Member Article

Media organisations and journalists will now need to be more cautious when entering into contracts with third parties for interviews and information, following the decision of the High Court in ACCC v Seven Network. The court held that section 65A of the Trade Practices Act (TPA) will not afford protection to a media organisation against section 52 of the TPA when it engages in chequebook journalism.

As we previously reported on the decision of the Full Federal Court in the case of the Seven Network v ACCC, the ACCC claimed a breach of section 52 of the TPA by the Seven Network in its screening of an episode of Today Tonight. The Seven Network successfully argued an exemption to section 52 conferred by section 65A of the TPA.

Section 65A provides a general exemption to the media and other 'prescribed information providers from the application of section 52 (and other sections) in relation to prescribed publications. A 'prescribed publication' is defined to include, among other things, a publication made by a prescribed information provider in the course of carrying on a business of providing information. The TPA contains a non-exhaustive definition of the term prescribed information provider. The section was inserted into the TPA to protect the media following three decisions of the Federal Court that held the media would contravene section 52 if they published information which was inaccurate or misleading in news or current affairs reports. Section 65A contains a number of exceptions such that not all publications by the media are protected. Publications that do not attract the protection of section 65A include publications made in connection with the supply of goods or services, where the relevant publication was made pursuant to a contract with a person who supplies goods or services of that kind.

Key Implications

- Media organisations may be held liable under section 52 of the TPA for misleading and deceptive statements made by interviewees

- Section 65A of the TPA will not operate to exempt media organisations from section 52 where there is a contract, arrangement or understanding between the organisation and an interviewee for the provision of services (i.e. the interview) by the interviewee.

The Seven Network broadcast two reports in its Today Tonight current affairs program about two women who had set up a property investment mentoring program. Some of the statements the two women made in the broadcast reports were false. The ACCC issued proceedings against Seven Network. The ACCC claimed the reports were made pursuant to an arrangement between Channel 7 and the two women, and contained a number of false representations that were in breach of section 52. Channel 7 relied on a number of defences including the exemption under section 65A.

The ACCC appealed to the High Court, which reversed the decision of the Full Federal Court in favour of the ACCC. The court ruled that the exemption granted by section 65A does not apply to situations where a media outlet, under an arrangement with a supplier of goods or services, publishes and makes representations of a misleading or deceptive character in relation to those goods or services.

The High Court also held that a contract, arrangement or understanding between a media organisation and a supplier of goods, such as the women who were interviewed on Today Tonight, does not have to detail the content of the publications. It does not have to be strictly legally enforceable, but must constitute more than a mere hope or expectation that each party will act according to the terms and have an element of reciprocal commitment.

The High Court identified several other instances in which section 65A would not afford protection to a media organisation against section 52 of the TPA, such as the publication of matter in connection with goods or services that the media organisation itself provides, or publications that are critical of goods or services provided by competitors of the media organisation.

The Seven Network case has important implications for any media organisation or journalist that engages in chequebook journalism. While the High Court noted that decisions regarding section 65A will turn on the specific facts of the case, a media organisation who has entered into an arrangement with a supplier of goods or services to publish a story regarding those types of goods or services, may find themselves liable for any misleading or deceptive statements made during an interview or by the interviewee.

 

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