Calf feed firm fined over false claims

A company that manufactured and sold a calf feed that did not meet its advertised specifications has been fined $125,000 in Auckland District Court.

Mainfeeds, formerly known as PCL, pleaded guilty to eight charges of breaching the Fair Trading Act.

From June 2006 until June 2008, Mainfeeds described a product called Finish Up as a "superior 16 per cent protein calf feed" and as "a high energy nutritionally balanced feed", the Commerce Commission said today.

But between July 2007 and February 2008, Mainfeeds changed the Finish Up recipe and the resulting product contained a reduced amount of crude protein and an increased amount of salt, readily fermentable carbohydrate and crude fibre.

The changes to Finish Up meant the claims made about the product were no longer accurate and at times the quality of the calf feed was diminished, the commission said.

Through its own quality control measures, Mainfeeds was aware that its Finish Up product no longer met the advertised specifications, but it did not alter the claims made on the packaging. It also did not alert its suppliers or consumers about the issue, the commission said.

In sentencing, Judge Anne Kiernan noted that the offending had the potential for serious and far reaching consequences, particularly given that farming was a key industry.

In mitigation, the judge noted that Mainfeeds had acknowledged its culpability by pleading guilty, and had made attempts to change the formula when it became aware of the problems. She also noted that Mainfeeds cooperated with the commission, had no previous convictions and had reimbursed those farmers who complained about the product.

The commission said its investigation was triggered by a complaint from a farmer who noticed that his 2007 calves rejected Finish Up, when he had not experienced the same problem in 2006.

"To ensure compliance with the Fair Trading Act, businesses must make sure that any claims they make about their products are accurate and not misleading. Businesses need to ensure that they have effective compliance programmes in place to allow them to identify and fix potential breaches of the Act," commission general manager enforcement Kate Morrison said.

"Misleading information not only affects consumers, but may damage other businesses competing in the same market."

- NZPA