Australian Competition and Consumer Commission v Meriton Property Services Pty Ltd

Counsel for the Respondent: Mr MR Hall SC with Mr SEJ Prince and Ms JD Alderson

BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION Applicant

AND: MERITON PROPERTY SERVICES PTY LTD (ACN 115 511 281) Respondent

JUDGE: MOSHINSKY J DATE OF ORDER: 10 NOVEMBER 2017

1. The matter be listed for hearing as to remedies. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Introduction 1 TripAdvisor, Inc (TripAdvisor) operates an online travel site comprising several regional websites. This proceeding concerns the Australian regional website with the website address "www.tripadvisor.com.au" (the TripAdvisor website). 2 Consumers may post reviews of accommodation properties on the TripAdvisor website via a TripAdvisor account or a Facebook account. Additionally, as discussed below, consumers who have stayed at a hotel or other accommodation may be invited by email to leave a review. 3 A consumer review consists of an overall rating out of five, a title for the review, and a written review of a minimum of 100 characters. Reviews are posted on a page of the TripAdvisor website dedicated to the relevant property, with the most recently submitted reviews generally appearing first. TripAdvisor gives an overall rating (out of five) for each property. Although these are displayed as circles or bubbles, for ease of expression I will refer to these as 'stars' in these reasons. Thus a property may be rated one-star, two-star, etc, with five-star being the best rating. The TripAdvisor website also ranks all the properties of a given type in a particular geographical area (eg, 1 out of 54, 2 out of 54, etc). TripAdvisor uses an algorithm to rate and rank the properties, based on the quality, recency and quantity of reviews. 4 TripAdvisor offers a service to accommodation providers called "Review Express". This service allows participating accommodation providers to send an email (through TripAdvisor) to guests who have stayed at a property inviting those guests to post a review of their stay on TripAdvisor. The accommodation provider provides the email addresses of its guests to TripAdvisor, and TripAdvisor sends email invitations to those guests on behalf of the accommodation provider. The email invitation provides a simple and streamlined mechanism for guests to post a review. The evidence indicates that using Review Express substantially increases the number of reviews about a property. 5 The respondent (Meriton) conducts a business of offering serviced apartment accommodation at (at least) 13 properties in Queensland and New South Wales. These properties appear on the TripAdvisor website. During the period November 2014 to October 2015 (the relevant period), Meriton participated in the Review Express service offered by TripAdvisor. On a weekly basis, Meriton provided TripAdvisor with the email addresses of guests who had stayed at its properties and TripAdvisor sent email invitations to these guests to post a review. However, rather than sending TripAdvisor the email addresses of all guests who had stayed at its properties (other than those who had requested that their details not be provided), Meriton adopted the following two practices: (a) The first practice was to add the letters "MSA" (which stand for Meriton Serviced Apartments) to the front of the email addresses of certain guests. This rendered the email address invalid. This practice was applied to guests who had made a complaint or were otherwise considered likely to have had a negative experience at a Meriton property. I will refer to this practice as the MSA-masking practice. (b) The second practice was to withhold from TripAdvisor the email addresses of all the guests who had stayed at a property during a period of time when there had been a major service disruption (such as the lifts not working, no hot water, etc). I will refer to this practice as the bulk withholding practice. 6 The effect of both practices was the same: the guest or guests did not receive an email invitation to post a review on TripAdvisor through the Review Express system. In the case of the MSA-masking practice, the email sent by TripAdvisor to the guest was not received because the email address was invalid. In the case of the bulk withholding practice, TripAdvisor did not receive the group of email addresses and so no emails were sent to those guests. 7 Towards the end of the relevant period, the method of masking the email addresses of individual guests changed. With the introduction of a new property management system (the software used to manage guest bookings and accounts), a field called "TA Mask" was created, and the letters "MSA" could be inserted into this field. In such cases, the email address of the guest was automatically not selected for provision to TripAdvisor. I will refer to this also as the MSA-masking practice in these reasons. 8 The practices were engaged in deliberately and systematically by Meriton during the relevant period. Front line staff were instructed to add the letters "MSA" to the email address of any guest who complained. This practice was standard across the organisation and, from January 2015, was reflected in Meriton's standard operating procedure for checking out a guest. In relation to the bulk withholding practice, hotel managers would request that all email addresses be withheld for a particular time period and the State Manager for the relevant State would decide, on a case by case basis, whether to withhold the email addresses. In the event, the practice was engaged in on many occasions during the relevant period. 9 These practices were contrary to TripAdvisor's guidelines or rules for using Review Express, as appearing on the TripAdvisor website. Those guidelines stated that participating accommodation providers should ask all guests for permission to email them, and send Review Express emails to everyone who consents. Further, TripAdvisor stated on the website that selectively emailing guests who are most likely to write positive reviews was considered to be a fraudulent practice. 10 The applicant (the ACCC) alleges that by engaging in the conduct described above, Meriton contravened ss 18 and 34 of the Australian Consumer Law, being Sch 2 to the Competition and Consumer Act 2010 (Cth) (the Australian Consumer Law). Section 18(1) provides that a person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive. Section 34 relevantly provides that a person must not, in trade or commerce, engage in conduct that is liable to mislead the public as to the nature, the characteristics or the suitability for their purpose of any services. 11 Meriton essentially accepts that it engaged in the practices described above and that it ought not to have done so. Meriton also accepts that the practices were carried out for the purpose of preventing certain guests from receiving an invitation to review Meriton properties via Review Express, with the intention of reducing the likelihood that those guests would leave a review. 12 However, Meriton disputes that the practices had the effect, or the likely effect, alleged by the ACCC. In brief terms, the ACCC alleges that the practices had the effect, or likely effect, of reducing the number of recent negative reviews and that, by doing so, Meriton: improved (or was likely to have improved) the relative number of favourable compared to unfavourable reviews; and/or improved or maintained (or was likely to have improved or maintained) the ratings or rankings of Meriton properties on the TripAdvisor website. The ACCC alleges that Meriton thereby created (or was likely to have created) a more positive or favourable impression of the standard, quality or suitability of its accommodation services. Meriton submits that the ACCC has not established that the practices had this effect or likely effect. 13 In my view, for the reasons that follow, the impugned practices had the effect of reducing the number of negative reviews of the Meriton properties appearing on the TripAdvisor website. The impugned practices also had the effect of improving the relative number of favourable reviews compared to unfavourable reviews of the Meriton properties on the TripAdvisor website. I do not think it is established that the impugned practices affected the rating of the properties. However, at least in some cases, the impugned practices affected the ranking of the Meriton properties on the TripAdvisor website. In summary, I find that the MSA-masking practice and the bulk withholding practice created a more positive or favourable impression of the quality or amenity of the Meriton properties on the TripAdvisor website. 14 Further, for the reasons that follow, I consider that Meriton engaged in conduct that was likely to mislead or deceive, in contravention of s 18 of the Australian Consumer Law. I also consider that Meriton engaged in conduct that was liable to mislead the public as to the characteristics and the suitability for their purpose of the accommodation services provided by Meriton.

Procedural matters 15 The proceeding was commenced by originating application. By this document, the ACCC seeks: declaratory relief under s 21 of the Federal Court of Australia Act 1976 (Cth); orders for injunctive relief under s 232 of the Australian Consumer Law; disclosure orders, corrective publication orders and orders requiring Meriton to implement a compliance program under s 246 of the Australian Consumer Law; orders for pecuniary penalties under s 224 of the Australian Consumer Law; and costs. 16 The ACCC's case is set out in an amended concise statement (the concise statement). Meriton's response is contained in its response to the amended concise statement (the concise response). The concise statement refers to Meriton conducting a business, in trade or commerce, of offering serviced apartment accommodation at properties in at least 13 locations in Queensland and New South Wales (defined as the "Meriton properties"). 17 The concise statement includes a description of the TripAdvisor website and the Review Express service. In response, Meriton accepts that TripAdvisor provided a website broadly as described in the concise statement during the relevant period and that it included reviews of properties operated by Meriton. However, Meriton states that it is not privy to the structure or organisation of the TripAdvisor website, does not have access to the algorithms or methods of assessment it operates or applies, and cannot admit the particular matters of fact alleged by the ACCC. 18 The ACCC alleges, in [14] of the concise statement, that during the relevant period, Meriton identified guests whom it considered likely to have had a negative experience at a Meriton property or who, during the course of their stay, had made a complaint, and who Meriton considered likely to submit a negative review to TripAdvisor about a Meriton property. At [15] of the concise statement, the ACCC alleges: When providing the set of consumer email addresses to TripAdvisor for the purpose of the Review Express service, Meriton deliberately "masked" the email addresses of these guests (the masking practice) by: (a) inserting the letters "MSA" at the front of the guest's email address (or in the relevant area of Meriton's booking system) before using the Review Express service, so that the email address would be invalid and the guest would not receive the Review Express email; or (b) failing to send to TripAdvisor (when using the Review Express service) email addresses for guests who had stayed at a Meriton property during a period when the property had been adversely affected by an infrastructure or essential service failure, or by some other incident, so that these guests would not be invited by TripAdvisor to submit a review via Review Express. 19 Although the ACCC's concise statement uses the label "masking practice" to refer to both practices described in the above paragraph, as set out above I will use the expressions "MSA-masking practice" and "bulk withholding practice" to describe the two practices. 20 The ACCC gives examples of the masking practice in [16] of the concise statement and alleges, in [17], that Meriton's employees implemented the masking practice with the knowledge, and at the direction, of Meriton's senior management. It is alleged, in [19], that Meriton deliberately implemented the masking practice with the intention of reducing the likelihood of guests submitting negative reviews of Meriton properties to TripAdvisor, and improving or maintaining the rating of Meriton properties on the TripAdvisor website. In [20] of the concise statement, the ACCC alleges: The masking practice had the effect, or likely effect, of reducing the number of recent negative reviews of the Meriton properties submitted to TripAdvisor because consumers who had been identified as likely to give a negative review and who were subject to the masking practice were not contacted by TripAdvisor. This: (a) improved, or was likely to improve, the relative number of favourable reviews compared to unfavourable reviews of Meriton properties that would have otherwise been posted; and/or (b) improved or maintained, or was likely to improve or maintain, TripAdvisor ratings of Meriton properties, and thereby created, or was likely to create, a more positive or favourable impression of the standard, quality or suitability of accommodation services provided by Meriton properties on consumers who used the TripAdvisor website to find suitable accommodation. 21 Although [19] and [20] of the concise statement use the expression "rating" and not "ranking", the case was conducted on the basis that these allegations concern both rating and ranking (as described earlier in these reasons). 22 The ACCC alleges, in [23] of the concise statement, that by implementing the masking practice, Meriton engaged in conduct that was: (a) misleading or deceptive or likely to mislead or deceive in contravention of s 18 of the Australian Consumer Law; and/or (b) liable to mislead the public as to the nature, the characteristics and/or suitability for their purpose of the accommodation services at the Meriton apartments in contravention of s 34 of the Australian Consumer Law. 23 It is also alleged, in [24], that as a result of Meriton's conduct in implementing the masking practice, consumers who accessed the pages of the TripAdvisor website dedicated to the Meriton properties for the purpose of evaluating, comparing and choosing accommodation during the relevant period, were misled or were likely or liable to be misled about: the nature, characteristics and/or suitability of the Meriton properties for their purposes; and the nature, characteristics and/or suitability of the Meriton properties in comparison to competing accommodation providers. 24 In its concise response, Meriton states that at all relevant times Meriton encouraged all guests at its properties to post reviews on the TripAdvisor website by, among other steps, displaying information about the website in all guest rooms, at its reception desks and check-in facilities, and in 'flyers' provided to guests. 25 In its concise response, Meriton also states that, at a date prior to the relevant period, for reasons unconnected with TripAdvisor, Meriton introduced a practice of deliberately "masking" email addresses by adding the letters "MSA" to those email addresses with the intention and effect that users of those email addresses would not receive automated emails from Meriton or anyone else to whom Meriton provided those email addresses, while permitting specific emails to be sent to them by removing the additional letters at the time of sending. Meriton states that the reasons for instituting this practice included: (a) Where the guest had requested that they not be included in automated emails or that their addresses not be provided to third parties. Such requests were sometimes made en bloc (for example, by the New South Wales Police Force, or by film and television companies booking rooms on behalf of a number of participants in a 'shoot') and sometimes individually. (b) Where the email address associated with the booking was not that of the guest, for example where a travel agent or a person organising a wedding or other function booked multiple rooms for different guests. (c) Where a guest had been the subject of complaints of anti-social behaviour and had been asked to leave or told they would not be invited to return to the property for future stays. Meriton did not wish such guests to receive advertising or special offers in relation to its accommodation. 26 In [7]-[9] of its concise response, Meriton states as follows in response to the ACCC's case: 7. During the relevant period Meriton did seek to identify guests whom it considered likely to have had a negative experience at a Meriton property or who, during the course of their stay, had made a complaint. It did so for the purposes of improving customer service and responding to those negative experiences and complaints and it did so respond. 8. There were occasions during the relevant period when members of staff of the Respondent applied the masking practice or invited their colleagues to apply it for purposes other than those for which it had been established including for the purpose of preventing the guest receiving a further invitation to review the property via TripAdvisor's review express automated email. 9. The conduct identified in paragraph 8 did not have the effect or the likely effect of communicating any misleading representation to any consumer or of making any false representation concerning the standard, quality or suitability of accommodation services provided by Meriton. 27 In response to [15] of the ACCC's concise statement, Meriton states: 19. In answer to paragraph 15 the Respondent repeats paragraphs 6 to 9 above and otherwise: 19.1 admits that it inserted the letters "msa" at the front of some guests emails (or in the relevant area of Meriton's booking system) during the relevant period; 19.2 [a]dmits that some such email addresses with the letters 'msa' added were among those sent to TripAdvisor as part of its Review Express process; 19.3 admits that on some occasions it did not send email addresses to TripAdvisor in respect of some guests which had stayed at a Meriton property including some who had stayed during a period when the property had been adversely [affected] by an infrastructure or essential service failure. The Respondent otherwise denies paragraph 15. 28 Meriton admits that staff who added the letters "MSA" to the email addresses of some guests were likely to have done so within the scope of their actual or apparent authority and that such conduct was engaged in by Meriton for the purposes of s 139B(2) of the Competition and Consumer Act. 29 Meriton denies the allegations in [20] of the concise statement. Meriton also states as follows at [27]: The Respondent denies that as a result of its conduct in the relevant period that consumers who accessed the pages of the TripAdvisor website were misled or likely or liable to be misled about the nature, characteristics and/or suitability of the Meriton properties for their purposes and the nature, characteristics and/or suitability of the Meriton properties in comparison to competing providers. Further, the Respondent denies that the allegations in paragraphs 23 and 24 are capable of giving rise to liability on the part of the Respondent under ss 18 and/or 34 of the ACL. 30 The proceeding was set down for hearing on liability. Although the proceeding was commenced in the Victoria District Registry of the Court, following an oral application by Meriton at a case management hearing, I decided that the trial should take place in Sydney. 31 In its outline of opening submissions, Meriton stated that it "accepts that it did engage in both forms of conduct alleged (masking and non-forwarding of groups of email addresses) - and that it ought not to have done so". The outline stated: "Meriton also accepts that both the practices of masking and non-forwarding were done for the purpose of preventing the guest from receiving a further invitation to review the property via TripAdvisor's Review Express automated email … and that it was done with the intention of reducing the likelihood that the owners of those email addresses would leave a review". Meriton also asked the Court to note its "commitment not to repeat the conduct".

The hearing 32 At the hearing, the ACCC led evidence from the following witnesses: (a) Gerard O'Shaughnessy, an Assistant Director employed by the ACCC. Mr O'Shaughnessy's affidavit evidence included screen captures of the TripAdvisor website with information about Review Express and the ranking of properties. (b) Laura Elliott, a solicitor employed by the ACCC's solicitors. Ms Elliott prepared two affidavits. Her first affidavit included screen captures of reviews that had been posted about Meriton properties on the TripAdvisor website. Her second affidavit included screen captures from the Booking.com website, and further screen captures of reviews on the TripAdvisor website. (c) Professor Edward C Malthouse, an expert witness. Professor Malthouse is the Theodore R and Annie Laurie Sills Professor of Integrated Marketing Communications at Northwestern University, Illinois, United States of America. He prepared two reports. His first report dealt with, among other things: the impact of online reviews on purchasing decisions; the effect of automatic email invitations to post an online review; the likely effect (on matters such as the number of positive reviews, and rating) of Meriton using Review Express in accordance with its terms; and the likely effect (on such matters) of the masking practice alleged by the ACCC. Professor Malthouse prepared a second report, which was responsive to a report of Christopher Emmins, an expert called by Meriton. 33 Meriton led evidence from the following witnesses: (a) Carol Nazha, an employee of Meriton with responsibility, during the relevant period, for dealing with customer feedback (including feedback received through online reviews). Ms Nazha was first employed by Meriton in May 2014 as the Administration Co-ordinator. In December 2014, the title of that role was changed to Service Ambassador. In June or July 2015, she was promoted to the position of Training Co-ordinator (training employees on customer service), being a role in the Human Resources department. Although Belinda Adams became the Online Reputation Supervisor at this time, Ms Nazha continued to oversee TripAdvisor until the end of October 2015. Subsequently, Ms Nazha became the Talent and Culture Officer for the Meriton group of companies (the Meriton group). (b) Albert Chan, the Operations Manager - New South Wales for the serviced apartments division of the Meriton group, a position he has held since June 2014. (c) Christopher Emmins, an expert witness. Mr Emmins is a consultant based in the United Kingdom who specialises in the investigation, verification and resolution of issues regarding the factual content of internet sites. Mr Emmins prepared two affidavits, each annexing a report. Mr Emmins's first report, in broad terms, dealt with the effects or likely effects of Meriton's use of Review Express and its implementation of masking practices. Mr Emmins's second affidavit and report sought to address certain issues that had been raised by the ACCC in relation to his first report at an interlocutory hearing during the week before the commencement of the trial. 34 Each of the above witnesses was cross-examined. Mr O'Shaughnessy and Ms Elliott gave evidence by video-link from Melbourne. The other witnesses gave evidence in person in Sydney. 35 I make the following preliminary observations about the evidence of the witnesses: (a) Mr O'Shaughnessy's evidence was of a confined nature. There was no cross-examination as to credit and I accept his evidence. (b) Ms Elliott's evidence was also of a confined nature. Again, there was no cross-examination as to credit and I accept her evidence. (c) Professor Malthouse impressed me as a truly independent witness with a thorough and reasoned explanation for his opinions. He made appropriate concessions during cross-examination and presented as a witness who was endeavouring to assist the Court. I will consider his evidence further in the context of the specific issues discussed below. (d) Ms Nazha made significant concessions during the course of cross-examination, which enhanced the credibility of her evidence. Her responses to questions during her oral evidence appeared to be honestly given. I generally accept her evidence. (e) Mr Chan at times displayed reluctance in answering questions put to him during cross-examination. On some occasions, questions had to be put to him several times before he answered them. However, Mr Chan did make some significant concessions during cross-examination. To the extent that there were differences between Mr Chan's affidavit evidence and oral evidence, I generally prefer his oral evidence. To the extent that there were differences between Ms Nazha's evidence and that of Mr Chan, I generally prefer Ms Nazha's evidence. I will consider whether to accept Mr Chan's evidence in the context of considering specific factual issues, later in these reasons. (f) Mr Emmins did not detail some aspects of his research (either in his reports or in his notebook) making it difficult to test some of his conclusions. He did not keep a contemporaneous copy (whether electronic or hard copy) of the website pages or reviews he examined in the course of his research, again making it difficult to test some of his conclusions. During cross-examination, he was taken to drafts of his first report and to correspondence he exchanged with Meriton's in-house counsel in the course of preparing that report. In a number of instances, substantial matters that had been included in drafts of the report were taken out before the report was finalised. Although he explained some of these changes on the basis that he was cautioned by Meriton's in-house counsel not to be seen as attacking TripAdvisor, this did not seem to explain all of the changes. Some aspects of the correspondence suggest he may not fully have appreciated the independence required of an expert witness. On the other hand, during the course of cross-examination Mr Emmins made significant concessions and conveyed an understanding of the independence required of an expert witness. I will consider his evidence further in the context of the specific issues set out below. 36 It is convenient to note at this point that Meriton did not call Matthew Thomas, who was Meriton's National Manager during the relevant period and is now the General Manager of Meriton and a director of the Meriton group, to give evidence. The ACCC submits that inferences should be drawn in respect of Mr Thomas's unexplained absence in accordance with the principles in Jones v Dunkel (1959) 101 CLR 298. I will deal with this issue later in these reasons.

Evidentiary rulings 37 Two evidentiary issues were not resolved during the trial and need to be dealt with in this judgment. I will deal with each in turn. 38 The first issue concerns certain documents in the Court Book that were not tendered during the hearing. The question is whether, as contended for by Meriton, they should be admitted into evidence. At the conclusion of the trial it was arranged that the parties would prepare and provide to the Court a list of the documents in the Court Book that had not gone into evidence. Subsequently, by email dated 29 June 2017, the ACCC's solicitors provided a copy of the Court Book index in which they had identified in red highlighting the documents that the ACCC considered could be removed from the Court's copy of the Court Book. However, it was also indicated that Meriton considered that certain additional documents should be retained in the Court's version of the Court Book. Subsequently, by email of the same date, Meriton identified the documents that it considered should be included in evidence "as they either complete the included tabs or because reference was made to these documents in the evidence either explicitly or implicitly". The relevant tab numbers in the Court Book were: 15, 19, 27, 61, 76, 86, 92, 113, 121, 123, 132, 138, 148, 151, 154 and 155. (Tab 142 is not included in this list as it went into evidence by agreement between the parties.) Given the difference of position between the parties, I made orders for each party to file and serve a short submission regarding: whether Meriton should be granted leave to re-open its case to tender the documents set out in Meriton's email dated 29 June 2017; and, if so, whether the documents should be admitted into evidence. Having considered the submissions filed by the parties, I consider that each of these documents should be admitted into evidence (as a new exhibit, namely exhibit R14) on the basis that they were included in the ACCC's tender bundle and there was perhaps some ambiguity during the trial as to whether such documents would go into evidence if Meriton wanted to rely on them (even if the ACCC did not). To the extent that leave to re-open is required, I would grant that leave. However, in circumstances where there was no witness evidence about these documents, the weight to be given to them may be limited. I also note that none of these documents was referred to in the submissions. 39 The second issue concerns a number of reports obtained by Meriton from a subscription service known as "TrustYou" (the TrustYou Reports). TrustYou is a service that collects and analyses guest reviews of accommodation on the internet. During the trial, objection was taken by the ACCC, on the ground of hearsay, to the admission into evidence of the TrustYou Reports. Meriton contended that the reports should be admitted under the business records exception to the hearsay rule in s 69 of the Evidence Act 1995 (Cth). This was contested. In the circumstances, for practical reasons, so as not to hold up the trial, I provisionally admitted the TrustYou Reports, and the evidence based on those reports, and said that I would reach a final view as to admissibility and weight in the judgment. The ACCC subsequently indicated, in the course of closing submissions, that it sought the exclusion of the evidence under s 135 of the Evidence Act. 40 In relation to the TrustYou Reports, which are annexures CN-4 and CN-5 to Ms Nazha's second affidavit, Ms Nazha gave the following evidence (which I accept): (a) In her second affidavit, Ms Nazha stated that Meriton is a "subscriber to a computer system which is a feedback platform known as 'TrustYou'", and that TrustYou collects and analyses guest reviews, surveys and social posts from all across the web every week and provides subscribers with access to a program that allows the subscriber to view data analytics that "provide feedback as to what guests are saying in relation to the subscriber's hotel". She stated that: the person who originally subscribed to TrustYou on behalf of Meriton was Codie Beard; although Mr Beard is no longer working at Meriton, his Meriton email address was still used to log in to the system; and as a result, reports generated on Meriton's account state that they were "[g]enerated by Codie Beard" (when in fact this was not the case). (b) Ms Nazha stated in that affidavit that, on 3 May 2017, she caused a search to be made on Meriton's TrustYou account for a report (referred to as a "dashboard") on guest feedback across the web throughout the period November 2014 to October 2015 in relation to six particular Meriton serviced apartment properties, namely those located at: Bondi Junction; Campbell Street, Sydney; Danks Street, Waterloo; Parramatta; Pitt Street, Sydney; and World Tower. She stated that a report was generated and printed by her in relation to each individual property (being the reports comprising annexure CN-4). In cross-examination, Ms Nazha said that a dashboard was a collation of the online guest feedback that Meriton had received, including performance scores, and that it was a combination of material from Booking.com, TripAdvisor, Facebook, and "basically anything online that has our feedback on it". She said that she exported the property dashboards for each of the hotels identified in her affidavit, printed them, and gave them to Meriton's in-house counsel. Ms Nazha said that she did this at the request of Meriton's in-house counsel, and that they asked her to do it "[f]or the court case" (which I take to be a reference to this proceeding). (c) Ms Nazha stated in her second affidavit that, on 10 May 2017, she caused a further search to be made on Meriton's TrustYou account, in order to generate a report on guest feedback across the web throughout the period November 2014 to October 2015 in relation to the Meriton serviced apartment at Kent Street, Sydney. This report was annexure CN-5 to her affidavit. (d) Ms Nazha said in cross-examination that she first heard of TrustYou in early 2016. 41 The documents that comprise annexures CN-4 and CN-5 to Ms Nazha's second affidavit also appear under tab 10 of the documents accompanying Mr Emmins's first report. In this report, Mr Emmins stated that he was familiar with TrustYou and that it was an industry standard 'big data' source that provides analytical information to hotel businesses on the online reviews of hotels that are published on multiple websites. He stated that he regarded the data from TrustYou as being "accurate, expert and reliable". Mr Emmins was not challenged on this evidence, and Professor Malthouse (who made comments about the TrustYou Reports in his second report) did not suggest otherwise. I therefore accept this evidence of Mr Emmins regarding TrustYou. 42 It is relevant to note the way in which Meriton seeks to rely on the TrustYou Reports. The reports were relied on by Mr Emmins in sections 8, 9, 10 and 11 of his first report essentially to support the proposition that there was significant consistency during the relevant period between the volume of reviews posted, and the ratings, on Booking.com and the TripAdvisor website in relation to three properties at or about the times of certain major service disruptions referred to in the concise statement. Mr Emmins expressed the opinion that, given that there could have been no interference with the Booking.com results (in the sense of the masking practices alleged by the ACCC), this indicates that the actions by Meriton employees did not discernibly affect review volume or ratings. Mr Emmins relied on the TrustYou dashboard reports for Meriton's Bondi Junction, Kent Street and Pitt Street properties. There is a dashboard report for each of these properties. Mr Emmins principally relied on information contained on the first and second pages of each report. These pages contain two graphs: (a) The first graph, headed "Overall score", provided a score for the particular Meriton property on Booking.com, TripAdvisor and other websites over the period of time covered by the report (the Overall Score Graph). For example, the score for Meriton's Bondi Junction on TripAdvisor was about 90 for most of the period covered by the dashboard report. The evidence does not explain how the score was derived, but it appears open to infer (and I will proceed on the basis that) it is simply the rating on TripAdvisor converted to a score out of 100. Thus a rating of 4.5 out of 5 stars on TripAdvisor appears to have been converted to a score of 90. I note that in his second report, Professor Malthouse proceeded on the basis that the score reflected the rating. It is unclear whether the score is an average of the rating over a period of time (eg, for a month). (b) The second graph, headed "New reviews", dealt with the number of new reviews of the particular Meriton property, apparently on a month-by-month basis (see Professor Malthouse's second report at [2.4]), on Booking.com, TripAdvisor and other websites (the New Reviews Graph). Although it is a little difficult, given the small size of the graph, to ascertain a precise number for each month on each website, the graph indicates, at least approximately, the number of new reviews of the property per month on each website. 43 Section 59(1) of the Evidence Act provides that evidence of a previous representation made by a person is not admissible to prove the existence of a fact that it can reasonably be supposed that the person intended to assert by the representation. Such a fact is, in Part 3.2 of the Act, referred to as an "asserted fact": s 59(2). The expression "previous representation" is defined in the Dictionary for the Act as meaning a representation made otherwise than in the course of giving evidence in the proceeding in which evidence of the representation is sought to be adduced. The expression "representation" is in turn defined in the Dictionary as including (among other things) an express or implied representation (whether oral or in writing). Section 59 is considered not to apply to machine-generated information in respect of which there is no human input on the basis that it refers to a representation "made by a person": see Odgers S, Uniform Evidence Law (12th ed, Thomson Reuters, 2016), [EA.59.150]; Heydon JD, Cross on Evidence (10th Aust ed, Lexis Nexis Butterworths, 2015), [35560]. 44 There are a number of exceptions to the hearsay rule, including the business records exception in s 69 of the Evidence Act. Section 69 relevantly provides as follows: (1) This section applies to a document that: (a) either: (i) is or forms part of the records belonging to or kept by a person, body or organisation in the course of, or for the purposes of, a business; or (ii) at any time was or formed part of such a record; and (b) contains a previous representation made or recorded in the document in the course of, or for the purposes of, the business. (2) The hearsay rule does not apply to the document (so far as it contains the representation) if the representation was made: (a) by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact; or (b) on the basis of information directly or indirectly supplied by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact. (3) Subsection (2) does not apply if the representation: (a) was prepared or obtained for the purpose of conducting, or for or in contemplation of or in connection with, an Australian or overseas proceeding; or (b) was made in connection with an investigation relating or leading to a criminal proceeding. 45 In Roach v Page (No 27) [2003] NSWSC 1046, Sperling J said at [11]: "The thinking behind the section is clear enough. Things recorded or communicated in the course of the business and constituting or concerning business activities are likely to be correct. There is good reason for the courts to afford to such records the same kind of reliability as those engaged in business operations customarily do." The word "kept" in s 69(1)(a) has been construed as meaning "retained or held": see Australian Securities and Investments Commission v Rich (2005) 216 ALR 320 at [190]. In relation to s 69(1)(b), a representation may be made or recorded in a document for the purposes of a business, even though it is not made by an officer of the business: Australian Competition and Consumer Commission v Air New Zealand Ltd (No 1) (2012) 207 FCR 448 at [45]-[50]. In relation to s 69(3), it has been observed that it is an unusual use of language to refer to the "preparing" of a representation, but the intention is clear enough; the reference is to the person who prepared, formulated, shaped or framed the terms in which the representation was made; and this will typically, perhaps always, be or include the maker of the representation: Australian Competition and Consumer Commission v Advanced Medical Institute Pty Ltd (2005) 147 FCR 235 at [25]. Further, the person who "obtains" the representation is the person who seeks the representation or procures it to be made: Australian Competition and Consumer Commission v Advanced Medical Institute Pty Ltd at [26]-[27]. 46 Section 135 of the Evidence Act provides that the Court may refuse to admit evidence if its probative value is substantially outweighed by the danger that the evidence might: be unfairly prejudicial to a party; be misleading or confusing; or cause or result in undue waste of time. 47 Before addressing directly the application of these provisions, I make some further observations about the TrustYou Reports. There is no evidence about how TrustYou derived the figures that appear in the Overall Score Graph and the New Reviews Graph in each dashboard report. In all likelihood, a computer was utilised to obtain the relevant information from the internet, and an algorithm was used to determine the scores and the number of new reviews. Apart from programming the relevant software, there may have been no or very little human involvement in this process. Based on the way in which Mr Emmins relied on the TrustYou Reports, it would seem that the following facts are sought to be established: first, that the scores for the particular property on Booking.com and TripAdvisor during the period covered by the dashboard report were as set out in the Overall Score Graph; and, secondly, that the number of new reviews for the particular property on Booking.com and TripAdvisor for each month covered by the report were as set out in the New Reviews Graph. 48 It may be observed that the information in these graphs is quite rudimentary. It is merely the score for the property on Booking.com and TripAdvisor (among other online sites) over a period of time, and the number of new reviews of the property posted on the websites each month. It may also be observed that the information is closely concerned with the conduct of Meriton's business. It is information of a type that could have been collected by a member of Meriton's staff during the period covered by the report. Instead, as is no doubt increasingly common these days, Meriton subscribed (for a fee) to a service that collected the information and made it available to Meriton. Although on this occasion Ms Nazha accessed the TrustYou database and exported information for the period November 2014 to October 2015, it would have been open to Meriton to have accessed the database and exported comparable reports on a regular basis during the relevant period (and it may have done so). 49 With these matters in mind, I turn to the legislative provisions. Although there is no real issue between the parties that the TrustYou Reports contain hearsay representations within the meaning of s 59, it is necessary to examine briefly why this is the case. As discussed above, in all likelihood there was significant computer involvement in the collection of the data and generation of information in the two graphs. Nevertheless, there was at least some human input by way of guests posting reviews (including with their star rating of the property): see, by analogy, Hansen Beverage Co v Bickfords (Australia) Pty Ltd (2008) 75 IPR 505; [2008] FCA 406 at [125] (although reversed on appeal, this does not affect the reasoning on this issue). Underlying the data in the graphs are previous representations by guests that they: had reviewed the property; and gave the property a particular rating. On this basis, the material in the graphs is prima facie inadmissible under the hearsay rule. 50 The question then is whether the TrustYou Reports fall within the business records exception in s 69. The TrustYou Reports were created by Ms Nazha accessing the subscription service and creating and exporting the reports. Given that each of the reports contained information concerning Meriton's business, it may be inferred that they were retained by Meriton as part of the records of its business. In my view, each report forms part of the records kept by Meriton in the course of and for the purposes of its business. Accordingly, I consider the requirements of s 69(1)(a) to be satisfied. Section 69(1)(b) requires that the document "contains a previous representation made or recorded in the document in the course of, or for the purposes of, the business". I consider that the previous representations (as identified in [49] above) were recorded in the reports for the purposes of Meriton's business. Accordingly, the requirements of s 69(1)(b) are satisfied. 51 Section 69(2) provides that the hearsay rule does not apply to the document if the representation was made: (a) by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact; or (b) on the basis of information directly or indirectly supplied by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact. Here, the previous representations (as identified in [49] above) were made by the guests of Meriton's properties, who had personal knowledge of the asserted facts. Accordingly, s 69(2) is satisfied. 52 Section 69(3) provides that subsection (2) does not apply if the representation was prepared or obtained for the purpose of conducting, or for or in contemplation of or in connection with, an Australian proceeding. Importantly, the focus here is on the representation rather than the document. Although it is true that the TrustYou dashboard reports were created and exported by Ms Nazha for and in connection with an Australian proceeding (being this proceeding), the representations (as identified in [49] above) were not prepared or obtained for or in connection with the proceeding. They were obtained by TrustYou in advance of, and not in connection with, this proceeding. 53 For these reasons, I consider the TrustYou Reports to be admissible as business records pursuant to s 69. 54 It remains to consider s 135. As indicated above, I accept the unchallenged evidence that the data from TrustYou is "accurate, expert and reliable". I have described, above, the nature of the material relied on by Mr Emmins in the TrustYou Reports. It is principally the information contained in the Overall Score Graph and the New Reviews Graph in the dashboards reports for the three properties he examines. While there are a number of difficulties with drawing conclusions from this data (as described in Professor Malthouse's second report and discussed below), I consider these to be matters going to weight and to the evaluation of Mr Emmins's opinions rather than admissibility. Taking these matters into account, I do not consider the probative value of the evidence to be substantially outweighed by the danger that the evidence might: be unfairly prejudicial to the ACCC; be misleading or confusing; or cause or result in undue waste of time. Accordingly, I do not exclude the evidence under s 135. It follows that I admit into evidence the TrustYou Reports and the evidence based on those reports.

Findings of fact 55 The following findings of fact are based on the affidavit evidence, oral evidence and documents admitted into evidence. I will deal separately, later in these reasons, with the question whether the impugned conduct had the effect alleged by the ACCC in [20] of the concise statement.

Meriton 56 During the relevant period, Meriton carried on a business of providing serviced apartment accommodation at (at least) 13 properties in New South Wales and Queensland. The expressions "serviced apartments" and "hotels" were used interchangeably in the evidence to describe the accommodation provided by Meriton at the properties, and I will similarly use the expressions interchangeably in these reasons. 57 Star Ratings Australia, an independent assessor that rates accommodation providers (hotels, motels, serviced apartments, caravan parks, etc) and provides accredited star ratings, assessed the Meriton properties in 2014. The evidence includes the assessment reports provided by Star Ratings Australia. For example, Meriton's Broadbeach property was assessed as four stars (out of five). It is important to emphasise that the stars used in these assessment reports represent an independent assessment of the property against objective criteria. This is to be distinguished from the circles or bubbles (which I am referring to for ease of expression as 'stars') on the TripAdvisor website. In the latter case, the rating is produced by a TripAdvisor algorithm, based on customers' online reviews of the property. 58 Mr Chan referred in his affidavit to the following Meriton properties that are identified in the concise statement: (a) Bondi Junction; (b) World Tower; (c) Kent Street; (d) Danks Street; (e) Campbell Street; (f) Pitt Street; (g) Broadbeach; and (h) Parramatta. 59 Mr Chan stated in his affidavit that, during the relevant period, the nature, characteristics and suitability for purpose of each of these properties did not deteriorate in any substantial or material respect. 60 Ms Nazha annexed to her second affidavit a document created from the business records of Meriton that identified how many reservations were made during the 2015 year and the method or channel by which they were made (eg, TripAdvisor, Meriton's direct website, Expedia.com, Booking.com, etc). This table indicates the scale of Meriton's business and the relative proportions of bookings made through different methods. For example, during the 2015 year, approximately 306,000 reservations were made. Of these, 94,315 were made through Meriton's brand website and 138,977 were made through Booking.com.

The TripAdvisor website 61 TripAdvisor conducts an online travel site that assists consumers to choose (among other things) accommodation. Mr Chan accepted in cross-examination that the following statement reflected Meriton's opinion about TripAdvisor: "It's the world's largest travel site, helping millions of visitors every month plan the perfect trip". 62 The TripAdvisor website includes a page for each property, a rating for the property (out of five, including half stars), a ranking for the property (compared against all properties of the same type) in the geographical area, and reviews of the property (with the most recent reviews generally appearing first). Reviews include the reviewer's rating for the property out of five stars (not including half stars). It appears that the reviewer has the option to rate the property, not only overall, but also with respect to particular aspects such as value, location, room quality and cleanliness. The reviews initially appear with only about four lines of text visible. The reviews can be 'expanded' (by clicking on "More") to show the full text of each review. The reviews in evidence have a notation at the end to the following effect: "This review is the subjective opinion of a TripAdvisor member and not of TripAdvisor LLC." 63 The evidence does not include a detailed description of the algorithms used by TripAdvisor to determine the rating and ranking of a property. However, an indication of the matters taken into account by the property ranking algorithm during the relevant period is provided by the following extracts from the TripAdvisor website, explaining a change to the algorithm made in early 2016. 64 The Frequently Asked Questions section of the TripAdvisor website, under the heading "Changes to the TripAdvisor Popularity Ranking Algorithm", included the following statements: Why We Changed the Popularity Ranking Algorithm Over the past decade, the volume of reviews and opinions on TripAdvisor has increased exponentially - from six million in 2006 to over 350 million in 2016. Today, travellers are adding 200 new contributions to the site every minute. Due to the speed at which travellers are sharing their experiences on TripAdvisor, we found instances where a newly listed property was able to skyrocket to the top of the rankings on relatively few 5-bubble reviews. We called these properties "fast-risers". Over time, TripAdvisor travellers would submit more reviews on the fast-risers, causing them to settle into more stable, accurate rankings. Unfortunately, while this transition was happening, TripAdvisor consumers may not have been seeing the most accurate rankings for the destination. Fast-risers would temporarily enjoy higher positions before falling significantly in the rankings, and other businesses would appear lower than they would have otherwise. To improve our site experience for travellers and businesses alike, we've enhanced our Popularity Ranking algorithm. The enhanced ranking results in a more accurate representation of a business's performance over time. These changes were not undertaken lightly and were carefully designed and tested to improve our rankings algorithm in some very specific ways, while maintaining the accurate standings of existing properties with great reputations among TripAdvisor members. … How the Enhanced Popularity Ranking Algorithm Works Our goal was to design an enhanced algorithm where a property settles into a stable ranking more quickly and avoids the fast-riser behaviour. The Popularity Ranking continues to be based on the quality, recency and quantity of reviews that a business receives from travellers. … Quality The bubble ratings provided by travellers as part of their reviews continue to be used to rank properties. All other things being equal, a property with more 4- and 5-bubble ratings will rank higher than a business with lower bubble ratings. Recency We believe that recent reviews are more valuable to our travellers than older reviews. They give a more accurate representation of the current experience at the property. To take this into account, we continue to give more consideration to fresh reviews over those that were written in the past. This means that reviews - even excellent ones - that are more dated will not count as much towards a property's ranking as a review written last week. Even though these reviews do not have as much weight in the ranking, they are still visible to travellers in the Traveller Rating bar chart, in the overall bubble rating on each listing as well as in the review history. Quantity The number of reviews is a critical indicator to TripAdvisor travellers about a property. TripAdvisor consumers read multiple reviews to help form a balanced opinion on a business and tend to have more confidence in their decisions when they see agreement across a large set of fellow travellers' reviews. … (Emphasis added.) 65 On the basis of the above description, it is to be inferred that, even before this change, and during the relevant period, the property ranking algorithm took into account the quality of reviews, the recency of reviews and the quantity of reviews in ranking properties in a particular geographical area. Although there was a change to the algorithm, the above extract (and in particular the emphasised words) indicates that these matters were already taken into account before the change. Although the evidence does not contain a description of the rating algorithm, I would infer that similar matters were taken into account in rating a property (that is, that the rating of properties was also based on the quality of the reviews, the recency of reviews and the quantity of reviews).

Descriptions of Meriton properties on the TripAdvisor website 66 Meriton provided descriptions of each of its properties to TripAdvisor for inclusion on the TripAdvisor website. During the relevant period, these descriptions were available for view on the website. Screenshots of these descriptions were annexed to Mr Chan's affidavit. Mr Chan stated in the affidavit that, based on his own personal experience and observations of each of the properties, the descriptions of these properties were accurate and fair descriptions of the nature, characteristics and suitability of the properties during the relevant period.

Review Express 67 Central to this case is the service provided by TripAdvisor to accommodation providers known as Review Express. During the relevant period, the TripAdvisor website included a page headed "The complete Review Express guide". This page included the following explanation of Review Express: Looking for an easy way to get more reviews for your business? Try Review Express - the review collection tool that TripAdvisor created based on feedback from hospitality businesses like yours. It's free for all types of properties, i.e. no Business Listings subscription or TripConnect™ campaign required. With Review Express, you'll create and send professional-looking e-mails that encourage guests to write reviews of your business. These e-mails can be customised with your property's branding. There's also a Review Express dashboard that provides in-depth analysis and tracking to help you fully optimise your campaigns. On average, regular Review Express users see an uplift of 33% in the amount of TripAdvisor reviews for their property. Read on to learn how easy it is to start using Review Express for your business. … Send E-mail In this step, add the e-mail addresses of the guests you'd like to reach. Have just a few addresses? Type them into the text box. If you have lots of e-mails to send, upload a spreadsheet of up to 1,000 e-mail addresses using the file upload box. Review Express will accept .CSV or .XLS files up to 5MB in size. If you're sending e-mails to guests in different languages, be sure to set up a new message and upload just those addresses for that campaign. Keep in mind, TripAdvisor takes fraud and privacy very seriously. The addresses you submit must belong to people who have visited your property and you must have permission to e-mail them. You cannot have a personal relationship with any of the recipients and they cannot be offered any incentives for reviews. Finally, avoid selectively e-mailing only the guests you believe will write positive reviews. Review Express e-mails should be consistently sent to all guests - properties are often happily surprised by the results. Once you've added your recipients, review and click the three notices at the bottom of the page. Then, hit "Send". Your e-mails will be sent within 24 hours. Reviews that you receive through Review Express will have a label indicating they were collected in partnership with your property. … (Emphasis added.) 68 As indicated in the last sentence of the above extract, reviews posted through Review Express have a label indicating that they were collected in partnership with the property. There are many examples in evidence of reviews that include the sentence, near the bottom of the review, "Review collected in partnership with this hotel". It was common ground that this notation appears when a review was posted following an email invitation through Review Express. Immediately after this notation, an information symbol appears. If the consumer clicks on that symbol, the following statement appears: "This business uses tools provided by TripAdvisor (or one of its official Review Collection Partners) to encourage and collect guest reviews, including this one". 69 During the relevant period, the TripAdvisor website included a page (located within the Help Centre) addressing the question: "What is considered fraud?" This page stated as follows: Visitors to TripAdvisor have the expectation that the site will provide them with unbiased reviews and content for accommodations, attractions, restaurants and other venues. Travellers who wish to share their personal experiences with the TripAdvisor community provide this content. TripAdvisor is committed to ensuring the integrity of the content it collects and provides to its global community of travellers and businesses. Any attempts to mislead, influence or impersonate a traveller is considered fraudulent, and is subject to penalties. This may include but is not limited to: - Attempts by an owner or agent of a property to boost the reputation of a business by: • Writing a review for their own business, or for any property the reviewing party owns, manages, or has a financial interest in. • Utilising any optimisation company, marketing organisation, or third party to submit reviews. • Impersonating a competitor or a guest. • Offering incentives in exchange for reviews, including discounts, upgrades or any special treatment. • Asking friends or relatives to write positive reviews. • Submitting reviews on behalf of guests. • Copying comment cards and submitting them as traveller reviews. • Selectively soliciting reviews (by e-mail, surveys or any other means) only from guests who have had a positive experience. • Pressuring travellers to remove a negative review on TripAdvisor. • Asking guests to remove their reviews in return for a discount or incentive. • Prohibiting or discouraging guests from posting negative or critical reviews of their experience. … (Emphasis added.) 70 Further, during the relevant period, the TripAdvisor website included a page headed "9 common Review Express concerns". The ninth of these dealt with selectivity: Can I be selective and only send Review Express emails to guests who are likely to write positive reviews? You should ask all guests for permission to email them, and send Review Express emails to everyone who consents. Selectively emailing guests who are most likely to write positive reviews is considered a fraudulent practice and may result in penalties for your property. For more information, click here. Keep in mind - properties are often surprised by the amount of positive feedback they receive … after all, the average TripAdvisor review rating is 4.12 bubbles out of 5. (Emphasis added.)

Meriton's participation in Review Express 71 It appears from the document discussed in the next paragraph below, that Meriton commenced its participation in Review Express in about August 2013. 72 In November 2014, TripAdvisor provided Meriton with a presentation on the performance of Review Express to date. This took the form of a PowerPoint presentation. The "Executive Summary" page stated: Meriton has had a massive benefit from instituting a formal review collection program • 65% more reviews per property per month • 90% of properties saw overall rating • 67% saw increase in overall ranking → 5 are #1 in their GEO • 60% increase in page views per property per month (Errors in original.) 73 The next page of the presentation was headed "Summary Activity to Date" and included figures for such matters as the total number of email invitations sent for each property, the "Click-Thru Rate" (which would appear to refer to the recipient clicking on the hyperlink in the email invitation), the number of reviews left through Review Express, the rank of the property at the start of the period (probably referring to the introduction of Review Express) and the rank at the end of the period (probably, about October 2014). In a number of cases, the rank had improved significantly. For example, Meriton World Tower had gone from a rank of "7 out of 188" to a rank of "3 out of 183". The rank of each of the 13 Meriton properties identified in the presentation at the end of the period was as follows: (a) Bondi Junction - 1 out of 9; (b) World Tower - 3 out of 183; (c) Pitt Street - 13 out of 183; (d) Parramatta - 1 out of 10; (e) Waterloo - 14 out of 183; (f) Kent Street - 10 out of 183; (g) Broadbeach - 2 out of 22; (h) Southport - 1 out of 4; (i) Campbell Street - 2 out of 183; (j) Brisbane on Adelaide Street - 3 out of 160; (k) Zetland, Sydney - 9 out of 183; (l) Brisbane on Herschel Street - 1 out of 160; and (m) North Ryde - 1 out of 6. 74 A slide headed "Program has delivered more reviews, at higher average ratings" indicates that the program launch (probably when Meriton started using Review Express) was in August 2013. The next slide, headed "Properties are generating on average more reviews per month due to Review Express", indicates that there were (on average) 23 reviews per month before and 55 reviews per month after. I take it that these statements refer to before and after Meriton started using Review Express. It is to be inferred that participation in Review Express substantially increased the number of reviews on TripAdvisor of Meriton's properties. 75 During the relevant period, Meriton provided (or uploaded) email addresses to TripAdvisor for Review Express on a regular basis, approximately weekly.

Reviews of Meriton properties on TripAdvisor 76 Ms Nazha gave evidence (which I accept) that, during the relevant period, approximately 30 new reviews a day were posted on TripAdvisor in respect of the Meriton serviced apartments or hotels. 77 Mr Chan gave evidence (which I accept) that, from about October 2014 to October 2015, Meriton received approximately 52,000 online guest reviews in relation to its properties, and that TripAdvisor reviews accounted for 20% of these. On the basis of these figures, it seems that, from October 2014 to October 2015, Meriton received approximately 10,000 TripAdvisor reviews. 78 Mr Chan also gave evidence, which I accept, that the TripAdvisor reviews during that period had a reputation index of 92.8%. He explained that a reputation index is a percentage rating compiled by "ReviewPro" (a commercial service) by a formula that analyses each review on TripAdvisor to summarise the effect of those reviews. Mr Chan said that he knew from his own observations that a reputation index from ReviewPro of 92.8% indicated a very high level of positive reviews. 79 Ms Nazha said in her first affidavit that: in her role as Administration Co-ordinator (subsequently, Service Ambassador) her responsibility was primarily to deal with customer feedback; and a large part of that feedback was received through online reviews, such as on the TripAdvisor website. Ms Nazha said that each morning she would log in to the business listing screen for Meriton on the TripAdvisor website and log the number of reviews received and the number of reviews yet to be responded to. She said that she would identify any negative reviews (which Ms Nazha said during cross-examination was a one, two or three-star review (out of five)), or any negative comments in positive reviews (ie, four or five-star reviews), and put the following procedure into effect. First, she would forward the negative review or the negative comment to the hotel manager of the relevant property and ask the manager to investigate the issues and seek to identify the relevant booking (ie, the guest) using internal clues within the review. She did this because part of her task was to respond to reviews via the TripAdvisor site. Next, Ms Nazha would ask the manager to investigate the cause of the complaint and respond to her. Ms Nazha stated that there is a facility for a hotel to respond to any review on TripAdvisor by posting a comment below the review. She stated that her invariable practice was to respond to every review of a Meriton property on TripAdvisor (this applied both to positive and negative reviews). Ms Nazha said during cross-examination that she did not herself contact guests directly (ie, by email or phone); this was something done by the hotel manager. Ms Nazha stated that when the hotel manager had spoken to a guest who had left a negative review, or made a negative comment in a positive review, the manager would report back to her and she would treat the matter as closed. I accept Ms Nazha's evidence as set out in this paragraph. 80 The evidence includes a number of cases where Meriton (usually the hotel manager) contacted a guest who had left a negative review. In some of these cases the guest was offered compensation to address a matter about which they had complained in the review. In some cases, the guest was asked to, and agreed to, amend or remove the review. 81 Ms Nazha prepared a weekly report on activity on TripAdvisor, using a template that was already established when she joined Meriton. The report set out, for each property, matters such as the ranking, the total number of reviews, the overall distribution of positive and negative reviews, and any negative comments received over the course of the past week. This report was provided to management. 82 Ms Nazha said during cross-examination that sometimes reviews posted on TripAdvisor would breach TripAdvisor's guidelines, for example if they were "hearsay". She said (and I accept) that she would dispute the review with TripAdvisor and, in some cases, it would remove the review. 83 During the relevant period, Meriton received awards from TripAdvisor, a matter that it publicised on its own website. The evidence includes a page from the Meriton website with the heading "Australia's Most Awarded Hotel Brand", the date 21 January 2015, and a large TripAdvisor logo. The following text appears: On Wednesday, six of Meriton Serviced Apartments' 13 locations were recognised in the annual Travellers' Choice awards from TripAdvisor, the world's number one guest-review website. For the 13th year, TripAdvisor has highlighted the world's top properties based on millions of traveller reviews. Meriton Serviced Apartments properties won six spots in Australia's Top 25 Hotels, and represent five of the South Pacific's Top 25 Hotels, with Meriton Serviced Apartments World Tower, Campbell Street, North Ryde, Brisbane on Herschel Street, Brisbane on Adelaide Street and Southport all getting the nod - making Meriton the most awarded hotel brand in Australia. … 84 Ms Nazha accepted during cross-examination that Meriton promoted itself by reference to the awards it had received from TripAdvisor.

The MSA-masking practice (up to August 2015) 85 Ms Nazha stated in her first affidavit that, when she joined Meriton (in May 2014), the company was already using Review Express to generate automatic emails to guests asking for their feedback. 86 Ms Nazha stated in that affidavit that, at the time she joined Meriton, it had an existing policy of sometimes adding the letters "MSA" to the beginning of the email address of some guests in Meriton's booking records, for various reasons, to prevent automatic emails being received by the person. During cross-examination, Ms Nazha stated that Mr Beard (the Marketing Manager at Meriton) had said to her that the normal practice was to place the letters "MSA" in front of the email address of any guest who complained. Ms Nazha agreed that the email masking practice had been introduced before she started working at Meriton, and was well under way at the time she commenced. I accept Ms Nazha's evidence as set out in this paragraph. 87 Ms Nazha stated in her first affidavit that, in her experience, the two most common reasons for adding the letters "MSA" were that the guest had complained, or that the guest was blacklisted, for example because he or she had been evicted from the hotel. However, in cross-examination, Ms Nazha accepted that overwhelmingly the most common reason for adding the letters "MSA" was because the guest had complained. Ms Nazha stated in her affidavit that she did see the letters added for other reasons, such as because the guest asked not to be contacted, but that these reasons were less common. I accept Ms Nazha's oral evidence in preference to her affidavit evidence on this matter. 88 Ms Nazha stated in her first affidavit that adding the letters "MSA" to the email addresses of guests who had complained "was common knowledge and practice across all management and front line staff". In cross-examination, she said that the task of putting the letters "MSA" in front of a guest's email address (so as to invalidate it) was that of front line employees, such as guest service agents, the managers on duty, indeed, everyone who was checking the guests in and out. I accept Ms Nazha's evidence as set out in this paragraph. 89 Ms Nazha indicated in her evidence during cross-examination that the MSA-masking practice was applied even in cases where a complaint had been resolved. She was asked why she considered it necessary to mask even where the issues had been resolved. She answered that she was "just following [her] instructions from [her] management team". I accept this evidence. 90 Ms Nazha stated in her affidavit, in the context of having instructed staff to add the letters "MSA" to email addresses, that her intention was to comply with Meriton's policy and "to reduce the likelihood that a review would appear that did not reflect the true quality of the service offered". While I consider that Ms Nazha's intention was to reduce the likelihood that a negative review would appear, I doubt that her thought process at the time included that such a review would not "reflect the true quality of the service offered". 91 Ms Nazha accepted during cross-examination that her understanding was that the "MSA-masking policy" and the "bulk suppression of email policy" existed "to prevent, so far as possible, these guests being invited by TripAdvisor through the Review Express process to submit reviews". She accepted that this was, to her knowledge, the understanding of everyone at Meriton. She said that the policies were not secret within Meriton. 92 On the basis of the evidence set out in [85]-[91] above, I find as follows. (a) From at least May 2014, Meriton adopted a practice of masking the email addresses of guests who complained. (b) The method of masking was to add the letters "MSA" to the beginning of a guest's email address, thus invalidating it. (As discussed below, the method changed in about September 2015.) While the letters "MSA" were added in some other cases, overwhelmingly the most common reason was because the guest had complained. (c) The practice was standard across the whole of the organisation. It was implemented by front line staff, ie, at the hotel level rather than at head office. (d) The practice was adopted on the instructions of management. (e) The effect of masking an email address by adding the letters "MSA" was that the email address was invalid. This meant that the guest would not receive an email invitation through Review Express to post a review on TripAdvisor. (f) Meriton's intention in adopting the practice was to reduce the likelihood of negative reviews being posted on TripAdvisor. 93 On 20 November 2014, Ms Nazha sent an email to all hotel managers in New South Wales, with the subject "Masking Emails", as follows: Hi Team, In order to ensure complaints are not carried onto TripAdvisor, I strongly recommend that each property add a 'Email MSA'd' column in their duty log spreadsheet as seen attached (this is just an example). Of course this won't eliminate negative reviews completely, but at least it will streamline masking guest bookings more effectively and capture all guests who have recorded a complaint. MSA Kent Street have recently implemented this showing great results with their reviews so I wanted to share it across all properties as well. Any questions please don't hesitate to ask. (Emphasis added.) 94 Ms Nazha accepted in cross-examination that by "great results with their reviews" she meant far fewer negative reviews. In re-examination, Ms Nazha said (and I accept) that this was based on her own observation rather than research. 95 Attached to that email was a template spreadsheet headed "Handover - Follow up", which included a column headed "Email MSA'd". Ms Nazha said during cross-examination (and I accept) that: she did not prepare this spreadsheet; she noticed that the hotel at Kent Street was using it; and she raised this matter with Mr Chan, who suggested that she send it to all the hotel managers. 96 In January 2015, Meriton updated its standard operating procedure for check out. This document expressly referred to the masking of email addresses, as the third of nine steps to be carried out by front line staff, in the following terms: Ask guest if they enjoyed their stay, if positive pass a Trip advisor feedback card to guest requesting them to post feedback online and if negative mask guest email by adding MSA to the beginning of guest email address and discuss concerns. (Emphasis added.) At the foot of this document, there is a space for staff members to sign. Above the space for the signature, the following statement appears: "I understand that should I not follow this standard correctly that disciplinary action will occur". 97 Ms Nazha said in cross-examination (and I accept) that although the masking procedure was well under way at the time she joined Meriton in May 2014, it was not in writing before January 2015. I take it from this evidence that the inclusion of the above statement in the standard operating procedure for check out, in January 2015, merely formalised what had already been the standard practice for some time, including the whole of the relevant period for the purposes of this proceeding. 98 Ms Nazha said during cross-examination that when she was checking Meriton's TripAdvisor reviews, and saw a review from Review Express, she would question why the email address had not been masked if the guest had reported the issue during their stay. Ms Nazha explained that she could tell if the review was from Review Express by the notation "Review collected in partnership with this hotel" at the bottom of the review. Ms Nazha said that she was told by Mr Chan, Mr Thomas and Mr Beard on numerous occasions that it was part of her job to follow up the failure to put the letters "MSA" in front of the guest's email address in such cases. I accept Ms Nazha's evidence as set out in this paragraph. 99 On 5 March 2015, the hotel manager for Kent Street sent an email to others at Meriton, copied to Ms Nazha, as follows: Hi team, Please be advised we have just received a new 3 star review this morning. I believe I have found the booking and the details are (booked via TA): … Christina can you please check this room, I believe it would still have the old carpet. Kareem & Eric, can you please try to contact the guest as there is an email on file, maybe they will amend the booking to a 4 star if we take their feedback on board … It doesn't look like they complained during their stay so this is why the booking wasn't masked. 100 Ms Nazha accepted during cross-examination that this was an example of Meriton endeavouring to improve the rating on a review. 101 On 9 April 2015, Ms Nazha sent an email relating to a three-star TripAdvisor review. It appears that the email was sent to the hotel manager. The email contains a copy of the review, which had the title "Location is good". Ms Nazha stated in her email: Good Morning, Please find below 3 star TA review. I trust you will investigate and advise before we proceed with responding. Also note that this is a review express review, it's a shame it wasn't masked as it could have been avoided. 102 Ms Nazha accepted in cross-examination that her preference, and that of Meriton, was that such reviews were not published at all. 103 On 11 April 2015, Kareem Mostafa (the Front Office Manager at Kent Street) emailed others at Meriton, copying in Ms Nazha, regarding a two-star review. The email identified the guest and concluded: "Eric can you make a call to the guest tomorrow and see if we can have it taken down". Later in the same email chain, the hotel manager for Kent Street sent an email to staff at the hotel, stating that "there [were] no notes in this booking about these complaints even though this guest contacted [the front desk] on a number of occasions". The email instructed: "Please ensure everyone is aware of the importance of updating notes and masking bookings for even the smallest issues" (emphasis added). Ms Nazha, in cross-examination, said (and I accept) that this was the policy of Meriton at the time. 104 In an email dated 28 August 2015, Rhys Adams, the hotel manager for Meriton's Bondi Junction apartments, sent an email to Ms Nazha, Mr Chan and others, with the subject line "1 Star TA Review-'Property AMAZING Service TERRIBLE'". The email was in response to an earlier email from Ms Nazha to Mr Adams, which attached a copy of the review and noted that the booking had not been masked. In the email in response, Mr Adams stated: "Staff have been advised that if they fail to msa a booking when they should have it will result in a warning" (emphasis added). During cross-examination, Ms Nazha was asked whether this was Meriton's policy where staff had failed to mask when it was necessary to do so. She responded that it was not a standard policy to give a staff member a warning, but that it was not her responsibility to comment on a matter such as this. 105 The internal Meriton email correspondence referred to in [93]-[104] above indicates that: Meriton closely monitored, on a daily basis, the reviews of its hotels posted on TripAdvisor; Meriton was very concerned about negative reviews; and (at least in some instances) Meriton considered that such reviews could have been avoided had the guest's email address been masked in accordance with the masking policy or practice. The email correspondence also indicates that Meriton was so concerned about negative reviews that staff were instructed to mask email addresses for "even the smallest issues" and that, at least at some hotels, staff who failed to mask an email address when they should have were given a warning. 106 There are no precise figures as to the number of times Meriton masked the email addresses of guests who complained during the relevant period. However, an indication of the extent of the practice is provided by a letter from Meriton to the ACCC dated 29 February 2016, in which Meriton stated that it had concluded that "there had been a higher than expected number of emails that had been 'masked'". Under Tab 4 to that letter was a list of all email addresses supplied to the TripAdvisor site between 1 April 2015 and 31 December 2015. In [27] of the updated schedule to the concise statement, the ACCC states that this list of email addresses includes the following instances of email addresses in which the letters "MSA" have been inserted: Meriton property Number of email addresses with the letters "MSA" inserted World Tower 644 Pitt Street 1,294 Kent Street 1,846 Campbell Street 1,199 Waterloo 1,466 Zetland 508 Bondi Junction 2,406 Parramatta 1,807 North Ryde 1,445 Broadbeach 1,033 Herschel Street 127 Southport 218 Adelaide Street 591 Total 14,584

107 During closing submissions, Meriton's senior counsel accepted that the figures set out in [27] of the updated schedule to the concise statement (ie, the figures set out above) accurately set out each instance when the letters "MSA" were added to an email address in the period in respect of which Meriton had been asked to provide details (T424-425) and I proceed on this basis. While the above figures include instances other than where the guest complained, on the basis of Ms Nazha's evidence, referred to above, it may be accepted that the overwhelming majority of these cases relate to guests who complained. 108 It should also be noted that the figures set out above are likely to significantly underestimate the instances of masking by the addition of the letters "MSA" because they do not cover the entire relevant period, but only the period from 1 April 2015. To the extent that the period included in Tab 4 extends beyond the relevant period, this is unlikely to significantly inflate the number of masked email addresses because: from about September 2015, the system of masking changed to the "TA Mask" field in Meriton's new property management system; and Meriton was not using Review Express for most of November and December 2015, as explained below.

The bulk withholding practice 109 On many occasions during the relevant period, Meriton withheld from TripAdvisor the email addresses of all guests who had stayed at a particular property during a period when there was a major service disruption (such as the lifts not working, there being no hot water, etc). I refer to this practice as the "bulk withholding practice" in these reasons. 110 The process by which this occurred was that the hotel manager would make a request to head office that the email addresses be withheld from Review Express, and the State Manager for New South Wales or Queensland (as the case may be) would decide whether or not to withhold the email addresses. Mr Chan was the State Manager for New South Wales. In the case of Queensland, this was Shayne Lucas. The request was usually made by the hotel manager emailing Ms Nazha. Ms Nazha would then ask the relevant State Manager for approval and let the hotel manager know the response. If the request was approved, Ms Nazha would implement the decision by withholding the relevant email addresses when next providing (or uploading) email addresses to TripAdvisor. 111 Ms Nazha accepted in cross-examination that the bulk suppression of emails was happening by October 2014. 112 Mr Chan said during cross-examination (and I accept) that a request to withhold email addresses was made approximately once a week and that he was directly involved in this process for New South Wales. 113 Mr Chan said in cross-examination that his approval of requests for the bulk withholding of emails was not a policy but "more of a mutual understanding" with the hotel managers or department heads at the respective properties. Ms Nazha in her evidence referred to the practice of blocking groups of email addresses as a "policy" of Meriton (eg, at [30] of her first affidavit). This label does not appear to be inapposite. 114 Mr Chan said in cross-examination that "on occasion" he declined a request for the withholding of email addresses. He was unable to refer to any documentary evidence that he declined a request, and was not taken to any such document in re-examination. I infer that, if there were occasions on which he declined a request, there were few such occasions. 115 Mr Chan accepted in cross-examination that the withholding of groups of email addresses took place when events occurred at the New South Wales properties that gave rise to a concern in Meriton's head office that an adverse review might be published on TripAdvisor as a result of that event. Mr Chan also accepted that the purpose of not sending the email requests was to lower the risk that adverse reviews might be published. 116 In his affidavit evidence, Mr Chan stated, in relation to the withholding of email addresses following the occurrence of events at a particular property, that hotel managers would request this on an ad hoc basis, where events had occurred that were "out of the ordinary and no fault of their own". In cross-examination, Mr Chan initially said that whether the hotel was at fault in relation to an event was "a factor during the decision process but it wasn't the only factor". However, Mr Chan then accepted that: it was false to suggest that he ever took into consideration whether or not it was the fault of the hotel; and he wanted to suppress negative reviews. In light of this evidence, and the evidence generally, I find that whether or not the hotel was at fault was not a factor in the decision as to whether to engage in the bulk withholding practice. 117 Mr Chan stated in his affidavit that his motivation for approving the requests to withhold email addresses (for all guests who stayed at a particular property during a particular time period) was "to ensure that the properties were not exposed to unrepresentative reviews which might be influenced by an exceptional temporary factor and did not properly reflect the true nature of the accommodation". In cross-examination, however, Mr Chan accepted that the so-called unrepresentative reviews: might be "entirely justified"; might be "entirely true"; and would not in any respect be false or misleading. 118 In her first affidavit, Ms Nazha stated that she took the steps to withhold groups of emails to comply with what was explained to her as Meriton's policy and because she "wanted to reduce misleading reviews that do not reflect the quality of the hotel". During cross-examination, Ms Nazha was asked to explain why such a review would be misleading. She said that the review "would have mentioned the major service disruption" but that, because this issue would have been resolved by the time the review was published on TripAdvisor, the review "wasn't a true representation of the product". I doubt that Ms Nazha's thought process at the time involved wanting "to reduce misleading reviews that do not reflect the quality of the hotel". This seems to me to be an explanation or rationalisation developed after the event. My impression, based on Ms Nazha's evidence as a whole, is that she implemented the practice or policy of blocking groups of email addresses because she was instructed to do so, and to reduce the likelihood of negative reviews appearing. 119 In his affidavit evidence, Mr Chan said that the characteristics, nature and suitability of each of the Meriton properties "remained the same … before and after the temporary event which triggered that decision", that is, the decision to withhold the email addresses of guests. During cross-examination, however, Mr Chan accepted that, during the temporary event that triggered the decision to withhold the email addresses, the characteristics, nature and suitability of the properties were "quite different to those characteristics, nature or suitability when things are working properly". 120 On the basis of the evidence set out in [111]-[119] above, I find that: (a) The bulk withholding practice was adopted by Meriton across all hotels and during the whole of the relevant period. (b) The practice was implemented at head office upon the request of the relevant hotel manager. (c) Requests to withhold email addresses were made approximately once a week, and most requests were acceded to. (d) The decision whether to withhold email addresses was made by the relevant State Manager. (e) Meriton's intention in adopting the practice was to reduce the likelihood of negative reviews being posted on TripAdvisor. 121 I will refer now to some examples of the bulk withholding practice, and other email correspondence regarding the practice. 122 On 27 April 2015, Nico McCombs (the hotel manager at Meriton's Bondi Junction property) sent the following email to Ms Nazha: Hi Carol, Please do not sent out any review requests for MSA BJ from 16/4 until 27/4. Phone lines were down during this time and many other issues such as no hot water overnight, lift down on Saturday, leaks etc. Many Thanks Nico 123 Ms Nazha responded that Review Express would be blocked off for two weeks for the Bondi Junction property. She said during cross-examination that Mr Chan made this decision and she was reporting his decision in this email. Subsequently, on 1 May 2015, Nico McCombs requested that the withholding of emails be extended until 1 May "due to not having water 2 nights in a row". 124 On 10 August 2015, Ms Nazha sent an email to all hotel managers (copied to Ms Adams and Mr Beard) with the subject line "Review Express". The email stated: Hi All, Just a reminder that we should only be requesting for review express emails to be blocked off during major issues only. Whilst I understand that receiving a negative review affects our ranking, not receiving reviews all together has a more detrimental impact on your properties CSI [Customer Service Index]. I trust you will reiterate this with your teams and ensure they are still masking emails where necessary. (Errors in original; bold emphasis in original; italics emphasis added.) In cross-examination, Ms Nazha was asked where she obtained the understanding that "receiving a negative review affects our ranking". She said that it was based on her observation of tracking reviews, as well as TripAdvisor's insights. She also said that the Customer Service Index was a score that TripAdvisor gave to Meriton. I accept Ms Nazha's evidence as set out in this paragraph. 125 Subsequently, in the same email chain, the hotel manager for Meriton's Pitt Street apartments, Sam Agha, emailed Ms Nazha to request that emails be "blocked off" for certain days: Hi Carol Could I please get the 10/08/15 blocked off as we had to evacuate Level 42 and fire brigade had to attend due to a gas line being damaged mistakenly by our Maintenance person at about 5pm. This caused natural gas to be released onto the floor. There was not hot water in the building for 2hours. We did MSA the bookings on the floor and any Guest that rang and said it effected them. I would like to do this just in case we get negative feedback. (Errors in original.) 126 On 12 August 2015, Ms Nazha emailed Ms Adams and Mr Agha stating: "I would block it off for guests who departed on Monday 10th and Tuesday 11th just in case." 127 The following table sets out the details of some of the instances of bulk withholding included in the evidence. The table sets out: the name of the property; the date of the event that caused the email addresses to be withheld; and the nature of the event that was the reason for withholding the email addresses. Property Date Event Broadbeach 11 April 2015 All lifts in the North Tower out of service on Saturday afternoon for 45 minutes (CB3036) Bondi Junction 16-29 April 2015 Phone lines were down and "many other issues", such as no hot water overnight, lift down on Saturday, leaks etc (CB3040-3041) Kent Street 1-8 June 2015 Lift delay (CB3077) Kent Street 15 June 2015 No hot water in the hotel (CB3083) Broadbeach 2 August 2015 Ongoing computer issues, which prevented a quick check-in and affected service for guests (CB3108) Pitt Street 10 August 2015 Had to evacuate level 42 and the fire brigade had to attend due to a gas line being damaged, which caused natural gas to be released onto the floor; there was no hot water in the building for two hours (CB3110-3111) Broadbeach 2-4 September 2015 Lost power and hot water for three hours on 2 September 2015; excessive construction noise with drilling concrete on site next door on 3 and 4 September 2015 (CB3159)

The MSA-masking practice (from September 2015) 128 In about September 2015, Meriton introduced a new property management system that included a field called "TA Mask". This enabled a new process to be used to mask emails. By inserting the letters "MSA" in this field, the email addresses of all the guests associated with a particular booking would automatically not be included in the email addresses exported to TripAdvisor as part of Review Express. 129 The new process for masking was explained in an email sent by Ms Nazha to all hotel managers on 2 September 2015. The subject of the email was "Masking Emails in Guest Centrix". Guest Centrix was the new central management and booking system being introduced by Meriton at this time. The email stated: Hi Team, For sites who have changed to the new PMS [Property Management System], we have noticed a discrepancy where the TA Mask Field has been left empty for emails that need to be masked. All emails that need to be masked must have MSA in the TA Mask field as per below. When placing MSA in the TA field, this masks all emails in the respective booking. Please note for data quality, refrain from placing 'msa' in front of the email. Nico and I have done a test email for a masked booking and the system works correctly. Also for your information I have noticed a trend in the following negative reviews that have not been masked: • Credit card surcharge fee • Aircon not working • Lost property • Rooms moves (especially due to internal or external noise complaints) • Wifi connection issues/limit • Room not ready • Key card not working Please reiterate to your teams that if the guest mentions any issue during their stay even if we have resolved it prior to check out, then still please mask the booking. If the guest did not report anything during their stay, we can still capture a masked email on check out when we ask them "How was your stay?" or "Did you enjoy your stay with us". (Bold emphasis in original; italics emphasis added.) 130 Ms Nazha said in her oral evidence (and I accept) that: her email described a change in the method used to mask email addresses; previously, it had been effected by adding the letters "MSA" to the front of the email address; at about this time, with the change to a new property management system, the method changed; her email included a screenshot from the new property management system, which showed a TA Mask field; the new method was to add the letters "MSA" to the TA Mask field for guests who complained, were blacklisted, or asked that marketing material not be permitted; and the effect of adding the letters to this field was that the customer's email address was not provided to TripAdvisor. 131 In cross-examination, Mr Chan accepted that, with the new property management system, Meriton could suppress emails without inserting the letters "MSA" into the email address, and that, as a result, a person receiving the email addresses "would not know, by observing all of these curious MSA letters in front of people's emails, that there had been any tampering with email addresses". He accepted that Meriton now had a system whereby it "could suppress the emails without anybody knowing about it". Mr Chan said (and I accept) that the TA Mask field was added "after the fact" to the property management system, in the sense that it was specifically developed for the purpose of masking emails. 132 On the basis of the evidence and facts and matters set out in [129]-[131] above, I find that, although the mechanism of masking changed in about September 2015 with the introduction of the new property management system, Meriton's practice or policy of masking email addresses was otherwise unchanged. 133 I will now refer to some examples of the MSA-masking practice after September 2015. 134 On 11 September 2015, Ms Nazha sent an email to Jason Sabin, the hotel manager for Campbell Street. In the email, Ms Nazha set out a copy of a one-star TripAdvisor review with the heading "Terrible hotel". Among other things, the review stated that the lifts did not work due to heavy rain and the hotel did not apologise. The review had the notation "Review collected in partnership with this hotel" at the bottom, indicating that it was posted through Review Express. Ms Nazha asked Mr Sabin to investigate. He responded within minutes: Hi Carol, We have found the guest already whom I will be contacting. We had gone through all the bookings that stayed on the day and masked them but [this] one obviously was missed. Tyson is going through all the reservations again to make sure all are masked. I will keep you posted with outcome with guest. Regards, Jason (Emphasis added.) The email indicates that the MSA-masking practice was used, not only in cases of guests who complained, but also in response to infrastructure problems. 135 Later in the email chain, Ms Adams followed up with Mr Sabin to see if he had received a response from the guest. Mr Sabin responded that he had emailed the guest but she had not yet responded, and he would try to contact her by phone overseas. Ms Adams responded that it was "definitely worth chasing to get a 1 Star 'edited' if possible". 136 On 24 September 2015, Ms Adams sent an email to Mr Sabin including a copy of a one-star review of Campbell Street. The title was "Said very clearly need 2 beds instead of one, offer only 1 bed on arrival". The review included the notation "Review collected in partnership with this hotel" at the bottom, indicating that it had been posted through Review Express. Ms Adams asked Mr Sabin to investigate: Morning Jason, Please investigate review and ID guest if possible. I'm sure there is more to this but it is disappointing that it was collected via Review Express. These 1 Star review hurt us, please remind staff the importance of masking guests with issues such as this. Thanks, Bel (Emphasis added.) 137 Mr Sabin responded to the effect that it was "[v]ery disappointing indeed", and that he would "follow up with my team re: masking guests". Later in the email chain, Mr Sabin sent an email to Ms Adams explaining how the issue regarding the guest's booking had arisen, that he had contacted the guest and apologised, and that "[t]hey have agreed to remove the review". Ms Adams responded: "Great work Jason!" She asked whether any "compo" (compensation) had been offered. Mr Sabin responded that he had agreed to refund the total stay. 138 On 25 September 2015, Katrina Ooms (a Guest Service Manager at Meriton) sent an email to Way They at Meriton with the subject "Masking emails". The email included a three-star review with the title "Hot water dribble". The review included the notation "Review collected in partnership with this hotel", indicating that it was posted through Review Express. The email stated: Please see below print screens and three star review. It is disappointing to see that with a bit more attention to detail and care, it looks like this review could have been prevented. The "MSA" should have been written under the TA Mask field. Please always take care with guests and any updating, especially when it comes to Trip Advisor. 139 The next email in the chain, from Tarryn Patterson, the hotel manager at Danks Street, Waterloo, to Ms Adams and Ms Nazha, stated that "it is a common issue here that HO [Head Office] is fully aware of. Water pressure and lack of hot water is due to the water system we have".

Matters regarding both practices 140 It was put to Ms Nazha during cross-examination that, in applying the masking policy, she was "driven by a desire to see the Meriton hotels move up the TripAdvisor rankings". Ms Nazha accepted that this was a reason, but said that it was not the primary reason. In re-examination, Ms Nazha was asked for the primary reason. She responded that she was instructed to do so, and that it was also "to reduce a negative impression on the hotel that was misleading". As indicated above, my impression based on Ms Nazha's evidence as a whole is that she implemented the MSA-masking practice and the bulk withholding practice because she was instructed to do so, and to reduce the likelihood of negative reviews appearing on TripAdvisor. 141 On the basis of the facts and matters set out above, I find that both the MSA-masking practice and the bulk withholding practice were engaged in deliberately and systematically throughout the relevant period.

October to December 2015 142 On 19 October 2015, Minesh Shah (Senior Director, Global Hotel Partnerships at TripAdvisor), who was located in the United Kingdom, sent an email to Mr Thomas and Mr Beard (copied to Grant Colquhoun of TripAdvisor) with the subject "Review Express Usage Anomalies". The email stated: Matthew / Codie I look after our Review Express Platform and Review Collection efforts for TripAdvisor globally. It has come to our attention that there may be certain systematic anomalies in usage of Review Express by your properties that may lead to Review Express being biased in terms of who receives the Review Express email, which is against the usage terms of TripAdvisor in soliciting reviews. As such, we have notified our Content Integrity teams, but I wanted to reach out [to] you to have a discussion and understand regarding your Review Express practices as well as discuss certain data anomalies we have seen. Can you please let me know some times that you are available for a meeting to discuss, preferably soon, as we may also eliminate access to Review Express until we have this conversation. 143 The above email was received during the evening of 19 October 2015 (Australian time). A short time later, Mr Thomas forwarded this email to Mr Beard, Mr Chan and Ms Nazha. Mr Thomas's email stated: My office tomorrow please at 11 to talk about this. This is the masking of emails. What I don't get [is] why they are not removed prior to uploading. Why have we become so lazy? Matthew (Emphasis added.) 144 Later that evening, Mr Thomas sent an email to Mr Shah as follows: Hi Minesh What anomalies? If you can let me know I can investigate with our teams who look after this. Thanks Matthew 145 Mr Shah responded a short time later (still during the evening of 19 October, Australian time) as follows: Hi Matthew, many thanks for your email. The hypothesis we have is that there have been alterations to email addresses submitted to Review Express for guests that were suspected of having had a bad experience at your properties to make these particular emails undeliverable. I can discuss this in further [detail] if we can set up a call. 146 Mr Thomas responded to this email at 7.20 am on 20 October 2015 (Australian time), as follows: Hi Minesh I'll look into and I'm meeting with Grant on Wednesday, so we can cover this with him. I know we choose not to send an invitation to review our properties to those guests who have been evicted or had official noise warnings given. We also exclude the student market that we offer accommodation long term at extremely low rates with no housekeeping. This is not our typical customer however we need to use our hotel PMS to store these booking and as such their email gets into the review express data pool. We also just change the hotel PMS system at all 14 hotels. (Errors in original.) 147 It is difficult to avoid the conclusion that this email was misleading, in light of Meriton's policies of masking emails and withholding them in bulk. Mr Chan accepted in cross-examination that to write back to TripAdvisor and not mention either of the two policies "could have been misleading". 148 Later in the morning of 20 October 2015, there was an exchange of emails between Mr Thomas, Mr Chan, Mr Beard and Ms Nazha, following on from the email from Mr Shah of 19 October 2015. In one email, Mr Thomas stated: "I think someone may of highlighted this to TA direct". Then, Mr Beard stated in an email: I have just check Bondi Junction in the backend of Review Express. The last email's sent with "MSA" were sent on 5 AUG 15. Since Guest Centrix has been introduced no "MSA" emails have been upload to TripAdvisor. (Errors in original.) 149 Mr Chan sent an email at 10.00 am that included the following: That was my understanding too with the new Guest Centrix PMS [Property Management System], no masked emails "MSA" are sent/exported. So no bounce backs for TripAdvisor to see. This leads to us thinking also that someone may have reported this to TripAdvisor. Maybe an ex-employee or an employee that has joined another hotel group has spilled the beans on how we mask emails. Mr Chan said in cross-examination that Meriton did not identify the person who "spilled the beans" with any certainty. 150 In cross-examination, Mr Chan said he was not sure whether the meeting scheduled for 11.00 am on 20 October 2015 took place. Mr Chan said during cross-examination (and I accept) that: he had a discussion with Mr Thomas early on the morning of 20 October; Mr Thomas "knew what this was all about" (ie, the masking of email addresses); and, during the conversation, Mr Chan agreed with Mr Thomas that Mr Shah's email probably had to do with masking and that a current or ex-employee might have shared "our policies with masking emails". 151 Ms Nazha said that Meriton ceased using Review Express on or about 20 October 2015, following receipt of the email from TripAdvisor notifying Meriton of the usage anomalies. Ms Nazha said in cross-examination (and I accept) that Mr Thomas told her to make sure that staff were not masking any more, and to stop using Review Express until further notice. 152 In October 2015, an Australian Broadcasting Corporation program went to air that raised issues about Meriton's practices in relation to TripAdvisor. Subsequently, on or about 28 October 2015, Meriton issued a press release headed "Meriton Group Statement". The statement included: Meriton were never told who made these allegations to the ABC last week or given ample opportunity to make comment to these claims. Matthew Thomas National Manager of Meriton Serviced Apartments said that "we would love to see this person and find out what his problem is. He has NO RIGHT to do this. This is one person who is blackmailing Meriton as well as killing the tourism industry that we are a leader in." This claimed "masking emails" terminology has been blown out of proportion. It is a policy designed to be used in "extreme" circumstances only. For example when a guest may abuse a staff member or simply does not choose to receive emails, or have abused the Meriton Serviced Apartments guest policies and have been evicted from their rooms. There would be no reason for these people to be sent an email with our newsletters and future promotions as well as requesting TripAdvisor feedback as they have done the wrong thing during their stay. … Meriton Serviced Apartments is a very large business with hundreds of employees. Like any business, occasionally you may get some employees who do not adhere to the strict company guidelines and may possibly want to "mask an email address" of someone who complained about them personally or some minor service issues such as not having enough towels in their room or the pool was not hot enough. This would be purely for personal benefit only and is not condoned here at Meriton Serviced Apartments. (Emphasis added.) 153 Mr Chan said in cross-examination that he was not aware of any blackmail threats. Mr Chan accepted in cross-examination that the statement did not mention Meriton's standard policy to suppress the email address of anyone who made a complaint. He also accepted that the statement did not mention the standard policy of the bulk suppression of the email addresses of all or most of the guests in a particular property if there was an adverse event. Mr Chan agreed that it was quite misleading not to mention those matters in connection with the policy described in Meriton's press release (in the penultimate paragraph set out above). In relation to the last paragraph set out above, Mr Chan accepted in cross-examination that it was "utterly misleading" to suggest that the suppression of email addresses was done other than in accordance with Meriton's actual company policy. 154 In late November 2015, Meriton resumed using Review Express. But, shortly thereafter, it was suspended from using Review Express by TripAdvisor. 155 Mr Chan accepted in cross-examination that this caused a problem for Meriton because it was not getting sufficient reviews on TripAdvisor, and it was very important for the business to have "plenty of reviews on TripAdvisor". 156 In December 2015, there was an exchange of correspondence between Mr Thomas and officers of the ACCC in relation to Meriton's use of TripAdvisor. On 2 December 2015, Mr Thomas sent an email to Ben Morawetz of the ACCC that included the following statement: Just so you are aware when the issues was raise to my office on 21st October 2015, we immediately stopped all use of the Review Express (powered by TripAdvisor) product. Our internal investigation found that it was obvious that over time, some staff had misunderstood or potentially (and purposely) abused the ability to exclude emails form the post-stay communication. This was always reserved for extreme cases. (Errors in original; emphasis added.) 157 The evidence in this case does not suggest that staff had "potentially (and purposely) abused" the ability to exclude emails from the post-stay communication. To the contrary, as Ms Nazha's evidence makes clear, the masking of the email addresses of guests who complained was company policy. So too (as Ms Nazha accepted in cross-examination) was it company policy to exclude all of the email addresses in respect of particular properties that had a major problem during a given period. Ms Nazha said that she was not aware of an internal investigation as referred to in the email, but she was in a different role at this time.

January 2016 158 On 18 January 2016, Ms Nazha sent an email to Mr Thomas and Mr Chan with the subject "Drop on TA". The email provided details of a drop in the ranking of several of the Meriton properties, as follows: (a) World Tower - drop to 5; (b) Pitt Street - drop to 16; (c) Kent Street - drop to 13; (d) Campbell Street - drop to 4; (e) Danks Street - drop to 17; (f) Zetland - drop to 8; and (g) Adelaide Street - drop to 3. 159 In the email, Ms Nazha provided explanations for each hotel's drop in ranking. In a number of instances, she cited the receipt of negative reviews as part of the explanation. Mr Chan accepted in cross-examination that the receipt of additional negative reviews was a factor in the decline in the rankings of these hotels. 160 In January 2016, while Meriton was not participating in Review Express, Ms Nazha prepared a template for an email that could be sent to guests inviting them to post a review on TripAdvisor. The template almost exactly replicated the text of the Review Express email that had been previously used by Meriton. I would infer that Meriton was concerned that its non-participation in Review Express was a problem for its business, because it was receiving fewer reviews on TripAdvisor. 161 Ms Nazha said in cross-examination (and I accept) that Meriton re-commenced using Review Express in March or April 2016.

The effect of the impugned practices 162 I now consider whether the ACCC has established that the impugned practices had the effect alleged in [20] of the concise statement (set out at [20] above). The issue is whether the MSA-masking practice and the bulk withholding practice had the effect, or likely effect, of reducing the number of recent negative reviews of the Meriton properties submitted to TripAdvisor and whether this: (a) improved, or was likely to improve, the relative number of favourable reviews compared to unfavourable reviews of Meriton properties that would have otherwise been posted; and/or (b) improved or maintained, or was likely to improve or maintain, TripAdvisor ratings or rankings of Meriton properties, and thereby created, or was likely to create, a more positive or favourable impression of the standard, quality of suitability of accommodation services provided by Meriton on consumers who used the TripAdvisor website to find suitable accommodation. 163 Before directly considering whether the impugned practices had the effect of reducing the number of negative reviews, I deal with some general and contextual matters: (a) It would seem to be uncontroversial, and in any event the evidence establishes, that participation in Review Express substantially increased the number of online reviews of Meriton properties posted on the TripAdvisor website. Professor Malthouse gave evidence in his first report that sending automated emails to customers would increase the number of reviews posted over what he called self-motivated reviews. He described a self-motivated reviewer as one who decides to write a review for a product or service without any prompting. He outlined some of the steps that a self-motivated reviewer may have to undertake, including finding the website (such as TripAdvisor), finding the relevant page on the website, and creating a log in. He accepted in cross-examination that some self-motivated reviewers would not need to undertake all these steps (eg, if they already had a TripAdvisor account). Nevertheless, the point made in his first report remains valid: "Email solicitations make the process of writing a review substantially simpler, since the consumer often only must click on a link in the email. This makes the process more frictionless and will increase the number of reviews." That participation in Review Express substantially increased the number of reviews of Meriton properties on TripAdvisor is also supported by the information about Review Express on the TripAdvisor website (see [67] above) and the PowerPoint presentation given by TripAdvisor to Meriton in November 2014 (see [72] above). I note also that Mr Emmins (at [17.16]-[17.17] of his first report) broadly agreed with Professor Malthouse's evidence on this matter. (b) I would also accept that participation in an automated email solicitation system, such as Review Express, is likely to increase the overall proportion of reviews that are positive. (I use the expression "positive" in the same way that Meriton used it, namely four-star or five-star reviews.) Professor Malthouse gave evidence in his first report that his research showed that the number and fraction of positive reviews would increase after automated email solicitations were introduced. He explained that self-motivated reviews have a selection bias towards negative customers. He continued: "When a customer must find the website, create a log in, etc, dissatisfied customers are more likely to invest the substantial effort to write a review. When the process is frictionless, as with email solicitations, a broader and more representative cross section of customers will write reviews. Assuming that a substantial fraction of customers are, in fact, satisfied with the product or service, having a broader group of reviewers will attract more positive reviews." This evidence was not challenged in cross-examination and I accept it. It is also consistent with the information provided by TripAdvisor to Meriton in November 2014 (see [72]-[74] above). I note also that Mr Emmins (at [17.18] of his first report) indicated his agreement with Professor Malthouse on this aspect. 164 I now turn to address the other issues outlined in [162] above, in particular whether the impugned practices had the effect of reducing the number of negative reviews. This issue is squarely addressed in the expert evidence called by each side. (Some of the lay evidence is also relevant to this issue.) In brief terms, Professor Malthouse expressed the opinion that the impugned practices had the effect of reducing the number of negative reviews. On the other hand, Mr Emmins expressed the opinion that the impugned practices did not have this effect. 165 In section 7 of his first report, Professor Malthouse addressed, first, the bulk withholding practice and then, second, the MSA-masking practice. (I note that the word "not" should read "now" in the third last line of p 15 of this report.) His evidence can be summarised as follows: (a) In relation to the bulk withholding practice, Professor Malthouse expressed the view that if Meriton had followed the policies of TripAdvisor and sent email solicitations during the periods with service disruptions, then: (i) the total number of positive reviews would have remained about the same (as before the service disruption), since customers who experienced the service disruption would likely not have given positive reviews, and hence there would have been few new positive reviews; (ii) the number of negative reviews would have been greater and, moreover, those negative reviews would have been recent, and thus displayed at the top of the list of reviews, and affected the property's rank within its geographical region; and (iii) the average rating for a particular Meriton property would have remained about the same as long as the property had many existing reviews (noting that the Meriton properties currently have thousands of reviews). (b) Professor Malthouse expressed the view that: by suppressing email solicitations during periods of service disruptions, Meriton likely avoided having negative reviews about those service disruptions appear at the top of the list of reviews; and these negative reviews would likely have been submitted if Meriton had followed TripAdvisor's policies. Professor Malthouse accepted during cross-examination that he did not have empirical evidence for his opinion that reviews submitted during a period of service disruption would be disproportionately negative. However, he maintained that this was his opinion. (c) Professor Malthouse accepted during cross-examination that self-motivated reviews are still possible during a period of service disruption. He also accepted that if (as he expects) more negative reviews are likely to arise during a period of service disruption, then it is likely that there would be a higher number of self-motivated reviews during that period. (d) In relation to the MSA-masking practice, Professor Malthouse expressed the view that whether or not Meriton resolved the complaint to the customer's satisfaction was relevant. He explained that: the effects of complaint resolution have long been studied in the services literature; satisfaction with complaint resolution has a positive impact on customer loyalty; and complaint resolution is thus an important element in a company's customer retention strategy. He addressed two distinct scenarios: (i) The first scenario was where Meriton did not resolve complaints to its customers' satisfaction. In this scenario, masking the email addresses of those customers who complained would not affect the number of positive reviews, but would reduce the number of negative reviews. In other words, in his opinion, without masking, there would be more negative reviews. (ii) The second scenario was where Meriton did resolve complaints to its customers' satisfaction. In this scenario, the number of positive reviews would be higher without masking than with masking. He stated: "Under the scenario of positive complaint resolution, Meriton is hurting itself with the masking process." In the course of cross-examination, Professor Malthouse accepted that the expression "service recovery" was used to describe an intervention by the retailer or supplier whereby it was able to repair the harm that might otherwise have been done by a negative feature of a product or experience. He also accepted that the literature he had reviewed showed that successful service recovery can increase customer satisfaction over the customer who never had the problem in the first place. Professor Malthouse also accepted that this analysis would apply where emails had not been forwarded "en bloc" if the complaints of the affected group of customers had been resolved to their entire satisfaction. However, the evidence generally suggests that positive service recovery (in the sense discussed by Professor Malthouse) occurred in only a small proportion of the cases in which the impugned practices were implemented. There are only a few examples in the evidence of such positive service recovery. If Meriton was generally achieving positive service recovery, which would have been likely to generate positive reviews, it is unlikely that it would have adopted the impugned practices. While it is theoretically possible that it did not realise that it was depriving itself of a large number of positive reviews, it seems unlikely that Meriton, a large and sophisticated business, would not have appreciated this. For completeness, I note that I do not think the fact that Ms Nazha placed a response on TripAdvisor to every review (whether positive of negative) detracts from these conclusions. That response was posted after the customer had already placed a review (whether positive or negative). It did not generally constitute positive service recovery as described by Professor Malthouse. 166 I note for completeness that in his first report, Professor Malthouse referred to "snippets" of the reviews that appeared on the TripAdvisor website, as illustrated in Fig 3 to the report. A snippet appears to be a short one-line extract taken from the text of a customer review. Professor Malthouse accepted in cross-examination that whether the snippet was visible may depend on the "particular method of interrogation" of the website that was adopted. I therefore put this aspect to one side. 167 I also note for completeness that in the course of cross-examination, Professor Malthouse was asked some questions about an article he co-authored with E Maslowska and S Bernritter entitled "Too good to be true: the role of online reviews' features in probability to buy" (2017) 36(1) International Journal of Advertising 142. In the article, the authors concluded (at p 154) that, for the categories of products studied, products with an average star rating of 4.5 to 5 were less likely to be purchased than those between 4 and 4.5 stars. The authors stated that the reason for this may be that consumers perceive such positive reviews (ie, of 4.5 to 5 stars) as too good to be true. The authors stated that this finding suggests that it is important to have some fraction of non-perfect reviews, as a few negative messages can increase perceived credibility. The authors agreed with previous researchers who had expressed the view that companies should not censor negative reviews. 168 Mr Emmins approached the question of whether the impugned practices had an effect on the number of negative reviews, broadly, in three ways. (It is important to note that Mr Emmins used the expression "negative review" to refer to a one or two-star review, whereas Meriton also considered a three-star review to be a negative review.) First, Mr Emmins looked at the cases of service disruption identified by the ACCC in the concise statement and reviewed the TripAdvisor website at about the times of these disruptions and counted how many negative reviews there were. Secondly, Mr Emmins relied on the TrustYou Reports to compare the rating and volume of reviews of the Meriton properties on Booking.com and TripAdvisor. Thirdly, Mr Emmins personally looked at reviews on the Booking.com website, particularly at the times of the service disruptions referred to by the ACCC. I deal with each of these approaches in turn. 169 In relation to Mr Emmins's first approach, I note the following: (a) In sections 2-7 of his first report, Mr Emmins set out data and conclusions based on his analysis of the TripAdvisor website at about the times of (and immediately after) the instances of the bulk withholding practice referred to in [16] of the concise statement. That paragraph of the concise statement alleges four instances of the bulk withholding practice: (a) in relation to Meriton's Bondi Junction property in the period 16 April 2015 to 29 April 2015 (when phone lines were down, there was no hot water available and a lift was not operating); (b) in relation to Meriton's Kent Street property between 1 and 8 June 2015 (when there were lift delays); (c) in relation to the Kent Street property on 15 June 2015 (when the hot water was unavailable); and (d) in relation to Meriton's Pitt Street property on 10 August 2015 (when there was an evacuation of guests on one level of the apartments due to a damaged gas line, which also caused a hot water failure for guests on other levels). Mr Emmins analysed the reviews on the TripAdvisor website for these properties at about the times of (and immediately after) these service disruptions and noted the number of reviews that were one, two, three, four or five-star reviews. He concluded that: there was a total of 72 self-motivated reviews (ie, unprompted reviews) posted about the relevant properties during the specified periods, of which only three were negative (ie, one or two-star reviews); and within the content of these negative reviews, there was no mention of the problems (ie, specific service disruptions) cited by the ACCC in [16] of the concise statement. On the basis of these conclusions, Mr Emmins expressed the view that he disagreed with [20] of the concise statement "as my research and analysis of the TripAdvisor data pertinent to the cited periods shows no evidence that the masking practice described had any discernible effects, improvements or maintaining of the positions on TripAdvisor or was likely to have had any discernible effects, improvements or maintaining of the position on TripAdvisor as described". (b) One immediate difficulty with Mr Emmins's first approach is that he adopted a different definition of negative review to that used by Meriton. This point was raised with Mr Emmins during cross-examination and he maintained his position that only a one or two-star review should be considered negative. However, in the particular circumstances of Meriton's business, its own view of what constitutes a negative review would appear to be relevant. There are examples in the evidence of three-star reviews that may aptly be described as negative. In any event, Mr Emmins did not address the difference between his characterisation and that of Meriton, or discuss whether it affected his conclusions. Further, as a result of the approach he took, Mr Emmins did not look for references to the service disruptions in three-star reviews. (c) Another difficulty is that Mr Emmins did not keep proper records of the reviews he analysed, making it difficult to test some of his conclusions. (d) Mr Emmins gave oral evidence-in-chief that he had carried out a similar exercise to that described above in relation to the service disruptions identified in certain paragraphs of the updated schedule to the concise statement. He did not produce any documentary record of this work, including in his two reports. He said that he had not seen specific references to the service disruption issues on the TripAdvisor pages for the relevant Meriton properties and, on this basis, he presumed there were no negative reviews on the subject. In cross-examination, Mr Emmins said he did not keep a record of this work in his notebooks. In the absence of any documents to demonstrate that this work was carried out, and the results of this work, I do not place any weight on Mr Emmins's analysis of the TripAdvisor website in respect of any incidents alleged in the updated schedule to the concise statement, as he described in his oral evidence-in-chief. 170 In relation to Mr Emmins's second approach, I note the following: (a) In sections 8-11 of his first report, Mr Emmins relied on the TrustYou Reports as the basis for comparing reviews on Booking.com and reviews on TripAdvisor about certain properties. Specifically, Mr Emmins examined the three Meriton properties referred to in [16] of the concise statement, namely Bondi Junction, Kent Street and Pitt Street. The premise of comparing reviews on Booking.com with those on the TripAdvisor website was that the Booking.com reviews were not affected by the impugned practices. This premise is established by Mr Chan's evidence and is not disputed by the ACCC. The TrustYou Reports comprise the dashboard reports for several of the Meriton properties for the period 1 November 2014 to 31 October 2015. Each dashboard report contains an Overall Score Graph and a New Reviews Graph, as described in [42] above. Mr Emmins's analysis was substantially the same for each of the three properties. It is therefore sufficient to refer, by way of example, to his discussion of the Bondi Junction property. Mr Emmins referred to the Overall Score Graph and stated: "This graph clearly shows a very consistent 'score' across the entire period - including the period cited by the ACCC [in [16] of the concise statement] - and across the reviews websites. There are no discernible fluctuations." After referring to the New Reviews Graph, Mr Emmins expressed the opinion: "I note that there is significant consistency between the figures relating to Booking.com and TripAdvisor, including during the period cited by the ACCC. Given that there could have been no interference with the Booking.com results, this indicates, that actions by Meriton employees during the period cited by the ACCC did not discernibly affect review volume." After referring to the number of pages in the TrustYou dashboard report for the Bondi Junction property and that it has a "number of different breakdowns of data", Mr Emmins expressed the view: "There appear to be no significant fluctuations in consistency of the volume of posting of reviews or the ratings scores being awarded by consumers during the period cited by the ACCC. I am of the opinion that if the actions of Meriton employees had significantly affected the volumes or ratings scores, then there would have been evidence of this in the TrustYou data." Mr Emmins also stated that he believed that this (ie, the impact of the impugned practices) would have been made apparent from: fluctuations in the data relating to TripAdvisor concerning volumes during the period cited by the ACCC; a deterioration in the satisfaction performance of the relevant property on Booking.com during the period cited by the ACCC; and fluctuations in the comparative satisfaction performance data between TripAdvisor and Booking.com during the period cited by the ACCC. In his supplementary report, Mr Emmins added that the fluctuations in the data that he would have expected to see if the masking practice had significantly affected the volume of reviews or rating scores were not present, and therefore he concluded that the masking practice described in the concise statement had not had the effect or likely effect of "changing the message given to consumers" who visited the identified pages of the TripAdvisor website. (b) The fundamental difficulty in relying on the New Reviews Graph is that, as Professor Malthouse pointed out in his second report, the data is presented on a monthly basis. It is therefore not possible to determine from this data whether there were fluctuations in the volume of new reviews on Booking.com or TripAdvisor in the days of and immediately following the four service disruptions examined by Mr Emmins (namely the service disruptions described in [16] of the concise statement). The data simply is not sufficient granular to enable any conclusions to be drawn about whether there were fluctuations as between the two websites in respect of these specific service disruptions. There may well have been fluctuations between them during the course of the month, but it is not possible to tell. (c) In relation to the Overall Score Graph, as Professor Malthouse noted in his second report, when there are hundreds of reviews, adding a few less positive reviews would have a negligible effect on the average star rating. Another difficulty raised in Professor Malthouse's second report is that "we cannot know which reviews were written by people who were affected by the service outages", as customers do not necessarily leave reviews contemporaneously with their stay at a particular property and may do so well after their date of departure. (d) Apart from the Overall Score Graph and the New Reviews Graph, it is not apparent from Mr Emmins's reports how he relied on the balance of the dashboard report for each of the three properties. No submissions were made indicating how any other part of the dashboard reports supported Mr Emmins's conclusions. It is not clear how the balance of the dashboard reports supports Mr Emmins's opinion. 171 In relation to Mr Emmins's third approach, I note the following: (a) In sections 12-13 of his first report, Mr Emmins stated that he had carried out research on the Booking.com site "in order to further evaluate the question of whether the service disruptions created negative perceptions by guests that may have led to the posting of negative reviews". However, very little detail was provided as to the work carried out or its outcome. (b) In his supplementary report, Mr Emmins stated that, from the Booking.com data (which would seem to refer to data he derived from his research on the Booking.com website) he drew the conclusion that there was no discernible difference in the (relative) volume or rating given in reviews, in the relevant periods when the masking practice was in operation, between the Booking.com website and the TripAdvisor website. Mr Emmins also stated that his personal examination of the Booking.com website corroborated his opinion, formed on the basis of the TrustYou data, that the service disruption periods cited by the ACCC did not cause any increase in negative reviews. (c) In cross-examination, Mr Emmins said that, when he prepared his first report, he had looked at the Booking.com data himself. He said that this material was not identified (in section 18 of his first report) as a document relied upon because he had made the mistake of not actually printing out the documents that he had looked at. He explained that: he had used a computer to look at the data on the Booking.com website; and he had then manually counted up the number of reviews. When asked how he did this when the Booking.com website would not enable a person to go back beyond two years, he responded "actually, I cannot recall". Mr Emmins accepted that annexure CE-6 to his second affidavit, which was said to comprise the Booking.com reviews relating to Meriton's Bondi Junction property that he had looked at in preparing his first report, did not in fact comprise those reviews. Apart from one 2015 review, the rest of the 62 pages comprised reviews from 2017. 172 In section 14 of his first report, Mr Emmins stated that he had carried out some further research, comparing reviews of Meriton properties on the TripAdvisor website before and after the introduction of Review Express. A summary of reviews for Meriton's Bondi Junction property posted in July 2013 (before Meriton started using Review Express) and in September 2013 (after it started using Review Express) was set out. Mr Emmins expressed the view that this data helped to substantiate that the use of Review Express: increases the overall number of reviews; increases the number of positive reviews; and appears not to increase the number of negative reviews. He stated that the data appeared to confirm that "reducing the use of the Review Express system would not be of any benefit to Meriton". 173 In section 15 of his first report, Mr Emmins set out his responses to certain questions he had been asked by Meriton. He expressed the opinions (based on the analysis set out earlier in the report) that: neither the masking practice nor the failure to send emails referred to in the concise statement would have had the effect, or likely effect, of reducing the number of recent negative reviews of Meriton properties submitted to TripAdvisor; he does not believe that the actions of the Meriton employees referred to in the concise statement would have been likely to have improved the relative number of favourable reviews compared with unfavourable reviews of Meriton properties that would otherwise have been posted on TripAdvisor; and he does not believe that the actions of Meriton's employees would have (or would have been likely to have) improved, maintained or prevented a reduction in the TripAdvisor ratings of the Meriton properties. 174 In response to Professor Malthouse's first report, Mr Emmins stated in his first report that: he did not find any evidence of the number of negative reviews (being reviews submitted by guests who were not using the Review Express system) increasing during the periods of service disruption cited by the ACCC in the concise statement; and he disagreed with Professor Malthouse's assumption that a service disruption issue would necessarily increase the number of negative reviews. 175 I note the following further matters arising from the cross-examination of Mr Emmins: (a) Mr Emmins was taken to the part of his résumé where he referred to work he had done for the UK Competition & Markets Authority with regard to online reviews and endorsements. The résumé stated that he had been asked to provide, among other things, "[e]xamples of gaming review sites such as TripAdvisor". In cross-examination, Mr Emmins accepted that the masking of emails so as to prevent emails going out to persons whom the relevant accommodation provider feared might write negative reviews was an example of the "gaming" he referred to in his résumé. (b) Mr Emmins was taken to a document published by the International Consumer Protection and Enforcement Network (ICPEN) titled "Online Reviews & Endorsements - ICPEN Guidelines for Traders & Marketing Professionals" (June 2016). Mr Emmins said he was very familiar with the document. In the context of that document, Mr Emmins was asked some questions about the principle of not preventing consumers from seeing the whole picture of genuine, relevant and lawful reviews. Mr Emmins referred to a situation where a review is published that the business wishes to have taken down on the basis that it is biased or unfair. Mr Emmins said that the situation is a matter between the business and the review site to determine "what is fair and what is not". The following exchange then occurred: … It follows from your answer a few moments ago that you consider the appropriate response, if a business regards a review as unfair, as you put it, that the business will deal with that review not by attempting to silence the critic in any respect, but, rather, by dealing with the review site; is that correct?---Yes. And you would regard it, having regard to these principles, as improper for a business to endeavour to silence its critics in any respect, wouldn't you?---I would. Do you agree that's what Meriton was doing in this [case]?---I do. And you agree, therefore, it was wrong to do it?---I do. (c) Mr Emmins was taken to a bundle of documents comprising correspondence between Meriton and himself that had been produced during the trial in response to a notice to produce (the notice to produce documents). In an email dated 2 April 2017, Mr Emmins expressed the view that Professor Malthouse's first report "whilst competent in terms of a general academic interpretation … lacks sufficient focus on the more precise ways that consumers actually search and the processes that are involved which may or may not lead to a purchasing decision". He expressed the view that, in this respect, it was "fundamentally flawed". In cross-examination, Mr Emmins accepted that he did not elaborate on these matters in his own report and, in this respect, his own report was flawed. (d) Mr Emmins said that, in the course of preparing drafts of his first report, Meriton's in-house counsel cautioned him to "stay on track in terms of what the case was about, and the case was about Meriton's actions, not TripAdvisor's flaws" and he (Mr Emmins) "believed that was good advice". (e) Mr Emmins was taken to a draft of his first report, which contained material that was subsequently removed and not included in the final version of the report. Although he initially sought to explain the removal of this material on the basis that it "looks like an attack on TripAdvisor", he subsequently accepted that this did not provide an explanation (T290). Although Mr Emmins rejected the proposition that this material was an "inconvenient truth" for Meriton in this case, he was unable to provide a reason why it was taken out. The fact of the removal of this material, and the absence of any real explanation, raises a concern that it may have been removed to assist Meriton's case. (See also T295, 297-298.) (f) Mr Emmins was taken to correspondence in the notice to produce documents in which he had written that, unless certain additional information was provided to him, "I do not believe the evidence will be as much in the favour of your defence as possible". It was put to Mr Emmins in cross-examination that this was not the language of an independent expert. He responded: "I would take your point on that." 176 In the discussion that follows, I adopt the definition of "negative review" used by Meriton, namely a one, two or three-star review. 177 In my view, the opinion of Professor Malthouse that the impugned practices had the effect of reducing the number of negative reviews of Meriton properties appearing on TripAdvisor is to be preferred to the contrary view of Mr Emmins. First, Professor Malthouse's written material was presented in a clear and logical manner. In contrast, Mr Emmins's written evidence did not clearly articulate the research he had carried out, or provide detailed reasons for the conclusions he had reached based on that research. Further, there was a lack of documentary support for some of this work, making it difficult to test his conclusions. Secondly, in his oral evidence, Professor Malthouse impressed me as having a better command of the subject matter. He was able to explain why he reached the conclusions that he did with greater clarity and cogency, in my view. Thirdly, a difficulty with Mr Emmins's evidence generally was that he adopted a different definition of "negative review" to that adopted by Meriton. There is force in the proposition that Meriton had a better understanding of what constituted a negative review in the context of its own business. In any event, the implications of the difference were not addressed by Mr Emmins. Fourthly, a fundamental difficulty with the second approach taken by Mr Emmins is that the data in the New Reviews Graphs is presented on a monthly basis. It is therefore not possible to determine from this data whether there were fluctuations, at or about the times of the service disruptions referred to in [16] of the concise statement, in the volume of new reviews on Booking.com or TripAdvisor. Further, in relation to the Overall Score Graph, as discussed further below, when there are many hundreds of reviews for a given property, adding a few less positive reviews is likely to have a negligible effect on the average star rating. Fifthly, Professor Malthouse's opinion, to the effect that the impugned practices reduced the number of negative reviews appearing on the TripAdvisor website, is inherently plausible and accords with the lay evidence referred to earlier in these reasons. As set out in the reasons above, Meriton's intention in engaging in the impugned practices was to reduce the likelihood of negative reviews being posted on TripAdvisor. Moreover, Meriton's staff responsible for monitoring the TripAdvisor website (in particular, Ms Nazha) clearly thought that the impugned practices had the effect of reducing the number of negative reviews. For example, as set out at [93] above, Ms Nazha sent an email commending the spreadsheet (with an "Email MSA'd" column) adopted by Kent Street. She commented that they had recently implemented this approach, and were showing "great results with their reviews". Ms Nazha accepted in cross-examination that, by this comment, she meant far fewer negative reviews. 178 It should be noted that Professor Malthouse expressed the opinion that, in cases where a complaint or a service disruption issue was resolved or dealt with by Meriton to the customer's satisfaction, the impugned practices would not have had the effect of reducing the number of negative reviews. I accept this evidence. However, as noted above, the evidence generally suggests that positive service recovery occurred in only a small proportion of cases in which the impugned practices were implemented. I therefore do not consider this scenario to be of such significance as to detract substantially from the overall position. 179 It is true that the impugned practices did not prevent a self-motivated reviewer from posting a negative review. However, the evidence establishes that there are many guests who will leave a review (including a negative review) if prompted by an email invitation, but who would not otherwise post a review on TripAdvisor given the additional effort that is involved. Accordingly, while it may be accepted that negative reviews may still have occurred, this does not detract from the proposition that the impugned practices had the effect of reducing the number of negative reviews. 180 Further, in my view, that the impugned practices had the effect of improving the relative number of favourable reviews compared to unfavourable reviews of Meriton properties on the TripAdvisor website. The impugned practices reduced the number of negative reviews (compared with the position if the impugned practices had not been implemented). And while the impugned practices may also have reduced the number of new positive reviews, I consider that these would have been far fewer than usual on account of the occurrence of a service disruption issue or customer complaint that led to the masking. 181 Importantly, the TripAdvisor website generally displays the most recent reviews first. This means that, if (as I have found) the impugned practices had the effect of reducing the number of negative reviews, there are likely to have been more extended periods of time when, but for the impugned practices, the first review (or the first few reviews) that a consumer would have seen on accessing the page for the relevant property on the TripAdvisor website would have been a negative review (or negative reviews). While the circumstances of consumers looking at the TripAdvisor website to choose accommodation vary from case to case, it may be inferred that a recent negative review (or a few recent negative reviews) complaining, for example, about lift delays at high rise accommodation, is likely to have conveyed a more negative impression and influenced the consumer. Based on the evidence generally, and the findings I have made above, I consider it likely that there were periods of time when, but for the impugned practices, a negative review or a few negative reviews would have appeared first on the TripAdvisor page for a Meriton property. Although it is true that a self-motivated reviewer may have in any event posted a negative review about the particular issue at the property, it is likely that in some cases that did not occur or did not occur until some time later. 182 Whether the impugned practices improved or maintained the TripAdvisor ratings and rankings of the Meriton properties, is a more difficult question. I will deal with the question of rating and ranking separately. (a) In relation to the rating of a property, the evidence of Professor Malthouse establishes that, where there are a large number of reviews (as was the case with the Meriton properties), a single review will have very little effect on the overall rating. As Professor Malthouse said during cross-examination, in relation to TripAdvisor: "We do not know the exact weight function, but … unless it were a very extreme case where they gave zero weight to the majority of reviews, the statement would hold that when you have a lot of reviews, and you add one more, the effect is very small." He also said, in relation to the recency of reviews: "There would be slightly more weight given to that more recent one, but we do not know exactly how much more weight." In light of this evidence, it is not established that the impugned practices affected the rating of the properties on TripAdvisor. (b) The evidence generally suggests that a single review may have a relatively greater influence on ranking than on rating. While there are effectively only 10 different positions with respect to rating (including half stars), in some geographical areas the number of different ranking positions was much greater. For example, several of the Meriton properties are in the Sydney area. There were, at the relevant time, 183 properties in this area (see [73] above). As there are more increments in ranking, this suggests that the relative influence of a single review may be greater with respect to ranking compared with rating. Further, it is very possible that many properties in a given area may attract similar ratings, and be ranked closely together, such that a few negative reviews might affect the ranking. The lay evidence supports the view that a recent negative review had the capacity to affect a property's ranking. On a number of occasions, Ms Nazha expressed the view in contemporaneous documents that a property's ranking had been affected by recent negative reviews. I refer, in particular, to Ms Nazha's email of 18 January 2016: see [158] above. I refer also to Ms Nazha's email of 10 August 2015: see [124] above. Given how closely Ms Nazha monitored reviews of Meriton's properties on the TripAdvisor website, I place considerable weight on her contemporaneous observations in this regard. Further, as set out in [159] above, Mr Chan accepted that the receipt of negative reviews was a factor in the decline in the ranking of the hotels referred to in the 18 January 2016 email. On the basis of this evidence, I infer that a single review, or at least a small number of reviews, may affect the ranking of a property on the TripAdvisor website. I would also find, on the basis of this evidence, and taking into account my earlier findings, that in some cases the impugned practices affected the ranking of a Meriton property on the TripAdvisor website. For example, but for the impugned practices, a property may have been ranked "3 out of 183" rather than "2 out of 183". While the circumstances of consumers looking at the TripAdvisor website to choose accommodation vary from case to case, it may be inferred that a difference in ranking is likely to have influenced the consumer in some cases. 183 For these reasons, I find that the MSA-masking practice and the bulk withholding practice created a more positive or favourable impression of the quality or amenity of the Meriton properties on the TripAdvisor website. Moreover, when the scale of the MSA-masking practice and the frequency of the bulk withholding practice (as discussed earlier in these reasons) are taken into account, this effect was substantial.

Applicable principles 184 Section 18 of the Australian Consumer Law provides that a person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive. Conduct is misleading or deceptive, or likely to mislead or deceive, if it has a tendency to lead into error. In Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640 (TPG), French CJ, Crennan, Bell and Keane JJ said at [39]: Conduct is misleading or deceptive, or likely to mislead or deceive, if it has a tendency to lead into error. That is to say there must be a sufficient causal link between the conduct and error on the part of persons exposed to it. It is in that sense that it can be said that the prohibitions in ss 52 [of the Trade Practices Act] and 18 [of the Australian Consumer Law] were not enacted for the benefit of people who failed to take reasonable care of their own interests. (Footnote omitted.) See also TPG at [48]-[50]; and Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd (2014) 317 ALR 73 (Coles) at [39] per Allsop CJ. 185 Whether conduct is misleading or deceptive, or likely to mislead or deceive, is a question of characterisation and "generally requires consideration of whether the impugned conduct viewed as a whole has a tendency to lead a person into error": Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304 at [24]-[25] per French CJ, approved in TPG at [49]. As has been held in connection with former s 52 of the Trade Practices Act 1974 (Cth), the words "likely to mislead or deceive" in s 18 of the Australian Consumer Law make it clear that it is not necessary to demonstrate actual deception to establish a contravention of the provision: Google Inc v Australian Competition and Consumer Commission (2013) 249 CLR 435 (Google) at [6] per French CJ, Crennan and Kiefel JJ. Further, where an issue in a s 18 proceeding is the effect of conduct on a class of persons such as consumers, who may range from the gullible to the astute, the Court must consider whether the 'ordinary' or 'reasonable' members of that class would be misled or deceived: Google at [7]. 186 It is well established that an intention to mislead or deceive is not a necessary element in order to establish contravention of s 18: TPG at [56]. 187 Turning to s 34 of the Australian Consumer Law, it is convenient to set out both s 33 and s 34 as the provisions are comparable in some respects and several of the cases concern s 33 (or its predecessor) rather than s 34. Sections 33 and 34 provide as follows: 33 Misleading conduct as to the nature etc. of goods A person must not, in trade or commerce, engage in conduct that is liable to mislead the public as to the nature, the manufacturing process, the characteristics, the suitability for their purpose or the quantity of any goods. 34 Misleading conduct as to the nature etc. of services A person must not, in trade or commerce, engage in conduct that is liable to mislead the public as to the nature, the characteristics, the suitability for their purpose or the quantity of any services. 188 Both ss 33 and 34 fall within Part 3-1, which is concerned with unfair practices. A pecuniary penalty may be imposed for a contravention of s 33 or 34: see s 224(1)(a)(ii). The Australian Consumer Law contains offence provisions which mirror ss 33 and 34: see ss 155 and 156. I note that the predecessors of ss 33 and 34 were ss 55 and 55A of the Trade Practices Act. Those provisions were in substantially the same terms. 189 There are broad similarities between the type of inquiry required by s 18 and that required by ss 33 and 34. In Coles, Allsop CJ said at [38]: For the inquiry under s 18, it is necessary to identify the impugned conduct and then to consider whether that conduct, considered as a whole and in context, is misleading or deceptive or likely to mislead or deceive: Google Inc v Australian Competition and Consumer Commission (2013) 249 CLR 435; 294 ALR 404; 99 IPR 197; [2013] HCA 1 at [89], [102] and [118]; and Campomar Sociedad Limitada v Nike International (2000) 202 CLR 45; 169 ALR 677; 46 IPR 481; [2000] HCA 12 at [100]-[101] (Campomar). The same applies to the inquiry as to representations and conduct under ss 29(1)(a) and 33, respectively. Although the above passage refers to s 33, it applies equally to s 34. 190 Further, in relation to both s 18 and ss 33 and 34, it is necessary to have regard to the conduct as a whole and its context. As Allsop CJ said in Coles at [41]: It is necessary to view the conduct as a whole and in its proper context. This will or may include consideration of the type of market, the manner in which such goods are sold, and the habits and characteristics of purchasers in such a market: see generally TPG at [52]; Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191 at 199; 42 ALR 1 at 6-7; 1A IPR 684 at 688-9; [1982] HCA 44 (Parkdale); and Reckitt & Coleman Products Ltd v Borden Inc [1990] 1 WLR 491; (1990) 17 IPR 1 at 16-17 (a passing off case). The context will also include relevant disclaimers or explanations: Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592; 212 ALR 357; [2004] HCA 60 at [49] (where the disclaimer, in small print, but in a short document, was "there to be read"). 191 There is no meaningful distinction between the words and phrases "misleading or deceptive" and "mislead or deceive" (s 18) and "mislead" (s 33): Coles at [40]. This applies equally to s 34. However, a distinction is to be drawn between "likely to mislead or deceive" (s 18) and "liable to mislead" (ss 33 and 34), with the latter applying to a narrower range of conduct. In Coles, Allsop CJ said at [44]: While the words and phrases "misleading or deceptive", "mislead or deceive", "false or misleading" and "mislead" are synonymous, the authorities reveal that a distinction is to be made between "likely to mislead or deceive" (in s 18) and "liable to mislead" (in s 33). The latter has been said to apply to a narrower range of conduct: Westpac Banking Corporation v Northern Metals Pty Ltd (1989) 14 IPR 499 at 502; Trade Practices Commission v J & R Enterprises (1991) 99 ALR 325 at 338-9 (J & R Enterprises); and Australian Competition and Consumer Commission v Turi Foods Pty Ltd (No 4) [2013] FCA 665 at [79]. Under s 33, what is required is that there be an actual probability that the public would be misled: J & R Enterprises at 339. (This citation of J & R Enterprises at 338-9 should not be taken to endorse the comments of O'Loughlin J as to a burden beyond reasonable doubt at 339.) This passage was approved in Australian Competition and Consumer Commission v Snowdale Holdings Pty Ltd (2016) 339 ALR 455 (Snowdale) at [527] per Siopis J. Again, while referring to s 33, the reasoning in the above passage is equally applicable to s 34. 192 The application of ss 33 and 34 is limited to conduct that is liable to mislead "the public". In Trade Practices Commission v J & R Enterprises Pty Ltd (1991) 99 ALR 325, O'Loughlin J said at 347-348: The word "public" is not to be taken as meaning the world at large or the whole community. There will be a sufficient approach to the public if, first, the approach is general and at random and secondly, the number of people who are approached is sufficiently large. In dealing with the phrase "invitation to the public", Barwick CJ said in Lee v Evans (1964) 112 CLR 276 at 285: "…the basic concept is that the invitation, though maybe not universal, is general; that it is an invitation to all and sundry of some segment of the community at large. This does not mean that it must be an invitation to all the public either everywhere, or in any particular community." 193 This requirement was further considered in Shahid v Australasian College of Dermatologists (2008) 168 FCR 46, a case concerning s 55A of the Trade Practices Act. In this case, the Full Court held that it had not been established that the relevant representations had been made to the public. On this issue, Jessup J (with whom Branson and Stone JJ relevantly agreed, at [1]) said at [206]: I accept, of course, that the concept of "the public" is, in an appropriate context, narrower than the world at large, and narrower even than all persons who, for example, live or work within a particular area. I would accept that a representation might be regarded as being addressed to the public in the relevant sense notwithstanding that the potential users of the services in question were, in the nature of things, few in number. I have in mind, for example, a representation made in an advertisement for services of a very specialised kind. It would be the generality of the range of persons to whom the representation was addressed, rather than the practical likelihood of many of them being interested in acting upon the representation, that would justify the conclusion that it was addressed to the public: see Lee v Evans (1964) 112 CLR 276 and J & R Enterprises 99 ALR at 347-348. 194 I turn now to the meaning of the words and phrases "nature", "characteristics", and "suitability for their purpose" in s 34 of the Australian Consumer Law. (The allegations in the present case do not include the aspect of s 34 concerned with quantity, therefore this aspect can be put to one side.) 195 The expressions "nature", "characteristics" and "suitability for their purpose" are not defined in the Australian Consumer Law. In my opinion, they are to be given their ordinary meaning, in the context of the consumer protection purpose of the provisions. The word "nature" is defined in the Macquarie Dictionary (6th ed, 2013) as meaning (among other things) "the particular combination of qualities belonging to a person or thing by birth or constitution; native or inherent character" and "character, kind, or sort". See also Spunwill Pty Ltd v BAB Pty Ltd (1994) 36 NSWLR 290 at 302. The word "characteristic" is defined as meaning (as a noun) "a distinguishing feature or quality". Different views have been expressed as to whether the word "characteristics" in s 33 (or its predecessor, s 55 of the Trade Practices Act) is limited to the internal constitution or utility of goods, or also extends to the manner of their creation: see Snowdale at [528]-[535]; cf Australian Competition and Consumer Commission v Turi Foods Pty Ltd (No 4) [2013] ATPR 42-448; [2013] FCA 665 at [124]-[129]. However, this issue does not arise in the present case. The word "suitability" is defined by reference to the adjective "suitable", which is defined as meaning "such as to suit; appropriate; fitting; becoming".

Application of principles to facts of this case 196 There is no real dispute, and in any event I find, that Meriton engaged in the MSA-masking practice and the bulk withholding practice during the relevant period. The details of those practices have been described in the factual findings section of these reasons. 197 The context in which to consider these practices includes the significance of the TripAdvisor website as a mechanism for assisting consumers to choose suitable accommodation at which to stay, as indicated by the evidence referred to earlier in these reasons. The importance of the TripAdvisor website is illustrated by the fact that Meriton had a staff member who spent most of her time: monitoring reviews of Meriton's properties on the TripAdvisor website; preparing reports to management about the ranking and reviews of those properties on TripAdvisor; and responding on TripAdvisor to every review. There was no suggestion that anything comparable was done in relation to any other website. 198 The relevant class of consumers for present purposes is consumers accessing the TripAdvisor website to assist them in choosing suitable accommodation at which to stay. The consumers in this class may book the accommodation in a variety of ways, such as with the accommodation provider directly, through Booking.com, or by some other means. They consult the TripAdvisor website to gather information about different accommodation options to assist them in choosing accommodation. Regard is to be had to the ordinary or reasonable members of the class. While some ordinary or reasonable members of this class may be sceptical about online reviews, many will rely on the rating, ranking and reviews on the TripAdvisor website given the large number of reviews (which are in turn the basis for the rating and ranking) and the convenience of the website as a means of obtaining information about accommodation options. 199 It was in this context that Meriton participated in Review Express but also engaged in the MSA-masking practice and the bulk withholding practice. Review Express involved sending email invitations to guests who had stayed at a property inviting them to post a review on the TripAdvisor website. It provided a simple and streamlined method of posting a review, and substantially increased the number of reviews of the property posted on TripAdvisor. The reviews generated by Review Express were generally positive, for the reasons given in the expert evidence. However, Meriton withheld from this process the email addresses of guests who: had stayed at a property during a major service disruption; had made a complaint; or were otherwise considered likely to have had a negative experience at a Meriton property. In simple terms, Meriton was soliciting reviews from many guests who had stayed at its properties, but not from those considered likely to write negative reviews. Mr Emmins, the expert called by Meriton, described this conduct as "gaming" the website. 200 The MSA-masking practice and the bulk withholding practice were engaged in on a very large scale. An indication of the scale of the MSA-masking practice is provided by the evidence that there were 14,584 instances of email addresses being masked with the letters "MSA" during the period 1 April to 31 December 2015. While this figure includes instances other than where the guest complained, it may be accepted that the overwhelming majority of these cases relate to guests who complained. In relation to the bulk withholding practice, requests to withhold groups of email addresses were made about once a week by hotel managers to the State Manager. In most cases these requests were acceded to and a group of email addresses was withheld from TripAdvisor. 201 The questions are whether this conduct was "likely to mislead or deceive" (s 18) and whether this conduct was "liable to mislead the public" as to "the nature, the characteristics, [or] the suitability for their purpose" of the accommodation services provided by Meriton (s 34). 202 Each of the provisions is concerned with conduct. Although in many cases under s 18 the conduct involves the making of a representation, it is important to emphasise that the section is framed in terms of conduct rather than the making of a representation. So too s 34 (in contrast with s 29) is framed in terms of conduct rather than the making of a representation. Thus, the fact that, in the present case, the relevant statements on the TripAdvisor website were made by guests, rather than by Meriton, does not of itself present an obstacle to the potential application of the provisions. Each of these provisions was drafted and enacted at a time well before the internet as we now know it, and websites such as TripAdvisor, existed. Nevertheless, each provision is drafted in elegant and simple language capable of potential application to new circumstances that arise through developments in technology. 203 The main factual issue at trial was whether the impugned practices had the effect alleged by the ACCC in [20] of the concise statement. I have dealt with this issue at [162]-[183] above. I have found that the MSA-masking practice and the bulk withholding practice had the effect of reducing the number of negative reviews of Meriton properties appearing on the TripAdvisor website, and that the practices had the effect of improving the relative number of favourable reviews compared to unfavourable reviews of Meriton properties on the TripAdvisor website. This conclusion is unsurprising in circumstances where, as I have found, Meriton's intention in engaging in the practices was to reduce the likelihood of negative reviews being posted on TripAdvisor. I have also found that, at least in some cases, the practices affected the ranking (but not the rating) of the Meriton properties on the TripAdvisor website. In summary, I have found that the MSA-masking practice and the bulk withholding practice created a more positive or favourable impression of the quality or amenity of the Meriton properties on the TripAdvisor website. 204 Having found that the impugned practices created a more positive or favourable impression of the quality or amenity of the Meriton properties on the TripAdvisor website, it is necessary next to consider whether consumers were or were likely to have been led into error and whether there is a sufficient causal nexus between Meriton's conduct and any such error. 205 The reviews of Meriton's properties on the TripAdvisor website were predominantly concerned with the quality or amenity of the serviced apartment accommodation and were predominantly positive. (There are hundreds of examples in evidence - see, eg, annexure AC-2 to Mr Chan's affidavit). Many of the reviews contained information about objective matters such as the location, the layout of the apartment, the availability of parking, etc. I would infer that the statements about such matters were generally accurate. The reviews also contained comments of a more evaluative nature about matters such as the cleanliness of the rooms, the quality of the service, etc. A consumer accessing the TripAdvisor website and looking at the page for a particular Meriton property was presented with a rating and a ranking for the property and a stream of reviews. As indicated, the reviews presented a generally positive impression of the quality and amenity of Meriton's serviced apartments. In this context, the impugned practices had the following effect on consumers searching for accommodation on TripAdvisor: (a) In the case of the bulk withholding practice, Meriton's conduct served to reduce the number of negative reviews posted about major service disruptions at Meriton's properties. In some instances, Meriton may successfully have eliminated all negative comments about the relevant issue. In other cases, Meriton may have only reduced the number of negative reviews (eg, from three reviews to one). In either case, Meriton's conduct had the effect of reducing, in the mind of consumers, awareness of the prevalence of service disruptions at the Meriton properties. In doing so, Meriton created an impression that was incomplete and inaccurate. (b) In the case of the MSA-masking practice, Meriton's conduct served to reduce the number of negative reviews left by consumers regarding a range of complaints in relation to the Meriton properties. It also improved the relative number of favourable to unfavourable reviews about each property. In doing so, Meriton's conduct was designed to, and did, minimise the awareness of prospective patrons about the frequency and kinds of negative experiences encountered by its customers. As a result, Meriton created an unduly favourable impression about the quality and amenity of Meriton's serviced apartments (including in respect of objective matters, such as lifts not working). 206 The effects described in paragraphs (a) and (b) above are made more acute by virtue of the fact that the most recent reviews about a property generally appear first in the list of reviews. While consumers on TripAdvisor may vary in their degree of conscientiousness, many ordinary or reasonable consumers would not read all of the reviews about a particular property but might only glance at the initial set of reviews. Had it not been for the impugned practices, there would have been more occasions when consumers, accessing the page for a particular Meriton property, would have seen, among the first few reviews shown, a negative review or a greater number of negative reviews. The absence, or reduced number, of these reviews was likely to have had a particularly significant effect in shaping the impressions of consumers about the quality and amenity of Meriton's serviced apartments, including in respect of objective matters. 207 In the case of the bulk withholding practice, the likely subject matter of the additional negative reviews (that otherwise would have been posted) would have been the service disruption that prompted the email addresses to be withheld. In the case of the MSA-masking practice, the additional negative reviews would likely have referred to a range of issues. An indication of the subject matter of such reviews is provided by the examples in the evidence of negative reviews that were posted through Review Express in circumstances where the email address had not been masked. As set out in the factual findings section, in such cases questions were raised as to why the email address had not been masked (the implication being that, had the address been masked, the review in all likelihood would not have appeared). The reviews discussed in these emails raised service issues of an objective nature, such as old carpet, smells from the restaurant, sofa old and dirty, lifts not working (see, eg, CB3012, 3169). Further, in some cases, the MSA-masking practice was utilised in relation to guests en masse following a major service disruption (see, eg, [134] above). In such cases, there was no real difference between the bulk withholding practice and the MSA-masking practice. 208 Meriton submits that it is not enough for the ACCC to establish that a more positive impression of the Meriton properties was presented on the website; it needs to show that it was a false or misleading positive impression. Meriton says that the ACCC has not established this. However, for the reasons given in [205] above, I consider that it has been established that the positive impression of the Meriton serviced apartments on the TripAdvisor website was incomplete and inaccurate, or unduly favourable, in the circumstances described in that paragraph. It is not feasible or necessary to examine how the Meriton properties were presented on the TripAdvisor website at each point in time when the impugned practices were carried out. This would be an impossible task in relation to the MSA-masking practice. Further, in circumstances where new reviews were being posted continually, the presentation of the properties also changed continually. However, the large body of reviews in evidence provides a sound basis to form a general view of how the serviced apartments were presented. This has been described in [205] above. 209 Meriton submits that where an alleged contravention of s 18 concerns 'half-truths', it is necessary to show that the alleged contravenor has itself made a representation that contains a relevant inference. However, I do not see why the provision is necessarily so confined. It is not so confined in terms. As discussed above, the focus of the provision is conduct. It is necessary to determine, on the facts of the particular case, whether there is a sufficient causal connection between the conduct of the alleged contravenor and the error. I consider that this may be established in cases involving a third party representation. 210 It is true that negative reviews about service issues may still have appeared notwithstanding the MSA-masking practice and the bulk withholding practice. It was always open to a guest to post a review on TripAdvisor (referred to in the expert evidence as a self-motivated review). However, even if a self-motivated review did appear in relation to a major service disruption or a customer complaint, the number of negative reviews about the issue would have been greater but for the MSA-masking practice and the bulk withholding practice. Even in this scenario, as a result of the impugned practices, consumers accessing the TripAdvisor website are likely to have been misled by relying on positive reviews of the quality or amenity of the serviced apartments, but without the negative aspects receiving sufficient emphasis. In this regard, I emphasise the vast scale of the MSA-masking practice. 211 In his affidavit, Mr Chan stated that his motivation for approving the requests to withhold email addresses (for all guests who stayed at a particular property during a particular time period) was "to ensure that the properties were not exposed to unrepresentative reviews which might be influenced by an exceptional temporary factor and did not properly reflect the true nature of the accommodation". However, in cross-examination Mr Chan accepted that the so-called unrepresentative reviews: might be "entirely justified"; might be "entirely true"; and would not in any respect be false or misleading. I do not accept the proposition (implicit in Mr Chan's affidavit evidence) that these matters were relevant only during the time of the temporary disruption and did not say something about the ongoing quality or amenity of the accommodation services. If problems of this nature had occurred before at the property, they may well have occurred again. In this context, the positive or favourable impression of the Meriton properties on the TripAdvisor website was apt to mislead by the absence or reduction in the number of reviews about such matters. 212 In the discussion above I have focussed on the reduction in negative reviews rather than the effect of the impugned practices on ranking. In relating to ranking, I have found that Meriton's conduct affected the ranking of Meriton's properties in some cases. Where this occurred, a consumer accessing the TripAdvisor website would have seen the properties ranked more highly than would otherwise have been the case. This presented the Meriton serviced apartment in a more favourable light. Many ordinary or reasonable consumers would have understood that the ranking was based on guest reviews of the property (even though the details of the algorithm were not known). Meriton's conduct created an unduly favourable impression of the guest feedback about the serviced apartments, because the reviews had been solicited on a selective basis. Many guests would have assumed that, to the extent reviews were solicited, this had not been done in a selective way. Such an assumption was consistent with TripAdvisor's guidelines for Review Express. By engaging in the impugned practices, Meriton created an unduly favourable impression of the guest feedback about the serviced apartments. 213 For these reasons, I conclude that by engaging in the MSA-masking practice and the bulk withholding practice during the relevant period, Meriton engaged in conduct that was likely to mislead or deceive within the meaning of s 18 of the Australian Consumer Law. 214 Turning to s 34, although this provision uses the expression "liable to mislead", which is narrower than "likely to mislead or deceive", I consider the reasoning set out in [205]-[211] above to be applicable also in the context of s 34 and to support the conclusion that the conduct was "liable to mislead". (I do not consider [212] above to be applicable in the context of s 34.) There does not appear to be any issue regarding the element that the conduct be liable to mislead "the public". In any event, in circumstances where the TripAdvisor website was available to the public generally, I consider that this element is satisfied. 215 Section 34 refers, relevantly, to the conduct being liable to mislead the public as to "the nature, the characteristics, [or] the suitability for their purpose" of any services. Here, the relevant services are the accommodation services provided by Meriton at its serviced apartments. The reviews of Meriton's serviced apartments on the TripAdvisor website were predominantly concerned with the quality or amenity of the serviced apartments, including objective matters such as location, bedroom layout, availability of parking, etc. Reviews of this type described the "characteristics" of the accommodation services. They also described the "suitability for their purpose" of those services. They may also have described the "nature" of the accommodation services, but this is perhaps less clear as a general proposition. Likewise, objective matters that would have been raised in negative reviews had it not been for the impugned practices (such as lift delays, phone lines down, no hot water, and other service issues) would have described the "characteristics" of the accommodation services and the "suitability for their purpose" of such services. These conclusions are unsurprising as it is precisely the role of a review to address the characteristics and suitability for purpose of accommodation services. 216 Applying the same analysis as set out in [205] above, the conduct of Meriton was liable to mislead the public as to the characteristics and the suitability for their purpose of the accommodation services provided by Meriton at the properties. Given the widespread nature of the impugned practices, I am satisfied that there is an actual probability that members of the public were misled as to these matters. I note for completeness that I do not think it is necessary, for s 34 to apply, that a specific characteristic or a specific aspect of suitability for purpose be identified. The section does not in terms require this. The provision refers to "the characteristics" in the plural. The expression "the suitability for their purpose" suggests that the provision covers suitability in general as well as in particular aspects. 217 Finally, I refer to the ACCC's submission that inferences should be drawn in accordance with Jones v Dunkel from the unexplained absence of Mr Thomas. The evidence establishes that Mr Thomas was available to give evidence. I do not consider it necessary to draw any inference from Mr Thomas's absence to make the findings and reach the conclusions set out in these reasons.

Conclusion 218 For these reasons, I conclude that, by engaging in the MSA-masking practice and the bulk withholding practice during the relevant period, Meriton contravened ss 18 and 34 of the Australian Consumer Law. 219 I will make an order that the matter be listed for a hearing as to remedies. I certify that the preceding two hundred and nineteen (219) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moshinsky.