An Auckland man has been sentenced to 12 months home detention for selling millions of eggs from caged hens as free range.
Xue (Frank) Chen sold eggs through his company Black Water Trading Limited, trading as Gold Chick, from a farm in Henderson, West Auckland.
His company bought more than 3 million caged eggs from other suppliers and packaged them into cartons labelled free range, selling them at higher prices, from September 2015 to October 2017.
In sentencing at Auckland District Court on Tuesday, Judge Field said it was "an easy matter to package eggs in a misleading way and there must be corresponding deterrence".
He said Chen's "motivation seems to be entirely financial" and that the offending could "discredit an entire industry in the minds of consumers when they can't be sure what they are buying is in fact the product."
Chen had earlier pleaded guilty to a representative charge brought by the Commerce Commission of obtaining by deception under the Crimes Act 1961.
"We estimate the fraudulent profit from selling caged eggs as free range was approximately $320,000, based on the difference between what Mr Chen's company spent on purchasing caged eggs and the revenue gained from selling them as free range," Commission chair Anna Rawlings said.
The commission opened its investigation into Mr Chen's business in June 2017 following a complaint from a former Gold Chick employee.
Surveillance showed regular purchases of eggs from a supplier known to solely produce caged eggs. A search warrant was executed in December 2017 and the evidence recovered included invoices from the caged eggs supplier and burnt remains of its packaging labels.
Chen has undertaken to make a $50,000 donation to the SPCA.