A Federal Court ruling on Thursday found supermarket giant Coles deliberately disguised price increases as discounts under its "Down Down" campaign. Justice Michael O'Bryan determined that 13 out of 14 "Down Down" tickets examined were misleading, as the products in question were not sold at the stated "was" price for a sufficient period before the advertised discount.
The court's decision establishes that Coles engaged in misleading conduct, contravening Australian consumer law. This ruling, concerning 245 products, could result in significant penalties for the retailer, with some reports suggesting potential fines in the hundreds of millions of dollars.
Coles has stated it is reviewing the judgment. The case, heard in February, hinges on the supermarket's practice of temporarily increasing prices before applying a "Down Down" discount. Justice O'Bryan noted that a price rise would need to be sustained for at least 12 weeks before a subsequent discount could be considered genuine and not misleading.
Read More: Beauty Sales Start Early for Memorial Day Weekend 2026
The Australian Competition and Consumer Commission (ACCC), which brought the case, argued that Coles' promoted prices were often higher than, or the same as, the previous regular price. Lawyers for Coles had contended that price increases were due to inflation and that discounts represented genuine savings. However, Justice O'Bryan rejected this argument, stating, "They’re not [genuine savings]."
This verdict sets a potential precedent for the wider supermarket industry regarding how long price hikes must be in effect before advertised discounts can be promoted without legal consequence. A similar case against Woolworths, heard earlier, awaits judgment later this year.
Coles' shares saw a dip of around one percent in the market following the ruling. Brand experts have voiced concerns about potential long-term reputational damage, suggesting the "Down Down" campaign's core promise of price leadership has been undermined. Consumers, they argue, rely on trust and shortcuts when shopping, and deceptive pricing tactics can erode this foundation.
Read More: Supreme Court Rules Tate Modern Viewing Platform Is Nuisance
The ruling could also lead to substantial compensation payouts for consumers who were misled. Justice O'Bryan observed that consumers may not have purchased the products had they known the true pricing history. The court is expected to consider factors such as Coles' culpability, mitigation efforts, and the duration of the breaches when determining penalties.
