ACCC blasts Fantastic Holdings for allegedly breaching safety standards for second time in three years

The corporate watchdog has slammed a group of retailers including furniture chain Fantastic Furniture with action in the Federal Court for allegedly offering bean bag covers that did not meet quality standards.

The Australian Competition and Consumer Commission has also said that it is taking action against homewares chains Spotlight and Smash Enterprises for the same alleged offenses.

In a statement the ACCC said that Smash supplied bean bags to Fantastic Furniture and Spotlight, and allegedly left off a warning label that warned buyers the items were a choking hazard. This label is required by law.

It is also alleged that Fantastic Furniture and Spotlight then supplied those items to consumers, and that by supplying the covers, Fantastic Furniture breached a court-enforceable undertaking it provided to the ACCC in 2008 that lasts for three years.

In November 2008, Fantastic Furniture admitted to the ACCC that it sold some bunk bed furniture without meeting the mandatory requirements for safety. The particular item had openings in the guardrails which caused fall-through hazards.

At that time, the company provided court enforceable undertakings that it would contact each customer who bought the product, and that it would introduce a compliance program.

The relevant clause the ACCC is now referring to states that, “for a period of three years from the commencement of this Undertaking, ensure that goods supplied by Fantastic Furniture that are subject to a prescribed safety and/or information standard under the TPA comply with the relevant standard”.

The watchdog then alleges that because these bean bag covers were sold, Fantastic Furniture broke the Trade Practices Act. It is seeking:

• Declarations that the three companies contravened the act.
• Pecuniary penalties for supplies made by Fantastic Furniture after April 15.
• Injunctions preventing the three companies from supplying bean bags unless they comply with safety standards
• Orders Spotlight and Smash implement a trade practices compliance program.

The matter is set to appear before the Federal Court on March 7, 2011.

Fantastic Furniture, Smash and Spotlight were all contacted for comment by SmartCompany this morning, but none were available for comment before publication.