The Australian Competition and Consumer Commission (ACCC) has reportedly urged the court to impose a penalty of AUS $10 million against the Kraft-Heinz company’s local arm for distorted claims, to prevent other companies from doing the same in the future.
Sources state that ACCC has approached Justice Richard White to ensure that the company pays for implying that its Little Kids Shredz products for toddlers were healthy and nourishing.
For the uninitiated, in March this year, the Adelaide Federal Court concluded that Heinz deliberately misled its consumers about the nutritional content of its products. The Court found statements like ‘99% fruit and veg’, that normally paired with a prominent imagery of fresh fruits and vegetables on the packaging, to be marking the product as healthy and nutritious, said sources familiar with the matter.
Reportedly, the contents of the product were claimed to have the same nutrition as fresh fruits and vegetables. The product approached consumers with an impression that it was a nutritional snack meant to encourage healthy eating habits among children.
However, the company failed to mention that the ingredients also include 60% sugar, which means they were more like confectionery, said Nutritionist, Dr. Rosemary Stanton.
According to Tom Duggan, Counsel for the ACCC, in this case, the nature and characteristic of the conduct are very serious, indeed egregious. The penalty needs to be big enough or it will fail to represent a strong warning because the conduct involved willful blindness or recklessness, he added.
According to reports, the lawyers of the Heinz company defended the claims made by ACCC. The company is conscientious and there is no evidence that supports the sort of nature and character as stated by ACCC, said Michael O’Brien. According to his statement, a penalty of $400,000 would’ve been appropriate, considering it matched the total gross profit of the product range. He found the $10 Million figure put forward by ACCC as an oppressive prospect for Heinz.
Meanwhile, Justice White is yet to impose a penalty, cite sources.