Samsung fined $9.8M for deceptive Australian cellphone advertisements

CANBERRA, Australia — An Australian decide on Thursday ordered Samsung to pay 14 million Australian {dollars} ($9.8 million) in fines for deceptive promoting about how waterproof some smartphone fashions are.

Federal Court docket Justice Brendan Murphy gave Samsung Electronics Australia, a subsidiary of South Korea-based Samsung Electronics Co., 30 days to pay the fines.

Samsung should additionally pay AU$200,000 ($140,000) in prices to the Australian Competitors and Shopper Fee, the buyer watchdog that initiated an investigation into the telephones 4 years in the past.

Samsung has admitted that it made false and deceptive claims in 9 ads between 2016 and 2018 concerning the water resistance of seven fashions of Galaxy smartphones. They’re the S7, S7 Edge, A5 (2017), A7 (2017), S8, S8 Plus and Word 8.

Samsung and the fee additionally agreed to the fines.

The deceptive advertisements promoted the telephones’ water resistance and suitability to be used in swimming swimming pools and sea water. However the charging ports might be broken and cease working if the telephones have been charged whereas the ports have been nonetheless moist.

Samsung mentioned the charging port difficulty solely impacts the seven fashions recognized within the case that have been launched between 2016 and 2017.

“The problem doesn’t come up for Samsung’s present telephones,” mentioned a Samsung assertion.

Samsung offered 3.1 million of the susceptible telephones in Australia, however the courtroom couldn’t decide what number of clients discovered faults of their charging ports.

An unknown variety of clients had their ports changed by approved Samsung repairers. Some repairmen did the work without cost, whereas others charged between AU$180 ($126) and AU$245 ($171), the courtroom heard.

Murphy mentioned clients have the correct to imagine {that a} huge firm like Samsung would not promote that its Galaxy telephones have been secure to submerge in water in the event that they could not.

“Many customers possible noticed the offending advertisements and a major variety of those that did so possible bought one of many Galaxy telephones,” Murphy mentioned in his ruling.

Fee President Gina Cass-Gottlieb mentioned her investigation has acquired a whole lot of complaints from cellphone homeowners.

“They’ve skilled issues with their Galaxy telephones after being uncovered to water and, in some instances, they’ve reported that their Galaxy telephones have stopped working fully,” Cass-Gottlieb mentioned in a press release.

The decide mentioned the penalty exceeded Samsung’s revenue from the false promoting marketing campaign.

Samsung’s attorneys initially denied that the advertisements have been deceptive and that the telephones might be broken by immersion in water, the decide mentioned.

“I do not assume Samsung Australia ought to get a whole lot of credit score for its cooperation,” Murphy mentioned.

Samsung mentioned it cooperated with the fee’s investigations, which initially included greater than 600 advertisements and 15 Galaxy cellphone fashions.

“Samsung strives to supply all our clients with the absolute best expertise and we remorse {that a} small variety of our Galaxy customers have skilled an issue with their machine on this matter,” Samsung mentioned.

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