Label claim causes $1m headache

Nurofen seller Reckitt Benckiser New Zealand (RBNZ) has received a $1.08m fine in the Auckland District Court for 10 charges relating to its Nurofen specific pain range products.
 
RBNZ admitted that, between 2011 and 2015, its packaging of the products and representations on the nurofen.co.nz website were liable to mislead consumers about the nature, characteristics and suitability of the products. The products include Nurofen Migraine Pain, Nurofen Tension Headache, Nurofen Period Pain and Nurofen Back Pain.
 
The product packaging erroneously stated that the products targeted a particular type of pain, when in fact, each product contained exactly the same active ingredient, 342 mg ibuprofen lysine, and each worked identically to the other products. The website contained a number of statements and a product comparison page which gave the overall impression that RBNZ had created separately formulated products to target and relieve specific types of pain when that was not the case.
 
Mark Berry, Commerce Commission Chairman, said, “The packaging of these products and the website gave consumers the impression that the products were targeted to relieve a specific kind of pain. In fact, the products all contained the same ingredients and worked identically, to alleviate inflammation and pain generally, but were not specifically formulated to treat a particular area of pain. Consumers paid significantly more for these products compared to other ibuprofen products that would have had a similar effect.
 
“RBNZ was made aware in 2011 and 2013 through a media article and a complaint to the Australian Therapeutic Goods Administration that the products were potentially misleading, yet continued to market and sell the products.”
 
“The Commission will continue to take cases where traders do not promote their products truthfully. Products need to be as described on the box, and these were not. We take a particularly dim view when goods for human consumption are misdescribed; especially where pharmaceutical or healthcare products are not promoted truthfully. With these types of products consumers have little opportunity to verify the claims being made and tend to rely heavily on what they are told by the trader. To be able to choose the product best suited for them, consumers must have accurate and reliable information”
 
In sentencing RBNZ, Judge Jelas described RBNZ’s behaviour as “highly misleading” and noted it was “blatantly apparent they were in breach of their lawful obligations to New Zealand consumers.”
 
“Without the misleading statements the reason for the products existence disappears. There was no reason to choose one over the other.”
 
Judge Jelas accepted that RBNZ had expressed its remorse for its conduct, but only after the Commission opened its investigation, having ignored previous warnings and publicity in the media.
 
Half of the conduct charged occurred before the 2014 changes to the Fair Trading Act which increased the maximum corporate penalty for breaching the Act from $200,000 to $600,000.