NRM found guilty of contempt for making representations about Advanced Medical Institute treatments

On 22 April 2015 the Federal Court found that the AMI companies and NRM, by operating the AMI business, engaged in unconscionable conduct and used unfair contract terms in the way it promoted or supplied male sexual dysfunction products.

The Federal Court has found NRM Corporation and NRM Trading (together NRM), guilty of contempt of court. NRM owns and operates the business known as the Advanced Medical Institute (AMI).

The ACCC filed proceedings for contempt on 20 August 2015 alleging that NRM had failed to comply with court orders made by Justice North on 22 April 2015 in earlier proceedings brought by the ACCC.

In those earlier proceedings, Justice North found that NRM had engaged in unconscionable conduct and used unfair contract terms in the way it promoted and supplied medical services and medications to men suffering from sexual dysfunction.  Justice North made orders permanently restraining NRM from making representations about the efficacy of treatments offered, and prospective patients’ need for AMI treatments, except where they were made by a duly qualified medical practitioner during face-to-face consultations.

The contempt proceedings were heard by Justice Moshinsky on 24 November 2015.  His Honour found that NRM committed contempt of court by making representations on its website, and in radio and television advertisements, regarding the efficacy of AMI sexual dysfunction treatments offered by NRM in breach of Justice North’s orders.

Justice Moshinsky said that NRM’s conduct was deliberate and that the orders were “clear and unambiguous”.

The statements found to have breached the order were made on ten occasions on the AMI website, in six radio advertisements variously broadcast in Sydney, Perth, Brisbane, Melbourne, Adelaide and Newcastle, and in a television advertisement broadcast in Sydney, Brisbane, and Melbourne over the period of 25 April 2015 to 30 July 2015.

“This decision reinforces the importance of abiding by any orders which the ACCC has obtained for the protection of consumers,” ACCC Chairman Rod Sims said.

“The ACCC will take action where necessary to enforce such orders.”

The ACCC had also argued that NRM had made representations in breach of the injunction prohibiting it from making statements to patients about their need for AMI treatments, and any adverse consequences that may result from consumers not obtaining such treatments. The ACCC was not successful in that part of the action.

A hearing on penalty will be heard on a date to be fixed.

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