Thermomix to Pay $4.6m for Misleading Consumers and Failure to Report Burn Injuries

On 11 April 2018, the Federal Court of Australia ordered Thermomix in Australia Pty Ltd (‘Thermomix’) to pay penalties of $4.6m for making false or misleading representations in relation to remedies, and failing to act in response to known incidents of burn injuries in the case of ACCC v Thermomix in Australia Pty Ltd [2018] FCA 556.

Facts

In 2017 the ACCC commenced proceedings in the Federal Court against Thermomix, alleging that it contravened provisions of the Australian Consumer Law ('ACL')  in relation to its model, TM31. There was a potential risk of burn injuries caused to consumers by the lid lifting and hot food or liquid escaping from the mixing bowl. A voluntary recall notice in relation to a safety issue with the TM31 was published on the ACCC'S Product Safety website on 7 October 2014. Thermomix also notified its customers of the recall via Facebook post on 23 September 2014 and sent emails to affected consumers on 25 September 2014.  

The ACCC alleged that Thermomix mislead customers about their consumer guarantee rights, failed to comply with mandatory reporting requirements for burn injuries arising from the use of the appliances, made false representations and engaged in misleading conduct regarding refunds related to injuries caused by the TM31 model. 

In relation to conduct regarding refunds or remedies for injuries, ACCC argued that Thermomix made false representations that remedies were conditional upon consumers signing non-disclosure agreements, which would prevent them from making negative statements about Thermomix. Thermomix also represented to other consumers that they would not be provided with a remedy.

For more information on the background of this case, please read TimeBase’s earlier article. 

Decision of the Federal Court

Justice Murphy, sitting alone, held that Thermomix breached the ACL by making false or misleading representations to consumers because of its silence about a safety issue affecting the performance of the TM31 appliance, which Thermomix knew about from 7 July 2014.

In addition, Justice Murphy found that Thermomix made false or misleading representations about their consumer guarantee rights by telling consumers that refunds or replacements were not available. In the case of one consumer, Thermomix told them that their entitlement to a refund or remedy was conditional on the signing of a non-disclosure agreement. This non-disclosure agreement would prevent the consumer from making negative comments about Thermomix. It was found that the contraventions occurred at a time when senior management were aware of the negotiations and the contraventions. 

Penalties

Thermomix was ordered to pay a penalty of $4,608,500. In addition, Thermomix was ordered to pay the ACCC’s costs. 

The Court ordered Thermomix to establish a Consumer Compliance program and maintain that program for a period of three years, and to publish information on the homepage of Thermomix related to this judgement for 90 days. In addition, Thermomix was ordered to publish information related to this judgement on its Facebook page for a period of 90 days.

Media Response

In a media release published by the ACCC, ACCC Commissioner Sarah Court stated:

Bianca Mazur from Thermomix was reported in ABC News as saying:

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ACCC v Thermomix in Australia Pty Limited [2018] FCA 556

Stephen Letts, ‘Thermomix fined $4.6 million for failure to report burns,’ (ABC News), 11 April 2018.

[media release] ACCC, ‘Thermomix ordered to pay penalties of more than $4.6 million,’ 11 April 2018.