Is Social Media Benefiting or Ruining Your Business?

social Media

Is Social Media Benefiting or Ruining Your Business?

Social Media can be an easy and effective way to advertise your business. However, statements that you make online, and statements posted by others, can have legal consequences for your small business.

A few years ago, a company made claims on its website (and its Facebook page) that it could cure people’s allergies, and detect and identify allergies without proper testing. It also stated that their methods were safe and low risk when in fact they were unsafe and potentially life-threatening for people with severe allergies. 

The business' Facebook page also contained comments from people stating how great the company was and how its services cured their allergies.

The ACCC commenced court action against the company. The court held that because the company knew about the customer testimonials that were misleading and didn’t take any steps to remove them, they were liable for the posts (even though the posts were made by others). The company was also found to be in breach of the Australian Consumer Law for the statements they made themselves that were false and misleading. In these cases, courts will take into account the size of an organisation and the resources available to it to manage its Social Media sites when determining whether a company is liable for failing to remove misleading and false statements by others, but in this case the Court decided the company had sufficient resources to properly manage its social media.

Business owners should:

  1. Make sure that statements made on Social Media or anywhere online are accurate and are not likely to mislead consumers. If a business is unsure whether something may breach consumer law it is best to seek legal advice

  2.  Ensure Social Media accounts are being managed properly and that content that is not true (or could mislead others) is removed as quickly as possible.

If you think you may need legal advice regarding your business call us on 9440 1202.