The Federal Court has imposed an $11 million penalty on US-based Fitbit for making false, misleading or deceptive representations to 58 consumers about their consumer guarantee rights to a refund or replacement after they claimed their devices were faulty.

This marks the second time a company within the Fitbit Group has been pulled up by the Australian Competition and Consumer Commission (ACCC) for conduct involving consumer guarantee rights.

Fitbit has admitted its customer service staff told 40 consumers they did not have a right to a replacement product because the two-year ‘warranty period’ had expired. Of those 40, 39 had contacted Fitbit about a problem with a replacement product, and Fitbit represented the warranty period was that of the original device, which had expired.

Additionally, the company has admitted staff told 18 other consumers they did not have a right to a refund unless they returned the faulty product within 45 days of purchase. These representations have been acknowledged by Fitbit as false or misleading, constituting conduct that was misleading or deceptive, or likely to mislead or deceive. The service experiences occurred between about November 2020 and February 2022.

"In this case, consumers may have incurred additional expense and inconvenience paying for repairs or replacement products because they were told false and misleading information about their consumer guarantee rights," said Acting ACCC Chair, Catriona Lowe. "We took this action as a reminder to Fitbit, and other businesses, that they must honour their customer’s consumer guarantee rights without restrictions and not mislead consumers about these rights."

Fitbit LLC, previously Fitbit Inc, is a consumer electronics and fitness company based in the United States, providing health and fitness devices, including wearable trackers. The company was publicly listed on the New York Stock Exchange until January 2021, when it was acquired by Google and became Fitbit LLC. Fitbit is responsible for the operation of Fitbit’s customer support services internationally, including for Australian consumers.

Fitbit (Australia) Pty Ltd, a related company of Fitbit, manages Fitbit’s relationships with its third-party retailers in Australia, and Australian marketing and promotional activities. In May 2018, Fitbit (Australia) gave the ACCC a court-enforceable undertaking after it acknowledged representations it made to consumers about warranties for faulty products may have contravened the Australian Consumer Law.

In October 2022, the ACCC instituted Federal Court proceedings against Fitbit LLC for alleged false and misleading representation to consumers about their consumer guarantee rights. The parties filed joint submissions, a statement of agreed facts and admissions and joint proposed orders.

"We are pleased Fitbit admitted its misconduct, especially since this is the second time we have had to respond to a company in the Fitbit group with concerns about representations involving consumer guarantee rights," Lowe said.