GLAD fined $8.25 million for misleading "ocean claims"

The Federal Court has ordered Clorox Australia Pty Ltd to pay $8.25 million in penalties for making false or misleading claims that certain GLAD garbage and kitchen bags were made from recycled ‘ocean plastic’. The ruling follows court action brought by the Australian Competition and Consumer Commission.

Clorox admitted that between June 2021 and July 2023, it breached the Australian Consumer Law by promoting its GLAD to be GREEN “50% Ocean Plastic Recycled” Kitchen Tidy Bags and Garbage Bags as being made with at least 50% recycled plastic collected from the ocean or sea. In reality, the plastic was sourced from communities in Indonesia located up to 50 kilometres from the shoreline and lacking formal waste management systems. The remaining material in the products was made from non-recycled plastic, processing aids, and dyes.

More than 2.2 million of these misleadingly labelled products were sold during the period in question.

“Environmental claims matter to many consumers and can influence what they buy,” ACCC Chair Gina Cass-Gottlieb said. “When those claims are false or misleading, it’s a serious breach of trust and the law.”

Ms Cass-Gottlieb added that misleading environmental claims not only deceive consumers, who generally can’t verify these statements themselves, but also disadvantage companies that are making genuine, accurate claims about their environmental efforts.

“The Court found the packaging including the reference to ‘ocean plastic’, the blue colour scheme and wave imagery conveyed a clear environmental message that would influence the average consumer’s understanding of the product,” Ms Cass-Gottlieb said.

The Court emphasised the broader harm of such conduct, noting that misleading environmental claims can undermine public trust in sustainability initiatives and mislead well-intentioned consumers. While innovation in eco-friendly products is welcomed, these claims must be truthful.

In addition to the financial penalty, the Court ordered Clorox to implement a compliance program under the Australian Consumer Law, publish a corrective notice on its website, and contribute to the ACCC’s legal costs.

“Greenwashing is a priority area for the ACCC,” Ms Cass-Gottlieb said. “We support businesses offering sustainable products but will act where misleading claims are made.”

Clorox cooperated with the ACCC throughout the investigation and court proceedings. It admitted the conduct and jointly submitted with the ACCC an agreed penalty and set of court orders. The products were voluntarily discontinued in July 2023, after Clorox became aware of the ACCC’s investigation and before legal action commenced.