ACCC launches action against Seednet over Compass barley claims

Grain Central, August 6, 2018

THE AUSTRALIAN Competition and Consumer Commission (ACCC) announced today it had instituted proceedings in the Federal Court against Landmark Operations Limited (trading as Seednet) for allegedly making false, misleading and deceptive claims in a fact sheet for its barley variety, Compass.

At the time of the alleged conduct, Compass was a new barley variety that was developed by the University of Adelaide.

Seednet markets and distributes Compass to retailers and farmers across Australia under a licencing agreement with the University of Adelaide.

Commander is an older variety of barley commonly grown by farmers, developed by the University of Adelaide and also marketed and distributed under licence by Seednet.

The ACCC alleges that, from at least December 2014 to December 2016, Seednet misrepresented to farmers that Compass barley had strong straw; had better straw strength than Commander; had improved lodging resistance than Commander; and was better suited to early sowing, higher fertility paddocks and higher nitrogen rates than Commander.

The ACCC alleges that by at least December 2014, Seednet had received information which made it (or ought to have made it) aware that Compass’ performance did not support these representations.

The ACCC also alleges that, from at least January 2016 to December 2016, Seednet misrepresented to farmers that Compass had higher resistance to the disease, leaf rust, than it actually did in NSW, Victoria, Queensland, SA and WA.

By January 2016, Compass had been rated very susceptible to leaf rust in NSW, Victoria and Queensland, and ranging up to very susceptible in SA under consensus ratings through the National Variety Trials program.

“Our allegation is that Seednet was engaging in misleading and deceptive conduct in relation to the claims they were making about the Compass barley variety, particularly the claims about its performance in relation to lodging and its rust resistance,” ACCC deputy chair Mick Keogh said.

“We allege that Seednet knew, or ought to have known, that its representations in relation to Compass’ straw strength and leaf rust resistance were incorrect, but that it did not amend its fact sheet to correct these representations.”

Potentially misleading marketing of new varieties of agricultural produce is a key issue that has been raised with the ACCC by farmers.

“The issue arose because complaints were lodged with us by growers who felt they and their agronomists had been given incorrect information about the performance of this variety,” Mr Keogh said.

“Farmers have told us they suffer harm as a result of misleading marketing because, without correct information, they assume or are incorrectly advised that other factors such as the weather are to blame when crops don’t succeed or perform in the way that has been represented by suppliers.

“It is very difficult for individual farmers to judge whether it is the year, their production decisions or the variety that is causing the outcome in terms of their crop. That’s why we think it is critically important that the information is correct.

“Agribusinesses should be careful to ensure they have a proper basis for marketing the qualities of new agricultural varieties and that they do not misrepresent the properties or performance of new products. Any misrepresentations risk ACCC enforcement action.”

Landmark response

Landmark has confirmed in a statement that the ACCC has filed proceedings against it in the Federal Court of Australia, alleging that Landmark’s Seednet business made misleading statements in historical marketing materials in relation to the Compass barley variety.

Landmark said it was currently reviewing the ACCC’s claims, but as the matter was now before the Federal Court it was unable to make any further comment on the allegations.

“We wish to stress, however, that the ACCC’s allegations relate to certain statements made by Seednet, and in no way relate to the overall performance of Compass itself,” it said.

“Compass has recently achieved malt accreditation and is one of the highest yielding varieties of barley on the market across Australian barley growing regions.

“Landmark is very pleased to have brought the Compass variety to market. We are proud that Compass has performed strongly since its introduction, and continues to deliver excellent yields to Australian growers.”

Source: ACCC, Landmark




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