ACCC’s focus on online markets continues with further penalties.
Group buying website Spreets has become the latest in a line of online deal businesses to be ordered to pay penalties for misleading and deceptive conduct. The ACCC has received numerous complaints regarding the veracity of representations made on online group deal websites since they first emerged in 2010.
Last week, the Federal Court ruled that Spreets, a “daily deal” website, must pay penalties of $600,000 for misleading consumers between June 2011 and April 2012. Spreets engaged in misleading and deceptive conduct regarding the price of particular deals, the ability of consumers to redeem vouchers and the refund rights of consumers. In doing so, the website contravened Australian Consumer Law.
Online “daily deal” or “deal of the day” websites offer heavily discounted goods and services when multiple customers prepay for the same good or service.
In December 2013, Scoopon was made to pay $1 million in respect of misleading its customers (see our previous post), and in 2014, LivingSocial agreed to a court enforceable undertaking that it would change its contracts and website. Spreets, the latest in line, also implemented compliance programs in response to the ACCC’s investigation. While still up and running, Spreets no longer offers its own deals but now aggregates and publishes deals from other online group buying sites.
This latest decision indicates that the ACCC is just getting started with its enforcement priority of online consumer issues and is yet another reminder to online businesses that they are not exempt from the operations of traditional consumer law.