Heinz Fined Millions For Lying About "Healthy" Toddler Food

The company claimed toddler snacks were healthy when they contained more than 60 percent sugar.

Food giant Heinz has been fined $2.25 million  by the competition watchdog for misleading marketing.

The company claimed that a range of toddler snacks called Little Kids Shredz were healthy when they contained 60 percent sugar.

In July this year, the High Court of Australia found Heinz had provided misleading nutritional information to the public regarding the contents of the product. Following these findings, legal action was launched against the company by the Australian Competition and Consumer Commissions (ACCC).

The result of that legal action was a fine of over $2 million dollars even though the ACCC requested the fine be a whopping $10 million. Justice Richard White ordered Heinz pay the cash within 30 days as punishment for breaching Australian consumer law. The money will also cover the ACCC's legal costs.

The snacks contained 60 percent sugar. Image: Getty Images

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White however, refused the ACCC's request that Heinz publish corrections to the misleading material.

ACCC SAYS IT Will Continue To Fight For Better Marketing Standards

ACCC's chair Rod Sims said the organisation would continue to fight for harsher penalties against big food companies as a means of cracking-down on misleading marketing.

"The ACCC wants to ensure that penalties for breaches of the consumer law are large enough to get the attention of the financial markets, boards and senior management," Sims said in a statement.

Heinz said it "respects the decision that has been made" in regard to penalty.

Heinz also said it remained committed to providing high-quality food products to consumers.

In a recent hearing, counsel for the ACCC Tom Duggan said the penalty imposed on Heinz had to be sufficient to act as a deterrent against similar conduct by the company and others in the food industry.

He argued the company's conduct in representations on the packaging of its Little Kids Shredz was "egregious" because of the potential implications for the diet and oral health of young children and involved both "wilful blindness" and "recklessness".

The ACCC says it will continue to push big companies to uphold marketing standards. Image: Getty Images.
Heinz Says Penalty Too Harsh

Michael O'Brien, for Heinz, said there were no facts to support the company's conduct being egregious and the court had ruled that while it made an error, it did not intend to mislead.

He said a penalty of around $400,000 would be more appropriate.

In a judgment in March, Justice White found the prominent statements on the packaging, that the Shredz snacks comprised 99 percent fruit and vegetables together with the pictures of the fruit and vegetables, conjured impressions of nutritiousness and health.

"I am satisfied that each of the Heinz nutritionists ought to have known that a representation that a product containing approximately two-thirds sugar was beneficial to the health of children aged one to three years was misleading," he said.

The Shredz products were a dehydrated snack made from 99 percent fruit and vegetable ingredients and did not contain any preservatives, artificial colours or flavours but had a high sugar content.

More than one million were sold before the products were pulled from shelves in May 2016.

With AAP

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