The consumer watchdog says it has no sympathy for an egg supplier fined by the Federal Court for misleading buyers.

The Australian Competition and Consumer Commission (ACCC) took Derodi Pty Ltd and Holland Farms Pty Ltd to court, claiming it had falsely labelled eggs as free range from January 2012 to December 2014.

The two companies trade together as the entity Free Range Egg Farms, and sold eggs under the labels Ecoeggs, and Port Stephens and Field Fresh free range eggs.

The ACCC said the company also promoted the eggs as free range on social media and in advertisements.

The court agreed with the ACCC and fined the company $300,000 after finding some of the chickens were not always able to freely move about on open ranges.

ACCC chairman Rod Sims said it was a wake-up call to the industry not to dupe customers.

"When you advertise birds as free range you are charging double what you charge for barn laid eggs, so there are serious consequences for consumers, and also you are gaining an advantage over your competitors," Mr Sims said.

"I am afraid we don't apologise for taking people to court when we feel that the law has been breached, and we certainly feel that was the case here."

Company says it now exceeds industry standards

In a statement, the company said it was disappointed by the judgement because it had ceased working with the farm involved and had amended its practices to now exceed industry standards.

It said it had implemented a voluntary compliance program, and had reviewed all of its marketing and packaging material.

The ACCC said it was the third court win in its campaign on free-range farming.

Mr Sims said the commission had been targeting egg producers to make sure they were meeting community expectations.

"We're very pleased with the outcome, and we're hoping it sends a good message of deterrence to the egg industry to make sure if the birds are labelled free range, that they are actually out on the range often enough to actually qualify for that term," he said.

"And I would like to think now that we are going to see the necessary level of change that the consumers want."