Luxottica Retails New Zealand Limited v Specsavers New Zealand Limited [2012] NZCA 357

Luxottica was originally denied summary judgment in the High Court against Specsavers for alleged misleading and deceptive conduct in breach of sections 9 and 13 of the Fair Trading Act 1986.  Specsavers ran an advertising campaign for progressive glasses where Specsavers' offer of two pairs of their cheapest progressive glasses "for as little as" and "no more than" $399 was juxtaposed with a statement that at OPSM (a brand of Luxottica) you would pay "up to" or "as much as" $976 for two pairs. 

The prices were prominently displayed, with certain qualifying words in fine print below.  The issue before the Court of Appeal was whether the High Court Judge erred in denying Luxottica summary judgment on its claim.  To determine this, the Court of Appeal had to be satisfied that none of Luxottica's claims could have succeeded.  The Court of Appeal allowed the appeal by Luxottica and found that the High Court had erred in concluding that Luxottica could not establish an arguable case.  The High Court Judge had concluded that because no error in the information contained in Specsavers' advertisements had been established by Luxottica, then no misleading or deceptive conduct had occurred.  The Court of Appeal concluded that just because information was factually accurate it was not necessarily precluded from being misleading or deceptive.  The Court noted that the class of consumers to whom the advertisement was directed and the media used must be considered, and the Court discussed the fleeting timeframe of availability of information in a television commercial, observing that the reasonable impression of the audience must be considered in light of all the circumstances. 

The Court noted that only the most attentive and astute viewer would notice the half-size qualifying small print that accompanied the full size price comparison, and the small print was likely to be missed by the majority.  The most obvious and prominent feature in the advertisements under review were the comparative prices.  While it could be shown that the representations made (including the small print) were literally correct, this was not necessarily sufficient to preclude a finding of misleading or deceptive conduct.  It was, in this case, the overall impression conveyed to the average consumer that was the critical factor. 

In a world where market competition is rife, it is increasingly important to ensure appropriate care is taken in comparatively promoting a product or service alongside that of a competitor.  While the facts or information contained in the promotion may well be accurate, this case serves as a reminder to carefully assess the likely impression of consumers viewing the advertising material provided, without the benefit of time or detailed information for consideration.