MELBOURNE, May 15, 2026, 08:05 (AEST)
- Federal Court found 13 of 14 sampled Coles “Down Down” tickets were misleading. ACCC
- ACCC will seek penalties later; Coles says it is reviewing the judgment.
- Woolworths faces a similar ACCC case, with judgment still pending.
Coles Group Ltd is facing a sharper legal and investor test after Australia’s Federal Court found its flagship “Down Down” supermarket discounts misled shoppers, a ruling that hit the grocer’s shares and put rival Woolworths under closer watch.
The decision matters now because it lands in the middle of Australia’s cost-of-living fight. The Australian Competition and Consumer Commission said the case covered 245 common products sold by Coles between February 2022 and May 2023, and that the Federal Court found misleading representations in 13 of 14 sample “Down Down” tickets examined at the liability hearing. ACCC
For investors, it is not just a fine-risk story. The ruling may curb how a large grocer promotes a price cut after supplier-driven cost increases, a key part of supermarket merchandising when shoppers are already sensitive to shelf prices.
Justice Michael O’Bryan found Coles breached the Australian Consumer Law, the national consumer-protection law, by using tickets that suggested a real saving when products had not been sold at the higher “was” price for long enough. In the judgment, he said the “discount represented on the ticket was not genuine.” Federal Court Judgments
Coles said in an ASX release the court found all price increases came from supplier cost-price increases and were commercially justified. But it also said the court found a 12-week “minimum price establishment period” was required before products could be promoted on “Down Down” — meaning a higher shelf price had to be in place for that period before it could serve as the benchmark for a discount.
The ACCC framed the judgment as a consumer win. “We welcome the Court’s finding that Coles breached the Australian Consumer Law,” ACCC Chair Gina Cass-Gottlieb said, adding that the case had increased transparency around Coles’ discounting program. ACCC
Coles said it was reviewing the judgment. In its filing, the company did not announce a provision, appeal or settlement; the next stage is orders and penalties.
Shares in Coles fell 2.7% after the decision, while Woolworths shares lost 1.9%, Reuters reported. Vantage Markets analyst Hebe Chen said the ruling was “the clear trigger” for the weakness, but investors were also pricing in the risk that Coles’ “discounting playbook becomes less flexible.” Reuters
The competitive read-through is plain enough. Coles and Woolworths together sell nearly two-thirds of Australian groceries, Reuters reported, and the ACCC has also brought separate Federal Court proceedings against Woolworths over similar pricing claims. That judgment remains pending.
There is a wrinkle. O’Bryan said the conclusion was “relatively narrow” and noted that if Coles had held the higher “was” price for 12 weeks, the tickets would not have been misleading. He also said the question of whether consumers were harmed would need to be dealt with in the class action and possibly in the ACCC case, depending on the relief sought. Federal Court Judgments
The Federal Court ordered the parties to file proposed orders by May 29, or written submissions by June 5 if they cannot agree. The matter is listed for further case management at 10:15 a.m. on June 10.
Cass-Gottlieb told a news conference the regulator wanted a penalty that could not be dismissed as a “cost of doing business,” Reuters reported. That is the next pressure point for Coles: not whether the promotion looked bad, but how expensive the court decides it was. Reuters
