Activ8me has become latest broadband provider to be hauled into court by the Australian Competition and Consumer Commission (ACCC) accused of making inflated and misleading claims for its internet services.
The NBN reseller used thousands of direct mail shots and online banner ads between June and October this year to spruik that Opticomm fibre-to-the-premises product provided up to 100 megabit per second speeds.
The ACCC claims the Opticomm FTTP plans were advertised as costing $59.95 a month, with no set-up charges and that the company told consumers the packages had unlimited data.
The reality turned out to be different however.
The watchdog reckons the $59.95 Opticomm plan actually delivered a mere 12/1 Mbps speed and consumers ordering service were stung for another $99.95 in set up fees if they did not sign up for 12 months, hence the trip to the Federal Court.
There are set to be some teeth marks too , with the ACCC going for declarations, injunctions, monetary penalties, a corrective notice, redress for consumers and a compliance program for Activ8me that also faces paying costs for the legal action if it loses in court.
This is the second time this year that Activ8me's sales tactics have landed the provider in legal hot water.
For regulators, claims by Activ8me seem to have a magnetic attraction to them.
Claims its services were endorsed by the ACCC earned the NBN reseller an infringement notice from the watchdog in March this year, and a $12,600 penalty.
That Activ8me followed up its misleading conduct slap in March with further alleged false representations has the ACCC's hackles well and truly raised.
“Our decision to take court proceedings this time shows how seriously the ACCC takes Activ8me’s further conduct,” the ACCC deputy chair Delia Rickard said.
Activ8me is not alone in getting its corporate ears boxed by ACCC for misleading claims relating to internet services.
If the Federal Court agrees with ACCC, it could join a rogues' gallery featuring Telstra, Optus, TPG, Dodo, iPrimus and Commander, MyRepublic, iiNet and Internode, all of which have had action taken against them for misleading broadband speed claims.