ACCC action re cancelled Qantas flights

[RooFlyer]

Is the $100m fine the largest ACCC fine
Are there any larger fines?

I think its the largest fine against a corporate entity.

Heaps. Google search showed Phoenix Institute for nearly half a billion.

Record penalties of $438m ordered against Phoenix Institute and CTI for acting unconscionably and misleading students

The Federal Court has today imposed record penalties of $438m against former vocational college Phoenix Institute of Australia Pty Ltd (Phoenix) and its marketing arm Community Training Initiatives Pty Ltd (CTI) in proceedings brought by the ACCC and the Commonwealth.

www.accc.gov.au

Heaps? I count 1 (one). Phoenix as you said, and the reason that was so large had a few factors

Rather, the assessment for an appropriate range was best assessed by reference to other factors, including:

• the payments made by the Commonwealth to Phoenix totalling $106 million;
• the gross benefits to Phoenix totally approximately $360 million; and
• the losses to enrolled consumers, including total debts exceeding $428 million;

There’s a fundamental difference in that a plea deal finds the defendant guilty, a settlement is the abandonment of the case under mutually agreed terms.

Yeah. It was given as an analogy. Not an equivalence.

 

[Quickstatus]

I will point out that sometimes businesses just eat the cost

Sometimes business just make their customers eat the cost
Business that absorb costs don't actually absorb costs - the costs are eventually paid for by others if the company is making a profit.

In the end sending a message to a large company like Qantas only hurts the vulnerable the government are supposed to be protecting.

To the contrary, it gives the investor be they mum and dad, super funds, institutional investors, comfort and confidence that there are regulatory frameworks and laws that companies must operate within. Qantas has now been found to breach 2 laws, and now pays $120M by agreement after admitting guilt in one + who knows how much in the other case where they were found to have breached employment law by the HCoA.

Not a very good corporate citizen and spirit of Australia it is not.

 

[justinbrett]

I think its the largest fine against a corporate entity.



Heaps? I count 1 (one). Phoenix as you said, and the reason that was so large had a few factors

You have Google in Tasmania, right?

Court orders Volkswagen to pay record $125 million in penalties

The Federal Court has ordered Volkswagen AG to pay $125 million in penalties, after it declared by consent that Volkswagen breached the Australian Consumer Law by making false representations about compliance with Australian diesel emissions standards.

www.accc.gov.au

And of course as per the chair quote above, she explicitly said a penalty of $100 million is not enough to be a deterrent. If she hadn’t made a big song and dance about getting much more out of Qantas perhaps she could claim it as a win, but considering she quite explicitly defined the metrics of success for the case, and failed to achieve that, then I think we can all make our own conclusions.

 

[SYD]

What is the process for determining who is going to get some of the $$?

I'd like to think my 2023 BNE-LAX flight would qualify but don't know where to start to join the queue.

Quite. The noise around the the case outcome is somewhat academic now.

I’m wondering if delayed restart of SYD-SFO will be included? Even if I did have CR flights!

 

[Cheatah]

You have Google in Tasmania, right?

Court orders Volkswagen to pay record $125 million in penalties

The Federal Court has ordered Volkswagen AG to pay $125 million in penalties, after it declared by consent that Volkswagen breached the Australian Consumer Law by making false representations about compliance with Australian diesel emissions standards.

www.accc.gov.au

And of course as per the chair quote above, she explicitly said a penalty of $100 million is not enough to be a deterrent. If she hadn’t made a big song and dance about getting much more out of Qantas perhaps she could claim it as a win, but considering she quite explicitly defined the metrics of success for the case, and failed to achieve that, then I think we can all make our own conclusions.

Not sure what your day job is but clearly you are not a lawyer. Of course before a case you talk up and talk big about the egregious actions of the other party, knowing full well that nothing is guaranteed and even if a court decides in your favour any compensation awarded may be much lower than you think is warranted. Similarly, Qantas would(and did) stridently deny any misbehaviour. All par for the course.

And now, Qantas has been forced to pay $100m+ without a drawn out legal process, by any measure ACCC has not only ensured the guilty party suffers financially, but suffers enough that it will be a deterrent for future misbehaviour. Job done.

Qantas shareholders will be hit due to the failures of management and this is exactly how it should be, if Qantas thought it had a reasonable defence it is unlikely to settle now for such a large sum. Additionally, in many organisations management bonuses would also be clawed back if the organisation suffers due to illegal actions or actions which have a material financial or reputational impact.

Unusually in Australia, this case is a win for consumers.

 

[justinbrett]

Not sure what your day job is but clearly you are not a lawyer. Of course before a case you talk up and talk big about the egregious actions of the other party, knowing full well that nothing is guaranteed and even if a court decides in your favour any compensation awarded may be much lower than you think is warranted. Similarly, Qantas would(and did) stridently deny any misbehaviour. All par for the course.

And now, Qantas has been forced to pay $100m+ without a drawn out legal process, by any measure ACCC has not only ensured the guilty party suffers financially, but suffers enough that it will be a deterrent for future misbehaviour. Job done.

Qantas shareholders will be hit due to the failures of management and this is exactly how it should be, if Qantas thought it had a reasonable defence it is unlikely to settle now for such a large sum. Additionally, in many organisations management bonuses would also be clawed back if the organisation suffers due to illegal actions or actions which have a material financial or reputational impact.

Unusually in Australia, this case is a win for consumers.

I would have agreed with your comments had the ACCC chair (who seems to love the media) not given us a detailed account of what she would and wouldn’t consider an acceptable penalty, and just so happen to specify the exact amount of $100 million as insufficient, and that it would be viewed as a “cost of doing business” and not a deterrent for a large corporation like Qantas.

Doesn’t sound like you’re a lawyer either, but cases settle for many reasons, and don’t necessarily imply acceptance of liability. We don’t know why the case settled but several theories have been floated, including the obvious of QF wanting to put the bad PR behind them, and the SMH suggested it could be that QF did not want to disclose to the court the inner workings of the company. Others have suggested it was ACCC that initiated the settlement.

In essence QF has admitted to process failures but ACCC has failed on its allegation that QF was taking money for "a service it did not, and had no intention of, providing". The ACCC's use of the phrase "deceptive conduct" in the allegation has also been removed in the settlement.

 

[Cheatah]

I would have agreed with your comments had the ACCC chair (who seems to love the media) not given us a detailed account of what she would and wouldn’t consider an acceptable penalty, and just so happen to specify the exact amount of $100 million as insufficient, and that it would be viewed as a “cost of doing business” and not a deterrent for a large corporation like Qantas.

Doesn’t sound like you’re a lawyer either, but cases settle for many reasons, and don’t necessarily imply acceptance of liability. We don’t know why the case settled but several theories have been floated, including the obvious of QF wanting to put the bad PR behind them, and the SMH suggested it could be that QF did not want to disclose to the court the inner workings of the company. Others have suggested it was ACCC that initiated the settlement.

In essence QF has admitted to process failures but ACCC has failed on its allegation that QF was taking money for "a service it did not, and had no intention of, providing". The ACCC's use of the phrase "deceptive conduct" in the allegation has also been removed in the settlement.

This is what you are missing - the ACCC has not "failed", it has agreed to settle for a known penalty against Qantas. We will never know if ACCC would have been unable to prove it's case, and then potentially fail to convince the court, that Qantas is guilty.

Given their are two parties, by your logic if ACCC has failed then Qantas has succeeded here, yet Qantas itself has decided to pay $100m+ rather than risk going to court. And Qantas could have garnered a lot of good publicity for a lot less than $100m if that was the primary reason they settled.

Qantas is paying a huge sum of money, apologised and yet its the ACCC that has failed. LOL.

 

[justinbrett]

This is what you are missing - the ACCC has not "failed", it has agreed to settle for a known penalty against Qantas. We will never know if ACCC would have been unable to prove it's case, and then potentially fail to convince the court, that Qantas is guilty.

Given their are two parties, by your logic if ACCC has failed then Qantas has succeeded here, yet Qantas itself has decided to pay $100m+ rather than risk going to court. And Qantas could have garnered a lot of good publicity for a lot less than $100m if that was the primary reason they settled.

Qantas is paying a huge sum of money, apologised and yet its the ACCC that has failed. LOL.

No, the outcomes are not binary. You’re conflating winning and losing in a general sense vs ACCC failing in its mission to obtain a record penalty for Qantas as a deterrent. These are not my words, go back and read the transcript from the Chair; it does not need interpretation, she explicitly defined what the metrics of success were.

As for the general outcomes, I’d probably call it a draw as both sides seem happy with the outcome. Even a court win would have been bad PR for Qantas, they will be happy to have this behind them.

 

[Jacques Vert]

they will be happy to have this behind them.

And they can blame it all on AJ

 

[anat0l]

And they can blame it all on AJ

I doubt that is an effective thing to do.

Politicians (especially heads of state) love to blame it all on predecessors. It gets stale to do so, particularly when the new incumbents love to take credit for initiatives that did work but were started in the previous regime.

Most of the current were, for lack of better phrase, co-conspiritors with AJ, so blaming him alone, even if he was the CEO, is pretty lame in both character and objectivity. If AJ deserved to be executed for what he did to Qantas, a number of others still present and in power have every reason to go down with him.

Mind, if Qantas was a Japanese airline, we'd be rattling off obituaries for the entire Qantas board right now...and be all the much happier for it.

 

[encryptededdy]

Mind, if Qantas was a Japanese airline, we'd be rattling off obituaries for the entire Qantas board right now...and be all the much happier for it.

uhh...

 

[jase05]

Most of the current were, for lack of better phrase, co-conspiritors with AJ, so blaming him alone, even if he was the CEO, is pretty lame in both character and objectivity

Yep, bit hard to throw it all back to AJ when he throws the keys to his loyal lapdogs and those are the ones still holding the fort.

I’d suggest QF will be very happy for it all to go away quietly

 

[Stone]

The ACCC is obliged to behave as a model litigant. If Qantas made an offer to settle that is close to the likely penalty the court would impose (not the penalty the ACCC proposed), they are expected to.

For Qantas to accept such a penalty, there must have been incriminating material they had to hand over in the discovery process. To date, they have wanted to litigate all the way.

 

[MEL_Traveller]

I wonder if this has any implications for flights that are zero’s out, but the call centre won’t let you change because ‘no official cancellation’ has been confirmed?

Frustrating when we know a flight isn’t going to operate, but at the same time we can’t change! Appreciate airlines want to use the time to reaccommodate pax onto other flights, but for those without status, acting early and fast means we have a better crack at alternatives.

 

[RooFlyer]

I think it’s also time for you to respect the fact that the ACCC also misled the Australian public when they stated that QF “charged fees for no service” and failed to provide evidence, and failed to achieve their full motive, why is why their penalty is only $100 million, a far cry from the $600 million floated by the ACCC when they were excited about this last September.

Gosh. Maybe Qantas should have applied to the court to have ACCC fined $100 million instead for its outrageous comments (and you need to learn the difference between allegations and statements-assertions). Then of course there's the sinister influence of you-know-who .

"The National virus Carrier" (TM), admitted selling flights that had been cancelled was false and misleading and has been fined $100 million. This after its convictions in the sacking of baggage handlers and laying off the guy who queried the cleaning of planes (can't recall specific there). Quite the rap sheet isn't it? The airline is an embarrassment to the flag it claims to carry.

You have Google in Tasmania, right?

Court orders Volkswagen to pay record $125 million in penalties

The Federal Court has ordered Volkswagen AG to pay $125 million in penalties, after it declared by consent that Volkswagen breached the Australian Consumer Law by making false representations about compliance with Australian diesel emissions standards.

www.accc.gov.au

Fair 'nuf. That's two (2). Keep that googling going and find us the 'heaps' (of ACCC penalties greater than Qantas') that you claimed above.

Doesn’t sound like you’re a lawyer either, but cases settle for many reasons, and don’t necessarily imply acceptance of liability. We don’t know why the case settled but several theories have been floated, including the obvious of QF wanting to put the bad PR behind them, and the SMH suggested it could be that QF did not want to disclose to the court the inner workings of the company. Others have suggested it was ACCC that initiated the settlement.

Qantas has explicitly admitted liability - that their actions were false and misleading to customers. Your whole argument has devolved into the ACCC not getting what they sought and this somehow constitutes a failure. Classic diversion "look over there".

As the saying goes - you've got to know when to fold 'em. Settling now, possibly for less than they wanted they wanted to squeeze out of the airline, means that the consumers that Qantas admitted they misled, can get a token of their money back, not wait another year or so.

I wonder if this has any implications for flights that are zero’s out, but the call centre won’t let you change because ‘no official cancellation’ has been confirmed?

That was the situation I brought up/suffered. I think the airline got away with those.

 

[justinbrett]

Fair 'nuf. That's two (2). Keep that googling going and find us the 'heaps' (of ACCC penalties greater than Qantas') that you claimed above.

This is getting tedious. You can do the rest.

Record $153 million in penalties ordered against training college AIPE

The Federal Court has ordered $153 million in penalties against Australian Institute of Professional Education Pty Ltd (in liquidation) (AIPE).

www.accc.gov.au

Qantas has explicitly admitted liability - that their actions were false and misleading to customers. Your whole argument has devolved into the ACCC not getting what they sought and this somehow constitutes a failure. Classic diversion "look over there".

As the saying goes - you've got to know when to fold 'em. Settling now, possibly for less than they wanted they wanted to squeeze out of the airline, means that the consumers that Qantas admitted they misled, can get a token of their money back, not wait another year or so.

The ACCC failed to get a record penalty awarded against Qantas for deceptive conduct.

Overall the ACCC had a partial success but didn’t meet its own metrics of success. QF’s fine will be considered the cost of doing business, according to the Chair, and not enough to be a deterrent.

I think both parties were happy to settle.

 

[Quickstatus]

The ACCC failed to get a record penalty awarded against Qantas for deceptive conduct.

Unless in the ACCC litigation team, no one would know if the ACCc failed.
All we have is the settlement.
$100m+$20 could be just the cost of doing business. I wonder though, is reputational damage also the cost of doing business?

 

[Quickstatus]

You can do the rest.

The VW case is interesting IIRC.
The Federal court actually imposed a larger fine than what the ACCC/VW originally agreed to which was $75M

The Federal court has not signed off on the ACCc/Qantas deal.

Separately I think that anyone who has a CL ticket should not sit in litigation/judgement in this case

 

[RSVKanga]

QF’s share price has today surged and finally re-entered the $6-7 territory for the first time since this ACCC case was initiated in August. It’s a win-win-win situation for the airline, ACCC and consumers.

It should be smooth sailing for the national carrier from this point onwards. With this dark chapter now closed, it’s time for all Australians to put the past behind and be vested to ensure QF’s perpetual success and growth internationally.

 

[oz_mark]

QF’s share price has surged and finally re-entered the $6-7 territory for the first time since this ACCC case was initiated in August.

It should be smooth sailing for the national carrier from this point onwards. With this dark chapter now closed, it’s time for all Australians to put behind the past and support QF’s perpetual success and growth internationally.

Why would.you support a company that thinks legal compliance is optional?