Court declares operators of Designer Brand Outlet website misled consumers

December 16, 2008 - Australia

Consumers buying from the Designer Brand Outlet website had been misled the Federal Court has declared. The Australian Competition and Consumer Commission had alleged that Bindert (Ben) Kloosterman and Xin Fan (Lucy) Shi, operators of the Designer Brand Outlet website (www.designerbrandoutlet.com) had engaged in false, misleading and deceptive conduct in breach of the Trade Practices Act 1974.

It alleged this included making representations that genuine designer label women's clothing was available to buy when in some cases no items were supplied and in others the clothing was counterfeit.

The court also granted injunctions restraining Mr Kloosterman and Ms Shi from engaging in similar conduct for five years. Failure to comply with these injunctions is contempt of court and is punishable by fines or imprisonment. Mr Kloosterman and Ms Shi were also ordered to pay the ACCC's legal costs.

"At the time of institution of the proceedings, the ACCC indicated that it may bring a representative action for compensation on behalf of consumers misled by the Designer Brand Outlet website operators," ACCC Chairman, Mr Graeme Samuel, said.

"Justice Flick has adjourned the matter to 2 March 2009 so that the ACCC can prepare the compensation proceedings. The ACCC anticipates that there will be a large number of consumers eligible for compensation.