A Federal Court judge has questioned the consumer watchdog's case against Woolworths over alleged misleading pricing practices, suggesting the evidence doesn't show "nefarious" conduct by the supermarket giant.
The Australian Competition and Consumer Commission brought the case against Woolworths, alleging the company engaged in deceptive discount pricing by temporarily raising prices before reducing them to create the appearance of larger discounts than actually existed.
But during Federal Court hearings, Justice Michael Lee questioned whether the conduct was genuinely misleading or just normal retail pricing strategies, stating "none of it strikes me as nefarious."
Mate, when the judge hearing your consumer protection case says it doesn't look nefarious, that's not a good sign for the regulator. The ACCC is finding out that proving pricing practices are misleading is harder than it looks.
The case centres on Woolworths' "Prices Dropped" promotional campaign, where products were marked as having reduced prices. The ACCC alleges Woolworths inflated prices for a period before implementing the "price drop," making the discount appear larger than it actually was compared to the product's regular selling price.
This kind of pricing strategy—raise the price briefly, then drop it and claim a big discount—is common in retail. The question is whether it crosses the line into misleading conduct under the Australian Consumer Law. The ACCC clearly thinks it does. Justice Lee appears skeptical.
The judge's comments during the hearing don't determine the outcome—he's testing the ACCC's arguments and evidence, which is what judges do. But his suggestion that the conduct doesn't appear nefarious is a warning sign that the regulator's case may not be as strong as it hoped.
Woolworths has consistently denied engaging in misleading conduct, arguing its pricing practices are standard retail operations. The company says prices fluctuate for various commercial reasons, and promotional campaigns reflect genuine price reductions even if the comparison isn't to the lowest historical price.
