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Coles, Woolworths identify defence to price gouging allegations
Appearing for the first time in court to face the allegations they misled customers with dodgy promotions, Coles and Woolworths have outlined the defence they would rely on during the hearing.
Naomi Neilson
At a case management hearing on Wednesday (23 October) morning, counsel for Coles and Woolworths both flagged they would pursue the defence that a sudden inflation hit to suppliers was responsible for an increase in product prices.
The watchdog has alleged the giant supermarket retailers temporarily increased the price of more than 200 products for a short time before it was placed on a “promotional discount” at a price that was “higher than, or equal to, their original selling price”.
Appearing for Coles, counsel John Sheahan KC said that in “almost every case” alleged by the ACCC, the prices were brought about “because of a request by the supplier for a price increase … because of an increase in the costs borne by the supplier with a sudden inflation”.
Similarly, Cameron Moore SC said “any price increases” on Woolworths’ shelves were “initiated by the suppliers … in response to rising costs, [which] resulted in new standard retail prices, which were not temporary, but permanent or long term”.
“What happened thereafter is a response to promotions or promotional spending by the suppliers, which may permit prices to be put on special or a longer-term price reduction,” Moore said.
Moore went on to claim the ACCC’s case is “factually … misconceived”.
“When one comes to question of costs, one of the complexities … is from the perspective of the retailer, the cost in the traditional sense is a combination of the price being charged by the supplier but also the promotional spend that the supplier is providing, and that is quite a complex inter-relationship,” Moore said.
Sarida Mcleod, for the ACCC, said none of these submissions had taken the watchdog by “surprise”, and despite the supermarket’s submissions, she alleged, “the conduct is still misleading”.
Speaking to Lawyers Weekly, Holding Redlich partner Joanne Jary and senior associate Caitlin Waldron explained the ACCC has alleged the promotional strategies employed by the supermarkets have “diminished consumers’ ability to make informed choices”.
“These deceptive price representations, made during a time of increasing cost-of-living pressures, were part of a program aimed at helping consumers save on household staples but instead caused harm by misrepresenting the potential savings,” they said.
Coles and Woolworths have been given until the end of November to file and serve a concise statement in response.
A further case management date will soon be fixed.
Naomi Neilson
Naomi Neilson is a senior journalist with a focus on court reporting for Lawyers Weekly.
You can email Naomi at:
