Fletcher v Nextra Australia Pty Ltd [2015] FCAFC 52: Misleading and Deceptive Conduct in Blogs

The Full Court of the Federal Court of Australia has handed down its decision in the case of Fletcher v Nextra Australia Pty Ltd [2015] FCAFC 52, affirming the decision of the Federal Court that comments posted on an industry blog can constitute false and misleading conduct under section 18(1) of the Australian Consumer Law (ACL) (Schedule 2 of the Competition and Consumer Act 2010 (Cth)). The Court found that despite the comments being posted on an industry blog, the appellant was an active industry participant and his comments were an attack on a competitor for the purpose of protecting his own business interests, which would usually be regarded as conduct in trade or commerce.

Background to the Case

The appellant, Mr. Fletcher, and the respondent, Nextra Australia Pty Ltd, were both involved in the newsagency industry. Mr. Fletcher is a director and shareholder of newsXpress Pty Ltd and the respondent is a competitor at newsXpress. Around 2011, Nextra distributed flyers to encourage newsagencies to join the Nextra Group. Mr. Fletcher responded to these flyers by composing and posting a blog article in which he criticised said flyers.

In first instance, the Federal Court found that Mr. Fletcher was liable for misleading and deceptive conduct in contravention of Section 18 of the ACL as his blog had erroneously asserted that the flyer did not properly differentiate between those newsagencies who had signed up for the full service Nextra group franchise and those who had signed up for the cheaper News Extra franchise. Mr. Fletcher asserted that the blog was his own opinion and was merely designed to encourage debate about the flyer. The Court disagreed with this point and found that Mr. Fletcher had clearly asserted these points as facts.

Full Court Finding

Mr. Fletcher contested this finding in the Full Court. His main argument was that while the blog may have been misleading and deceptive, the blog article was not conduct ‘in trade and commerce’ as required by Section 18 of the ACL. The Court determined that remarks by an independent industry commentator which are not intended to have an impact on trading or commercial activities will not be conduct in trade or commerce. 

However, when examining the particulars of Mr. Fletcher’s blog, the Court decided that, given Mr. Fletcher’s position in the industry and that his blogs had been used for commercial purposes in the past, it was clear that the blog was designed as an attack on a competitor for the purpose of protecting his own business interest. The fact that the comments were made in a blog which was recognised for providing authoritative industry commentary did not take them outside trade or commerce.

TimeBase is an independent, privately owned Australian legal publisher specialising in the online delivery of accurate, comprehensive and innovative legislation research tools including LawOne and unique Point-in-Time Products.

 Bloggers Beware

 Fletcher v Nextra Australia Pty Ltd [2015] FCAFC 52