HP forks outs $3.2 million for dodgy consumer practices

HP has been ruled to hand over $3 million in penalties by the Federal Court  for breaching Australian Consumer Law as part of a lawsuit initiated last year by the consumer watchdog.

The Australian Competition and Consumer Commission (ACCC) launched the legal action against the PC giant last October.

Two weeks ago the pair agreed out-of-court to a proposed penalty of $500,000 for each of the six contraventions HP admitted to making. The maximum legal penalty per contravention is $1.1 million.

The agreement required the approval of the Federal Court, given under today’s judgement, which also ruled on declarations, injunctions, and payment of costs. 

HP was found to have given misleading information to customers about product repairs and warranties, and not honoured repairs and exchanges for its online store.

It told customers

• they could not get replacements for products until those products had been repaired multiple times
• returns would only be provided at HP’s discretion, and
• the warranty period for products was limited to an “express” period, after which customers would have to pay for repairs.

HP last month admitted to the contraventions in a hearing, but said the conduct was not common practice at HP, nor deliberate. 

Lawyers for the ACCC said the evidence from consumers showed the issue was systemic, rather than of a case-by-case nature. 

Alongside the pecuniary penalty, the court also made orders in relation to

• declarations;
• injunctions;
• a contribution towards the ACCC’s costs of $200,000;
• consumer redress orders;
• public disclosure orders;
• corrective advertising orders; and
• orders to implement a compliance program.

HP said in a statement it 'deeply regretted' it fell short of its "core commitment to high standards of service" in the instances identified.  

"We have committed to, among other things, review our warranty and support practices against the Australian Consumer Law and implement a robust program to monitor and achieve ongoing compliance," it said.

"We will provide customer support to assist consumers in resolving concerns with HP products in accordance with the Australian Consumer Law and have established a specific consumer redress program (involving a customer contact centre) to help with past concerns relating to HP-branded desktop computers, notebooks/laptops and printers."

It said it had also taken steps to adjust its consumer policies and practices as well as retrain its Printing and Personal Systems team members.