News & Insights

The Federal Court has dismissed an action brought by the consumer watchdog which alleged that the manufacturer of ‘flushable’ wipes had engaged in misleading and deceptive conduct.

Alleged misleading and deceptive conduct

In 2016, the Australian Competition and Consumer Commission (ACCC) sued Kimberly-Clark Australia for engaging in misleading and deceptive conduct after it advertised its range of Kleenex Cottonelle Cleansing Cloths as ‘flushable’.

The wipes were advertised as ‘flushable’, ‘completely flushable’, ‘able to be flushed in the toilet’ and able to ‘breakdown in a sewerage system or septic tank’. The ACCC alleged that by making these claims, Kimberly-Clark Australia had induced consumers to believe that the wipes would disintegrate like toilet paper when flushed down the toilet, when this was not accurate.

Tests conducted by Australia’s leading consumer advocacy group Choice revealed that after 20 hours the ‘flushable’ wipes had not broken down, while regular toilet paper had fully disintegrated in less than 3 minutes.

The ACCC received 28 consumer complaints alleging that the ‘flushable’ wipes had caused blockages to household sewerage systems. However, Sydney Water argues that the problems caused by ‘flushable’ wipes are far greater than that. According to the Water Services Association, more than $15 million is spent annually on rectifying sewerage problems related to ‘flushable’ wipes.

Federal Court wipes away alleged problems

The Court determined that while it was reasonable to assume that the wipes had contributed to the problems complained of, it could not be concluded that the wipes themselves had caused the sewerage blockages.

The Court considered that fecal matter, toilet paper and defects in sewerage infrastructure were also likely contributors. Additionally, it was possible that wipes other than those manufactured by Kimberley-Clark Australia were the cause of the blockages.

The Court’s decision diverges from a Federal Court order made against Pental last year. In that case, Pental was required to pay $700,000 after it admitted that its representations about its range of White King ‘flushable’ cleaning wipes were misleading and deceptive.

Key takeaways

Although Kimberley-Clark avoided liability in this instance, the case highlights the potential risks associated with inaccurate advertising and the importance of making substantiated representations. Businesses should exercise caution when making claims or representations about their products, and ensure they are supported by strong evidence.

This is particularly important given the range of parties who are able to bring complaints about advertising statements. As this case demonstrates, it is not only customers or competitors who have a right to complain, but also consumer advocacy groups such as Choice and the ACCC on the basis of its own investigation.

Macpherson Kelley can assist in ensuring product claims and representations comply with relevant legislation. If you require further information or assistance in relation to misleading and deceptive conduct, please do not hesitate to contact our Commercial team.

This article was written by Erin McLeod, Law Graduate.