Fake organics land butcher with meaty $10,000 fine

Issued 25 May 2006/132

Fake organics land butcher with meaty $10,000 fine

In a first for the Commerce Commission, a butcher has been fined for falsely labelling products as certified organic when they were not. Jason Arthars and Clark’s Organic Butchery Ltd were fined a total of $10,000 ($5,000 for Arthars and $5,000 for the company) in the Waitakere District Court today for falsely suggesting the company was certified by New Zealand’s principal certification agencies.

Arthars and the company pleaded guilty to 11 charges, including deliberately labelling products as “certified organic” and “allergy free” when neither claim was true. They also claimed to be certified by Bio-Gro and Agriquality New Zealand (formerly CERTENZ); the Bio-Gro certification had lapsed at the end of August 2002 and the business had never been certified by Agriquality.

In his summing up, Judge Taumaunu said that the fine sent a clear message that those involved in organic food must be careful in labelling their products to protect consumers in the organic industry as a whole.

He noted that cases such as this almost always involve trader detriment. “Other traders may lose trade because publicity means consumers place less faith in organic goods.”

Commerce Commission Director of Fair Trading Deborah Battell welcomed the fine as a successful outcome for both consumers and competitors: “Organic products attract a premium due to the costs involved in raising animals under the stringent rules required by the certification agencies. Consumers are only willing to pay this premium because they trust in the integrity of these producers. Arthars not only abused the trust of consumers but also unfairly brought into question the sincerity of all honest organic traders.”

This is the first time an organic supplier has been sentenced by the courts. The Commission previously settled with Ross’s Super Meats in January 2003 for falsely labelling their products were preservative free. The business of Clark’s Organic Butchery was sold earlier this year and the new owners continue to trade as Clark’s Organic Butchery. The new owners were not associated with the offending.

Background

Section 10 of the Fair Trading Act 1986 says that no person shall, in trade, engage in conduct that is liable to mislead the public as to the nature, manufacturing process, characteristics, suitability for a purpose, or quantity of goods.

The 11 charges that Clark’s Organic Butchery and Jason Arthars included representations that:

- The defendant was backed by Bio-Gro and CERTENZ;
- The defendant stocked “Heuvel” and “Harmony” products when they did not;
- The venison sausages were organic when they were not;
- The pork sausages were organic when they were not;
- The chicken was “certified organic” when it was only organically farmed, not certified;

- Its beef and lamb sausages were organic when only the meat was organic, not the meal and other ingredients;

- The chicken sausages were “pure organic chicken sausages” when in fact 4.7% of each sausage were made from non-organic ingredients, including preservatives;

- The lamb, mince and beef sausages were “certified organic New Zealand Agriquality” when the defendants were not certified by Agriquality; and

- The beef sausages were “organic allergy free” when they contained the ingredient phosphate and were not made of “allergy free” ingredients.

Clark’s Organic Butchery has been in operation since 1995, and trading as an organic meat butchery since 1999. The charges relate to conduct from late 2004 until 2005.

ENDS

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