Samsung fined $9.8M for misleading Australian phone ads

Jul 28, 2022, 1:53 AM | Updated: 1:54 am

CANBERRA, Australia (AP) — An Australian judge on Thursday ordered Samsung to pay 14 million Australian dollars ($9.8 million) in penalties for misleading advertising over how water-resistant some models of smartphones are.

Federal Court Justice Brendan Murphy gave Samsung Electronics Australia, a subsidiary of South Korea-based Samsung Electronics Co., 30 days to pay the fines.

Samsung must also pay AU$200,000 ($140,000) toward the costs of the Australian Competition and Consumer Commission, the consumer watchdog that initiated an investigation of the phones four years ago.

Samsung admitted to making false and misleading claims in nine advertisements between 2016 and 2018 about the water resistance of seven models of Galaxy smartphones. They are the S7, S7 Edge, A5 (2017), A7 (2017), S8, S8 Plus and Note 8.

Samsung and the commission also agreed to the penalties imposed.

The misleading ads promoted the phones’ water resistance and suitability for use in swimming pools and seawater. But the charging ports could be damaged and stop working if the phones were recharged while the ports were still wet.

Samsung said the charging port issue only effected the seven models identified in the case that were launched between 2016 and 2017.

“The issue does not arise for Samsung’s current phones,” a Samsung statement said.

Samsung sold 3.1 million of the vulnerable phones in Australia, but the court could not determine how many customers found faults in their charging ports.

An unknown number of customers had their ports replaced by authorized Samsung repairers. Some repairers did the job for free while others charged between AU$180 ($126) and AU$245 ($171), the court heard.

Murphy said customers were entitled to assume that a large company such as Samsung would not advertise that its Galaxy phones could safely be submerged in water if they could not.

“A great many consumers are likely to have seen the offending advertisements and a significant number of those who did so are likely to have purchased one of the Galaxy phones,” Murphy said in his judgment.

Commission Chair Gina Cass-Gottlieb said her investigation had received hundreds of complaints from phone owners.

“They experienced issues with their Galaxy phones after it was exposed to water and, in may cases, they reported their Galaxy phones stopped working entirely,” Cass-Gottlieb said in a statement.

The judge said the penalty exceeded Samsung’s profit during the course of the misleading advertising campaign.

Samsung’s lawyers had initially denied the ads were misleading and that the phones could be damaged by immersion in water, the judge said.

“I do not consider Samsung Australia should be given much credit for its cooperation,” Murphy said.

Samsung said it had cooperated with the commission’s investigations, which originally included more than 600 ads and 15 Galaxy phone models.

“Samsung endeavours to deliver the best possible experience to all our customers and we regret that a small number of our Galaxy users experienced an issue with their device pertaining to this matter,” Samsung said.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

Haitian migrant Gerson Solay, 28, carries his daughter, Bianca, as he and his family cross into Can...
Associated Press

US, Canada end loophole that allowed asylum-seekers to move between countries

President Joe Biden and Canadian Prime Minister Justin Trudeau on Friday announced a plan to close a loophole to an immigration agreement.
18 hours ago
Expert skateboarder Di'Orr Greenwood, an artist born and raised in the Navajo Nation in Arizona and...
Associated Press

Indigenous skateboard art featured on new stamps unveiled at Phoenix skate park

The Postal Service unveiled the “Art of the Skateboard" stamps at a Phoenix skate park, featuring designs from Indigenous artists.
18 hours ago
(Facebook Photo/City of San Luis, Arizona)...
Associated Press

San Luis authorities receive complaints about 911 calls going across border

Authorities in San Luis say they are receiving more complaints about 911 calls mistakenly going across the border.
7 days ago
(Pexels Photo)...
Associated Press

Daylight saving time begins in most of US this weekend

No time change is observed in Hawaii, most of Arizona, Puerto Rico, the U.S. Virgin Islands, American Samoa, Guam and the Northern Marianas.
15 days ago
Mexican army soldiers prepare a search mission for four U.S. citizens kidnapped by gunmen in Matamo...
Associated Press

How the 4 abducted Americans in Mexico were located

The anonymous tip that led Mexican authorities to a remote shack where four abducted Americans were held described armed men and blindfolds.
15 days ago
Tom Brundy points to a newly built irrigation canal on one of the fields at his farm Tuesday, Feb. ...
Associated Press

Southwest farmers reluctant to idle farmland to save water

There is a growing sense that fallowing will have to be part of the solution to the increasingly desperate drought in the West.
22 days ago

Sponsored Articles

(Desert Institute for Spine Care in Arizona Photo)...
Desert Institute for Spine Care in Arizona

5 common causes for chronic neck pain

Neck pain can debilitate one’s daily routine, yet 80% of people experience it in their lives and 20%-50% deal with it annually.
(Photo by Michael Matthey/picture alliance via Getty Images)...
Cox Communications

Valley Boys & Girls Club uses esports to help kids make healthy choices

KTAR’s Community Spotlight focuses on the Boys & Girls Club of the Valley and the work to incorporate esports into children's lives.
...
Day & Night Air Conditioning, Heating and Plumbing

Prep the plumbing in your home just in time for the holidays

With the holidays approaching, it's important to know when your home is in need of heating and plumbing updates before more guests start to come around.
Samsung fined $9.8M for misleading Australian phone ads