settlement agreement

Clarus [2025] NZASA 23 - settlement agreement

Litigation

Sabin

Sabin Litigation

Filing Year For Action

An online advertisement for Clarus showed a photo of a family in a kitchen making pancakes. Below the image was the text “Renewable gas now flowing – Enjoy all the same benefits of gas with renewable gas. Learn more”. The advertisement resulted in two separate complaints, both arguing that the claim of "renewable gas" was misleading and a form of greenwashing.

The relevant codes cited for the complaints were the Advertising Standards Code, specifically Principle 2, Rule 2 (b) Truthful Presentation and Rule 2 (h) Environmental Claims.

The two complaints both focused on the misleading nature of the advertisement's claim of "renewable gas." The first complaint argued that the claim was deceptive because Clarus's gas was not fully renewable, but rather blended with fossil fuels, a fact that was not clearly disclosed to the public who might assume they were purchasing a completely green product; the complainant also pointed out that current gas appliances are not designed to run on entirely renewable gas. 

The second complaint went further, challenging the environmental basis of the claim by stating that methane gas, even if considered renewable, is demonstrably worse for the climate than coal when whole-of-life emissions are considered, especially noting that very small amounts of leakage (<0.2%) make it environmentally detrimental.

The Chair of the Complaints Board ultimately ruled the matter as Settled. This decision was based on the fact that Clarus, the Advertiser, was co-operative with the self-regulatory process and removed the advertisement after receiving the complaints. The Chair concluded that no further purpose would be served by placing the matter before the Complaints Board.

The Advertising Standards Authority held that the complaint was settled after Clarus voluntarily withdrew the advertisement after the complaints were received.