Case Number: 2588

Council Meeting: JUNE 2017

Decision: Upheld with Dissent

Publication: Whakatane Beacon

Ruling Categories: Accuracy
Balance, Lack Of
Comment and Fact
Errors, Apology and Correction Sought
Headlines and Captions
Unfair Coverage


1. Fritz Lindekilde complains a Whakatane Beacon story about the court sentencing of two companies operating a chain of bike stores breaches Principles 1 (Accuracy, Fairness and Balance), 4 (Comment and Fact), 6 (Headlines and Captions), 11 (Photographs and Graphics) and 12 (Corrections).

2. The complaint is upheld with one member of the Press Council dissenting.


3. The Beacon story covered the Auckland District Court sentencing of Bike Retail Group and Bikes International, joint operators of Bike Barn in New Zealand, in February of this year.

4. However, the story was published in late March, and was largely based on the Commerce Commission’s reaction to the judgement.

5. Both companies had pleaded guilty to charges brought by the Commission under the Fair Trading Act and were fined $800,000.

6. The charges related to marketing and sales conduct between 2013 and 2015, effectively attracting customers with misleading impressions about discounts on bikes, and the timeframe around those discounts.

7. The Beacon story featured a photograph of the Whakatane branch of Bike Barn, under a headline which read ‘Bike Barn fined for misleading pricing’, and a final paragraph pointing out the location of the town’s store.

8. Whakatane’s Bike Barn was, at the time, owned by Mr Lindekilde’s company Lindekilde Industries. It has since been sold to another private operator.

9. The story did not include any detail about the specific ownership of the Whakatane store, which is one of five independently-owned branches out of 20 operating in New Zealand. The remaining 15 are owned by the two prosecuted companies.

The Complaint

10. Mr Lindekilde argues the timing of the story nullified its news value. The Commerce Commission investigation had kicked-off in 2015 and the court judgement was handed down in early February, 2017, attracting some national news coverage. TheBeacon picked up the story too late.

11. Its coverage was the publication of ‘an unedited press release’ from the Commerce Commission, without any additional research or effort to contact any of the companies.

12,. The article was misleading in that it implied the owners of Whakatane’s Bike Barn were fined in the District Court. The large photo supported that implication.

13. There is no clarification in the article that the fined companies did not own the Whakatane branch.

14. Following a meeting with the editor and owner of the paper, what Mr Lindekilde perceived as a promise of a follow-up clarifying article never eventuated.

The Response

15. Beacon editor Geoff Mercer said the story was not published earlier because a) it wasn’t aware of the Commerce Commission action in 2015 and b) it wasn’t aware of the court judgement in February, 2017.

16. Being community-focused, the Beacon newsroom did not have the resources to be ‘all knowing” or to “slavishly follow” the national news agenda.

17.It published the story after following up a public news tip. At that time, it was still newsworthy to many of his readers.

18. The editor attached qualified privilege to the Commerce Commission press release and viewed it as a dispassionate account of the court judgment.

19. It saw no obligation to contact the guilty parties. And Bike Barn Whakatane wasn’t one of the parties identified in the story as being guilty anyway.

20. Mr Mercer makes the point strongly that, although Lindekilde Industries (as owner of the Whakatane store), wasn’t charged or fined, it still benefited from practices which led to the judgement.

21. He argues equally as strongly that the story didn’t imply the Whakatane store was part of the court action. Because of this, any suggestion there was need for clarification of ownership or a correction was irrelevant.

22. There was never an undertaking to follow-up with another story clarifying the points challenged by Mr Lindekilde. Instead, there was an undertaking to do a business story about the store’s new owners. Although that hadn’t happened, it still would.

{{ruling['The Response Extra']}}

The Discussion

23. Although the publication date of the story could not exactly be described as timely, it’s not true to say it completely lacked news value to the Whakatane audience.

24. However, the almost sole reliance on the Commerce Commission statement was lazy journalism at best. A simple phone call or visit to the store would have clarified ownership.

25. It is very clear that Whakatane’s Bike Barn - and its owner - was not prosecuted by the Commerce Commission.

26. It is a big stretch for the editor to argue that, because the story didn’t specifically say that Whakatane’s store was involved in the court action, it wasn’t implied.

27. The story also didn’t specifically say it wasn’t involved – and given the copy was wrapped around a large photo of the store, under a ‘Bike Barn fined….’ headline and referenced the local outlet – it was very much implied.

28. This, in counter to the editor’s argument, makes the discussion around clarifications relevant and, in the Press Council’s view, warranted.

29. It is not for the editor to determine as fact, and by way of a general news story, that Whakatane Bike Barn benefited from deceitful advertising practices. That is a role of the courts. Again we point out thatWhakatane Beacon conducted no investigation and provided no evidence to support their claim.

30. Aside from Principle 4, which the Council did not consider on the basis the story was clearly a news report and not an opinion piece, all elements of the complaint areupheld.

Chris Darlow dissented from this decision.

Press Council members considering this complaint were Sir John Hansen, Jo Cribb, Chris Darlow, Tiumalu Peter Fa’afiu, Hank Schouten, Mark Stevens and Tim Watkin.


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