Australia: Telstra's - I Go To Rio - advertising campaign not misleading or deceptive, says Federal Court

What you need to know

• The Federal Court of Australia has dismissed a claim by the Australian Olympic Committee that Telstra's 'I Go To Rio' marketing campaign was unlawful.
• The AOC argued that Telstra had breached both the Olympic Insignia Protection Act and the Australian Consumer Law, through its conduct of an 'ambush marketing' campaign which misled the public to believe Telstra was a sponsor of the Rio Olympic Games.
• The case may be taken as an indication of where the line might be drawn on conduct that businesses can engage in when they are not official sponsors of the Olympic Games, but wish to leverage the excitement that always surrounds the Games.

Background

In mid-July, the Australian Olympic Committee (AOC) launched an urgent case against Telstra after the telecommunications giant began running advertisements promoting its sponsorship of the Seven Network's Olympics app. The AOC alleged that Telstra's 'I Go to Rio' advertising campaign was misleading, causing the public to believe that Telstra was a sponsor of the Olympic Games, which it was not (although it did have a previous sponsor relationship with the AOC which ended last year).

The key allegations against Telstra were that it:

• contravened section 36 of the Olympic Insignia Protection Act (OIPA) by using protected Olympic expressions for commercial purposes without a licence from the AOC; and
• breached section 18 and sections 29(g) and (h) of the Australian Consumer Law (ACL) by engaging in misleading and deceptive conduct and by making false or misleading representations that Telstra is a sponsor of the Rio Olympic Games.

The case was fast-tracked and on 29 July, the Federal Court handed down its decision, dismissing the AOC's application.

Case under the OIPA

The protected Olympic expressions forming the basis of the OIPA allegations were 'Olympic', 'Olympics' and 'Olympic Games'. The question to be determined by the Court was whether the application of these expressions would suggest to a reasonable person that Telstra is or was a sponsor of, or is or was the provider of sponsorship-like support for, any of the organisations associated with the Rio Olympic Games.

Justice Wigney took the view that at the end of the day the statutory test was quite clear and simply a matter of making a factual finding on what the expressions would, in the context of all the relevant circumstances, suggest to a reasonable person. After applying the objective statutory test to the various components of the Telstra's marketing campaign, Justice Wigney found that "none of the advertisements, videos, catalogues, email or online materials or other marketing or promotional materials that employ the Olympic expressions would suggest to a reasonable person, that Telstra is or was a sponsor of, or is or was the provider of, sponsorship-like support to any relevant Olympic body."¹ The Court was not satisfied that the AOC proved on the balance of probabilities that Telstra contravened section 36 of the OIPA.

Case under the ACL

The AOC's allegations against Telstra under the ACL were treated in a similar fashion to those under the OIPA.

The AOC's case relied on the proposition that the relevant advertising material either individually or cumulatively represented (or had a tendency to lead the audience to assume) that Telstra was affiliated with the Rio Olympic Games and other associated organisations.

The critical issue here was whether the advertisements were likely to convey to a reasonable person (who was in the target audience or likely to receive the advertisement) that Telstra had some form of sponsorship, licensing or affiliation arrangement with a relevant Olympic body. The Court acknowledged that the position was complicated by the fact that Telstra was part of a sponsorship-like arrangement with the Seven Network in relation to its broadcast of the Rio Olympic Games. That arrangement extended to Seven providing Telstra customers with free premium access to the 'Olympics on 7' app through which the broadcast could be viewed. The Court found it difficult to see how Telstra could be precluded from promoting its affiliation with Seven's broadcast app and equally, how Telstra could do so without referring to the Rio Olympic Games.

Ultimately the Court found that Telstra's conduct amounted to no more than the company advertising its relationship with Seven and that the representations, which did not go far beyond conveying the relationship between Telstra and Seven (including in relation to the 'Olympics on 7' app), were unlikely to mislead or deceive. Accordingly, the Court found that the AOC had failed to demonstrate that Telstra contravened either section 18 or sections 29(g) and (h) of the ACL.

Key takeaways

At the time of writing, the decision has not been appealed although it remains to be seen whether the AOC will do so within the allowed timeframe.

For now, the case may be taken as an indication of where the line might be drawn on conduct that businesses can engage in when they are not official sponsors of the Olympic Games, but wish to leverage the excitement that always surrounds the Games. This case is a good example of how the Court will readily apply the 'reasonable person test' to determine whether conduct is likely to mislead or deceive, having regard to all circumstances including the content of messaging, the targeted audience and relationships between relevant entities. The line is very fine – although Telstra was found not to have crossed that line in this case, slightly different circumstances might produce a different result.

Footnote

¹ Australian Olympic Committee, Inc. v Telstra Corporation Limited [2016] FCA 857 at [124].

This article is intended to provide commentary and general information. It should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this article. Authors listed may not be admitted in all states and territories