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Providing strategic advice on expansion structures November 16, 2018

Founded in Bondi Beach in 2012, Bailey Nelson has rapidly grown into a global eyewear retailer and service provider with boutiques in Australia, London, Canada and New Zealand. The strong demand for their products and … Continued

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Maddocks appoints leading energy and resources partner November 19, 2019

Tuesday 19 November 2019 Maddocks has appointed one of Australia’s leading energy and resources lawyers. Peter Limbers will be joining Maddocks as a partner in Sydney in early 2020. Peter is widely recognised as one … Continued

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The Retail Leases Amendment Bill 2019 – ESMs, rent reviews and cooling off December 12, 2019

Since the issue of VCAT’s advisory opinion in May 2015 (Opinion), the retail leasing sector has been grappling with uncertainty about a landlord’s ability to recover from a tenant certain costs incurred in complying with … Continued

Reckitt Benckiser’s Nurofen headache – Part three

Since our last update, there have been significant developments in the proceedings brought by the ACCC against Reckitt Benckiser for its misleading representations in relation to its ‘Nurofen Back Pain’, ‘Nurofen Period Pain’, ‘Nurofen Migraine Pain’ and ‘Nurofen Tension Headache’ pain relief products.

The initial penalty of $1.7 million imposed on Reckitt Benckiser by the Federal Court in April 2016 was appealed by the ACCC in May last year.  At the time the ACCC stated that the penalty ‘on a company the size of Reckitt Benckiser does not act as an adequate deterrent and might be viewed as simply a cost of doing business’.

The Full Federal Court allowed the ACCC’s appeal and increased the penalty to $6 million in December 2016. This was the largest corporate penalty ever awarded for misleading conduct under the Australian Consumer Law. The Full Court justified the penalty, stating:

The objective of any penalty in this case must be to ensure that Reckitt Benckiser and other ‘would-be wrongdoers’ think twice and decide not to act against the strong public interest.

Reckitt Benckiser applied for special leave to appeal to the High Court of Australia on a number of grounds including that the Full Federal Court had erred in its finding that the original penalty was manifestly inadequate. On 5 April 2017, the special leave application was dismissed and Reckitt Benckiser must now pay the full $6 million penalty.

These proceedings demonstrate that the Courts are willing to enforce substantial penalties for breaches of the Australian Consumer Law.

Authors:   
ELIZABETH BLANCH 5CM COLOUR JPG 2015 Elizabeth Blanch
Senior Associate
61 2 9291 6172
elizabeth.blanch@maddocks.com.au
Jordan Reid
Lawyer
61 2 9291 6303
jordan.reid@maddocks.com.au

Since our last update, there have been significant developments in the proceedings brought by the ACCC against Reckitt Benckiser for its misleading representations in relation to its ‘Nurofen Back Pain’, ‘Nurofen Period Pain’, ‘Nurofen Migraine Pain’ and ‘Nurofen Tension Headache’ pain relief products.

The initial penalty of $1.7 million imposed on Reckitt Benckiser by the Federal Court in April 2016 was appealed by the ACCC in May last year.  At the time the ACCC stated that the penalty ‘on a company the size of Reckitt Benckiser does not act as an adequate deterrent and might be viewed as simply a cost of doing business’.

The Full Federal Court allowed the ACCC’s appeal and increased the penalty to $6 million in December 2016. This was the largest corporate penalty ever awarded for misleading conduct under the Australian Consumer Law. The Full Court justified the penalty, stating:

The objective of any penalty in this case must be to ensure that Reckitt Benckiser and other ‘would-be wrongdoers’ think twice and decide not to act against the strong public interest.

Reckitt Benckiser applied for special leave to appeal to the High Court of Australia on a number of grounds including that the Full Federal Court had erred in its finding that the original penalty was manifestly inadequate. On 5 April 2017, the special leave application was dismissed and Reckitt Benckiser must now pay the full $6 million penalty.

These proceedings demonstrate that the Courts are willing to enforce substantial penalties for breaches of the Australian Consumer Law.

Authors:   
ELIZABETH BLANCH 5CM COLOUR JPG 2015 Elizabeth Blanch
Senior Associate
61 2 9291 6172
elizabeth.blanch@maddocks.com.au
Jordan Reid
Lawyer
61 2 9291 6303
jordan.reid@maddocks.com.au