Dulux Group engaged in misleading and deceptive conduct by claiming its heat-reflective paint could substantially reduce the interior temperature of a house, the Federal Court has ruled.
The Australian Competition and Consumer Commission took legal action against the company over its claims that its InfraCOOL and Weathershield Heat Reflect products could reduce inside temperatures by up to 10C when applied to the roof, and by up to 15C when applied to exterior walls.
The company was ordered by the court on Wednesday to pay a $400,000 penalty and legal costs of $150,000, and also publish a corrective notice in a newspaper and on its website.
Justice Antony Siopis said InfraCOOL roof paint was sold at a premium of $4.95 per litre and about 144,000 litres were sold, which means consumers paid some $700,000 more than if they had bought the standard Dulux roof paint.
The approximate premium for the Heat Reflect paint over the standard wall paint was $2.20 per litre and with 48,000 litres sold, consumers were induced to pay about $105,000 more than if they had bought the cheaper product.
"I am not prepared to find that consumers did not suffer a loss by losing the opportunity to purchase the cheaper standard paint," Justice Siopis said.
"Dulux introduced a heat reflective product into a market in which there were already suppliers in Australia of heat reflective paint.
"It is obvious, therefore, that Dulux undertook a marketing and advertising campaign of which the contravening conduct was part, in order to earn market share."
