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Company fined $1m for making false claims to farmers

Landmark Operations Limited (trading as Seednet) has been ordered by The Federal Court to pay a $1 million penalty for making false, misleading and deceptive claims in a fact sheet for its barley variety known as ‘Compass’.

Seednet told farmers from at least December 2014 to December 2016 that Compass barley had strong straw and better straw strength and lodging resistance (ability to remain upright), than an older variety of barley known as ‘Commander’, when that was not the case. The company also misled farmers into thinking ‘Compass’ was better suited to early sowing, higher fertility paddocks and higher nitrogen rates than ‘Commander’.

ACCC Deputy Chair Mick Keogh said, “Seednet’s conduct was unacceptable because it misled farmers into sowing barley crops under a false impression about the qualities of the crops they were planting.”

“As a result of Seednet’s conduct, farmers were denied the chance to make a fully informed decision on what would be the best barley variety for their farms.”

In addition, Seednet represented from at least January 2016 through to December 2016 that ‘Compass’ had higher resistance to a disease known as leaf rust than it actually did.

Seednet admitted it made the lodging and leaf rust claims through factsheets distributed nationally, despite the fact that Seednet was, or ought to have been, aware that Compass’ performance did not support the lodging representations, and that the leaf rust representations understated Compass’ susceptibility to leaf rust.

“Exaggerated marketing of new agricultural produce is a major concern across the industry,” Keogh said.

“At the time of the release of a new crop variety, farmers and their agronomists lack other sources of independent information beyond what businesses tell them.

“Seed companies, and agribusinesses more generally, are warned that they must have a proper basis for marketing the qualities of new agricultural varieties and must not misrepresent the properties or performance of new products.”

The Court also ordered Seednet pay $50,000 as a contribution to the ACCC’s legal costs.

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Gali Blacher

Gali Blacher

Gali Blacher, editor, Dynamic Business

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