Coles 'Down Down' Campaign Accused of Tricking Shoppers in Melbourne Court

The ACCC claims Coles' 'Down Down' prices were not always lower than the original price. This case could lead to big fines for the supermarket.
By Newsroom | Business, Australia |

The Australian Federal Court is currently hearing a significant case where the competition regulator, the ACCC, accuses supermarket giant Coles of misleading consumers with its "Down Down" discount promotions. The core of the ACCC's claim is that Coles artificially inflated prices before advertising them as discounted, leading shoppers to believe they were getting a better deal than they actually were. This legal battle, potentially involving substantial fines for Coles, represents a major scrutiny of supermarket pricing practices during a period of rising living costs.

Australia news live: Coles admits in court to strong-arming supplier amid ‘Down Down’ campaign - 1

The legal proceedings, which began in the Federal Court in Melbourne, are the result of a broader investigation by the Australian Competition and Consumer Commission (ACCC) into how supermarkets price their products. This case is described as a landmark test, highlighting the regulator's focus on supermarket pricing strategies amid widespread concerns about the cost of living. The court is scheduled to hear evidence over a 10-day period.

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Australia news live: Coles admits in court to strong-arming supplier amid ‘Down Down’ campaign - 2

  • Timeline: The hearings commenced on a Monday, with the ACCC expected to present its first witnesses shortly after. The articles were published around February 17-19, 2026, indicating the court case is ongoing.

  • Key Players:

  • Coles: The supermarket chain accused of misleading pricing practices.

  • ACCC (Australian Competition and Consumer Commission): The regulatory body bringing the legal action.

  • Federal Court of Australia: The venue for the legal battle.

  • Garry Rich SC: Senior Counsel representing the ACCC.

  • John Sheehan KC: Barrister representing Coles.

  • Justice Michael O’Bryan: The presiding judge.

  • Core Allegation: The ACCC alleges that Coles engaged in an "utterly misleading" discounts campaign. Specifically, the regulator claims that Coles increased the prices of hundreds of products for a period before advertising them as discounted under their "Down Down" campaign. The ACCC contends that the "promotional price" was often the same as, or even higher than, the regular shelf price that existed before the price increase.

Coles' Defence and Counterarguments

Coles has strongly denied the ACCC's claims, arguing that its "Down Down" promotions represented a genuine reduction in price. The company's defence hinges on several points:

Australia news live: Coles admits in court to strong-arming supplier amid ‘Down Down’ campaign - 3

  • Inflationary Pressures: Coles argues that price increases were driven by unanticipated inflationary periods, and the subsequent "Down Down" prices were genuinely lower than these inflated prices. They suggest that adding complex price history to labels would confuse consumers.

  • Genuine Discount: Coles' legal team, led by John Sheehan KC, has argued that consumers would accept the promotion as a real drop in price. They also stated that for most of the 245 items in question, the price had not been increased for a very short duration.

  • Complexity of ACCC Case: Coles has also claimed that the ACCC's case is "too complicated" and has challenged the regulator's ability to define what constitutes a "regular price" and for how long it must be offered to qualify as a benchmark for a discount.

ACCC's Rebuttal and Evidence

The ACCC, through its counsel Garry Rich SC, has rejected Coles' explanations, labeling them as a "half-truth apt to mislead consumers." The regulator has presented evidence in court, including internal Coles emails, which reportedly shed light on the company's concerns about maintaining competitiveness with rival Woolworths.

  • Email Evidence: These emails suggest that Coles' pricing rules were perceived as hindering its ability to compete, especially during periods of high inflation.

  • Definition of "Regular Price": The ACCC argues that while a promotional price might be lower than an immediately preceding inflated price, it is deceptive if it's higher than the long-term regular price that existed before any price spike.

  • Shapes Pricing Example: In one specific instance highlighted by the ACCC, former Coles manager Rebecca Thompson was questioned about Arnott's Shapes Multipack pricing. The ACCC claims that shoppers paid the same or more for these products during the "Down Down" promotion compared to their regular price, despite the advertised discount.

Expert and Former Regulator Commentary

While not directly involved in the current proceedings, figures like Graeme Fels, a former ACCC commissioner, have offered insights into the potential implications of such cases.

"Quite possibly the price increases were genuinely needed to cover inflation, but that is not a defence to allegations that consumers were misled and deceived." - Graeme Fels

Fels indicated that such a case could carry significant reputational risk for Coles and potentially lead to fines in the hundreds of millions of dollars, drawing parallels to penalties levied on other corporations found guilty of misleading customers.

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Findings and Potential Ramifications

The Federal Court is tasked with determining whether Coles' "Down Down" pricing strategies breached Australian consumer law. The case is significant not only for the potential penalties Coles may face but also as a test case for the ACCC's broader scrutiny of supermarket pricing.

  • Consumer Impact: If the ACCC is successful, it could lead to stricter regulations and greater transparency in how supermarkets advertise discounts, directly impacting consumer trust and purchasing decisions.

  • Market Dominance: Coles, along with Woolworths, controls a significant portion of the Australian grocery market, making the outcome of this case particularly impactful for consumers nationwide.

  • Next Steps: The court will weigh the evidence presented by both Coles and the ACCC to make its determination. The outcome will have implications for Coles' future marketing practices and could set precedents for the retail sector.

Sources Used & Context:

Frequently Asked Questions

Q: What is the court case about Coles' 'Down Down' campaign?
The Australian Competition and Consumer Commission (ACCC) is suing Coles in the Federal Court. The ACCC says Coles tricked shoppers by raising prices before advertising them as 'Down Down' discounts.
Q: When did the court case start and where is it happening?
The court hearings started on a Monday in February 2026 in the Federal Court in Melbourne. The case is expected to last for 10 days.
Q: What does the ACCC say Coles did wrong?
The ACCC claims Coles increased prices on many items for a short time, then advertised them as cheaper. They say the 'discount' price was often the same or even higher than the normal price before the increase.
Q: How is Coles defending itself in court?
Coles says its 'Down Down' promotions were real price cuts. They argue that price changes were due to high inflation and that their advertised prices were lower than the new, higher prices.
Q: What evidence does the ACCC have against Coles?
The ACCC has shown the court internal Coles emails. They also questioned a former Coles manager about specific product prices, like Arnott's Shapes, to show shoppers may have paid more during the sale.
Q: What could happen if Coles loses the case?
If Coles is found guilty, they could face large fines, possibly in the millions of dollars. This case could also change how all supermarkets advertise their discounts in the future.