ACCC Federal Court case against Retail Food Group set to begin with hearing in three weeks
Australia’s competition and consumer watchdog has been given a date to commence its grilling of Southport franchisor Retail Food Group.
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AUSTRALIA’S competition watchdog has been given a date to commence its grilling of Southport franchisor Retail Food Group.
A hearing has been scheduled in the Federal Court for the Australian Competition and Consumer Commission’s unconscionable conduct case against RFG’s parent company and five related companies for March 5.
The commission alleges RFG breached Australian Consumer Law by engaging in false, misleading and deceptive conduct when it sold or licensed 42 loss-making corporate stores to incoming franchisees between 2015 and 2019.
The action will begin with a case management hearing via web conference.
As well as RFG Ltd, respondents include Brumbys Bakeries, Donut King, Michel’s Patisserie, RFGA Management and Jireh International Retail, which operates Gloria Jeans.
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In a statement when the court action was announced, RFG said the allegations were “historical and which occurred under various senior executives who are no longer with the Company”.
“Even if the allegations did happen, let’s put them in the past, where they belong,” chairman Peter George said in December.
“Our franchisees continue to suffer from this drawn-out saga.”
The ACCC also alleges RFG withheld important financial information from incoming franchisees “purchasing or licensing the loss-making corporate stores and made false or misleading representations to them about the viability or profitability of the stores”.
“We allege that Retail Food Group withheld critical profit and loss information about these corporate stores from incoming franchisees, and falsely represented that these loss making stores were viable or profitable,” ACCC chair Rod Sims said.
The ACCC is seeking declarations, injunctions, pecuniary penalties, disclosure and adverse publicity orders, a compliance program order, redress orders and costs.
Shares in RFG were trading at 8c Thursday morning.
The stock has languished below 10c for the past year, dipping as low as 2c. The company is yet to reveal a date for release of its half-yearly results.
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