McDonald’s “beef” with Hungry Jacks’ deceptive conduct

The Federal Court recently delivered judgment in a claim brought by McDonalds, against Burger King’s Australian franchisee, Hungry Jacks, on the grounds of trademark infringement, as well as misleading deceptive conduct. The trademark infringement arose from the introduction by Hungry Jacks in early 2020 of two burgers known as the BIG JACK and the MEGA JACK. McDonald’s claimed that the naming of these burgers infringed the Trade Marks Act 1995 (Cth) and their trademarks: BIG MAC and MEGA MAC. Although McDonalds were unsuccessful in their trademark infringement claim, their claim under the Australian Consumer Law was upheld by Burley J.

Misleading or Deceptive Conduct in the Australian Consumer Law

Hungry Jacks conceded that in two relevant television commercials for the BIG JACK and MEGA JACK, the statement those burgers contained “25% more Aussie beef” than the burgers of an unnamed competitor, was a reference to McDonald’s BIG MAC. As a result, the key question that the Court was to determine was whether the representations were likely to mislead or deceive.

Cooked or uncooked?

Based on the evidence before the Court, whether the representation was likely to mislead or deceive fell on whether the representation was made in reference to the cooked or uncooked weight of the burger patty. McDonalds provided extensive evidence to support the argument that the difference between the cooked weights of the two burgers was significantly less than 25%, but if Hungry Jacks could prove that the representation was made in reference to the uncooked weights of the respective burgers, the difference in weight was around the represented 25%.

The Court focused on a number of elements of the advertisement, as well as the target audience and the context that the advertisement was likely to be viewed in, when coming to a determination regarding whether the representation was to the cooked or uncooked weights of the burger patties.

• In terms of the imagery portrayed in the advertisement itself, the Court considered elements such as the images of the meat patty in the ‘advanced stages’ of cooking, as seen through meat being darkened by the flame. The inclusion of images of the ready to eat burger were also considered, and seemingly contributed to the Court finding that the representation was based on the cooked, ready to eat weight of the burgers.
• The Court identified the target audience in this situation to be “typical consumers of hamburgers from quick service restaurants” who would likely be members of the public who would “make a purchase based on convenience, taste and value.” In this regard, it would seem that the Court was making the point that a consumer of this class is concerned with the meal in its ready to eat form.
• Following on from the previous point, it was also noted that an advertisement of this kind would likely be viewed in a commercial break or via social media, in a format and timing which would not lend itself to the viewer paying attention to a possible distinction between the cooked or uncooked weight of the burgers.

The Court dismissed the argument put forward by Hungry Jacks that consumers were somewhat acclimatised to the fact that meat was sold by reference to its uncooked weight, noting that the focus of the inquiry in matters such as this is the “impression carried away from the commercial.”

The Court determined that the impression carried away by a consumer of this class would be “that when you eat this meal, you will be eating 25% more Aussie beef than when you eat the competitor’s product,” highlighting that the representation was made in reference to the cooked weight of the burger.

Interestingly, the Court also raised an internal email in which two senior Hungry Jack’s employees discussed the competing products by reference to their cooked weights, rather than uncooked weights, further contributing to the finding against Hungry Jacks.

Key Takeaways

Misleading or deceptive conduct is the most litigated cause of action in Australia and is commonly relied upon.  In order to determine whether a representation will be misleading or deceptive, or likely to mislead or deceive, will depend on an objective test and the effect of the conduct which is likely to have had on ordinary or reasonable members of a particular class.  In this case, McDonald’s succeeded because the consumer of the Hungry Jack’s advertisements would objectively considered the statement by reference to the burger patty they purchased, and the advertisement construed as a whole was therefore misleading or deceptive.

If you require assistance in relation to any of the information provided above, Pragma’s team can provide advice to you and your business to minimise your future risk. Contact us today at hello@pragma.law or call us on (08) 6188 3340.