Businesses must be able to back up charitable claims

29 January 2020

ACCC takes action against Oscar Wylee

The ACCC has launched legal action in the Federal Court against eyewear company Oscar Wylee Pty Ltd (Oscar Wylee) for allegedly misleading consumers about its charitable donations and affiliations in breach of the Australian Consumer Law (ACL).1

In the ACCC’s claim, it asserts that Oscar Wylee,

  1. “engaged in conduct that was misleading and deceptive or likely to mislead or deceive, in contravention of s 18 of the ACL;
  2. made false or misleading representations as to the benefits of its optometry and eyewear goods or services, in contravention of s 29(1)(g) of the ACL; and
  3. engaged in conduct that was liable to mislead the public as to the quantity of goods, namely one pair for the customer and one pair to be donated, in contravention of s 33 of the ACL.”2

The ACCC alleges that Oscar Wylee engaged in misleading conduct, and made false or misleading representations by marketing itself to consumers as a company that made philanthropic donations each time a consumer bought a pair of glasses from it, when it did not do so, and by falsely overstating the charitable affiliations it held.3

Oscar Wylee represented that, when a consumer purchased a pair of glasses from Oscar Wylee, it donated a pair of glasses to someone in need at or around the time of purchase.4 These representations are said to have occurred between 13 January 2014 to 31 December 2018.5 The ACCC claims that while Oscar Wylee sold 328,010 pairs of glasses, it only donated 3,181 pairs of glasses during that period.6

The ACCC also claims that Oscar Wylee represented that it had an affiliation or partnership with Rose Charities. However, during the period between 13 January 2014 to 31 December 2018 Oscar Wylee allegedly only appeared to donate $2,000 and 100 glasses frames to that charity.

According to the ACCC, the representations depicted Oscar Wylee as a company that engaged in charitable activities on a significant scale. The effect of these claims and representations was that Oscar Wylee’s philanthropic actions were a reason consumers should choose to purchase their glasses from Oscar Wylee.7 One of the reasons the ACCC argues this alleged conduct is particularly problematic is that it involves statements or claims that consumers cannot monitor or verify.8

ACCC Deputy Chair Delia Rickard expressed her concern that “consumers may have chosen Oscar Wylee over other eyewear companies because they believed their purchase would result in Oscar Wylee providing glasses to people in need and supporting a sustainable eye care program in Cambodia.”9 The representations also had the potential to diminish consumer confidence in organisations that genuinely engage in philanthropic behaviour.10

Oscar Wylee has refuted the claims, stating “[we] utterly reject the allegations made by the ACCC, which do not reflect the range and scale of the community and charitable contributions made by Oscar Wylee.”

The ACCC is seeking declarations, orders for pecuniary penalties, injunctions, corrective publication orders and an order for Oscar Wylee to implement a compliance program.11

Businesses must ensure that any claims made that relate to philanthropic endeavours, donations or partnerships can be substantiated to avoid any claims that they have misled consumers in breach of the ACL.12

This article was written by Teresa Torcasio, Partner and Ruth Trevenen-Williams, Solicitor.

2, [14].
3, [2].
4, [4].
5, [4].
6, [7].
7, [5].
8, [18].
10, [18].

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