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Articles and legal news from the Atkinson Vinden Team.

Federal Court takes firm approach to AMI contempt

Commercial Law, General

Many of you would recognise the company AMI; the company that preyed on the insecurities and vulnerabilities of men nationwide, peddling remedies through mass marketing that supposably cured  “man’s greatest fear”, premature ejaculation.

About 6 months ago the Federal Court of Australia, criticised the company for exploiting the vulnerabilities and insecurities of men, and found them guilty of unconscionable, misleading and deceptive conduct. The Court found that there was no reasonable scientific basis for this treatment, nor did the company diagnose the medical cause of the erectile dysfunction in its patients. Further the company made unsubstantiated claims to its patients that untreated premature ejaculation could lead to lasting shrinkage, psychological impotence and even prostate cancer.

In this case the Court ordered that the company not make statements or representations in any forum that claimed that its treatments would work, and not to warn customers that they would be worse off without the products. Further, the court implemented stringent rules compelling the company to refer potential clients to a medical practitioner prior to entering into a contract.

Surprisingly AMI has recently been brought back before the Federal Court for Contempt of Court, being forced to answer claims that it has unashamedly continued to make statements through its various marketing avenues that included claims such as ‘solve erection problems in 30 seconds” and slogans such as “20 years of experience and expertise: can’t be wrong”. The matter is ongoing.

This is a prime example of the need for companies to carefully consider claims they make about their products prior to including them in their advertising campaigns, and to be sure that any claims they may make can be substantiated.

In particular, health claims will require peer reviewed medical evidence.