The Australian Competition and Consumer Commission is suing Woolworths and Coles, alleging the supermarket giants misled customers about their discounts.

Woolworths’ “prices dropped” promotions and Coles’ “down down” specials have landed both supermarkets in Federal Court for allegedly inflating prices for a temporary period before bringing them back down again at the same or a slightly higher price.

The consumer watchdog says the actions breach Australian consumer law by misleading customers, who have come to recognise both supermarkets’ campaigns as sustained reductions in the regular prices of grocery items.

“The discounts were, in fact, illusory,” said ACCC chair Gina Cass-Gottlieb in a statement.

“We allege that in many cases both Woolworths and Coles had already planned to later place the products on a “prices dropped” or “down down” promotion … and implemented the temporary price spike for the purpose of establishing a higher “was” price.”

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The regulator is suing Woolworths for 266 items over 20 months and Coles for 245 products over 15 months for displaying to customers a “was” price that was actually the temporarily increased price.

Many of the affected products are pantry staples and household names such as Tim Tams, Kellogg’s cereals, Moccona coffee, Oreos, Sprite, Bega cheese, Colgate toothpaste, Maggi noodles, Weet-Bix, Sakata, Whiskas cat food and more.

For instance, the ACCC says Woolworths sold Oreo family packs for $3.50 for nearly two years between January 2021 and late November 2022. On 28 November 2022, the supermarket hiked the price to $5 for 22 days, and on December 20, put the Oreo family pack on a “price dropped” promotion of $4.50 – 29 per cent higher than the original price, with a “was” price of $5.