Coles Down Down court case: 13 of 14 discounts not genuine

In the Coles Down Down court case, the Federal Court found in May that Coles misled shoppers: 13 of the 14 "Down Down" price tickets the court examined advertised a discount that wasn't genuine. Five months later, Coles hasn't been penalised (that hearing is set for March 2027), the judge still hasn't ruled on a similar case against Woolworths, and both supermarkets have just reported bigger profits.

What the Coles Down Down court case found

The ACCC sued Coles in September 2024. It alleged that between February 2022 and May 2023, Coles temporarily raised the prices of 245 products, then put them on "Down Down" promotions at prices that were higher than, or the same as, what they had sold for before the rise.

The court tested a sample of those products. On 14 May 2026, Justice Michael O'Bryan found:

• 13 of the 14 tickets were misleading. The products had been sold at the "Was" price for only a short period, typically four weeks and sometimes less, so "the discount represented on the ticket was not genuine".
• Twelve weeks is the line. A Down Down ticket would not have been misleading if the product had sold at the "Was" price for at least twelve weeks beforehand.
• That was Coles' own rule. As at January 2022, Coles' internal policy said a product couldn't go on Down Down showing a discount unless it had sold at the previous price for a minimum of twelve weeks. Coles cut that to four weeks in March 2022. The judge accepted that Coles did so "in response to perceived competitive pressure from Woolworths".

The court also found points in Coles' favour, and they matter. It found the price rises on the sample products "all resulted from supplier cost price increases", that Coles raised prices "in a commercially justifiable manner", and that it "did not select an artificially high 'Was' price" to inflate the discount. In other words, the prices weren't invented. The problem was calling the new price a discount after only a few weeks at the higher one.

Coles said it was reviewing the judgment.

A Coles supermarket in Southlands Boulevarde shopping centre, Perth. Photo: Shinjiman, public domain, via Wikimedia Commons.

How much was Coles fined for Down Down?

Nothing yet. The judgment decided liability for the sample products only; liability for the rest of the 245 products is still to be decided. The ACCC's case is listed for a hearing on penalties and other orders ("relief") on 31 March 2027. A separate class action, seeking compensation for shoppers who bought the products, is also running; its next case management hearing is on 11 December 2026.

The court will decide the amount. Until then, Coles has not been ordered to pay anything.

Woolworths: the 'Prices Dropped' case

Woolworths at Cannington, Perth. Photo: Bahnfrend, CC BY-SA 4.0, via Wikimedia Commons.

The ACCC brought a similar case against Woolworths. It alleges that between September 2021 and May 2023, Woolworths temporarily raised the prices of 266 products before putting them on "Prices Dropped" promotions at prices higher than, or the same as, their usual price.

Woolworths denies it. It argued that the price rises were driven by suppliers and its discounts were real. In closing arguments in April, the same judge, Justice O'Bryan, pushed back on the ACCC, saying "none of it strikes me as nefarious or inherently misleading". He has reserved his judgment, and no date has been announced. These are allegations, and no finding has been made against Woolworths.

Meanwhile, profits are up

Both supermarkets reported their 2025-26 results in August:

• Coles Supermarkets made $2,365 million in earnings before interest and tax, up 12.2%, on sales up 3.7%. Its profit margin widened from 5.3% to 5.7% of sales. Coles' own measure of price inflation across its supermarkets was 1.5%.
• Woolworths' Australian Food division made $2,953 million, up 8.5%, on sales up 4.6%. Woolworths says that excluding supply chain implementation costs and the previous year's industrial action, the rise would have been 4.8%.

None of that is illegal. But it fits what the competition regulator found in its 2025 inquiry. The ACCC said Woolworths (38%) and Coles (29%) together hold about two-thirds of supermarket grocery sales, an oligopoly. It found the supermarkets had increased their margins while costs rose, and called Australia's one of the most profitable supermarket sectors in the world. It did not find price gouging. "We didn't reach that conclusion," deputy chair Mick Keogh said.

Is supermarket price gouging illegal in Australia?

Since 1 July 2026, yes, for the biggest two. A new ban on "excessive" pricing, which the ACCC enforces, applies to supermarkets with annual revenue over $30 billion, which today means only Coles and Woolworths. A price breaks the law if it is significantly excessive compared with the cost of supplying the product plus a reasonable margin. The maximum penalty is the greatest of $10 million, three times the benefit gained, or 10% of annual turnover.

The ACCC said in June it would "initially focus on a select group of grocery products" and planned to publish the first of them "in the coming months".

A court has found that Coles' discounts weren't genuine, and the twelve-week line the court drew matched Coles' own earlier rule. The penalty won't be decided until 2027. Groceries are part of what's pushing up Australia's inflation rate, along with rent and car insurance.

Seen a supermarket "discount" that didn't add up? Send us the receipt.

Top photo: an aisle in a Coles supermarket (file photo, 2010). Photo: Bidgee, CC BY-SA 2.5 AU, via Wikimedia Commons.