put on any evidence from an officer of NRM, I find that its conduct in causing the advertisements to be broadcast and in publishing or causing to be published the website statements was deliberate. At hearing before me, senior counsel for NRM did not contend otherwise. 55 None of the statements was made in circumstances falling in the exception in the closing lines of paragraph 9(c) of the April 2015 orders. 56 NRM's principal contentions as to why it should not be found guilty of contempt were that: (a) the words "prospective patient" in the opening lines of paragraph 9(c) of the April 2015 orders are not "clear and unambiguous"; alternatively, the statements were not made to patients or prospective patients; (b) the word "efficacy" in paragraph 9(c)(i) is not "clear and unambiguous"; alternatively, the statements in items 4 to 20 of Annexure "A" were not statements as to the "efficacy" of NRM treatments; (c) the terms of paragraph 9(c)(iii) are not "clear and unambiguous"; alternatively, the statements alleged to have also breached that paragraph of the orders did not breach the paragraph.

NRM's contentions relating to the words "prospective patient" 57 NRM contended that in circumstances where the statements were broadcast or published to the public at large, whether this be by broadcast of the radio or television advertisements or publication on the website, the statements were not made to a "patient or prospective patient" as proscribed by paragraph 9(c). NRM put its contentions on two alternative bases. First, that the words "prospective patient" are not "clear and unambiguous". Alternatively, that the words "prospective patient" should be construed as meaning a person who has contacted NRM and who has an interest in the services offered. 58 In support of its arguments, NRM relied on the scope of the issues and evidence at trial. As the Reasons indicate, the focus of the ACCC's case at trial, insofar as it related to statements as to the efficacy of treatments (and the other matters set out in paragraph 9(c) of the April 2015 orders), concerned statements made in the course of one-on-one interactions between AMI or NRM salespeople or doctors and patients or prospective patients: see, eg, Reasons at [143] and following. NRM also referred to paragraph [524] of the ACCC's closing submissions at trial in which the ACCC submitted that the injunction which was sought (and which is reflected in paragraph 9(c) of the April 2015 orders) would prevent NRM salespeople from making the relevant representations to patients in order to obtain sales. 59 In my view, the words "prospective patient" in the present context include a member of the public who has sexual dysfunction issues and may be interested in obtaining treatment from NRM, and are not limited to a person who has contacted NRM. This is consistent with an ordinary meaning of the word "prospective", namely "potential" (Macquarie Dictionary, 6th ed, 2013). It is also supported by the context of the April 2015 orders as a whole. Paragraph 1(a) states that AMI promoted its business as the "Advanced Medical Institute" and advertised extensively across the media, including television, radio, newspapers and billboards. As the rest of that paragraph indicates, that conduct was directed at men suffering from male sexual dysfunction. The paragraph also refers to men seeking treatment for male sexual dysfunction as "patients" suggesting a broader meaning for the words "prospective patient". Paragraph 1(b) of the orders commences "on contacting AMI, patients were offered…" Because it describes a person who contacted AMI as a "patient", this suggests that the words "prospective patient" have a broader meaning. Comparable paragraphs appear in the declaration regarding NRM: see paragraphs 4(a) and (b) of the April 2015 orders. The last three lines of paragraph 9(c) contain an exception if the statement is made directly to a "patient or potential patient" by a duly qualified medical practitioner during a consultation. I consider the words "potential patient" appearing in this exception are likely to have been used interchangeably with "prospective patient" in the opening line. This follows from the structure of the paragraph as a whole. 60 A consideration of the Reasons, and the paragraph from the ACCC's trial submission relied on by NRM referred to above, does not persuade me that the words "prospective patient" have the narrower meaning contended for by NRM. While I accept that there was a focus at trial on statements as to efficacy (and the other matters referred to in paragraph 9(c) of the April 2015 orders) made in a one-on-one context, there were also evidence and issues concerning advertising by AMI and, subsequently, NRM to the general public: see Reasons at [72], [124]-[133] and [765]. These passages reinforce that the words "prospective patient" when used in the orders include a member of the public with sexual dysfunction issues who may be interested in obtaining treatment from NRM, and are not limited to someone who has contacted NRM. 61 Further, I consider the meaning of the words "prospective patient" to be clear and unambiguous, for the same reasons. Given the ordinary meaning of the words and the context of the orders as a whole, I consider that the meaning set out above is one which ought fairly to have been in the contemplation of NRM, as the person to whom the order was directed: cf Universal Music at [38]. 62 It is not to the point that the general public will include many people who are not patients or prospective patients of NRM. It is sufficient that the statement is made to the general public and this includes some people who are patients or prospective patients in the sense explained above. On the basis of NRM's own statements (as set out in Annexure "A"), which refer to a high proportion of men having sexual dysfunction issues, it may fairly be assumed that the general public did include at least some patients and prospective patients. 63 For these reasons, I conclude that each of the statements set out in Annexure "A" was made to a patient or prospective patient.

NRM's contentions relating to the word "efficacy" in paragraph 9(c)(i) 64 NRM contended that the word "efficacy" is not "clear and unambiguous". Alternatively, it contended that items 4 to 20 are not statements as to the efficacy of NRM treatments (it concedes that, if the order is capable of having any effect at all, items 1 to 3 are statements as to efficacy). 65 In support of the contention that the word "efficacy" is not "clear and unambiguous", NRM points to the ACCC's submissions on the present application. In those submissions, the ACCC cites two dictionary definitions of the word "efficacy" (namely, "power or capacity to produce effects; power to effect the object intended", from the Oxford English Dictionary, and "the capacity for serving to product effects", from the Macquarie Dictionary) and then submits that the meaning of "efficacy" in the present context "includes the possibility of, or potential to, bring about a result". NRM contends that to hold out the mere possibility of a result is a very different thing to holding out the capacity to deliver a result, and that this demonstrates that the word is ambiguous. 66 In my view, the word "efficacy" is clear and unambiguous. It has its ordinary meaning when used in paragraph 9(c)(i) of the April 2015 orders which is conveyed by the definition appearing in the Macquarie Dictionary (6th ed, 2013): "capacity for serving to produce effects; effectiveness". That the word bears its ordinary meaning is supported by the immediate context in which it is used in paragraph 9(c)(i), namely in connection with "NRM treatments". This expression is defined in paragraph 4 of the April 2015 orders as medications and medical services for the treatment of male sexual dysfunction. It is natural and logical to speak of the effectiveness of medications and medical treatments, or the capacity of medications and medical treatments for serving to produce effects, suggesting that "efficacy" does have its ordinary meaning in paragraph 9(c)(i). The word "efficacy" is also used in other paragraphs of the April 2015 orders in connection with medications and medical treatments: see paragraphs 1(d)(ii)(B), 4(d)(ii)(B) and 8(f) of the orders. It seems to me that "efficacy" also has its ordinary meaning in those paragraphs and thus has a consistent meaning throughout the orders. 67 In my view, it is not necessary to have regard to the Reasons in order to determine that the word "efficacy" has its ordinary meaning. But if regard is had to the Reasons, they confirm that "efficacy" is used in this sense. The Reasons contain extensive discussion of the efficacy or effectiveness (the two words often being used interchangeably) of the medications and medical treatments offered by AMI and, subsequently, NRM. In circumstances where, as his Honour found at paragraphs [202]-[206] of the Reasons, AMI salespeople made statements to patients about the efficacy or effectiveness of the medications and medical services offered by AMI, one of the major issues at trial was the efficacy or effectiveness of the AMI treatments: see the Reasons at [218]-[220]. After a detailed discussion of the scientific evidence regarding apomorphine (being the medication used by AMI to treat ED), North J concluded at paragraph [249] that Dr Vaisman's view about apormorphine as a treatment for ED was not only inconsistent with the scientific material relied on by the respondents in written submissions, but was also inconsistent with the scientific material on the subject exhibited to his first witness statement. At paragraph [258] and following, North J considered the evidence relating to the "efficacy" of clomipramine as a treatment for PE, this being the medication offered by AMI. In paragraph [277], North J concluded that whilst clomipramine had a limited role in the treatment of PE, it was displaced when the ejaculation-delaying effects of other medication, referred to as SSRIs, were discovered. North J found that the value which the respondents sought to place on clomipramine as a treatment for PE was exaggerated, and SSRIs were the first-line treatment for primary PE: Reasons at [277]. 68 North J then considered the "efficacy" of the drug delivery systems usually offered by AMI and NRM, namely nasal spray in the AMI period and oral strips in the NRM period: see the Reasons at [279] and following. After a detailed review of the evidence, North J accepted the evidence of Professor Colin Pouton that there is no scientific basis on which it can be concluded that the delivery of AMI and NRM medications through the nasal and buccal routes by nasal sprays, troches or oral strips is effective: Reasons at [327]. In paragraph [351], North J said: Whatever the effectiveness of apomorphine taken sublingually on-demand in the treatment of ED, or the effectiveness of clomipramine taken daily by tablet for the treatment of PE, there is no evidence that these medications administered by nasal spray or oral strip in much smaller doses is effective in the treatment of those conditions. Any potential effect of using the nasal, oral, or buccal routes for these medications is speculative. 69 In my view, the Reasons, in particular the passages referred to above, support the position that the word "efficacy" bears its ordinary meaning when used in paragraph 9(c)(i) of the April 2015 orders. 70 I note that the part of the ACCC's case at trial that concerned advertising did not focus on statements about the "efficacy" of the AMI treatments and NRM treatments but rather on statements that the treatment for ED and PE was by consultation with doctors: see the Reasons at [72]. As summarised in paragraph [130] of the Reasons, there were two predominant themes in AMI advertising: one was that the treatment was by a nasal spray delivery technology; the other was that the treatment was provided by doctors. However, in my view the different focus of the advertising part of the ACCC's case at trial does not affect the construction of the word "efficacy" in paragraph 9(c)(i). It does not suggest an alternative meaning for the word in that paragraph. If there be an issue about whether the orders made are sufficiently related to the conduct found to have contravened the legislation, that is a matter for the appeal against the orders rather than a matter to be considered in the present application. 71 As noted above, NRM's primary submission in relation to the word "efficacy" was that it was not "clear and unambiguous", and therefore paragraph 9(c)(i) could not found a contempt proceeding. NRM submitted, in the alternative, that the word "efficacy" meant "ability to bring about the intended result", citing the New Shorter Oxford English Dictionary. This is essentially the same as the Macquarie Dictionary definition set out above. Thus, the construction which NRM contended for (in the alternative to its primary submission) was the ordinary meaning of the word "efficacy". 72 For these reasons, I conclude that the word "efficacy" as used in paragraph 9(c)(i) of the April 2015 orders is clear and unambiguous, and bears its ordinary meaning, which is satisfactorily encapsulated in the definition, "capacity for serving to produce effects; effectiveness". 73 The next issue to consider is whether each of the statements in issue was a statement (or representation) as to the "efficacy" of NRM treatments. 74 In relation to items 1, 2 and 3 of Schedule 1 to the Amended Statement of Charge, NRM conceded that, if the order is capable of having any effect at all, these statements breached the order. In my view, this concession was correctly made and should be accepted. In relation to item 1, the statement that NRM's products "put a stop to" premature ejaculation is a statement as to the efficacy of NRM treatments. In relation to item 2, the statement that NRM's products are "effective" is a statement as to the efficacy of NRM treatments. Item 3 contains the same words, relevantly, as item 1. Accordingly, I find that NRM breached paragraph 9(c)(i) of the orders by causing to be broadcast the radio advertisements identified in items 1, 2 and 3. 75 No similar concession was made by NRM regarding the other items. 76 Items 4, 5 and 6 comprise statements made in other radio advertisements. Item 4 includes the statement that NRM's products "will get you back to your room shaking, show stopping sex". In my view, this is a statement as to the efficacy of NRM treatments because it represents that they will be effective. The advertisement also includes the statement, "you'll be her longer, stronger lover again … and again". The implication of this statement is that the treatments will be effective. Hence this too is a statement as to the efficacy of NRM treatments. 77 Item 5 includes the statement that "AMI's revolutionary oral strips will get you back to your room shaking, show stropping special cuddles". This advertisement uses the words "special cuddles" rather than the word "sex" which was used in the comparable sentence in item 4. However, in the context of the advertisement as a whole, this distinction is not material. In my view, the statement is tantamount to saying that the NRM treatments will be effective in addressing premature ejaculation problems, and hence is a statement as to the efficacy of NRM treatments. Further, the statement, "you'll be her longer, stronger lover again", which also forms part of the advertisement, is in my view a statement as to the efficacy of NRM treatments, because it is implicitly saying that they are effective. 78 Item 6 also contains, in my view, a statement as to the efficacy of NRM treatments. After referring to the problem of premature ejaculation, the advertisement says that "one call can fix it all". The advertisement urges the listener to call the doctor at AMI about their revolutionary oral strips and then says: "Pop it on your tongue and bam you're her longer, stronger lover". In my view, this is implicitly stating that the products will be effective. The word "bam" is an interjection which is an imitation of the sound of a blow or an expression signifying a sudden occurrence (Macquarie Dictionary, 6th ed, 2013). The implication is that, upon taking the medication, the man's premature ejaculation problem will suddenly be resolved. 79 Items 7 to 19 of Schedule 1 to the Amended Statement of Charge are statements published by NRM on the Advanced Medical Institute website. For the following reasons, in my view most of these are statements as to the efficacy of the NRM treatments. (a) Item 7 encourages the reader to call the doctors at AMI "to get immediate relief from Premature Ejaculation problem (sic)". This conveys that NRM treatments are effective. (b) Item 8 includes the statement that "[p]roper and accurate medication is provided which helps our patients enjoy a healthy sex life". This conveys that NRM treatments are effective. (c) Item 9 refers to the "New Oral strip treatment option" and describes it as a "new and revolutionary approach in the development of patient's (sic) friendly dosages of medication for the treatment of Erectile Dysfunction and Premature Ejaculation". I am not satisfied that these are statements (or representations) as to the efficacy of the treatments. The adjectives "new" and "revolutionary" do not clearly speak to the effectiveness of the treatments. Although there may be an implication that the treatments are effective, it is not sufficiently clear to conclude that this item amounts to a statement as to the efficacy of the treatments. (d) Item 10 includes the statement that NRM's products "have path breaking results". This amounts to a statement that the products are effective, and is therefore a statement as to the efficacy of NRM treatments. (e) Item 11 includes the statement that NRM's medications "have helped many patients experience healthy, enjoyable sex". This amounts to a statement that the medications are effective (at least in many cases) and is, therefore, a statement as to the efficacy of the NRM treatments. (f) Item 12 includes the statement that there "is now an answer to put a stop" to premature ejaculation. It also states that AMI has become the "'go-to solution' for men and woman who have tried everything to enjoy a more fulfilling sex life". These statements convey that the treatments offered are effective and hence constitute statements as to the efficacy of NRM treatments. (g) Item 13 contains a statement that at AMI "we have meds to treat Erectile dysfunction" and that treatment options are available. It also states that AMI is a "revolutionary thought leader in … treating Premature ejaculation and Erectile Dysfunction problems". I am not satisfied that these are statements (or representations) as to the efficacy of NRM treatments. Although there is a reference to having medications "to treat" erectile dysfunction, which may contain an implication as to efficacy, any such implication is not sufficiently clear. (h) Item 14 is the same as item 12 and the same reasoning applies. (i) Item 15 includes the statement that NRM's treatment "works with extreme ease in application and discreetness along with an improved onset of action". This is, in my view, a statement as to the efficacy of the treatment as the words "improved onset of action" convey that the treatment is effective. (j) I am not satisfied that item 16 contains a statement (or representation) as to the efficacy of NRM treatments. Although there is a reference to "getting better at blokes (sic) business in bed", which may contain an implication as to efficacy, any such implication is not sufficiently clear. (k) Item 17, comprises a video on the website (described in the item) together with certain statements. I have viewed the video file which formed part of the evidence. It is accurately described in item 17. In my view, the statements that "Medication acts twofold in Erectile Dysfunction" and "Medication treats Premature Ejaculation simultaneously", in conjunction with the video which shows the medication working, amount to statements that the medication is effective. Accordingly, in my view, this item constitutes a statement as to the efficacy of NRM treatments. (l) Item 18, comprises various statements about premature ejaculation and erectile dysfunction, followed by: "Call AMI Specialist today to end PE Issues". In my view this is a statement as to the efficacy of NRM treatments because the implication is that the medication or medical services provided by NRM are effective to end PE issues. (m) Item 19 also includes various statements about premature ejaculation and erectile dysfunction and then states: "At AMI we have meds to treat Erectile dysfunction. Treatment options are available for Erectile Dysfunction". I am not satisfied that this constitutes a statement (or representation) as to the efficacy of NRM treatments. It refers to the availability of treatment rather than making a statement about their effectiveness. 80 Item 20 is the television advertisement which has been described in paragraphs [45]-[47] above. The voiceover includes a statement that premature ejaculation problems "could be resolved" with AMI's treatment "for longer lasting sex". The voiceover also includes: "Call AMI doctors now for this incredible treatment that could help you resolve your premature ejaculation". In my view, these amount to statements that the treatments are effective, at least in some cases, and this constitutes a statement as to the efficacy of the treatments; it is a statement as to their capacity for serving to product effects or their effectiveness. The voiceover also includes: "Ask about this game changer and you could enjoy longer lasting sex". The same reasons apply to this statement. Further, the combination of the voiceover, the scenes, and the words on the screen reinforces the statements in the voiceover referred to above and confirms that they are statements as to the efficacy of the treatments. 81 In relation to the television advertisement, Schedule 1 to the Amended Statement of Charge specifies the period 23 April to 30 July 2015. However, the concession that NRM had knowledge of the terms of the orders is for the period "after 24 April 2015". In these circumstances, I consider that any finding of contempt should be limited to the period from 25 April 2015. (This issue does not apply to the other statements, as they were made after 24 April 2015.) 82 Where I have concluded that an item in Annexure "A" is a "statement" as to the efficacy of NRM treatments, for the same reasons it also constitutes a "representation" as to the efficacy of NRM treatments. 83 In relation to each of the statements which I have concluded are statements (and representations) as to the efficacy of NRM treatments, I consider this conclusion to be established beyond reasonable doubt. In the present case, as noted above, there is no issue concerning the fact that NRM caused to be broadcast the advertisements, and published or caused to be published the website statements. I am satisfied beyond reasonable doubt that each of the statements was made to a patient or prospective patient and (where I have so concluded) was a statement (and a representation) as to the efficacy of NRM treatments. 84 It follows from the above that NRM has breached paragraph 9(c)(i) of the April 2015 orders and is guilty of contempt of court by: (a) causing to be broadcast the radio advertisements identified in items 1 to 6; (b) publishing or causing to be published the statements on its website set out in items 7, 8, 10, 11, 12, 14, 15, 17 and 18; and (c) causing to be broadcast, from 25 April 2015, the television advertisement identified in item 20.

NRM's contentions regarding paragraph 9(c)(iii) 85 NRM contended that the terms of paragraph 9(c)(iii) are not "clear and unambiguous". In the alternative, it contended that the statements did not breach that paragraph. 86 Paragraph 9(c)(iii) refers to two matters, namely "the patient's need for the NRM treatments" and "any adverse consequences that might result if the patient" does not acquire or receive the NRM treatments. The word "and" is used between these two matters indicating that both must be present before a statement will contravene this paragraph of the orders. Senior counsel for the ACCC accepted that both elements need to be present before a statement would contravene paragraph 9(c)(iii) but submitted that the two elements overlap almost completely. I accept that the same words may constitute a statement as to "the patient's need for the NRM treatments" and "any adverse consequences that might result if the patient" does not acquire or receive the NRM treatments, but each case needs to be assessed to see whether the statement contains both elements. 87 The reference to the patient's "need" for the NRM treatments raises a question about the type of need covered by the order. Does this refer only to a medical need or does it extend to other types of need, for example what might be described as social need? Similarly, the expression "adverse consequences" raises a question about the type of adverse consequences covered by the order. Does this refer only to adverse medical consequences or does it extend to other types of adverse consequences such as social consequences? 88 In relation to the expression "adverse consequences", the declaration in paragraph 1(d)(ii)(C) of the April 2015 orders states that the Clinical Coordinators made statements in conversations with most of the Annexure B patients that he needed treatment "or would suffer adverse medical and social consequences if he did not get the treatment, including that his penis may shrink or he may become impotent". In my view, the expression "adverse consequences" is used in the same sense in paragraph 9(c)(iii) of the orders, namely so as to refer to adverse medical or social consequences. For consistency, I would read the word "need" in a similar way to "adverse consequences", namely as referring to medical or social need. 89 This construction of paragraph 9(c)(iii) is confirmed when regard is had to the Reasons: see, eg, paragraphs [171] and following of the Reasons. 90 So construed, in my view paragraph 9(c)(iii) is clear and unambiguous. 91 The ACCC in its Amended Statement of Charge alleges that NRM breached this paragraph of the orders by making the statements in items 1, 3, 4, 5, 18, 19 and 20 of Schedule 1 to that document. 92 Having considered the statements in each of these items, I am not satisfied that any of them breaches paragraph 9(c)(iii) of the orders. I address each item in turn. (a) Item 1 refers to the problem of premature ejaculation, which may arguably constitute a statement as to the need for the NRM treatments, but does not refer to any adverse consequences if the man does not acquire or receive the NRM treatments. In my view, a mere continuation of the status quo is insufficient to constitute an adverse consequence in the sense in which this expression is used in the orders. It is not comparable, for example, to penis shrinkage or impotence (referred to in paragraph 1(d)(ii)(C) of the April 2015 orders) which are new developments rather than merely a continuation of PE or ED issues. For these reasons, this item is not a statement (or representation) as to adverse consequences if the man does not acquire or receive the NRM treatments. (b) Items 3, 4 and 5 are relevantly comparable to item 1 and the same reasoning applies. (c) Item 18, comprises various statements about the problems of premature ejaculation and erectile dysfunction. I think these do constitute statements as to the need for the NRM treatments. But item 18 does not, in my view, contain statements (or representations) as to adverse consequences if the man does not acquire or receive the NRM treatments. Again, a mere continuation of the status quo is insufficient to constitute an adverse consequence. (d) Item 19 is relevantly comparable to item 18 and the same reasoning applies. (e) Item 20 refers in the voiceover to the problem of premature ejaculation. The words that appear on the screen include a statement about the percentage of men who suffer from premature ejaculation. I think these are statements as to the need for the NRM treatments. But the advertisement does not include statements (or representations) as to any adverse consequences that might result if the man does not acquire or receive the NRM treatments. 93 For these reasons, NRM has not breached paragraph 9(c)(iii) of the April 2015 orders.

Conclusion 94 For the reasons given above, NRM has breached paragraph 9(c)(i) of the April 2015 orders and is guilty of contempt of court by: (a) causing to be broadcast the radio advertisements identified in items 1 to 6 in Annexure "A" to these reasons; (b) publishing or causing to be published the statements on its website set out in items 7, 8, 10, 11, 12, 14, 15, 17 and 18 in Annexure "A"; and (c) causing to be broadcast, from 25 April 2015, the television advertisement identified in item 20 in Annexure "A". 95 Declarations should be made accordingly. The applicant's interlocutory application should be listed for further hearing, in relation to any fine, and costs. I certify that the preceding ninety-five (95) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moshinsky.

ANNEXURE A Schedule 1 To the Amended Statement of Charge (omitting evidentiary references) No. Statements Where, how and when the statements were made 1 (Woman) The Sixth and Seventh Respondents caused the statements to be made on: Guys, premature ejaculation doesn't just affect you. - 5 May 2015 during a radio broadcast in Sydney on the radio station 2DAY FM It has an enormous effect on your partner. - 25 May 2015 during a radio broadcast in Perth on the radio station 92.9 FM But you're the only one who can do something about it. Guys, make the call to AMI right now. AMI's revolutionary oral strips put a stop to premature ejaculation. So you can both enjoy room shaking, show stopping sex. Be her longer, stronger lover. Call AMI right now 2 What would you prefer? The Sixth and Seventh Respondents caused the statements to be made on 13 July 2015, 15 July 2015 and 25 July 2015 during radio broadcasts in: Average sex or mind blowing sex? - Sydney on the radio station 2DAY FM A few moments of forgettable, - Perth on the radio station 92.9FM Or passionate room shaking, show stopping, love making that lasts and lasts. - Brisbane on the radio station B105 Don't let premature ejaculation spoil things for both of you. - Melbourne on the radio station FOXFM There is an answer. - Adelaide on the radio station Hit107 AMI's revolutionary oral strips, super quick and effective. - Newcastle on the radio station NXFM So make the call to AMI on 1800 30 30 10. And be a longer strong lover. She'll love you for it. Call 1800 30 30 10. 1800 30 30 10. 3 (Man and woman) The Sixth and Seventh Respondents caused the statements to be made on: Guys, premature ejaculation doesn't just affect you. - 23 June 2015 during a radio broadcast in Perth on the radio station 92.9FM It has an enormous effect on your partner. - 12 July 2015 during a radio broadcast in Sydney on the radio station 2DAY FM But you're the only one who can do something about it. Make the call to AMI right now. AMI's revolutionary oral strips put a stop to premature ejaculation. So you can both enjoy room shaking, show stopping sex again. Be her longer, stronger lover. Call AMI right now. 4 (Man and woman) The Sixth and Seventh Respondents caused the statements to be made on 25 June 2015 and 28 June 2015 during radio broadcasts in Melbourne on the radio station FOX FM Guys, your premature problems in the bedroom don't just affect you. They affect her. But you're the only one who can do something about it. AMI's revolutionary oral strips will get you back to your room shaking, show stopping sex. Just pick up that phone and call AMI right now. You'll be her longer, stronger lover again …and again. Call 1800 40 40 10. 1800 40 40 10 5 (Woman) The Sixth and Seventh Respondents caused the statements to be made on 15 June 2015 during a radio broadcast in Adelaide on the radio station Hit107 Guys, your premature problems in the bedroom don't just affect you. They affect her. Isn't it time you made a call on it? AMI's revolutionary oral strips will get you back to your room shaking, show stopping special cuddles. Just pick up that phone and call AMI right now. You'll be her longer, stronger lover again. Call 1800 60 50 50. 1800 60 50 50 6 (Man) The Sixth and Seventh Respondents caused the statements to be made on 12 July 2015 during a radio broadcast in Melbourne on the radio station FOX FM If you're a bloke who suffers from premature ejaculation, you're not weird and you're not alone. Blokes all over Melbourne have the same embarrassing problem. But instead of ignoring it, thousands of them are tackling it head on. 'Coz one call can fix it all. Call the doc at AMI about their revolutionary oral strips. Pop it on your tongue and bam you're her longer, stronger lover. Call 1800 40 40 10. 1800 40 40 10. 7 At AMI we assure patients that treating premature ejaculation is possible! Call our DOCTORS at AMI at 1800 10 10 90 to get immediate relief from Premature Ejaculation problem The Sixth and Seventh Respondents published, or caused to be published, the statements on 28 April 2015 on the AMI website homepage located at the URL www.amiaustralia.com.au (AMI Website Homepage), under the heading "Treat Erectile Issues" and the statements were still on the website on 23 July 2015 8 AMI has doctors who are adept at treating Premature Ejaculation problems through a range of different options. FREE CONSULTATION is offered with registered doctors who diagnose the problems. Proper and accurate medication is provided which helps our patients enjoy a healthy sex life. The Sixth and Seventh Respondents published, or caused to be published, the statements on 28 April 2015 on the AMI Website Homepage, under the heading "Treat Erectile Issues" and the statements were still on the website on 23 July 2015 9 Talk to the doctors at The Advanced Medical Institute about the New Oral strip treatment option. It's a new and revolutionary approach in the development of patient's friendly dosages of medication for the treatment of Erectile Dysfunction and Premature Ejaculation. The Sixth and Seventh Respondents published, or caused to be published, the statements on 28 April 2015 on the AMI Website Homepage, via the link titled "Oral strip - how it works" and the statements were still on the website on 23 July 2015 10 AMI has developed their unique Oral Strip treatment option which have path breaking results which have helped many patients prevent premature ejaculation and treat erectile dysfunction. The Sixth and Seventh Respondents published, or caused to be published, the statements on 23 July 2015 on the AMI Website Homepage, under the heading "Treat Erectile Issues", by selecting page 2 and then the link titled "Impotance Treatment" AMI has developed treatment options to improve sexual health for over 20+ years & treated over 500,000+ patients. 11 At AMI we have the Expertise to treat both through our varied treatment options. We offer FREE CONSULTATION with registered doctors to diagnose your sexual health. We offer medications which have helped many patients experience healthy, enjoyable sex. The Sixth and Seventh Respondents published, or caused to be published, the statements on 23 July 2015 on the AMI Website Homepage, under the heading "Treat Erectile Issues", by selecting page 2 and then the link titled "Advanced PE Treatment" 12 There is now an answer to put a stop premature ejaculation and to last longer in bed. Instead of suffering from the impact of erectile dysfunctional problems, reach out to AMI who has become the "go-to solution" for men and women who have tried everything to enjoy a more fulfilling sex life. The Sixth and Seventh Respondents published, or caused to be published, the statements on 7 May 2015 on the AMI Website Homepage, under the heading "Treat Erectile Issues", by selecting page 3 and then the link titled "Treat Erectile Issues and the statements were still on the website on 23 July 2015 13 At AMI we have meds to treat Erectile dysfunction. Treatment options are available for Erectile Dysfunction. The Sixth and Seventh Respondents published, or caused to be published, the statements on 7 May 2015 on the AMI Website Homepage, by selecting the dropdown menu titled "Mens Sexual Health" and selecting the link titled "Sexual performance anxiety" and the statements were still on the website on 23 July 2015 AMI is a revolutionary thought leader in… treating Premature ejaculation and Erectile Dysfunction problems. 14 There is now an answer to put a stop premature ejaculation and to last longer in bed. Instead of suffering from the impact of erectile dysfunctional problems, reach out to AMI who has become the "go-to solution" for men and women who have tried everything to enjoy a more fulfilling sex life. The Sixth and Seventh Respondents published, or caused to be published, the statement on 13 May 2015 accessed from the bottom of the AMI Website Homepage, by selecting the link titled "Stop Premature Ejaculation in its Tracks. There's nothing more satisfying than being able to...", and the statements were still on the website on 23 July 2015 15 Stop Premature Ejaculation and Erectile Dysfunction New Oral Strip technology for Premature Ejaculation and ED Treatment Advanced Medical Institute takes pride in bringing forth the radical new approach our doctors have come up with in treating Erectile Dysfunction and Premature Ejaculation which are extremely patient friendly… Oral Strip Technology for treatment of Erectile Dysfunction is a friendly innovative dosage which works with extreme ease in application and discreetness along with an improved onset of action and enhanced safety in application called the Sexual Medicine- Rapid Oral Strip Technology (ROST). The dosage is safe, quick to dissolve than any other conventional form of dosage, bypassing stomach and liver. The Sixth and Seventh Respondents published, or caused to be published, the statements on 13 May 2015 accessed from the bottom of the AMI Website Homepage, by selecting the link titled "Stop Premature Ejaculation and Erectile Dysfunction New Oral Strip technology for Premature…", and the statements were still on the website on 23 July 2015 16 How do you choose an Effective Treatment for Improving erectile problems and getting better at blokes business in bed. Consider AMI your Premature Ejaculation Rehabilitation program partner. Choose AMI as your partner who cares about your sex life. We are here to help you with the all erectile failure problems. The Sixth and Seventh Respondents published, or caused to be published, the statement on 14 May 2015 on the AMI Website Homepage, under the heading "Treat Erectile Issues", by selecting page 2, under the heading "Premature Ejaculation Treatment", and the statements were still on the website on 23 July 2015 17 The depiction, in a flashvideo on the AMI Website Homepage by selecting the link "Oral Strip > See More" (Video), of a 3D model figure of a male taking an oral strip and then the oral strip activating blood vessels in the body, resulting in an erection in combination with the following statements: The Sixth and Seventh Respondents published, or caused to be published, the statements on 23 July 2015 on the Video on the AMI Website Homepage by selecting the link "Oral Strip > See More" Meds easily absorbed in tongue Distributed throughout Body Medication acts twofold in Erectile Dysfunction. One ingredient opens blood vessels in Penis Directly Second Ingredient stimulates production of hormones in brain that are responsible for erection Medication treats Premature Ejaculation simultaneously. It slows down Ejaculation. Helps longer lasting sex. The unique strength of our oral strip is the combination of these two ingredients. 18 Sexual Performance Anxiety - Types and symptoms of ejaculatory disorders The Sixth and Seventh Respondents published, or caused to be published, the statements on 7 May 2015 on the AMI Website Homepage, by selecting the drop down menu titled "Mens Sexual Health" and then selecting the link title with the first two words "Sexual Performance.." and the statements were still on the website on 23 July 2015 …Premature ejaculation (PE) Also known as rapid ejaculation, it is the condition whereby a patient jaculates (sic) with minimal sexual stimulation and before he wishes it to occur. It can be life-long (primary) or secondary (acquired). This is believed to be the most common sexual dysfunction in males with almost 30% of men of all ages suffering from this condition. It could be inferred that PE and ED share a vicious cycle, in which a man trying to control his ejaculation instinctively reduces his level of excitation (which can lead to ED), and a man trying to achieve an erection attempts to increase his excitation (which can lead to PE)… …Call AMI Specialist today to end PE Issues AMI is a revolutionary thought leader in providing Men's Health Services treating Premature ejaculation and Erectile Dysfunction problems. • AMI has developed and patented a Nasal Spray and also their unique Oral Strip treatment • AMI focuses on delivering safer, and lower dosage treatments to people suffering from sexual Health dysfunctions… 19 ED Treatment - symptoms-of-erectile-dysfunction-and-ejaculatory-disorders The Sixth and Seventh Respondents published, or caused to be published, the statements on 23 July 2015 on the AMI Website Homepage, by selecting the link in the orange tab titled "ED Treatment" …Premature ejaculation (PE) Also known as rapid ejaculation, it is the condition whereby a patient jaculates (sic) with minimal sexual stimulation and before he wishes it to occur. It can be life-long (primary) or secondary (acquired). This is believed to be the most common sexual dysfunction in males with almost 30% of men of all ages suffering from this condition. It could be inferred that PE and ED share a vicious cycle, in which a man trying to control his ejaculation instinctively reduces his level of excitation (which can lead to ED), and a man trying to achieve an erection attempts to increase his excitation (which can lead to PE)… …At AMI we have meds to treat Erectile dysfunction. Treatment options are available for Erectile Dysfunction… 20 (1) The following voiceover statements made during the course of the television commercial: The Sixth and Seventh Respondents caused the statements to be made from 23 April 2015 to 30 July 2015 by way of a television commercial which was broadcast in: Guys your premature ejaculation problem could be resolved with AMI's treatment for longer lasting sex. • Brisbane, on the television channels GEM, GO and Nine; You could satisfy your partner with a bigger performance so you last longer making love. • Melbourne, on the television channels GEM, GO, Nine, Seven and 7mate; and Call AMI doctors now for this incredible treatment that could help you resolve your premature ejaculation • Sydney, on the television channels GEM, GO, Nine, Seven and 7mate, Ask about this game changer and you could enjoy longer lasting sex. on the days and times referred to in Annexure MAS-6 to the Affidavit of Mark Antony Scatchard sworn on 20 August 2015 totalling 2,421 occasions Call now 1800 211 211. (2) Printed text forming part of the television commercial with the voiceover statements alleged in (1) above: Up to 50% of men suffer from Premature Ejaculation The Journal of Urology 1988 BIGGER AMI advanced medical institute and LAST LONGER AMI advanced medical institute LAST LONGER Call now for this incredible TREATMENT 1800 211 211 Lasting Performance 1800 211 211 Individual results may vary AMI advanced medical institute 1800 211 211 you could have BIGGER LONGER SEX 1800 211 211 you could have BIGGER LONGER SEX AMI 1800 211 211 advanced medical institute Phone NOW www.amiaustralia.com.au

Trade Practices Act 1974(Cth)

At a glance

Court

Decision date

Before

Source

Judgment (26 paragraphs)

Parties

Legislation Cited (5)

Cases Cited (14)