Consideration: the catalogue
54 In my view, neither the Storewide Discount Representation nor the 20% Off Storewide Representation were made by the first page of the catalogue in the terms asserted by the ACCC.
55 I have taken into account the asterisk where it appears, and the footnote text. In that regard, I note what Stone J said in Signature [2003] FCA 3 at [26] in the following terms:
I agree with the respondent's submission that George Weston Foods Pty Ltd v Goodman Fielder Ltd (2001) 49 IPR 553 ('the Wonder White case') is authority for the fact that an asterisk can be sufficient to draw the attention of a consumer to a qualification of a representation. That case concerned, inter alia, the packaging of the respondent's bread which declared in large typeface 'Now Twice the Fibre*'. Moore J observed that:
"the asterisk is prominent and would be taken to signify some qualification or explanation of the words used. One could expect a consumer interested in the fibre content to seek out the qualification or explanation. Not only is the explanation within 2 cm of the words used on the package (albeit in much smaller type) but it is repeated elsewhere on the packaging."
56 In my view, the asterisk is quite prominent and is sufficient to direct attention to the asterisk at the bottom of each page. The footnote disclaimer accompanied by the asterisk is not hard to find and is not hidden. But the context is clear, by the relative size of the headline and the footnote: the footnote is not to contradict the headline, but to explain or qualify or limit it. If it were simply to contradict the headline, one would expect the footnote to be much more prominent.
57 In my view, the footnote on each page was of limited effect. It said two things:
· that discounts were off "regular prices"; and
· that no further discounts apply to catalogue lines.
As noted above, the footnote on page 1 of the sale catalogue added that the banner content excluded television, sound, digital cameras and toys (on page 1 only).
58 The first part of the footnote, by itself, has no apparent special significance in this matter. It may serve to avoid any suggestion that the price markdown was from a price other than the regular price. Its significance may be tied to the second of those comments. That is because Harris Scarfe says that either the second of the two messages (or both together) amount to the footnote (or, as Harris Scarfe calls it, the catalogue disclaimer) meaning that the stated discounts "do not necessarily apply to those lines which appear in the catalogue".
59 In my judgment, that is an obscure reading of the "catalogue disclaimer". The meaning suggested is that the catalogue items do not, or do not necessarily, offer prices reduced by 20% to 60% from the regular price but are either not discounted from regular prices or have some other (and presumably lesser) reduction from regular prices. If that was what was intended to be conveyed to consumers, I think the appropriate disclaimer should have been that the catalogue items were excluded from the price deduction covered by the banner "20 OFF* STOREWIDE". And, so dramatically different from the apparently intended message of the banner would be the disclaimer - in effect 20% to 60% off regular prices storewide except for the items depicted in the sale catalogue - that its relative size and position would have to have been more prominent.
60 I do not have to go so far. It is sufficient to find, as I do, that a significant class of reasonable consumers would have understood that the items depicted in the catalogue were items reduced in price by between 20% and 60% from the regular price (other than television, sound, digital cameras and toys). I also find that a significant class of reasonable consumers, upon reading the footnote, would not regard that message as qualified in the way Harris Scarfe contends. The particular words "no further discounts apply to catalogue lines" are capable of conveying, and to a significant class of reasonable consumers would have conveyed, a composite message. First, that the price of catalogue lines as depicted had been reduced from the regular price by 20% to 60%, and secondly, that no further discounts could be expected. What further discounts might have been available is not explored in the evidence: it may have been understood as referring to some form of loyalty or card holder discount otherwise available, or simply to negotiated discounts, or to something else. But the use of the word "further" in relation to the "discounts" suggests, or at least would suggest to a significant class of reasonable consumers, that it refers to discounts from regular prices beyond those presented by the catalogue itself.
61 The catalogue, on subsequent pages, under certain banners says that the percentage price reduction is less than that range: 15% in the case of "ALL LCDs, VCRs and Digital Set Top Boxes"; and in the case of "ALL Audio & MP3 Players" (both on the second page); and in the case of "ALL 5MP Digital Cameras & Mini DV Camcorders" (the third page). On the remaining pages the banners refer to a percentage range of price reductions within the wider range of 20% to 60% except on the eighth page where the percentage reduction range in the banner is 40% to 70% off all "Essence, Living Art & Stanley Rogers Dinnerware". The three percentage reductions lower than the 20% to 60% Off Storewide Statements relate to products which fall within the exception signified by the third element of the footnote on the first page.
62 In my view, the third part of the footnote on the first page, excluding television, sound, digital cameras and toys, in conjunction with the banners on pages 2 and 3 of the catalogue to which I have referred, was sufficient to indicate to consumers that that range of products was not encompassed within the discount range conveyed by the banner on the first page. It is not necessary to determine whether the size and the terms of the footnote, taken alone, would have been sufficient to avoid such a representation to consumers or a class of consumers. The asterisk on the banner was prominent. It directed attention to the footnote. The footnote - in that regard - was clear and explicit, albeit in very much smaller print than the banner. But a consumer interested in purchasing such products would also have gone to the pages of the catalogue at which they were depicted. The banners on the second and third pages to which I have referred indicate clearly enough by their position and size that in respect of the products described or depicted (which are part of the more generic groups of television, sound and cameras in the footnote), the reduction from the regular price for those categories of products was not 20% to 60%.
63 The ACCC has not sought to make out a case that the Storewide Discount Representation or the 20% Off Storewide Representation were other than unqualified. I consider that they were. That is, in my view, the sale catalogue in context for the reasons given did not represent that all goods in Harris Scarfe stores were being offered at a discount, or offered for sale at a minimum of 20% off the regular prices for the duration of the sale. It did make those representations in respect of all products in its stores other than television, sound and camera products and toy products, but that is not the case sought to be made by the ACCC.
64 The 15% Off Home Entertainment Representation was, in my view, made by Harris Scarfe. Other than the content of the second page of the sale catalogue, including the footnote, it was not suggested there was other relevant content.
65 I have already explained why I reject the contention that the footnote by itself excluded all products depicted under the banner (or in the sale catalogue) from the assertion that there was 15% off all LCDs, VCRs and Digital Set Top Boxes, so that no representation of any reduction in price in relation to the products depicted under the banner was made.
66 The banner is on a yellow background, constituting about one quarter of the top half of the page. (There are different banners for the bottom half of the page). Apart from the text already referred to, it has five brand names (apparently in their individualised font style) including Panasonic.
67 There are then depicted only two television sets, each occupying vertically about one half of the top half of the page and laterally about one third of the page. The left-hand depiction has the words "24 Months Interest Free" highlighted in large print in the screen. It also has above it the stylised Panasonic name and on a smaller red rectangular background in white print the word "Plasma". In the same format immediately below the screen are the words "Giant 106cm Widescreen". Below the depicted screen in large highlighted print is the price and adjacent to it in standard (that is, black print on white background) and in considerably smaller print are the words:
A. Panasonic Standard Definition
Viera 42" (106cm) Widescreen
Plasma Integrated tuner & speakers,
progressive scan & 3D colour
management.
68 The other television set depicted is in the middle of the top half of the page (to the right are depicted two DVD Players and one Digital Set Top Boxes and immediately below is one Set Top Box). Its presentation is roughly of the same dimensions, and style, including the word "Plasma" as described. The screen contains, in larger print, "High Definition Widescreen. Crisp Images with Superb Depth". The highlighted price of $2699 also has above it "Save $300". The text below it is as follows:
B. Panasonic High Definition Viera 42" (106cm) Widescreen
Plasma 1024x768 resolution, 10,000:1 contrast ratio, PC
connection & twin HDMI input, 28.9 billion colours. R.R.P. $2999
69 As noted above, Harris Scarfe points out that in the manner described, each television depicted is said to be a "plasma", that is, each has a plasma, rather than an LCD, screen and the second television depicted also had a saving of $300 specified, together with its "R.R.P." so that the percentage saving could be readily calculated.
70 I do not consider that either the fact that the two televisions depicted were plasma screens rather than LCD screens, or the fact that the centrally depicted television disclosed the "R.R.P" - which I take to mean the regular price, as was assumed in submissions - and the sale price and the saving so that the percentage price reduction could be calculated (namely 10%) means that the 15% Off Home Entertainment Representation was not made in respect of the depicted items. The two points made by Harris Scarfe may apply made in the case of a cautious consumer. But not every consumer is as cautious as would be necessary to discern the refinements of the presentation and the small print. Nor, necessarily, is every reasonable consumer or class of consumer informed as to there being a difference between an "LCD" and a "plasma" television. The dominant message from the banner, and one which I find would readily have been taken by a reasonable class of consumers, was that the two televisions depicted were offered at a sale price 15% less than the regular price. Rhetorically, one might ask: to what other televisions was the banner directed, if not at least to those depicted? The banner was in the largest print, clearly highlighted by the colour print on a black background. A reasonable class of consumers, in my mind, would understand that the two televisions depicted immediately under the banner were those to which the banner related. The Harris Scarfe contention requires first an awareness of there being a difference between "LCD" and "plasma" and a sufficient attention to the detailed presentation under the banner to become aware that the only two televisions depicted were not encompassed within the message of the banner. Banners are obviously to draw attention to the opportunity to purchase certain products at a reduced price. The products are depicted. The fine print is not sufficient to exclude all reasonable groups of consumers from understanding that the message which - in my view - the banner conveys does not apply to the items depicted under it. Insufficient focus was drawn to the fact that the two televisions were plasma, as opposed to LCD, screens. I am satisfied that a reasonable class of consumers would have understood the banner as conveying the 15% Off Home Entertainment Representation, at least so far as it applied to the two depicted televisions, notwithstanding the word "Plasma" appearing in its size and form and colour in the depictions under the banner.
71 I have reached the same conclusion in relation to the second point made by Harris Scarfe concerning the television depicted in the middle of the top half of that page. The saving is identified as $300, and the larger printed price is $2,699. The "R.R.P." of $2,999 is in much smaller print and is not highlighted. Not every consumer attends to every aspect of advertising with fine attention to the detail. The "R.R.P." appears at the end of the fine printed text, apparently with other technical details. I do not consider it was sufficiently apparent as to expect all reasonable classes of consumers to have read it. More accurately, in the light of the banner and the overall presentation, I consider that there would have been a reasonable class of consumers who would not have realised that the regular price of that television was $2,999. I also consider that such an awareness was necessary, because it is no straightforward arithmetical task to calculate from the saving of $300 and the price of $2,699 that the saving was less than 15%. It is necessary to properly understand that the calculation requires the addition of the saving and the sale price, and then the calculation of the percentage that the saving represents of that total. I am satisfied that a reasonable class of consumers would not have made that calculation. The overall presentation gave them no especial reason to do so. And, in any event, I am satisfied that there would have been a reasonable class of consumers who would simply have associated the banner with the televisions depicted under it, and would have assumed that the saving of $300 represented 15% of the regular price.
72 My conclusions reflect the passage quoted with evident approval by Heerey J in Australian Competition and Consumer Commission v Nationwide News Pty Ltd (1996) 36 IPR 75 at 85 from the decision of the United States Supreme Court delivered by Hugo Black J in Federal Trade Commission v Standard Education Society 302 US 112 (1937) at 115:
The fact that a false statement may be obviously false to those who are trained and experienced does not change its character, nor take away its power to deceive others less experienced. There is no duty resting upon a citizen to suspect the honesty of those with whom he transacts business. Laws are made to protect the trusting as well as the suspicious. The best element of business has long since decided that honesty should govern competitive enterprises, and that the rule of caveat emptor should not be relied upon to reward fraud and deception.
73 In referring to that passage, I am not to be taken as suggesting that Harris Scarfe was in fact deliberately dishonest or intentionally deceptive in the way it presented the sale catalogue. That is a matter to be addressed when I consider the appropriate relief.
74 There is no dispute that the television depicted on the left was not reduced in price from its regular price, and that the other was reduced by only 10%. I therefore conclude that, at least in respect of those two televisions as depicted, that the sale catalogue made the 15% Off Home Entertainment Representation, and that it contravened both s 52 and s 53(e) of the TP Act.
75 It is not necessary to consider whether the 15% Off Home Entertainment Representation was made in respect of all other televisions which Harris Scarfe offered for sale during the period of the sale.
76 Essentially for the same reasons, I find that the 15% Off Audio Representation was made by Harris Scarfe. I have rejected the contention that the footnote to which attention may have been directed by the asterisk conveyed, or would have conveyed to all reasonable groups of consumers, that no representation about the percentage price reduction from the regular price was made in relation to the items depicted under the relevant banner.
77 One of the four items depicted under the relevant banner was a Samsung Z5 Music & Photo 2GB MP3 Player. It was not offered at a price reduced by 15% from its regular price. It was in fact offered at a price that was about 9.4% less than the regular price. That the discounted percentage could have been calculated on information contained in the text under the banner, upon a careful reading of that part of the sale catalogue does not mean that, to a reasonable class of consumers, that representation was not made or that it was not made in contravention of ss 52 and 53(e) of the TP Act. I have had regard to the size and appearance of the printed "Reg." price of that item relative to the advertised price and to the saving, and to the banner itself which prominently highlighted 15% off all MP3 players (as that item is described, in somewhat larger and highlighted print than the regular price), and the depiction of only two MP3 players under the banner. My conclusion is that a reasonable class of consumers would have taken the 15% Off Audio Representation as having been made and as applying to that depicted item. It was not accurate.
78 I also find that the 15% Off Cameras Representation was made by Harris Scarfe in respect of each of the items depicted on the third page of the sale catalogue. I further find that, in respect of the five items listed in [20] above, that representation was misleading and deceptive contrary to s 52 of the TP Act and was false and misleading as to the price of those items contrary to s 53(e) of the TP Act.
79 In respect of that banner and those items, Harris Scarfe relied on three matters to contend that no such contraventions were established: the terms of the footnote, to which the asterisk drew attention; secondly that two of the items are not "Mini DV Camcorders" but Camcorders and that two of the items are not "5MP Digital Cameras" but 6MP Digital Cameras; and thirdly that the first three items are presented with a disclosed regular price and a saving amount, so that the actual amount of the saving is apparent and the percentage price reduction from the regular price is calculable.
80 For the reasons already given, I reject the first contention.
81 I reject the second contention based upon the whole of the relevant part of the third page of the sale catalogue. The terms of the banner are set out in [20] above. It relates to the top two-thirds of that page. Under the banner, in the top half of the page, there are two separately delineated sections. The left third is under a sub-banner with particular savings on two specified and depicted camcorders. It is not necessary to refer to it. The right hand two-thirds depicts four camcorders, three of which are items (a)-(c) in the table in [20] above. They are all depicted as being about the same size. Underneath those two sections are depicted three cameras, running across the page and just below its centre line. Each camcorder is depicted, and has a large highlighted price and immediately above the price, also obvious but in a smaller print the saving (the camcorder not referred to in the table has a "lowest price" rather than a "saving" - I do not need to refer to it further). Each has a stylised brand name adjacent to its image, and in two instances (items (b) and (c) in the table) there is also a smaller highlighted technical feature. Each of those two camcorders then has a printed description in considerably smaller print containing a product description and the technical details, with at the end a "Reg." price. The product description is slightly bolder print than the technical details. In each of those two cases the description is "JVC GZ-MG37 30 GB Everio Hard Disk Camcorder" and "Panasonic NV-GS180 3CCD Camcorder". The item in (a) of the table is similarly presented. It is described as "JVC GR-D350 Mini DV Camcorder".
82 In my view, the fact that items (b) and (c) in the table are depicted under the banner, and the overall presentation, would have lead a reasonable class of consumers to the view that those items were for sale at prices which represented 15% off the regular prices. That is not to say that some consumers would not have appreciated, by reading the advertisement carefully, that items (b) and (c) were not Mini DV Camcorders but some other size of camcorder. Indeed, whether there is in the minds of all reasonable classes of consumers an awareness that a camcorder is not a mini camcorder - especially where they are depicted as about the same size - was not addressed in evidence. Nor did the evidence suggest that because a depicted item is a "Hard Disk" or a "3CCD" camcorder, it may not be in the minds of all reasonable classes of consumers a mini camcorder. Those observations reinforce the conclusions I have reached at the start of this paragraph.
83 For reasons similar to those expressed in relation to the 15% Off Home Entertainment Representation, I am also satisfied that a reasonable class of consumers would have understood the 15% Off Cameras Representation as applying to items (a)-(c) in the table, notwithstanding that a saving and a regular price was set out and, by calculation, a percentage saving revealed. That is not to say that a careful consumer might not have discerned in relation to those items and item (a) that the saving as specified did not represent 15% off the regular price. But I am satisfied that a reasonable class of consumers would not have been so discriminating.
84 A reasonable class of consumers would have connected the depicted items to the banner and there was in the presentation then insufficient focus on the matters to which Harris Scarfe refers to correct that message in relation to those items.
85 The two cameras referred to in items (d) and (e) of the table are presented in a slightly different way. There are only three digital cameras depicted under the banner. None is in fact (as presented) a 5MP Digital Camera. Each is described as a 6MP Digital camera, first by a small but highlighted box entry above its image reading "6MP Digital" and secondly, by the detailed printed description. The box highlighting is in the same style and colouring as the banner: black on yellow, except in the banner the words "15% OFF*" are further highlighted by a yellow on black boxed area. But for the small but highlighted box entry, I could have been satisfied that the 15% Off Cameras Representation was made in respect of those cameras, for reasons like those already given. It is a matter of impression. A reasonable class of consumers would be entitled to assume that the depicted cameras were, or included, those to which the banner was intended to apply. There is no particular reason why a significant contrast between the cameras referred to in the banner and as depicted should be drawn. Why, again rhetorically, would those cameras have been depicted if they were not, or were not illustrative of, cameras to which the 15% Off Cameras Representation applied? It is not simply a matter of noticing that 6MP Digital cameras were depicted, as distinct from 5 MP Digital cameras, but then of drawing the necessary disconnection between them and the banner because the banner referred only to "5MP Digital Cameras". I have come to the view that a reasonable class of consumers would have regarded the 15% Off Cameras Representation as applying to the cameras depicted, so the contravention of ss 52 and 53(e) of the TP Act is also made out in that respect.
86 I further find that the 20% Off Cordless Phones Representation was made, and that in respect of each of the items listed in the table in [23] above, that representation was misleading and deceptive contrary to s 52 of the TP Act and was false and misleading with respect to the price of those items contrary to s 53(e) of the TP Act.
87 For the reasons given earlier, I do accept that the footnote to which the asterisk in the banner directed attention conveyed that the price of the depicted items was not reduced by 20% from the regular price. Nor, for reasons similar to those expressed earlier, do I consider that the fact that in respect of items (b) - (e) in the table in [23] above, the saving and the regular price was set out so that, by calculation from that information or from the highlighted price and the regular price, the percentage price reduction could have been calculated, means that the representation was not made or that it was not misleading.
88 The banner relating to Cordless Phones runs across the third page of the sale catalogue about two thirds down that page. It is smaller than the other banners on that page. There are only five types of cordless phones depicted under it. Each has a highlighted price, and in smaller print and in a smaller and lesser highlighted box immediately above a saving amount. It is, in my view, clear that a reasonable group of consumers - if not the majority of consumers - would not readily calculate from that information the percentage saving from the regular price or conclude that the dollar saving was less than 20% off asserted in the banner. Each also has a detailed printed product description, with some additional features and, in four of the five cases, at the end of that relatively smaller and less featured text a "Reg." price. The departure from the banner's asserted reduction which Harris Scarfe seeks to justify by calculation from that extra data is not, in the light of the overall presentation, warranted. In each of those four cases, the calculation (if made) would directly contradict the banner. In my view, in such circumstances, much more prominence should have been given to that data, or the banner should have been qualified. No doubt some consumers, upon seeing the highlighted price and the saving sum expected no more than that saving. No doubt some cautious consumers calculated the percentage price reduction. But, as I have found in respect of similar instances in the catalogue, I consider that a significant group of reasonable consumers would have been misled by the representation into thinking that the price, and/or the saving, reflected a price reduction of 20% off the regular price.
89 I further find that the 20% - 25% Off Personal Care Representation was made, and that a significant class of reasonable consumers would have been misled by the representation into thinking that the price reflected a price reduction of 20% off the regular price.
90 The lower half of the fourth page of the sale catalogue contained the relevant banner. There were 10 items depicted under it, including the five items in the table in [25] above. Each of the depicted items had adjacent to it a highlighted boxed price, and immediately above it a smaller boxing saving in dollars. Each also had a detailed printed product description, in smaller and unhighlighted print with, at the end of that text, a "Reg." price.
91 I do not accept for the reasons already given that the asterisk on the banner and the footnote to which it drew attention meant that the prices set out in this part of the sale catalogue did not represent savings off regular prices. Also, for the same reasons as previously given, I find that a significant class of reasonable consumers would have concluded that the specified price in respect of each of the five items in that table represented a saving of not less than 20% off the regular price of those items. I shall not repeat those reasons. The evidence also shows that the price of those five items did not represent such a saving.
92 Consequently, I find that the 20 Off Personal Care Appliances Representation was made in respect of the items depicted under the banner, and that Harris Scarfe contravened ss 52 and 53(e) of the TP Act by doing so.
93 Finally, in this part of my reasons, I find that the 20-50% Off Kitchen Appliances Representation was made and that in respect of the Sunbeam Can Opener depicted under that banner the representation was misleading and deceptive contrary to s 52 of the TP Act and was false and misleading as to the price of that item contrary to s 53(e) of the TP Act.
94 Again, I do not accept that the sale catalogue had prices which did not represent savings from regular prices for the reasons already given.
95 The banner runs prominently across the top of the fifth page of the sale catalogue. There are 19 kitchen appliances depicted, all with significant savings specified relative to the sale catalogue price. They give no indication that the banner representation of 20% - 50% off did not apply to them, and that representation is reinforced in two instances where the percentage price reduction is highlighted. That overall picture provides further support for the conclusion I have drawn. The Sunbeam Can Opener is depicted in the bottom left hand corner of that page. As in other instances, it has a highlighted price and immediately above it a saving sum, and a more detailed product description in smaller and unhighlighted print ending with a "Reg." price. For reasons similar to those already given, together with the overall picture which that page of the catalogue presents, I am satisfied notwithstanding that data being set out in that way, that a reasonable class of consumers would have regarded the 20 Off Kitchen Appliances Representation as applying to that item. It was not correct.