Whether certain implied representations as to the clinical efficacy of deodorant products amounted to misleading or deceptive conduct for the purposes of the Australian Consumer Law (ACL) was examined by the Federal Court of Australia in its recent decision in Unilever Australia Ltd v Beiersdorf Australia Ltd [2018] FCA 2076.

A “clinical” grade deodorant?

The dispute centred on the effectiveness of “clinical” grade antiperspirant deodorants targeted, not surprisingly, at people who sweat more than others.

Justice Wigney was asked to consider whether laboratory testing alone was sufficient to prove that products described as having “clinical” grade antiperspirant properties were in fact “similar” or “superior” to other similarly marketed products in the mind of the “ordinary reasonable consumer”.

The evidence demonstrated that the Australian market for such “clinical” grade antiperspirant products consists of:

• Unilever’s Rexona and Dove ‘Clinical Protection’ ranges,
• Revlon’s ‘Mitchum Clinical’ range, and
• most recently, Beiersdorf’s Nivea ‘Clinical Strength’ range (Nivea Clinical Products).

To justify its claim that the new Nivea Clinical Products were in fact “Clinical Strength”, Beiersdorf submitted evidence of scientific testing which was said to confirm that the Nivea Clinical Products where just as efficacious when compared to the competitors’ products (Other Clinical Products). By this reasoning, Beiersdorf argued that the use of the word “clinical” in the name of its own product range was appropriate, given that the competitor products were similarly marketed as having high efficacy or “clinical” grade efficacy.

(Rexona Clinical Protection Antiperspirant Deodorant)

(Nivea Clinical Strength Antiperspirant Deodorant)

However, it was argued by Unilever that in using the word “clinical” in the Nivea product name, Beiersdorf made representations that were false, misleading or deceptive, or likely to mislead or deceive.

What were the alleged representations?

Unilever pleaded eleven representations allegedly made by Beiersdorf. Justice Wigney categorised those representations into three groups:

• representations that the Nivea Clinical Products have similar antiperspirant efficacy and characteristics to the Other Clinical Products (the Similarity Representations),
• representations that the Nivea Clinical Products have greater antiperspirant efficacy than all other non-clinical antiperspirant deodorants (the Superiority Representations), and
• representations that the Nivea Clinical Products have particularly strong efficacy or provides strong protection in relation to stress sweat (the Stress Sweat Representations).

Did Beiersdorf make the Similarity Representations or the Superiority Representations?

Justice Wigney found that Beiersdorf did not expressly make any of the Similarity Representations or the Superiority Representations, and therefore Unilever’s case relied upon whether such implied or inferred representations were made by Beiersdorf through the marketing, distributing and selling of the Nivea Clinical Products.

Unilever submitted that there is an established “clinical” subcategory of antiperspirant deodorants that is generally characterised by the use of the word “clinical”, packaging in a box with a leaflet, and a significantly higher price compared to that of non-clinical products. Unilever contended that Beiersdorf deliberately launched the Nivea Clinical Products with these particular characteristics to imply to the “ordinary reasonable consumer” that the products have similar antiperspirant efficacy or protection properties when compared to the existing Other Clinical Products, and also possessed greater antiperspirant efficacy or protection than all other non-clinical antiperspirant deodorants.

Justice Wigney found that while Beiersdorf had “adopted the cues” of a “clinical” subcategory of antiperspirant deodorants, it did not convey any of the Similarity Representations or Superiority Representations – rather, His Honour considered that Beiersdorf conveyed that the Nivea Clinical Products were highly efficacious with strong protection against sweat and odour.

If made, were those representations false?

While Unilever’s case in relation to the Similarity Representations or the Superiority Representations was not made out, Justice Wigney considered it necessary to determine whether such representations (had they been made) were in fact false in the event that Unilever wished to appeal against his findings.

While laboratory test results indicated that the Rexona Unilever Clinical Product was more efficacious in reducing sweat than the Nivea Clinical Products, Justice Wigney found that this could not assist Unilever’s case as the Similarity Representations and the Superiority Representations did not specifically compare the Nivea Clinical Products with the Unilever Rexona Clinical Product.
Justice Wigney noted that how the “ordinary reasonable consumer” would have understood the Similarity Representations and Superiority Representations plays an important role, and went so far as to indicate that consumer perceptions may be more important than laboratory testing.

Ultimately, the Court found on the balance of probabilities that the Similarity Representations, if made, were not false. On the other hand, the Court held that at least one of the Superiority Representations were false, given the results of the laboratory testing indicating that the Nivea Clinical Products were not necessarily of greater antiperspirant efficacy or protection than Rexona non-clinical antiperspirant deodorant products.

What about the Stress Sweat Representations?

Beiersdorf admitted that it made the Stress Sweat Representations, and thus the third issue for the Court to consider was whether or not those representations were false. Justice Wigney found that Unilever did not prove the falsity of one of the Stress Sweat Representations as Unilever had “misconceived” the representation and scientific testing and in doing so, limited the conclusions that could have been drawn from the evidence. The other Stress Sweat Representation involved a future matter and therefore was dealt with separately.

Was Beiersdorf stress sweating over future matters?

A final issue considered by the Court was whether Beiersdorf had reasonable grounds to make the Similarity Representations, Superiority Representations and Stress Sweat Representations which involved representations as to future matters (i.e. representations as to whether certain matters will occur in the future). Under the ACL, a person making a representation as to a future matter must have reasonable grounds to make that representation, otherwise the representation is taken to be misleading. There was no dispute that the Similarity Representations, Superiority Representations and Stress Sweat Representations, if made, comprised or included representations as to future matters.
Given the Similarity Representations and Superiority Representations were not proven to have been made by Beiersdorf, Justice Wigney addressed this issue on a hypothetical basis and ultimately found that Beiersdorf had not provided sufficient evidence to establish that it had reasonable grounds to make representations as to future matters in relation to the Similarity Representations and Superiority Representations.

However, the Court held that Beiersdorf had provided evidence that established reasonable grounds to make the Stress Sweat Representation in so far as they were representations as to future matters. This was based on the premise that the scientific testing submitted by Beiersdorf confirmed the product had high efficacy against stress sweat, which did not involve any comparison between the perspiration efficacy of the Nivea Clinical Product and the Other Clinical Products.

Lessons on how to stay dry in the future

The decision to dismiss Unilever’s claims as to misleading or deceptive conduct provides strong guidance for future cases of this nature involving competitor brands, particularly where established market subcategories tend to invoke certain consumer perceptions. Justice Wigney’s findings provide a timely reminder to fast-moving consumer goods, healthcare, and related industries to ensure that they are making accurate representations to consumers when marketing, distributing and selling over-the-counter products.

Interestingly, the case also suggests that consumer perception has the potential to carry more weight than scientific evidence when considering the effect of representations of this kind.