An Auckland appliance retailer, 2M Corporation, was fined $2,000 plus court costs in the Auckland District Court today for misrepresenting the price of television sets.
2M distributed brochures to households on the North Shore claiming that customers could save $1,000 when they bought Status television sets for $1,599. However, $1,599 was the normal price for the televisions and was also the manufacturers recommended retail price.
The company pleaded guilty to a charge brought by the Commerce Commission that the savings claim was a misrepresentation under the Fair Trading Act.
Another part of the brochure stated that the televisions cost around half the price of other leading brands. This statement did not prevent the savings claim being misleading.
Commission Chairman Dr Alan Bollard said that this is clear warning to companies that a specific misrepresentation as to price on one part of a brochure will not be corrected by a qualifying statement in another part of the brochure.
District Court Judge R.L.Kerr said that while $2,000 was at the lower end of the penalty scale in this area, it was appropriate taking into account that the company was a family affair which distributed the brochures itself, it was clearly not in a position of financial strength and had lost money on the enterprise.
Media contact:Acting Fair Trading Manager, David Taylor
