The Federal Court has found that Snowdale Holdings Pty Ltd (Snowdale) made false or misleading representations that its eggs were “free range” in contravention of the Australian Consumer Law, in proceedings brought by the Australian Competition and Consumer Commission

Snowdale supplied eggs labelled as “free range” to suppliers in Western Australia under the brands Eggs by Ellah, Swan Valley Free Range and Wanneroo Free Range. Snowdale also promoted its eggs as “free range” on the Eggs by Ellah website from May 2013.

The Court found that Snowdale represented that the eggs were laid by hens which were able to, and did, go outdoors and roam freely on an open range on most days.

The Court found that between April 2011 and December 2013, most of the hens from the Snowdale sheds did not move around on an open range because the farming conditions significantly inhibited them from doing so. These conditions included the number of pop holes, the number of birds per metre of pop hole, flock size inside the shed and shed size.

In his judgment, Justice Siopis noted “There is no suggestion in the images and get up used on any of the Snowdale egg carton labels that the laying hens are, in fact, housed in steel industrial style sheds about 100 m long and that the hens in those sheds would have to compete with another 12,000 or 17,000 other hens, as the case may be, before the hens could even exit the shed to enter an open range.”

“Consumers expect that when they purchase eggs promoted as ‘free range’ they are getting eggs from hens that actually go outside,” ACCC Chairman Rod Sims said.

A date for a hearing on relief is yet to be determined.

The ACCC is seeking declarations, injunctions, pecuniary penalties, implementation of a compliance program, corrective notices and costs.

Background

Snowdale is one of Western Australia’s largest egg producers. It supplies eggs labelled as cage, barn laid and free range to various retailers.

This case forms part of the ACCC’s broader work in the area of free range claims made by egg producers.

On 15 April 2016, the Federal Court imposed a penalty of $300,000 on Derodi Pty Ltd and Holland Farms Pty Ltd for false or misleading “free range egg” claims.

On 31 March 2016, Commonwealth, State and Territory Consumer Affairs Ministers agreed to the introduction of a national information standard under the Australian Consumer Law, requiring eggs labelled as “free range” to have been laid by hens with meaningful and regular access to the outdoors and with a maximum outdoor stocking density of 10,000 hens. The Ministers expressed their desire for the information standard to be in place within 12 months.