Australian Competition and Consumer Commission (ACCC) has announced the Federal Court has declared that documents used by a company to solicit customers for its online business directory were likely to mislead businesses receiving them. The company also engaged in conduct likely to mislead or deceive and acted unconscionably in demanding payment for these services.

In the Federal Court, Brisbane last week, the ACCC obtained orders by consent against Australialink Pty Ltd, its director Rachel Dargie and general manager Desmond O'Keefe.

Australialink publishes a number of online business directories, including the Australian Business Pages Directory. Each year it sends out more than a million directory requests to businesses across Australia.

The court declared that between January 2006 and June 2008, Australialink, through Ms Dargie and Mr O'Keefe, solicited customers for its directory listing services by sending out a document called a "Listing Advice Notice" (LAN) to a number of businesses. The LAN gave the misleading impression that businesses had already sought Australialink's services or had an existing business relationship with it. Once businesses signed and returned the LAN they would be invoiced $195.00 plus GST.

The court also declared that Australialink, along with Ms Dargie and Mr O'Keefe, acted unconscionably and with a lack of good faith towards businesses by intentionally misrepresenting that it had instituted, or was in the process of instituting, court proceedings against those businesses that had been invoiced for the listing but had not paid.

Australialink has been ordered to write to each person it invoiced between January 1 2007 and December 3 2008, notifying them of the proceedings brought by the ACCC, outlining the court's findings and advising that they may have a private right of action to seek compensation if they consider they have suffered loss as a result of Australialink's conduct.

In addition, the court:

• granted injunctions restraining the three respondents from using the documents concerned or being involved in similar conduct for a period of seven years
• ordered that Ms Dargie and Mr O'Keefe attend trade practices training, and
• ordered that the respondents pay the ACCC's costs.

29 September, 2009