Supermarket giant Coles has been accused of artificially increasing prices before reducing them and claiming it as a discount.
Australia's consumer watchdog is pursuing the chain through the Federal Court for allegedly misleading consumers with its "down down, prices are down" campaign.
The Australian Competition and Consumer Commission's case against Coles began today, with its lawyers accusing the company of using "utterly misleading" prices.
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With a "jingle that sticks in one's ear longer than is healthy", the ACCC's barrister alleged Coles' well-known "down down" marketing campaign had deliberately misled its customers.
"Why on earth are you telling your customers that your prices are going down, when they're not?" the commission's barrister Garry Rich SC told the court.
"The particular promotion they chose was a promotion that hinges on convincing customers that the price of this product has gone down.
"An utterly inappropriate promotional mechanic to use in circumstances where everyone within Coles knows the price is going up."
He opened the hearing using the example of a 1.2kg can of Nature's Gift adult wet dog food, which he said was sold for $4 from April 2022 to February 2023.
Rich claimed Coles had increased the price of the product to $6 for a week, before it was sold as reduced to $4.50.
"Coles's statement was utterly misleading," he said.
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"Coles had increased its price to $6 just seven days before the promotion and for 296 days before that the price was $4."
Justice Michael O'Bryan queried whether the reason the price rose was due to the supplier increasing its cost.
Rich said consumers would not know this information and it was misleading to claim the later price was discounted.
Using a giant red thumb, the "down down" campaign began in 2010 and claimed prices on everyday household products had been reduced and were staying low.
Coles said it was helping Australians keep their grocery costs down as part of its commitment to lower the cost of living, Rich said.
However, in reality Coles allegedly misled customers on prices for 245 similar products, including toothpaste, soft drink, cheese, shampoo, band-aids and laundry powder.
"You're not lowering the cost of living, you're not driving prices down, in circumstances of the kind we have here," he said.
Coles is fighting all allegations brought by the ACCC as the hearing continues.
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