Nurofen misleading advertising class action: Late amendment to pleadings refused

Nurofen misleading advertising class action: Late amendment to pleadings refused

Nurofen misleading advertising class action: Late amendment to pleadings refused

Brief overview of ACCC action against “specific pain” Nurofen products

In much-publicised proceedings, the Australian Competition and Consumer Commission successfully prosecuted proceedings against Reckitt Benckiser’s more expensive “specific pain” range of Nurofen products.  These Nurofen products were marketed differently for different types of pains (“migraine pain”, “tension headache”, “period pain” or “back pain”) but they contained the same active ingredients, worked in the same way, and did not work differently for different pain types.  We reported here that, in December 2015, the Federal Court found that the “specific pain” Nurofen packaging, and associated advertising, was:

  • misleading or deceptive, in contravention of section 18 of the Australian Consumer Law; and
  • liable to mislead the public as to its nature, character or suitability for purpose, in contravention of section 33 of the Australian Consumer Law.

The Federal Court ordered Reckitt Benckiser to pay a $1.7 million penalty for these breaches of the Australian Consumer Law, which was later amended on appeal by the Full Federal Court to $6 million.

Consumer class action – class action group denied extra damages claim shortly before the trial

The saga continues with a class action brought by consumers seeking damages as a result of purchasing the more expensive (but no more effective) “specific pain” Nurofen products, due to their misleading packaging and/or associated advertising.  The class action trial is due to begin on 1 August 2017.

In the recent decision Hardy v Reckitt Benckiser (Australia) Pty Limited (No 2) [2017] FCA 785, Justice Nicholas refused an application by the consumer class action group to amend its case to add a new claim for damages arising from the “specific pain” Nurofen products failing to comply with statutory guarantees as to acceptable quality imposed by sections 54, 56 and 59 of the Australian Consumer Law.  The amendment application was made on 29 June 2017, only a month before the start of the trial. 

Arguments resisting the late amendment

Reckitt Benckiser resisted the amendment, on the basis that it introduced, for the first time, the issue of the value of the “specific pain” Nurofen products compared to three cheaper, alternative, forms of Nurofen.   Reckitt Benckiser pointed out that:

  • The four different types of Nurofen that would be in issue, the “specific pain” Nurofen products, the cheaper fast-acting Nurofen Zavance, Nurofen Zavance liquid capsules, and standard Nurofen, each contained different forms of the active ingredient, ibuprofen.
  • There was no evidence about the different value of these four different formulations of Nurofen, either in terms of their different pharmacological effects, their different manufacturing costs, or other differences such as different shelf-life.
  • Further evidence about the differences between the different Nurofen products might be required if the consumer class action group’s late amendment was allowed.  For example:
    • evidence from a pharmacologist might be required to prove that there is a therapeutic benefit to consumers from fast-acting versions of Nurofen; and
    • evidence from an economist about the value of the products might also be required, and this evidence would take 6-8 weeks to complete.

Lessons concerning late amendments – reasons why the late amendment was refused

The consumer class action group failed to explain why its amendment, to seek damages for breaches of statutory guarantees, was not made sooner, nor when it decided to pursue this amendment to its case.  The consumer class action group also agreed that, if pursuing the new claim would require the 1 August 2017 trial date to be vacated (to allow sufficient time for further evidence), the new claim would be abandoned.

Given the new issues and possible extent of further evidence, Justice Nicholas considered that it would be unjust to require Reckitt Benckiser to meet the new claim at a trial beginning in a matter of weeks.  Accordingly, Justice Nicholas refused to allow the consumer class action group to add, so close to the hearing, a new claim for damages for breaches of statutory guarantees.

The decision is a useful example of when a party will not be allowed to amend its case shortly before trial, following the High Court seminal case Aon Risk Services Australia Limited v Australian National University [2009] HCA 27, which concluded that there is a limit to a litigant’s ability to make late changes to its case.