Samsung agrees to pay $14 million fine for misleading Galaxy ads | Samsung

Samsung has agreed to pay a $14 million nice for deceptive claims that seven of its Galaxy telephones had been waterproof when the units may cease working after being utilized in swimming swimming pools or ocean water.

Choose Michael Murphy permitted the settlement between the tech firm and the Australian Competitors and Client Fee (ACCC) within the long-running case launched in 2019about adverts associated to seven Galaxy telephone fashions.

The competitors watchdog had alleged that Samsung misled and misled prospects with its telephone claims in additional than 300 adverts since February 2016. In court docket on Thursday, Samsung lawyer Nicholas De Younger stated the Complete rely of affected adverts got here to 684.

On-line, tv, and billboard commercials confirmed the telephones to be waterproof and utilized in swimming pools and seashores, though the telephones weren’t appropriate to be used in pool water or salt water.

The agreed deal is for a a lot smaller set of adverts. Samsung agreed as a part of the settlement of the case that 9 adverts for seven units that ran for 2 and a half years between 2016 and 2018 had been deceptive.

The corporate admitted that if the units had been utilized in salt water or swimming swimming pools, there was “a fabric prospect of corrosion injury to the telephone’s charging port,” ACCC lawyer Caryn Van Procter advised the court docket.

Throughout that point, Samsung offered 3 million of the Galaxy telephone fashions included within the deal in Australia.

The problem would come up when individuals went to cost their telephone whereas it nonetheless had water within the charging port, regardless of a warning showing on the telephone advising the person to not cost it. Samsung has since mounted this downside with {hardware} and software program adjustments in later fashions of the Galaxy telephone, the court docket heard.

Whereas some info was supplied to the court docket in regards to the variety of views the Fb and Twitter adverts acquired, within the lots of of 1000’s of views every, the court docket heard there was no method of understanding what number of customers purchased the units on the again of the market. adverts, or what number of had had a subsequent telephone failure on account of utilizing it within the pool or ocean water after which charging it.

Murphy stated, in accepting the $14 million settlement, that many customers would have used their telephones within the method depicted within the adverts, counting on these depictions.

He stated that $14 million would act as a deterrent and that it was a “actual and ample assault” on Samsung Australia’s 14% revenue over the past six years. He additionally criticized the telephone maker for less than cooperating to resolve the matter just lately after years of opposition to the ACCC case.

He criticized the way in which merchandise are sometimes marketed in Australia, saying too usually the federal court docket sees instances introduced earlier than it the place merchandise are oversold to customers in advertising campaigns.

Samsung was ordered to pay $14 million plus a $200,000 contribution to the ACCC’s prices inside 30 days of the order.

ACCC President Gina Cass-Gottlieb welcomed the ruling.

“Samsung Australia’s adverts selling its Galaxy telephones featured individuals utilizing their telephones in swimming swimming pools and seawater, though this might finally result in vital injury to the telephone,” Cass-Gottlieb stated.

โ€œThis sanction is a robust reminder to corporations that every one product claims have to be substantiated. The ACCC will proceed to take enforcement motion in opposition to corporations that mislead customers with claims in regards to the nature or advantages of their merchandise.”

A Samsung spokesman stated the corporate had extensively examined the merchandise with seawater and swimming pool water, however welcomed the closure of the case.

โ€œSamsung strives to supply the very best expertise for all of its prospects. Samsung regrets if any Galaxy customers have skilled a problem with their gadget on account of the issues lined by this case.”

The Samsung units included within the deal are the Galaxy S7, S7 Edge, A5, A7, S8, S8 Plus and Note8 telephones.

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