Consumer rights have recently been upheld in the courts, although a question remains as to whether the remedies will be as effective as the subject matter.
In September 2016 the Commerce Commission took action against Reckitt Benckiser New Zealand, distributor of well-known drug Nurofen, for misleading the public in respect of four 'pain-specific' products. Ten charges were laid against Reckitt Benckiser under the Fair Trading Act, relating to the packaging and promotion of the Migraine Pain, Tension Headache, Period Pain and Back Pain 'pain-specific' products in the Neurofen range.
Each contained the same key ingredients and were equally as effective as standard Nurofen, yet were sold at a higher price point.
The District Court has now handed Reckitt Benckiser a fine of $1.08 million, noting the company's "blatant misleading conduct".
The average consumer is unlikely to have detailed knowledge of products such as pain-relief medication, which contain unfamiliar ingredients, and will therefore rely heavily on factors such as branding, packaging and advertising when making purchasing choices.
With that mind, has the consumer been vindicated here? It's a significant fine, but perhaps not, when the size of the company, the number of sales and the nature of the offending is taken into account.
The Federal Court of Australia seems to agree, it increased the penalty imposed on Reckitt Benckiser Australia (for the same conduct in Australia) from AUD$1.7 million to $6 million in December 2016.
However, at the end of the day, the Nurofen case serves as an important reminder to companies that, while the average consumer may be fooled, the Commerce Commission is watching and there will be a price to pay...
The watchdog said the packaging stated the products "targeted" a particular type of pain, "when this was not the case". Prosecutor Nick Flanagan said when the misleading claims were removed consumers were left with a "very different product" which was less attractive and similar to much cheaper options.