June 6, 2023
The Federal Court has declared by consent that Dell Australia Pty Ltd made false and misleading representations on its website about the prices of add-on monitors and in ‘strikethrough’ prices shown on the website.
On 4 November 2022, the ACCC instituted Federal Court proceedings against Dell Australia for allegedly making false or misleading representations regarding the price of monitors that consumers could add on to purchases of Dell computers.
When a consumer selected a desktop, laptop, or notebook on Dell Australia’s website, they were shown several compatible monitors and offered the option of ‘bundling’ a monitor to the purchase, often at a discounted price. The monitor was often shown with a higher strikethrough price, representing a significant saving if purchased with the computer.
Dell Australia admitted that the monitors were not sold for the ‘strikethrough’ price for most of the relevant time and, in some cases, the add-on price shown was more expensive than if the monitor was bought on a stand-alone basis.
Dell Australia also admitted that it made misleading statements about the discounted price of the add-on monitor on its website, including “Total Savings”, “Includes x% off”, “Discounted Price” and “Get the best price for popular accessories when purchased with this product”. In fact, the company sold more than 5,300 add-on monitors with overstated discounts.
Dell Australia has refunded or agreed to offer compensation to more than 4,250 affected consumers, who bought a monitor which was advertised on Dell Australia’s website with a discount that was in fact overstated or was not a discount at all.
“We brought these proceedings because we were concerned that Dell Australia had misled its consumers with false representations about its pricing and discounts,” ACCC Commissioner Liza Carver said.
“In some cases, consumers paid more for the add-on monitor advertised as ‘discounted’ than they would have paid if they had bought it as a stand-alone product, which is shocking,” Ms Carver said.
“As the Court noted, price and discounts are key differentiating factors for consumers deciding between product offers, and this case reinforces the importance of retailers displaying genuine ‘was/now’ pricing and accurate savings.”
“This case serves as an important reminder to businesses that suggestive upselling or bunding of products must not mislead consumers as to the deal they are getting.” Ms Carver said.
Consumers paid more than AU$2 million ($1.33 million/ €1.24 million) for add-on monitors between August 2019 and mid-December 2021. Dell Australia has been ordered to offer full or partial refunds to affected consumers. Some consumers have already been contacted and Dell Australia will now contact other consumers eligible for a refund.
The Court also ordered Dell Australia to appoint an independent compliance professional to review its compliance programme, and to issue corrective notices to every consumer that purchased an add-on Monitor through the Dell Australia website between August 2019 and December 2021.
The Court will hear submissions on penalties and costs at a later date.
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