Thinking | 8 April 2020

Undertaking by TEG Live to ACCC arising from advertising for international basketball matches

On 7 April 2020, the Australian Competition and Consumer Commission (ACCC) announced it had accepted enforceable undertakings from TEG Live Pty Limited (TEG Live) arising from advertisements promoting a series of basketball matches held in Australia in 2019.[1]

The conduct

In August 2019, three basketball matches were played between the USA men’s national basketball team and the Australian men’s basketball team at venues in Sydney and Melbourne. As the promoter for the matches, TEG Live undertook the promotion and sale of tickets to the matches.

As part of promotions of the matches TEG Live published advertisements featuring:

  • an image of a basketball stadium with tiered seating surrounding the court (Tiered Seating Image); and
  • information, images and videos of prominent USA basketball players including LeBron James, Kevin Durant, Paul George and James Harden (Player Advertisements).

Despite the Tiered Seating Image in TEG Live’s promotions, the seating for the matches immediately surrounding the court held in Melbourne was not tiered, and many of the spectators who had purchased floor-level seats had limited views. Additionally, some of the high profile USA basketball players that were featured in the Player Advertisements did not participate in the matches and only four players from the original 35 man squad played in the matches.

Relevant law

ACCC asserted the Tiered Seating Image and the Player Advertisements were likely to have contravened the following sections of the Australian Consumer Law:[2]

  • Section 18 - a person must not engage in conduct that is misleading or deceptive, or is likely to mislead or deceive;
  • Section 29(1)(b) - a person must not, in connection with the supply of goods or services or the promotion of the supply of goods or services, make a false or misleading representation that they are of a particular standard, quality, value or grade;
  • Section 29(1)(g) - a person must not, in connection with the supply of goods or services or the promotion of the supply of goods or services, make a false or misleading representation that they have sponsorship, approval, performance characteristics, accessories, uses or benefits; and
  • Section 34 - a person must not engage in conduct that is likely to mislead the public as to the nature, the characteristics, the suitability for their purpose or the quantity of any services.

Undertaking by TEG Live

In accordance with section 87B of the Competition and Consumer Act 2010 (Cth), the ACCC accepted an undertaking from TEG Live in which it accepted that there were no reasonable grounds for representing that the seating arrangements for the Melbourne games would be tiered or that those players featured in the Player Advertisements would play or would at least be available to play.

To address the alleged breaches of the Australian Consumer Law, and to mitigate the risk of any future contravention of the Australian Consumer Law, TEG Live has undertaken to (among other things):

  • identify and refund customers who purchased floor-level seats at the Melbourne matches between 18 June 2018 and 24 August 2019;
  • identify and refund customers who purchased tickets to the matches on or after 15 August 2018, but did not attend and requested a refund on the basis that players featured in the Player Advertisements were not participating in the matches;
  • operate a dedicated phone line for at least 18 weeks to deal with customer enquiries relating to the refund process;
  • include in any future marketing for an international team sporting tour a prominent disclosure that team selections and seating arrangements may be subject to change; and
  • provide a report to the ACCC on an annual basis until 2023 of any advertising for an international sporting team tour that features players who ultimately do not participate in that event.

The total refund for approximately 5,000 eligible customers is anticipated by the ACCC to be over $5 million.

Conclusion

The action taken by the ACCC in obtaining an enforceable undertaking from TEG Live reinforces that promoters of sporting contests, concerts and other entertainment events must be conscious of, and comply with, the requirements of the Australian Consumer Law when promoting and undertaking these events.  In particular, promoters need to ensure that their advertising is not misleading or deceptive.

Hall & Wilcox advises various event promoters, event organisers and venues, and can assist with reviewing advertising and promotional material associated with events and any other matters arising under the Australian Consumer Law.

[1] https://www.accc.gov.au/media-release/teg-live-to-refund-over-5-million-to-consumers-for-usa-basketball-games
[2] Competition and Consumer Act 2010 (Cth), sch 2.

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